A showroom that succeeds--from the inside out!

February 1, 2008

Showroom columnist

Let's set the stage: Penco Corporation is a 58-year-old, family owned, central Delaware plumbing/hvacr wholesaler, with six locations ranging from 45 minutes to 1 1/2 hours from the corporate headquarters in Seaford, Del. Its new 5,300-square-foot off-site showroom is called Elegant Designs and is Penco's first upscale showroom, with luxury products for the bath, plumbing and kitchen. Vice president Jeff Peterson is a third-generation plumbing wholesaler and headed up the showroom endeavor.

Penco is member of the American Supply Association and Embassy Group; with help and guidance from myself, they also joined the Decorative Plumbing and Hardware Association.

Penco's executive management had spent a lot of time contemplating a new showroom and was 100% committed to do it right -- the showroom and all aspects of what makes showrooms successful and very profitable. Jeff Peterson contacted me and we dialogued about the possibility of my working in a consulting and coaching capacity every step of the way, from "soup to nuts" for one full year.

In the summer of 2006, I met with the senior management team of Kent Peterson, George Sapna, Jeff Peterson and Scott Sapna for a full day of discussion about the new showroom -- the existing company, the market, the philosophies of very successful modern-day plumbing wholesaler showrooms, and much more. After putting everything out on the table, they unanimously agreed to bring me on board as their consultant/coach for a full year.

What I discovered was a company culture of the highest integrity and moral fiber, with one of the most experienced group of long-term employees I've ever seen. Here is one of the keys to the extraordinary showroom results: From the start, the executive management team was 100% committed to support the showroom -- which would trickle down throughout all of their operations and employees -- to attain 100% results.

Once we laid out the total concepts and philosophies and did some planning, we held a series of separate and integrated educational programs for the executive management, branch managers, middle management, outside salespeople and inside salespeople regarding the "positive effects and outcomes" of the new showroom for them and the overall company. Being that four of the branches are located 45 minutes away from the Seaford showroom, it was a great opportunity for each branch to participate. The senior executive management team and myself "empowered" the entire company in the deep benefits of the showroom.

In being totally upfront with you, this article will have lots of value and juicy information, but I will be holding back much of the Elegant Designs showroom's "deep tips and secrets and custom crafting to the market and competition" due the confidentiality of protecting Penco's best interest -- present and future. Penco Corporation paid me for the consulting and coaching expertise for the year and beyond, and some information is very proprietary to them. There is a lot of juicy information that was used effectively in planning for Elegant Designs that I have written in my monthly column for The Wholesaler (since 2005), which is available at the archives.

The showroom

An architect -- George, Miles & Buhr -- that Penco had worked with for many years, created the exterior plan from an existing off-site structure. This was the framework of the 5300-square-foot showroom. They also made a decision to hire Masco Design Solutions (www.mascodesignsolutions.com), a totally independent division of Masco Corporation, which has done hundreds of showrooms for builders, retailers and many prominent plumbing wholesalers across the U.S. Masco Design Solutions was not involved in any of the product or line selection.

Jeff Peterson and I then went into a comprehensive "Product Niche Marketing" study of competition and profitability in product lines. If you read my October 2006 column, you will know exactly what we accomplished. The selection of the product lines were not necessarily from the core basic lines of Penco's wholesaler side unless they fit a specific criteria.

Then came the action plan, of which the outcome was:

Exclusive and many semi-exclusive product lines Higher gross profit producing product lines Much higher volume than 75% of the other wholesaler showrooms Insulating their showroom from the surrounding competition. Every detail of the showroom was well thought out and taken from my 37 years industry experience and the great insight of Jeff Peterson and his executive team. One of the goals in the product selection process was to ensure that Elegant Designs was able to sell a complete bath/plumbing product package. The other product diversification was based on high profitability and uniqueness such as LCD mirrored TVs, wall-mount decorative water fountains, classic traditional wood medicine cabinets and much more. The line was drawn at having no kitchen cabinets, kitchen appliances, tile and surface materials, and door and cabinet hardware. You can bet your life their showroom will have a very select "Networking Partnership Program" with product sellers such as kitchen cabinets, appliances, tile, surface materials, and door and cabinet hardware suppliers, who do not compete in bath and plumbing products.

Not just another pretty face

Over the past 20 years, I have traveled throughout the U.S., Canada and Western Europe, and have seen gorgeous, drop-dead bath, plumbing and DPH type showrooms. The Elegant Designs showroom can be considered among the best, and has the perfect balance of the bath and kitchen products expected to be seen and to give a feeling of completeness.

There are dozens of working and functional displays; vignettes; 5' x 8' Universal Design/ADA residential baths; focus on every period of architecture; something from all of the major trends such as Green, Universal Design and more; and all of details you would expect if you bought a $6-million custom home.

I do not want in any way to negate the importance of a well-planned, well-designed and exceptional merchandised showroom, but there are so many other important ingredients and details that are not present in many of today's beautiful plumbing and bath showrooms.

People sell products

Showrooms themselves do not sell product. Wholesalers must continue to invest in training their most precious asset -- their staff! Showroom staff must also find ways to self-educate. Good examples are industry magazines, some with monthly showroom columns; dvds, cds, and audio tapes from Nightingale Conant Corp; and participation in the dpha (http://www.dpha.net/), which has great educational materials for showrooms plus many other perks. You will thank me. Many plumbing wholesalers are members, including Economy Plumbing Supply (Indiana), Portland Group (Massachusetts), Blackman Companies (Massachusetts), Torrington Plumbing Supply (Connecticut), Edelman's Plumbing Supply (Ohio), sps Companies (Minmnesota), us Supply (Pennsylvania), Morrison Supply (Texas), Dahl/Hajoca (Colorado) and tons more.

The right staff for the type of showroom

Please log on the Elegant Designs website, http://www.elegantdesignsshowroom.com/. You might want to take a glimpse at their site to see some of the built-to-succeed, inside-out things. Now click on the hyperlink: professionals and you will get to "Meet The Professionals." Please take a look at Lisa Venables' and Jodi McElwee's biographies and you will understand why they are charging an hourly fee in product selection for complete baths or more, refundable against the purchase of the goods.

They even have an "Outcall Service" at an hourly fee, too. This is in no way a conflict for the specifying and installing trades. I had Penco put together specific criteria to find these people. Did they have extensive bath and plumbing product line knowledge? No. Did they find the dpha Product Manuals invaluable? Yes! Did the manufacturers' reps do a great job educating them on each line? Yes. Can they sell a one-piece toilet like it was a Porsche? Yes!

One important note: These two showroom salespeople were extensively trained to give "perceived" value, and not to cross the line from a plumbing wholesaler showroom into being a k&b dealer and designer of baths.

It starts with a greeting

Please note the picture in this article of the receptionist area. As you walk into their showroom, you see a perpetual smiling face, Amanda Griffin, waiting to greet and say goodbye to each client, and checking in to make sure they have been served. This third key person was hired based on her greeting, communication and listening skills, and customer service winning attitude. She was taught the "art of qualifying." She also wanted to grow into the sales team.

This area was well laid out and also functions to support the efforts of the three showroom sales associates. Some of my plumbing wholesaler showroom clients found this person and put a desk logically correct near the front door. They claim it was the best investment they ever made to create better productivity for the sales team. To the left of the receptionist's area are the four workstations for the showroom sales staff.

Inside-out tips

The following are some of the key inside-out tips I share with any company wanting to improve their showroom operations.

Three Profound Keys of Showroom Success: 1) Qualifying clients 2) Who sent the client in? 3) Who is buying the goods? Do you really know what this means? It is the key in working relationships -- win-win -- although there is only one buyer per job and nobody gets hurt (the plumber, etc). Developing solid ways to control the showroom and speed up the selection process. Examples are: Receptionist handling the screening; long forms for plan take-offs; and quoting complete baths; scheduling plan appointments at your slowest times; and flyers on your showroom to be given out on how your showroom works. Marketing andadvertising. New construction is way down and high-end luxury bath and kitchen remodeling are up. How are you creating qualified traffic? Do you have a comprehensive trade mailing list within a 90-minute radius in the rural areas and 60-minute radius for city and more heavily populated areas? Can you reach consumers in the same radius that bought resale homes in a specific range of cost, when they closed escrow on the home? Who is generating the plumbing/bath specs: the plumber or the consumer and professional trades? The consumer and professional trades, of course. Network referral program. Do you have an effective comprehensive network referral program of related finished material suppliers who would be on the same remodels and new home construction as you? Do you have a professional trade -- installing and specifying -- network referral program where you take it deep into geographic area and specialization of trades. Can you handle a consumer who just bought a seven-bath resale home and wants upgraded bath fixtures? Don't feel bad -- only 8% to 10% of the plumbing wholesaler showrooms have this. Its one of my favorite specialties. 75% closing rate of quotation performed. I have written dozens upon dozens of win-win scenarios in my articles over the years, many of which have appeared in my column in The Wholesaler since 2005. There is a bunch of skill sets to increase your productivity and close on 75% of the sales or you shouldn't spend the time when there isn't a win-win outcome. Showroom compensation/outside salespeople. I am 100% convinced that showrooms should have a commissioned compensation plan for the staff if you're selling upscale luxury. I believe that this plan must be crafted so the outside salespeople can participate and not be penalized if their clients want to upgrade in the showroom. Wholesaler management can craft a plan like Penco and I did. The greatest failure of expo Design Centers were straight salaries, against The Home Depot's policies to pay commission. To the most part, who do they attract in staff? There are so many intricacies that must be constantly reviewed: product positioning to competition; having access to non-stock and non-display lines through master distributors; policies for sales and operations; public relations; marketing; branding the showroom; and most of all, don't just do what you know (the sum of your and employers knowledge), go outside and look for successful "models" and information on every area of the showroom!

Elegant Designs held two Grand Opening Events in November and had a great turnout of 200 of their customers. They are well on their way to meeting their goals and living their dreams. One of the most important things in Elegant Designs; success was the 100% commitment and drive of Jeff Peterson, who spearheaded the showroom while conducting his regular work as vice president-finance. All of the employees of Penco Corporation -- and especially the outside salepeople -- can see how they collectively can take the new showroom to the bank!