A century of success
Keidel Supply's investment in showroom operations pays off in a big way.
From time to time, I’m asked to write about an outstanding showroom operation. I love doing these in-depth articles.
For this month’s showroom profile, I started my research by contacting several reps and manufacturers of higher-end products and asking who, in their opinion, has the best showroom operations. I ended up with a dozen names. By doing more research and calling several of the “nominated” companies, I finally zeroed in on Cincinnati-based Keidel Supply. As I continued to learn more about this company, I knew I had made a great selection.
First, here are a few facts on the total company operation before I focus on the showroom side of the business. Keidel Supply celebrated its 100th anniversary last year. Art Keidel Sr. started the business in 1911 and ran it for 34 years before Art Keidel Jr. took over. Barry Keidel assumed the reins in 1991 and now shares top management responsibilities with Mike Barton, the company’s CEO since 2009.
Keidel, with two branches in Cincinnati, is a member of Affiliated Distributors, which gives it the advantages of enhanced rebate opportunities and the possibility of greater volume purchasing power. Plus, it allows Keidel to forge relationships with other independent distributors in its network.
I asked what sets Keidel apart from its competitors. Two things stood out: The company offers emergency service for standard accounts, which involves having personnel on call for inventory access during off hours; its new facility in Paddock Hills offers direct access to the sales counter from a covered parking and loading area, ideal for rainy and snowy days.
The showroom sideLet’s dive into my favorite part of the business - showrooms! Like many wholesalers, Keidel had a small display of plumbing products and cabinets in its counter area. The counter salespeople were responsible for these displays and sales efforts.
It was in the 1980s with the advent of a greater variety of higher-priced, better margin and more luxury styled products, and the change from Eljer to Kohler, when Keidel really became serious about showrooms. That’s when Keidel built its first dedicated showroom and hired showroom sales staff. The company marketed and sold kitchen cabinetry for a number of years, but in 1997 moved to higher-end cabinet lines and appliances.
To demonstrate how progressive Keidel is, it realized inventories and marketing efforts were too spaced out in the location it was in. Keidel wanted to bring all product groups together under one roof - creating a one-stop shopping destination. The bittersweet reality of the economic downturn and subsequent collapse of property values made this consolidation/expansion possible.
In 2009, the company purchased an existing warehouse/office complex in the Paddock Hills section of Cincinnati. The building sits on 8 ½ acres only a few minutes from downtown. It is accessible from two major interstates and within 20 minutes of virtually every Cincinnati neighborhood. The new facility gives Keidel greater net warehousing and showroom space and, with a 30-ft. elevation for warehousing, it ensures efficient material handling capabilities and logistics. There also is greater acreage for outdoor storage and the aforementioned larger parking capacity along with covered parking and loading areas for counter sales. The newly remodeled supply house and showroom opened in August 2011 - exactly 100 years after Mr. Keidel started the business.
Details, detailsThe new showroom encompasses 15,000 sq. ft. and features all four main product groups: plumbing, cabinetry, lighting and appliances. Lighting joined in 2010 via acquisition of a local lighting firm.
My good friend, David Hawkins, played a major role in helping design the showroom. With the various product groups all vying for space within the new showroom, it became necessary to integrate the products together as much as possible. Keidel stayed away from the traditional large vignettes and opted for a wider choice of products, especially kitchen cabinets. Cabinet selection centers show a wide selection of door styles, colors and finishes.
Staying consistent with its theme of integration, Keidel attempted to keep associated products within the same showroom space regardless of product group. Therefore, its kitchen cabinetry, appliances, countertops and kitchen-related plumbing products are in adjacent and/or integrated spaces. Ditto on laundry, wet bar and bathroom products. Although Keidel was able to integrate a lot of lighting throughout the showroom, it also built out a dedicated space for lighting displays, making it easier for clients and sales consultants to concentrate on these products.
Believing as I do that you should encourage customers to become as hands-on with the products as possible, the showroom is very interactive. There are working kitchens, including appliances, ventilation and faucetry. Keidel built a showerhead display demonstrating the functionality of 37 components - all controlled through a smart home iPad app. This demonstrates the various products and makes it fun for customers. Very innovative!
The showroom also features two functional digitally controlled shower systems from Kohler and Moen. Two wall-mounted, flat screens are accessible via computer by sales consultants while they work with clients. An aging-in-place display is featured, and the company is working on a dedicated space for interior designers to work with clients.
Showroom strategiesKeidel’s showroom staff includes a receptionist who meets and greets clients and gets them headed in the right direction, six plumbing sales consultants, three lighting salespeople, three appliance associates and three kitchen/bath designers. Work stations for sales associates are integrated throughout the showroom. The only exception is for the designers, who are located in an office space designed to minimize distraction during the design process. Showroom Manager David Dressler doubles as a kitchen/bath designer.
The showroom offers both higher-end and medium-priced products in all categories. It strives to gain separation of products offered by competitors by providing products that have functional or design advantages. The ultimate goal is to render a total value package to clients.
Keidel built its new showroom to allow it to take advantage of Kohler’s new “Next Generation” premier showroom specifications. Kohler designed the dedicated 1,900-sq.-ft. space and built the casework for the displays. Kohler has specific inclusions that needed to incorporate into its portion of the showroom, but it positioned those elements to complement Keidel’s plans for the overall look of the showroom.
Purchasing of showroom products varies by category. The company’s purchasing department handles plumbing. There are separate buyers for cabinets, appliances and lighting. The company carries little or no inventory in the last three categories, which is no surprise given it’s virtually all special-order material.
Tile and granite sub out to local vendors. I asked about door hardware and was advised it does not currently carry this, but may consider it in the future. The Rhoda Series of Basco shower doors has become an important part of the bathroom product offering. In addition to selling this product, Keidel smartly offers installation.
I was curious how sales broke out by customer group. Although plumbing may start out as a retail opportunity, it many times ends up purchased by a contractor. Thus, here is the following breakdown: plumbers - 50%; remodelers - 20%; retail - 20%; and builders – 10%. Retail drives lighting with 70% purchased by homeowners. The balance splits between builders and remodelers. The company does not sell to electricians. (How long before this is the case with plumbers and decorative plumbing products?) Appliances break out to 50% retail, 30% remodel and 20% builders. Cabinetry is 40% retail with remodelers and builders splitting the balance.
Spreading the wordKeidel works hard to put its products and services in front of architects and design communities by trying to hold as many vendor CEU presentations to both groups as often as possible.
The company earmarks an impressive 5% of showroom sales to marketing. I doubt very many wholesalers do this. The bulk of the money is spent on print ads, television, radio, trade shows, and specific in-house showroom events catering to both professionals and homeowners. The company maintains both a website and Facebook page.
I asked Dressler where he believes the company gets its biggest bang for the marketing buck. He said in-house dedicated events generated the most immediate sales. This also is my experience. You need to spend money in traditional ways (print, television, radio, trade shows, etc.) to create an image and tell folks who you are and what you do. This is the shotgun approach. The in-house events are the rifle approach directed to a specific potential client base.
Training of showroom personnel is ongoing. Keidel takes advantage of Kohler’s Sales Skills Training Program and currently has people enrolled in ASAU training programs. The company holds regularly scheduled vendor-specific training in each of the product groups.
The showroom and wholesale side of the business work well together (not always the case). The showroom sales folks are evaluated on sales performance, so it’s important jobs they quote end up being credited to them when a purchase is made. It’s up to each salesperson to do a good job following up quotes so they earn credit for the sale.
Keidel, an independently owned enterprise completely invested in its community, has been serving its clientele for 100 years and plans on doing so well into the future. Here’s wishing them another successful and profitable 100 years!