There! I Spent Your Money for You
“Don’t you have enough Yankee swag?” she asked.
As I opened the package which held my reply!
The "she" I refer to of course is my fiancee Gaetana! The official laundress of THE Mark Lipton swag collection!
Independent paint dealers continue to face a myriad of challenges. A labor shortage which makes hiring difficult, is increasing the stress on already over-taxed paint dealers.
Shortages in materials caused by winter storms make matters worse, as dealers spend more time than they are accustomed to on issues related to procurement.
But winter storms in Texas are only partially to blame for the current shortages leaving fill rates at an all-time low. Extreme increases in demand shoulder as much of the blame for the problem as interruptions in the supply chain.
Dealers I speak with tell stories of inordinately busy counters, phones and web sites! web sites like the one I did recently for Andriot's Paint in Shelbyville, Kentucky.
While a screenshot dealer’s text message makes the point that the tinters are getting refilled more often these days, it says nothing of the macro forces at play in his stores, which are causing this activity at the counter. This dealer knows he’s busy. What he doesn't know is if he is having the same experience as other stores. Up 80% of course, he’s got little to worry about it would seem.
Unless the industry were to be up 100%. In which case he’s falling behind!
And, to dealers trying to make strategic decisions in one of these most complicated economic times, anecdotal evidence is no replacement for data!
While making strategic decisions about their businesses, independent paint dealers suffer from a lack of shared data relating to consumer purchasing trends.
The largest player in the space Benjamin Moore, report their sales and sales trend data to one place and despite my best efforts, it's not located in Stamford, Connecticut!
And good luck finding how many more skids of MoorGard Benjamin Moore is making this season on the Berkshire-Hathaway 10-Q. Benjamin Moore's total volume for the quarter, perhaps as much as $500,000,000 is but a grain of sand on the beach of Berkshire-Hathaway's billions.
Maybe half a grain!
(Side note, if anyone has an email address for Greg Abel the recently named heir apparent to Warren Buffet at Berkshire-Hathaway, can you forward him my digits? Maybe tell him I'm doing websites now? Because the Berkshire-Hathaway web site is older than Warren Buffet's car!)
Despite my decades long frustration with the poverty of data which Benjamin Moore shares, the problem of dealer’s lack of sufficient data is not a problem of Benjamin Moore’s making.
Trade organizations in this space have struggled historically to maintain the type of relationship with dealers which would allow for real data sharing and reporting out. I wish the newly formed National Hardware and Paint Association (NHPA) luck in accomplishing what the PDRA was never able to do.
I think they're going to need it because their website has been down since I first checked it two-weeks ago!
Blah, blah PPG, Sherwin-Williams, Rustoleum or anyone else who makes their fortunes in this channel with independent paint dealers.
Which leaves dealers lacking a birds-eye view of what is happening at their counters. Data crucial to inform their strategic thinking! Data which would be available to retail-owners in any other industry.
How can dealers do any strategic thinking if they don't have access to data relating to consumer trends and purchasing patterns? Particularly at a time when these patters have been so disrupted.
Recently I saw an email which AllPro shared with its members. The email was filled with a pirate's booty of sales data; Category-by-category purchasing data for the first four-months of 2021.
AllPro of course is the member-owned cooperative of paint dealers, which I was a member of for 20-years. I still keep the certificate on the wall at my Stamford headquarters! That's president Jimmy Carter holding it up for me.
Jimmy is smiling because he knew then that in 25-years, he was going to sign a book for me at the Barnes & Noble in Union Square in Manhattan.
The 285 dealer-members of the AllPro group collaborate on a wide range of topics related to paint store life. Most significantly is the cooperative purchasing of products, which they do through both dealer-direct purchase from the manufacturers which bill through the group, and purchases from one of AllPro’s regional warehouses.
Allpro of course does not represent every paint dealer and there are far more independent paint dealers who are not members of AllPro than there are AllPro members. But at 1800 storefronts, AllPro’s data does represent a dependable reflection of what is likely happening across the wider dealer channel.
And that data, tells the story of an acute increase in demand for products in all categories which they track.
Demand for goods, reported as dollar purchases, showed significant increases in every category, with purchases of abrasives seeing the greatest increase. Up 68% for the first four-months of the year, paint stores are clearly prepping to stay busy!
The next-largest increase came in the interior stains category with purchases of these products increasing 51% over the same period in 2020.
Industrial coatings, a segment currently dealing with outsized price increases, have increased 45% year-over-year. With exterior stains not far behind notching a 43% increase.
With purchases of plastics, lacquers and caulking each up over 30%, it's no wonder dealers are struggling to keep the shelves full!
Purchases in the significant architectural coatings category are up 29% year-over-year. A percentage increase impossible to imagine during “normal” economic times.
Growth in our industry typically measures in the low single digits!
Add spray equipment which increased 41%, solvents up 26% and applicators up 22% and it’s easy to understand why AllPro members spent 32% more on tinting equipment during this time.
All this additional material billing through AllPro members is of course being sold at their counters. Add in the profits dealers achieve as price increases raise the value of their inventories and it’s clear that while dealers are rowing through some turbulent waters, they've got lots of cash to use as ballast!
Some of that ballast should be set aside; winter always comes! But dealers flush with cash should look to invest that "found money" in opportunities to increase both their size and their market share. Now! While consumers changing their buying patterns are changing so many of their long-held brand loyalties.
The economic tumult caused by the events surrounding the last year create an outstanding opportunity for locally-owned retailers to grow and find new pools of customers as consumers continue to express their preference for "mom & pop."
I've shared here previously my view that one of the leading indicators of success among independent paint retailers is membership in AllPro. Their members willingness to share information about their stores which most would consider private, partially informs that belief.
That attitude clearly exists amongst their board and executive staff as they were quick to assent when asked for permission to share their otherwise-private data.
Kudos to that group for seeing how valuable this data could be to dealers outside their member’s ranks. Their willingness to widely share this member data speaks volumes to their commitment to our greater success as a channel.
Others should do the same.
Through my various outlets; podcasting, blogging, this blog and THE Revolution, I am now putting out a lot of content. Some of that content is now sponsored and so I wanted to share some rules I use when I put this all together. So you know exactly what you're looking at.
This blog, and any content without a sponsorship is my commentary or reporting on the independent paint dealer channel. And of course, on THE life and times of Buck and Guy!
Other content such as my YouTube channel and my podcasts, which may sponsored, will always have that sponsorship read at the beginning of the content. If you do not see or hear a clear sponsorship, then see # 1 above.
I work closely to vet my sponsors ensuring that my sponsored words are just as accurate as my non-sponsored.
I make certain that stories about Buck and Guy are 100% true.
But I admit, they may be only partially complete!