Hank Darlington 2015-10-07 04:05:24
Miller's success The first week of September I was in Florida working with a longtime friend and client whose business is so very unique and successful. Meet Vicki Pfeil, owner and proprietor of Jupiter, Fla.-based Miller's Fine Decorative Hardware, which also has a second store in West Palm Beach, Fla. - putting the company in two of the higher-end cities in the U.S. A little history on Miller's tells us one of the early pioneers in our industry, Sid Miller, who was operating a decorative plumbing and hardware showroom in Ft. Lauderdale, Fla., opened a second store in Jupiter in 1989. Pfeil was Miller's first employee in the Jupiter store. Exactly five years to the day Pfeil started working for Miller she purchased 100% of the Jupiter store. Before going to work for Miller's she cut her teeth in the showroom business with Castle Supply in Sarasota, Fla., and another smaller HVAC/plumbing company. The name Miller's Fine Decorative Hardware doesn't tell the whole story because decorative plumbing has been a mainstay from the very beginning. Pfeil was approached by Waterworks, a recognized higher-end faucet, accessory and tile vendor in the industry, and asked to become the exclusive dealer of its products in West Palm Beach. This prompted her to open her second store in 2011 - the expansion taking place toward the end of our recent big recession. The recession caused some serious belt tightening, but the company has not only survived but now is thriving. Pfeil admits going through the downturn did cause a few knots in her stomach, but "the fear of failure serves no good purpose and that realization alone played a major role in the improvement of my business," she says. Now that's a great attitude. Pfeil agreed to share a bit of "privileged" information that shows the opportunities that are available if you are willing to run a showroom with the goal of maximizing ROI in your operations. Miller's employs 12 people of which the equivalent of 4 1/2 people are sales consultants. The company is surrounded by several well-known wholesalers but still manages to achieve in excess of $3 million in sales revenue. Please pay attention to this: Their margins on sales exceed 42%. I know firsthand Miller's is only one of dozens of independently owned showrooms that enjoy numbers like these. I keep preaching and hoping you will set goals and implement procedures to try and achieve numbers like these. I continue to believe in my head and my heart that profitability is more important than volume. HOW THEY DO IT Some more tidbits on Miller's success: For starters, their showrooms are beautifully built out. Pfeil and her team have selected vendors and products that cater to their higher-end clientele. These products are not overly distributed in the marketplace and, as much as possible, are price-protected on Internet selling. Many of the featured vendors and products are members of Forte, the buying group the company belongs to. Secondly, Miller's shows a great mix of products. In addition to the core products of decorative plumbing and hardware, they show and sell bathroom furniture, tile, lighting, boutique items, bath accessories and several lines exclusive to them in the marketplace (Waterworks being one of them). Third, the mix of customers is very healthy. Sales are almost equally spread between plumbing contractors, builders/ remodelers and homeowners. The company has worked very hard to earn the influence of designer and architect professionals. A wide selection of product, deep product knowledge and superb customer service all are hallmarks of the business. Next, Pfeil has made herself a true marketing professional in getting the word out about her business. Miller's advertises in several high-end trade and lifestyle magazines and hosts a number of events in the showrooms each year. To mention a few of these events: there is the Palm Beach Chamber of Commerce, a Houzz social media event and charity events for two different dog-rescue organizations. As a nice touch at these events the company offers valet parking, cocktails, appetizers, a silent auction and raffles. These events not only are held for a good cause, but are done to attract people to the showroom that might not otherwise have heard of them. Pfeil hired a PR agency five years ago to help in the area of marketing. These folks constantly are updating photos, doing a quarterly newsletter and putting out a continual stream of product, promotion and event e-blasts. They also maintain Miller's website, which I feel is one of the better ones in the industry (www.Millershardware.com). The company is active on several social media sites and engages an outside source to maintain its website. In addition to all of this, the company also hosts several networking and educational events for trade professionals. In 2014 the company celebrated its 25th anniversary and did a series of events and promotions to help celebrate this milestone. In addition to Forte, the company belongs to the Decorative Plumbing and Hardware Association and the American Society of Interior Designers. Pfeil has served on the board of the first two organizations and headed up several committees. She stresses being active in these industry organizations has been very beneficial for her and her business. THE BACK OFFICE Pfeil also has developed one of the best sets of monthly financials I have ever seen. She knows how to use them as an important tool to help manage her business. The P & L breaks out sales, cost of goods sold and gross profit numbers by customer type and product. Pfeil knows every month how much has been sold to plumbers, builders, designers and homeowners. She also knows exactly what sales and margins are by each product category. Operating expenses are broken out into 51 separate line items. In addition to this she does a running 12-month spreadsheet on each of the above chart of accounts. She can tell at a glance how sales, margins and expenses are doing in very minute detail. Here are a few other neat things Pfeil incorporates into her business: Detailed job descriptions for every position; At least an annual job performance review with every employee; Sales consultants are paid a salary plus commission (the commission is designed to reward sales of specific products and higher margins) and Miller's hours of operation are Monday through Friday from 9:30 a.m. to 5 p.m., at both stores with Jupiter open Saturdays during "the season" (November to April). Additionally, Miller's provides an informal training program that includes product knowledge sessions two to three times per month and sales training when offered by Forte (I am encouraging a more formal training program which would include more sales training); and it has its own private label faucet and bath accessory line named JESYKA in memory of Pfeil's sister. Pfeil admits the company could do a better job in the all-important area of "after-sale follow through" and is committed to keep working on this. Pfeil is succeeding in a male-dominated business by being a great overall manager. She has learned all three segments of managing a business: financial, human-resource and marketing management. She is a perfectionist who has very high expectations of herself, her employees and her vendors. She loves the challenges of building a successful business, building out two beautiful showrooms, selecting the best vendors and products and doing the marketing of the business. But, she will be the first to admit the day-to-day challenges/opportunities of being the "boss" can be a serious test from time to time. If you're ever in this hard-working industry professional's part of the world please stop in and say hello. She'd love to give you the tour and share her experiences. Hank Darlington, owner of Darlington Consulting, is a 2004 NKBA Hall of Fame inductee. He can be reached at 916/852-6855 or email@example.com.
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