5 Things the Best Home Improvement Companies Are Doing Right Now | Dave Crowell (Ep. 214)

Competition is pretty fierce in this industry, and at the same time, so is being humble. But being part of a great network, I think, is truly the differentiator for you. And once you're in it, you can just take advantage of it. And I think the bigger part— and we hear this right with the group that we're a part of— they want to get involved, they want to get involved. Well, a great way to also learn and do more is to get involved in the network. Not just by taking information, but by giving back information, sharing in the context of wherever you might be. Get involved in that network as well.

Hey everybody, welcome to another episode of the Wealthy Contractor Podcast. This is Brian Kaskavalciyan, and I am very happy to introduce all of you to Dave Crowell. Dave, welcome.

Thanks, Brian. It's great to be here.

Dave has been in the industry for a very long time. And he has been on the dealer development, support, training, growing side of the business, and he is one of the best out there. And so I thought it would be very good to get his kind of take on what it takes to build a really great company in this industry. Best in class. What are the things that the best in class companies do? So that's kind of what we're gonna talk about here today. But before we do that, Dave, tell everybody, I know your background, but you know, I'd like, I want everybody else to know what your background is. So give us like the quick 2 or 3 minute version.

You know, I spent a career, a career at one company and that was called the Andersen Corporation, Andersen Windows and Doors. And for those first 19 years, the journey to Chicago, to Texas, and also moved here to Minnesota with my family. And so HR roles, sales and channel roles, supporting big box, supporting builders, supporting architects, creating the Andersen experience and having nearly 5,000 customers tour the facility and see what we do and how we're different and better. Then along comes an opportunity with the home improvement division called Renewal by Andersen, still located in Minnesota. But I went to Renewal and I knew a lot about windows. I knew a lot about patio doors, Brian. But I didn't know a lot about home improvement. And over that 15 years, it gave me the opportunity to learn about marketing, sales, production, delighting the customer, but also how companies can differentiate and how we did differentiate. And then along comes another journey, another opportunity, right? And I opened my consulting business in 2020. I think at that time my wife thought, what are you doing? It's 2020 and there's just a lot going on, right? And I've never looked back. It's been a great experience. I've been able to draw upon a lot of good friends in the industry and really start to go off into a different direction, helping larger organizations with their siding projects, some with their window projects. But truly what I enjoy doing is helping businesses with their marketing, their sales, their production plans and strategies. So I've owned my Gateway Consulting business now for over 4 years. And it's been a terrific journey.

Yeah. And we were introduced a few months back by somebody we both know and love, Charlie Gundel, who was in the Renewal dealer network. And he spoke very highly of you. And we started this thing called the Wealthy Contractor Success Society. And Charlie said, you know, you really got to meet Dave. And we met. And immediately I asked you to join us and to, to help. You've been fantastic. Our clients love you. You've been running a mastermind group for us and you've been doing one-on-one coaching and clients love you. And the, the advice that you have, the experience that you have is great. And so I thought, okay, well, why don't we take you and expose you and have you talk to us about best in class? What is it? What makes companies in the home improvement business best in class? And I know there's a lot there, so where do you want to start?

Yeah, and I think from our position, right, and what we do and what Charlie's doing along with John and others is we listen. We get a chance to listen to what's on their mind, right? What in many ways, what are they thinking about, right? Do they want to grow their business? Well, how do they want to grow that business? And truly what I believe it starts with is good people, right? Being a good owner, being a good steward, giving back to your community, but ultimately having the mindset and the goal to grow and doing so in a way that you realize I'm not going to wear all the hats. I've got to think about my organization, I've got to think about my structure, and I also am going to pay them well, right? Create a great culture. And not just from the beginning, but what we're doing today is truly about helping owners and helping owners decide where they want to be and to help them with that path forward.

Let's talk a little bit about people and culture. For a lot of us, I mean, me included, people is like, people's tough. We could go out, we can install, we know how to go out and install, and we'll talk about sales and we'll talk about marketing. But overall, this idea of how do I recruit great people? How do I, how do I be a leader of these people? How do I create this culture of winning and accountability and just driving and, and all working towards that same end result, which is giving the customer an amazing— to me, it's about giving that customer such an amazing experience that they are just thrilled that they paid more and they got all the value and then some, and they paid more, which means that we're able to grow, charge the right price, make the right profits, and create a great, a great company.

Oh yeah, absolutely. And I think too, it's letting go at times, right? And truly setting that course for folks that can come in and, and take on a role and trusting in them. Really having open and honest dialogue with them, but in many ways, stepping away and giving them an opportunity to grow, to learn, and then flourish as an organization, share ideas, brainstorm, and do all the things that help create a great organization. But let others around you do so. Give them a chance and a little rope, little opportunity of, we're going to go this way. Can you help me get there? And it's amazing what people can do. They thrive in an environment of a great culture, in a great environment. But it's truly amazing to watch folks grow and to watch them build an organization that again might start out small, but as they get larger and larger, it's that foundation and that foundation of communication, transparency, and trust in others.

How does that come about? So for, you know, companies in this space are smaller. And it's, you know, the owners running around doing all kinds of stuff. It's tough for them. Like, it's tough for them to let go. They don't know how to trust somebody to do it. They don't know when they hire somebody if they actually have the goods or not. So what are some things that you're looking out for, or you're looking for in people when you're bringing them on?

Yeah, and I think— and I'll draw upon my, my experience at Renewal. We had truly a great network, great network of owners that were committed to the product, to the brand, to growing their culture, but committed also to grow their organization. And I would encourage anybody today, Brian, be part of a network. The Wealthy Contractor is a great network.

Yeah.

Take advantage of the folks that you meet from the East Coast, the West Coast, and take advantage of your network because in many ways, that network that you're a part of will probably have the answers to the questions that you have. The other part is going to do like my previous career. It might even challenge you, right? Competition is pretty fierce in this industry, and at the same time, so is being humble. But being part of a great network, I think, is truly the differentiator for you. And once you're in it, you can just take advantage of it. And I think the bigger part— and we hear this, right, with the group that we're a part of— They want to get involved. They want to get involved. Well, a great way to also learn and do more is to get involved in the network, not just by taking information, but by giving back information, sharing in the context of wherever you might be, get involved in that network as well.

You know, a big thing that's coming up right now is marketing. I said it the other day. I've had a number of conversations over the last couple of weeks. Where I basically have said, you know, and I hate to say it, but it's the truth. The COVID boom is officially dead and over. And now we're back to kind of what things were like pre-COVID, where it was all about lead efficiency. It was about diversity in lead flow, not relying on any one source. You know, during COVID so many people were— there was such an abundance of leads that you could go to an aggregator and say, okay, just send me all the leads you want. And then people were growing multi-million dollar businesses using aggregators. Well, if you're relying on an aggregator to help you build your business, you're in trouble. You're gonna— if you're not today, you're going to be, because it's getting uglier by the minute. And by the way, the aggregator, that whole deal wasn't set up to be more than 20% or so of your leads. Of your lead flow. And a lot of people are up in the 50%, 60%. I talked to somebody the other day, it's got a $40 million business, and he's rattling off all of the things that, that they're doing marketing-wise. They're doing TV, they're doing print, they're doing internet marketing. And I said, wow, it's really good. I'm glad to hear that you really didn't mention aggregators. He said, oh no, no, aggregators are a big part of our business. And I said, how much of your business? And he said it was almost 70%. I'm like, but wait a minute, just rattled off this whole list of other things that you're doing. And I said to the guy, go, can I give you a little piece of advice? And he said, yeah, I said, you got to flip that and flip it quick. Because 70% of $40 million is, you know, that's a tough place to be. So anyway, what do you see as, you know, with Anderson, you know, you've been a part of two incredible networks, dealer networks, like the Anderson one is just like best, the best one there is, hardest one to get into. And then the other one that's really, really good is the Jacuzzi one, which you've done a lot of work for Jacuzzi too. But aside from the fact that they pool their marketing efforts and they all talk with each other, what are some of the things that make them such good marketers?

Yeah, and no doubt, right? You could call it a salmon run. The salmon run's over, right? We gotta think about our marketing mix and all of it. Yeah. I think truly the differentiator, whether it's one or both of those companies, is to take a step back. Whoever you're working with, whoever's supplying you with your leads or product, take a step back. We just finished first quarter. Truly break it out by media, break it out by all of your media content, break it out by aggregators, break it out by how many events did you really do. And you hear, well, home shows are over. Shows and events aren't over. They should be expanding and growing throughout the summer. And really, when you hit the fall, you're just beginning, right? And I, I say that from a standpoint of in the mix and maybe what you had that was doing really well, and maybe in this case, or an example, 70% aggregators, it's time to rethink your mix. Where are you investing? The other part is to challenge your marketing representation and the talent that they have. And if you got people in your network, go see what they're doing, go observe what they're doing, get on a virtual meeting like this. But the other part, you, you need to think about it as far as micro gains. There might be things that you're doing today and you got to add to your mix, but if you were just to tweak your call center and how you set appointments, that gain could be 2 points. Tie that all the way to your sales and take this mix, take this analysis. And I'm not saying analyze and only the good leads get issued, right? Because they're all good leads because you're investing in them. But truly, take it from a funnel perspective, from what am I doing, what's my mix, how much money am I spending, what's my return on that, all the way through to the sales side. And just simply take some time and start reevaluating what you're doing and You're gonna have to do that as you move forward.

Yeah, absolutely. You know, a lot of people are spending a lot of money on stuff that is, they don't know is productive or not, number one. And, and when you're so busy and you've got so many leads coming in, you lose track and you're like, ah, okay, we've got enough. We got a lot of leads. We're coming in at a 10% lead cost. So, okay, whatever. But you know that probably 30% of what you've got is sucks. It's not producing, but you're spending your money on it anyway. So that's good advice is let's look at every single thing. And then the other thing you mentioned there is lead efficiency, the micro gains. So yeah, I used to, I've said this before, but we used to get 50 phone calls on a Monday morning and I would agonize over our scripting because every one more that we would get, you know, I mean, just think about it. You just got one more on Monday morning. Because your scripting was better, your training was better with your people, that's 52 more opportunities over the course of a year. And if you've got— even if you've only got a 1/3 close rate, that's another 15, 16 jobs that you're going to get at the end of the year because of one little tweak that you made, one little micro gain. And I think, yeah, more and more, I think people got to be looking at every one of those I call them the profit multiplier, the 7 home improvement profit multipliers. And actually, next— for next week's Success Society masterclass, that's what I'm going to be presenting are those, those profit multipliers. And quite a few of them have to do with, with lead efficiency. Let's talk a little bit about differentiation. Like, what are some of the things that people can do to go up against a Renewal by Andersen? So somebody that's in the window business, how do you go up against Renewal by Andersen? How do you differentiate yourself? How do you go up if you're in the one-day bath business? How do you go up against Jacuzzi?

Yeah, great point. And that's, it's interesting, right? You think you can't. And, and the fact is, right, your marketing, your marketing team worked really hard to get you to the front door, right, to that porch and that entry and that opportunity. Whether or not that consumer, that homeowner knows about Renewal or knows about Jacuzzi, they might, but you're there. And have you properly trained your representatives to smile when they open the door, deliver a great greeting, right? Set the agenda and do it in a highly professional manner because you're entering into some total stranger's home, but they've invited you into your home to have a great experience to either fix their windows, their patio doors, or their bath. And I think that's an example of, have you properly trained them? Have you utilized the technology and kept it simple, right? We can wrap ourselves around all this technology and all the ways to use it, but have a great presentation, know how to present price. And again, from beginning to end, that representative, that design consultant, creating a truly great experience. Because in many ways, it's not the two companies in the bath or window category that you're competing against. You're competing against that shower and bath that's there. You're competing against the windows and doors that are there. Name the brand, whoever they might be. But that's really your competition. And you, can you sell, convince, and create a great experience for that customer, that client that you're the right company to replace their windows or their baths. That's my approach.

Do you think in some ways that you're really also competing against yourself? And what I mean by that is, are you prepared? Did you roleplay this week? Is your head in the game? Are you connected with the homeowner? You know, are you listening to them? Are you asking them questions? Are you, are you getting out of them what it'll take for you to create an amazing experience for them so that at the end of your presentation, they will— they're like, oh my God, this is— these are the people we have to go with. Where do I sign?

Yeah. And again, it goes back to that experience, right, Brian? From a standpoint of you're not just issuing leads and the representative gets a piece of paper. It's a homeowner. They have a name, they have an address, they have a family, they may have a significant other. Right. And that's experience of how often are you talking to your design consultant about that appointment, the value in it, what's your company's story.

Right.

And again, this shouldn't be so difficult that it's not fun. Right. And yet once they, they've gone to the job and yeah, we know that some are selling at 35% and 40% and some aren't. Right. But can you ultimately create that experience in mindset for your representatives that they go in and deliver. Because for those 45, 50, 60% that don't buy, you want them talking about you. You want them referring that we couldn't quite do it. But at the end of the day, there's a great opportunity to go revisit, ask them for a referral even though they didn't buy. And again, I'll go back to creating that great experience from the knock on the door to when you leave for that homeowner. That can be a truly differentiator, I guess, without sharing anything proprietary.

How serious are the owners of RBA offices when it comes to training salespeople and managing salespeople on a scale of 1 to 10?

They're a 9.5.

Yeah.

And in some locations they're a 10.5.

Yeah.

It was several years ago that you start to realize there's quite a bit of turnover. Right? The hire 10, keep 5, hire 6, keep 3. And, and there's a lot of money invested in that. And I think the owners and the, the corporation, we took a real effort, right? A compliment to the leadership team of how can we do better in our recruiting? How can we do better in our onboarding? And that onboarding was a great opportunity to again bring in good talent, maybe not from the window and patio door business, but ultimately get after the onboarding to create 2 weeks, 4 weeks, whatever that was, but to get really good at that. And ultimately, if you're able to get good at that as I describe it, ultimately that representative, when they knock on that door, they're really good as well. And once they run 5 leads, they run 10 leads, they run 30 leads, you're talking to them, you're coaching them, you're coaching them up. And so we spent a lot of time and effort around some of those components, and we saw close rates, revenue per appointment go up, but we also saw turnover go down because the leadership team at the sales representative level, they got really good at it.

You know, one of the things that will really help accelerate anybody's success is by modeling the best in the business. So let's go look at the best in the business. And I'm not necessarily saying that every single RBA is the best in the business, but they're pretty damn close. I mean, Charlie, as an example, in Orange County, I mean, what a business he ran. What a business this guy ran. And we talk a lot in Success Society about, do you want to build an ordinary business or do you want to build an extraordinary business? Do you want to just get— make a living, or do you want to get rich? And obviously we want to help everybody build an extraordinary business so that they can use that business to become rich, whatever that means for them. And so part of being extraordinary means we got to look at every little detail. We got to, we got to make sure that our people are well trained, that they're well taken care of, but also that they've got all the tools and the coaching that they need in order to be successful, whatever it is they do, whether they're in sales or production or admin, call center, Yeah, this industry's just been an explosion of tech, right?

It, it was have a CRM, right? And there's some high-quality CRMs. Now you add to that tech stack between Engage, high-quality tool, to Rilla today. And at the end of the day, I tell clients, right, they're not expensive, but what is expensive is if you don't implement them. Spend the time thinking about how you onboard, representatives, your production team, and utilize those tools to also differentiate yourself in the home. But spend the time, not just the investment, but spend the time preparing your leadership team and spending the time to prepare your representatives and installers to use it while you're in the home.

Yeah, you mentioned, you know, tech and tech tools. I mean, there's so much great stuff out there. You mentioned CRM, BuilderPrime out there is an amazing platform. CRM Engage for presentations in the house. You're professional. On an iPad, and then Rilla. You put Rilla on top of it where you're recording every single conversation, so you hear what your salespeople are saying in the house. Because most of the time, we don't have a clue what they're saying in the house. All we know is whether they came back with a contract or without. But now with these tools in place, like even with Engage, we know what slides they were on, we know how much time they spent there. With Rilla, we know exactly what they said, how long they talked, whether they listened, whether they didn't, you know, whether they asked the right questions or not, whether they presented price properly. All of these little things make a huge difference. It goes back to what you said earlier about micro gains.

Yeah, and each one of those can also be great training tools, right? Are they practicing with Engage but also with Rilla? You just ran 2 appointments yesterday. Like, today, are you listening to those appointments? Training, self-development, and those become some differentiators as well, Brian. As you look at the middle-of-the-road design consultants to the top-end design consultants, those top-end consultants are always refining their skill, their trait in what they do, and they practice, they practice, and they utilize this technology to get better for their team, but also for themselves and, and for the organization. It's pretty remarkable how good they get.

Yeah, well, look, I've said this for years. A good sales team, a great sales team, you have an opportunity to build your own NBA team. But you got to look at what the NBA does. The NBA practices, you know, they're, they're sitting there, you know, the best in the business, the best in the business, Steph Currys of the, of the world and LeBron James and the Michael Jordans. They're there taking shots hour after hour. It's boring. I'm sure, but they're just sitting there taking free throw shots so that the chances are when they're at that line and they've got all this noise around them and that one point is going to make all the difference in the world, they've got muscle memory, they've got their mind trained to be able to make that shot. Can you imagine, you know, not listening? Can you imagine these NBA teams not watching the previous game, like not having any tape whatsoever? Of the game.

It's—

that's like unheard of. You can't win at the highest levels without some of this stuff in place. And I think— and I'll go— the last place I want to go with you, and I think that all of this applies to, is with all of the owners. You've worked with hundreds of owners of home improvement companies. What are some of the things that stand out? You know, what makes an owner— one owner run, you know, a super profitable multimillion-dollar company and another one just struggle and make a living? What are some of the things that you've noticed?

The mindset of that owner, whether they're in Greensboro, North Carolina, Peoria, Illinois, Syracuse, New York, right? The mindset of my market's different. My market's different from a standpoint of, well, I can't do what they do in New Jersey or Buffalo or New York and Boston, right? But at the same time, what you're doing is pretty unique, right? Again, what network, what product, what are you selling today? The tools are available for owners today. You don't have to be in this unique marketplace. And it's when they create that mindset that I can have a marketing mix, I can invest at that 10, 15%, I can generate leads in my market. Oh, but I thought my market was different. No, even in Greensboro, North Carolina, you can go generate leads. You're going to get a design consultant to go to the home having that mindset of, no, I'm in Greensboro, North Carolina, and I'm going to knock on that door and I'm going to go sell them windows, I'm going to sell them a bath. And then my install team— there's nobody better than my install team and my inside support. We're going to deliver a great experience for you. And so it's when that owner and it could be a husband, could be a wife working together, right? You know what that's like with, with your company, right? But we're all pulling in that same direction. But it's truly that mindshare, that mindset. When they realize they have a tremendous opportunity, no matter what market that they're in, they can go and excel. Because today, Brian, it's not like 20 years ago. We have all the technology. We have vendors that want to help us as small businesses. And, and as part of this network that we're a part of, you have a lot of great— I'll call them vendors— but folks that also want to be part of this network to go help our customers, go help our clients. You don't have to be a big company anymore to be successful in your own market. It's all there for you.

It's really incredible. You're right. You know, 20 years ago, I mean, can you imagine? You, 20 years ago, you had to go learn and develop your own selling system or hire somebody that was going to cost a fortune to come in and help you develop a selling system. Now you can, boom, you can just go and buy one. And then we talked about technology earlier about the different services that are out there. But, but yeah, you're right. It's like all of these companies now, the smart ones, at least the ones we work with, they all want to help. They want to like, here's how you implement my thing into your business. And here are the best practices that go with it, whether it's like texting, with Marla Mar, Rila, with all of their best practices. One&Fund when it comes to funding solutions. I mean, for years people don't understand how financing works and then comes along a company like GreenSky or like One&Fund, like Service Finance that just makes it so much easier. There's so much less to figure out. They make it so easy. It's on an app, it's a this, it's that. And so anyway, yeah, you're right. I mean, it's— you got to be open to all of these things and let other people help you and bring along good talent, hire good talent, pay them well.

Right. We're in a business that we can afford to pay them well. Right. And but in many ways we earn it, right? The work, the effort and all of that. But again, you can be in any market today and have a great marketing mix and deliver a great experience for the homeowner. So I, I like that question around my market's different. Well, let's talk about how truly different it is, right?

Right. Yeah, my mentor Dan Kennedy used to have a big sign in the basement, which was his, like, where he works and where we would go for mastermind. Some client had made it for him and he would have it up at, like, events and stuff. And it was, but Dan, you don't understand, my business is different, or, but my market is different. And I've used that. I stole it because I've heard it, you've heard it, Charlie's heard it over and over. It's like, yeah, but you guys don't understand, my market is different. My No, it's not. No, it's not. You got to let them say it. And then you got to prove them wrong. And it's, it's not for us being right. We don't, we don't care about being right. We just want you to be successful. And so sometimes we got to tell you hard stuff, and we got to push back a little bit. But we're not doing it from a place of wanting to be right. We're doing it from a place of, we want to shake you and we want to help you, like, get past that. So that the leads will start coming in.

Be part of a great network and participate. Get active in the network that we're in, right?

Yeah, don't do it all yourself. Don't try and— I did that for so long. I tried to figure everything out, out on my own. Oh, it's exhausting. Exhausting to try and figure it all out on your own. All right, well, look, this has been great, Dave. Thank you so much. I love everything that you've been doing for for the Wealthy Contractor Success Society. If anybody's interested, just reach out to us. I'm not sure when this is going to go out, but anyway, we've got meetings throughout the year and we'd love to talk to you and see if you'd be a good fit for, for Success Society. Thank you. Appreciate you. Thanks for being here and taking your time today. I am going to do a quick plug. Let me grab this. I hadn't been doing it for a while. Dave, and so I gotta, I gotta go back to doing it. So the Seven Secrets—

Brian?

Oh, he's got one too! Look at that. So I got this little book. It's called The Seven Secrets to Becoming a Wealthy Contractor. You know, this book has sold almost— we're almost at 10,000 copies, and I had no idea what that meant. And so I looked it up, and that's actually pretty damn good for a book that's self-published too. But anyway, I'm happy to send you a copy. I'll buy the book. I buy them, you know, hundreds at a time, and I'm happy to send them to you, send one to you. I just ask you to pay shipping and handling. And if you go to thewealthycontractor.com, you can go and get a copy of The Seven Secrets to Becoming a Wealthy Contractor. It's not a big book. Hopefully I get to the point. With the 7 secrets. And anyway, so I'm happy to buy you a copy. You just pay shipping and handling. We'll get a copy out to you. Go to thewealthycontractor.com. All right, Dave, thank you very much. Everybody that is listening, until next time, this is Brian Kaskavalciyan, and this is the Wealthy Contractor Podcast.