Every builder has one or two lumber dealers who are their “go to” sources for materials. So, if you sell building products to homebuilders, that makes the lumber dealer a very important customer.
If the builder’s preferred dealer doesn’t carry your product, he’s probably not going to buy it.
Why Builders Use Lumber Dealers.
1. Leverage – the builder, knows they are much more important to their dealer than they ever will be to a building materials manufacturer. If the builder needs something on a Saturday when the dealer is closed, he probably has the cell phone number of a rep who can get him what he needs that day.
When there’s a problem, the dealer gets it fixed. They discuss what happened and how it will be resolved later. Building materials manufacturers aren’t this easy to deal with.
2. Fewer Suppliers – homebuilders want fewer suppliers that they have to order from, manage and pay, not more. Manufacturers who are unfamiliar with this will frequently make the mistake of trying to sell the builder directly. Even if the builder can save some money, they usually aren’t interested because the savings will be outweighed by the cost of dealing with an additional supplier.
3. Relationships – the lumber dealer is frequently staffed by local people who have an understanding of the city they work in. They know the types of homes that are selling, and the features homebuyers want. They know which builders are growing and which ones may be struggling. They know the new start up builders.
Their kids go to the same schools and play on the same sports teams. They support the same civic organizations, and the builder may have some preference for buying local.
The builder also knows the manager and probably even the President or owner of the dealer, and they can easily contact them. It’s not easy for a dealer to reach anyone above their sales rep at a building materials manufacturer, making this both a relationship and a leverage issue.
Selling the Lumber Dealer
It’s important to use the right sales approach when selling to dealers.
The biggest mistake building materials sales people make when trying to sell a lumber dealer is selling to the dealer rather than through the dealer.
The dealer cares very little about selling your product—they care a lot about selling themselves. To be successful and grow, the dealer needs to convert more builders and keep their current builders happy. So, they carry the products the builder wants. It’s not their job to sell your product to the builder.
An effective sales approach to a dealer is one that shows how you can help them gain new builders and increase the loyalty of their existing builders. It may be about how your product will help the builder be more successful or how dealing with your company enables the dealer to better serve the builder.
The second mistake salespeople make is to view lumber dealers as if they are all the same. Before you make a call, take the time to do a little research.
Visit the dealer, if possible visit more than one location. Look beyond your product category—what do you notice about the dealer overall? How are they different than other dealers you have visited? Are they investing in their facilities? What products do they not carry?
What role does their showroom play? Do they also sell to DIYer’s? Introduce yourself and ask people about their business. What are they known for? What are their biggest challenges? Who are their biggest competitors? Are they having any problems with their current supplier of your product?
Visit the dealer’s website and spend some time learning what you can from it. What do they feature? Read the “History of Us” page. Visit their competitors’ websites.
Think about how your product and company can help the dealer be more successful. The idea is to not go in with a stock sales presentation. Take a little time and tailor your presentation to who they are as a company. Even with this small amount of preparation and research, you will make a much more effective lumber dealer sales call.