Competing with the Big Box on Solid Surface Countertops
Business tactics for a cabinetmaker who outsources his countertops. January 9, 2007
Question
We farm out all our solid surface tops, and pass the price to our customer - don't make a cent on them. Recently a customer brought a bid back from Home Depot (using the same plan she gave us) and it was almost $500 less on about an $8,000 SS job. I called the SS guy and he told me that Dupont gives Home Depot special pricing that is not available to me. This doesn't sound right to me, since I do not mark it up and am sure they do. Anyone know about this - is it legal? If this is the way it's going to be, I have no choice but to do my own again.
Forum Responses
(Laminate and Solid Surface Forum)
From contributor H:
You farm out your solid surface tops and pass them along to your customer at your cost? Big mistake. You are in fact losing money just by running the invoice through your shop. Things like that drag down your overall margin at year's end.
And yes, it is legal. "The Borg" does get better pricing from selected fabricators that can handle the volume. I have never been in that position because we have always done our own Corian, Avonite, Hanex, Formica SS. Dupont does have competitors.
Go back to doing your own, or don't do it at all. But stop running through your shop at cost. Ask your fabricator for a better price. You might get it, or use another fabricator. But honestly, 500.00 on 8000.00? Not a whole lot. 6% +-?
From the original questioner:
I don't run the invoice through my shop, but I used to, until I realized I was paying for it on my liability insurance. Even though you are right - I'm too easy or stupid or both. I'm buying a CNC router and I will soon be doing my own SS, so in the long run Dupont did me a favor.
From contributor C:
I wouldn't run it through my shop without making a decent margin on it. Who do you think the customer will call if there is a problem? That said, I believe if you are a personable and clever guy, you should be able to convince your client that the extra $500 is well spent on your far superior fabricators. Fire up your verbal skills, and go get 'em.
From contributor T:
Perhaps you should pause and think a bit more about this decision to make your own countertops. I think it is tempting to make everything yourself, but sometimes it pays to think about what your business really is all about before you jump into another application like countertops.
The loss on this one job represents a pretty small percentage. Don't make it too personal. Other options may be to find fabricators with DuPont competitor products, or even granite. But, whatever you do, make money on it!
From contributor R:
Whatever anyone tells you, your company does not have to have a CNC to make money. I've been fabricating for years with a 3/8 router and a 1/2 router special tec. Can bring you to doing 30 lin. kitchens in 12-18 hours depending on the jobs, and where seams and field joints are placed.
From contributor M:
Talk to your supplier and tell him the deal. He will lower his price. Dupont will work with you and him to compete as well. Most kitchen dealers I sell to add $500 to $700 per job. I template, fabricate and install. One thing Home Depot won't do is rip outs! This is how I get a lot of work from them. Plus, they take 3-4 weeks to my 5-7 days. Don't let these customers get away. Everyone else made very good points as well.
From the original questioner:
Thanks to everyone for your advice. I just completed my first SS job - went very well. 210 sqft earthstone, 7 sinks, took me 65 hours. It was very profitable and I think I can cut the time in half with a CNC router. The only problem is, I don't have any time leftover for beer - not good!
From contributor M:
Awesome! Great to hear! Good luck in the future.
From contributor V:
I make cabinets and when a customer wants solid surface, I give him the number of a local countertop shop. That shop gives me 10% of the total job! Nothing is in my name and I don't have to warranty anything! The last job I made 800 dollars for doing nothing but giving a name and a number. Look for shops in your area and see if they will do the same.
