Selling in Today’s Retail Environment: How to Handle Installation
The reasons for this are mostly cultural: Diminishing work values, a lack of respect for people who work with their hands, lack of vocational training in the schools and the wacky notion that everyone should go to college.
My 19-year-old son, a CFI certified installer, who has the advantage of having a father several generations older, has a work ethic like his dad and is proud of what he does while making more than most graduate engineers.
When I opened my first store, we paid $1.25 per square yard to carpet installers and charged the customer $2.50—similar to every other flooring retailer. However, I found early on that hourly workers generally aren’t as productive as subcontractors, many, not understanding business, are resentful of the mark-up the boss gets on their labor, and that expenses—trucks, taxes, benefits, materials and supplies—left little or nothing in the way of profit. Today, with expenses and government intrusion into the workplace, it’s even more expensive.
I closed my first business after nine years and moved back to New England where I became the leading salesperson in a 27-store chain, worked for Mohasco and ran a design center. All the while, I was planning my next retail operation, which I would run in a non-traditional manner, gleaning ideas from successful retailers in other, more sophisticated industries.
One function I was going to handle differently was installation. Other differences: We used customers’ measures without the problems associated with salespeople’s measures. We collected up front and we sold what the customer should have, not what they thought they wanted.
The store became successful beyond my dreams, and other retailers visited hoping to find out the secrets of my success, which I readily shared because I knew they wouldn’t do it (think customer measures).
I hired installers because of attitude and communication skills—we could teach anyone how to install—and hired them as subcontractors. My intention was to find one great installer and breed more. Luckily, the grandson of the late Gerry Talty, my former boss, filled the bill—hard worker, intelligent and responsible.
The deal was that the subcontractor was to set his own schedule, which meant answering phone calls immediately and doing the job in a timely, workmanlike manner, including vacuuming.
Our office had nothing to do with scheduling, which meant no wasted time with the back-and-forth of scheduling a day convenient to both. Our salespeople recommended the installer they wanted on their job, which meant the installer’s livelihood depended upon the salesperson and vice versa, so they supported each other in all phases of the sale.
The going rate for installers at this time was around $2 per square yard and $4 retail. The situation was the installer kept and collected the entire retail amount. We collected for the material up front. We hired the helpers for the installers to train based upon our criteria and paid their salary up to three months after which, if it was a fit, the installers paid them.
If and, when, the helper became an installer, the trainer could keep him on salary or let him become a sub. We had installers lining up at the doors for work. Our subs were full partners in our organization. They were invited to all events and training sessions and we relied upon them for their areas of expertise. They were as professional as we were and were treated as such.
In the 13 years until I sold the business, which by then consisted of six stores, we did not lose a single installer. We had 100% control. All adjustments were done free and willingly, prompting me to offer a lifetime installation guarantee. If a customer held back money from the installer, we paid him until it was settled. Even though the customer contracted the install directly, all complaints went through us. We tracked the customer experience thoroughly with survey forms and phone calls.
Gradually, over time, my methods became known. One retailer, Dick McAdams, who was just opening his Georgia Carpet Outlet Stores, sat down with me and discussed how it would fit in with his concept of a warehouse operation. My stores were mid- to high-end, but the method was perfect for stocking dealers as well. Big Bob initiated a form of it in the Big Bob’s franchise, along with others, but most dealers were leery of the concept.
In today’s business environment with unemployment, compensation, employee leave and dozens of other rules, it is foolish not to keep as many people as possible off the payroll. Another unforeseen benefit was the IRS push to classify subs as employees—hard to do when they got paid with a different check every day even though 100% of their work was through our customers.
Jim Walker of the CFI does an outstanding job training installers. One retailer thought Jim was “dangerous” because “we would have to pay installers more” Duh! However, 1,000 Jim Walkers will not be able to provide enough installers.
We need to train our own as well, work to get vocational classes into high schools and community colleges and let young people know they can earn more than college graduates. We have to treat installers better, pay them better and respect them as professionals.
One of the biggest lessons I have learned in business came from the book, “Ogilvy on Advertising,” in which he related that whenever he hired or promoted a manager, he gave them a set of six Russian nesting dolls with this note inserted: “If we all hire beneath us, we’ll be a company of midgets. One the other hand, if we all hire above us we’ll be a company of giants.”