When a local supplier's price for a sheet of plywood recently jumped $1.23 — from $14.79 to $16.02 — Randy Brown, owner of Clearwater Home Improvement, in Mystic, Conn., decided to say something. Bill in hand, he went to the manager, who knocked the price back down to what it had been. “It's still more expensive than The Home Depot,” Brown says, but the service is worth it.
Most home improvement company owners are paying close attention to the price of products and labor these days, and finding that it matters. Brown, for instance, always installed 4.2-gauge vinyl siding, but recently switched to 4.0 gauge when he realized that the price was $82 per square versus $42 per square. When he prices out siding jobs for homeowners, he asks them if they would prefer he install thicker-gauge vinyl. If not, he goes with the less-expensive gauge.
LOOKING TO SAVE Like many home improvement companies, Schmidt Siding & Window Co., of Mankato, Minn., is committed to a select handful of window, siding, sunroom, and gutter protection products, with no intention of switching. So opportunities for cost savings lie in the purchase of accessory items.
At the beginning of the summer, Schmidt Siding located a supplier in the Twin Cities that could furnish the company with millwork items such as window stops for about a third less than it was paying. It proved too good to be true. “They soon shut down their distributorship,” president Dale Brenke says.
Other companies similarly see themselves committed to certain brands because they have exclusive territories. “It's not like I can shop an RBA window or ABC Seamless siding,” says Joe Mand, general manager of Renewal by Andersen of East Central Wisconsin. Mand says he has long since developed strong product preferences for accessory items such as screws or underlayment, so finding cost savings is a matter of locating which supplier will sell preferred products at a lower cost. “We definitely do more price-checking now,” he says.
SHOPPING AROUND Pat Nicholson, CEO of Deckmasters Technologies, a deck-building franchise in Pittsburgh, says his company warehouses the materials it installs and redistributes lumber, fasteners, and other necessary materials to its franchises. “We watch all the costs, of everything, including materials,” Nicholson says.
But the owner also points out that switching materials for the sake of a quick savings could cost contractors in the long run. For instance, several years ago Nicholson says he switched from a treated fastener product to stainless steel when he realized the treated fasteners were eating wood. He wouldn't consider changing back, even though stainless steel is a cost that has to be explained to deck customers. “You can save money on materials today, but what happens in two or three years when you have all the problems? You can't just start subbing out [production] to someone for less cost. Then you end up with a big mess.”