here is only so far that the ‘mega merchants’ can expand by acquisition or organic market growth and that will produce some interesting developments as they enter new areas of business and reduce timber products as a percentage of their turnover. That naturally creates opportunities for the independent – so what are the best ways that they can market their business?

Twenty years ago selling on price was probably one of the few ways the independent could gain business. Today they stay in business by being smart.

The ‘mega merchants’ have a problem offering consistency of service or product knowledge, or a uniform product offer across their branch network. However, they do charge high list prices to cover the overheads within their businesses and to ensure that shareholders get a satisfactory return.

Against that background, for the independent merchant to try to take business by price is foolhardy and a waste of resource, especially when our biggest competitors are helping us by setting high rates. Instead, let’s use our unique selling points to our advantage.

There’s probably never been a better time to market independent timber merchants. The upswing in consumer interest created by wood. for good and the plethora of TV property programmes have brought about a growing demand for timber, especially in visual situations such as floors and claddings. What’s more, by the power of e-trading, a one-site operation can appear to be as ‘big’ as any other business, portraying a professional business that really cares about its customers, while providing excellent service.

Well-produced, high quality literature is essential. After all, if you’re competing with the ‘big guns’ you’ve got to look the part. Well laid out, informative, colourful brochures will help to create the right image, whereas photocopied black and white sheets of products and prices just promote cheap deals.

Service

In my opinion, service is the core aspect of the business for an independent merchant to market. If you can beat your competition on service, then price drops down the list of priorities. In an average building contract, where time penalties and skilled labour shortages are rife, timber probably accounts for less than 10% of the total contract value. Surely, by answering the phone rapidly, giving immediate, accurate answers and processing orders efficiently, your customers will come back, time after time. As part of your market research try ringing some competitors to see what their response is like.

Local market research is also vital. Large groups often say that their main competitors are usually individual merchants because of their knowledge of their local market. Identifying potential business by sector, split further into different categories and even possibly delivery areas, will give you analysis of sales by product so that you can price specifically for target markets. In other words, create databases that allow you to charge keenly where you need, but not where you don’t.

&#8220When service is linked to professional marketing, using a website and well-produced literature, your customers will have confidence, leaving you to deliver the goods on time, in good condition and with accurate paperwork”

A classic example of this is to divide commercial end users from core building companies. The big groups almost consider this sector to be theirs. If you can focus on this area specifically, there’s great potential for high margin added business.

The fact that you provide accurate, reliable delivery as standard should also be considered a crucial part of any marketing strategy.

When service is linked to professional marketing, using a website and well-produced literature, your customers will have confidence, leaving you to deliver the goods on time, in good condition and with accurate paperwork.

Quality materials

But, of course, there’s no point in going to all these lengths if we don’t follow through on the positive marketing message and supply quality materials. We see areas where the timber sector has lost market share by not providing what customers want or have been led to expect and all too often independent merchants have been cited as the route for inferior products to market.

Trading downmarket plays straight into the mega merchants’ hands. They have thousands of shareholders and a raft of legal requirements to meet; they cannot risk trading in anything unless it’s totally straight. So why buy low grade materials or ignore a standard when our main competitors are straightening all of that out for us and setting a price that’s good for us all?

What’s more, through wood. for good and enormous investment from upstream wood companies, timber is regaining its reputation. It would be sad to find that independent merchants were to blame for any setback in this multi-million pound campaign.

We’re also now entering the world of European quality and performance standards or ENs. This will eradicate many inferior products, raise prices and assist the independent merchant put over the message that they are supplying a quality-assured, sensibly priced product underpinned by excellent service and industry knowledge.