THE Buck CLEARLY Stopped Here!
My daughter Buck Wheat became a graduate of THE Ohio State University this weekend: all while laying on the couch in a Rolling Stones tee-shirt. I made her stand up when they called her school but I doubt that Apple CEO Tim Cook, who gave the commencement address via Zoom, took notice. Nor did anyone else other than me, Guy and Chris. It was all a bit anticlimactic. And sad! On the day that she was recognized for her educational accomplishment, she was not able to hug it out with her classmates, or even her mother! The last weeks of this strange semester left Buck with lots of free time. While you can see below that she has not been spending any of that time cleaning her room, she has been keeping busy planning for her life after the pandemic. Which is hopefully exactly what you’ve been doing? Some states have started to allow retail stores to reopen. I’ll leave the conversation over the timing of that to our elected officials but whenever the time comes when you can legally and safely reopen your stores to in-store traffic, you’ll need to have some changes in place. Depending on where your stores are located you will likely have restrictions on you when you reopen: How many employees you can have in your store and how many customers you can serve (as a percentage of capacity) is one thing I have seen in most state actions on the subject. Added to your concerns is the need to have masks, gloves and sanitizer on hand at all times as well as leaving time to install physical barriers and other markings as a means to control distancing between your customers and employees. And those are just the physical changes! On the sales side, the most significant change that you will notice in your stores as you get back to work is the absence of painters. In most of regions of the United States the damage to the residential repaint business is significant. A recent survey by the Farnsworth Group, a market research group who specializes in the architectural coatings segment, reported in their weekly survey (released April 20) that over 80% of contractors polled reported that they have had work delayed or stopped due to the Covid-19 outbreak. That dovetails with information Sherwin Williams shared on a recent call with investors and the media. There is no way to know how long the downturn in the residential-repaint segment will last but I continue to express concerns for the effect that this will have on sales at independent paint retailers, where the residential-repaint segment represents about 65% of dealers total volume. But even in a crisis there is opportunity. That same study by the Farnsworth Group (published April 20th, you can read it here) reported that DIY sales continue to see strength despite the quarantines. Over 65% of those consumers polled reported that they have started a NEW DIY project within the last week: a number which has risen in four of the five weeks they have done the poll since the outbreak began. For independent retailers, the Farnsworth Group’s research explains why retailers with a heavy DIY component continue to do so well! For the retailers who are not currently doing well in this segment, the report shines a light on the opportunity at hand! The DIY segment is not generally an independent paint retailers “bread and butter.” Accounting for only around 30% of the segments dollar volume, most dealers tend to spend their marketing dollars and efforts on the larger residential-repaint segment. But evidence suggests that in the coming quarters DIY will outperform the residential-repaint and other segments of your business. Dealers now need to direct their email marketing, social media efforts, local advertising and other marketing efforts towards this profitable segment of the market. It’s the only way to make sure that you get your piece of this high-margin growth opportunity. Reaching these DIY customers will not be easy but with some effort dealers can reach them.
At a time when people are trying to limit the proximity of their personal interactions, independent retailers have a tremendous advantage over the big boxes with the DIY consumer. Smaller stores, where you can easily get someone on the phone to place an order for curbside pickup while interacting with fewer people are VERY attractive to consumers who don’t want to get within six feet of another person. But to tap into this vein, consumers will have to know you’re there!