Master Plumbing Charges Into The Remodeling Market
Yet, is there anyone better positioned than a plumbing contractor to operate a successful bath showroom? Why should contractors concede this market to designers who, while talented at what they do, are often clueless when it comes to plumbing fundamentals?
David Judd is about to test these premises. The owner of Master Plumbing, a $1.5 million contracting firm in Cedar Rapids, IA, has invested just about every spare dime he has into Master Bath & Tile, a dazzling new showroom that will have everything needed to furnish a bath or kitchen renovation, except lighting.
In particular, Judd talks with excitement about entering the ceramic tile business, as a supplier of tile, stone and granite. This is something few plumbing contractors, even those with showrooms, have an inkling of. Yet, this business is said to have some of the highest net profit margins of any showroom sector.
Judd claims it will be by far the fanciest plumbing showroom in town and one of the best to be found anywhere in Iowa. One big advantage — it’s in the best location imaginable, on the busiest stretch of the busiest highway in town. This is not only good for the showroom, but for all sectors of the business.
“I felt the image enhancement we would get from a spectacular showplace would be great for the new construction and remodeling portions of our business. It would also put us in the forefront of people’s minds for service work. Since my employees are my most important asset (there is no company if no one shows up for work), I wanted a way to keep them busy during lean times. This way, we get first shot at customers when they’re in the planning stages looking at fixtures. A company that has excellent mechanics only, is at a disadvantage,” says Judd.
Large Investment: A happy-go-lucky personality under any circumstance, Judd exudes confidence that his dream showroom will pay off. He doesn’t know exactly how much money he’s sunk into this venture. He can calculate the hard costs, including the handsome fees paid for the services of David Lyon, probably the nation’s top plumbing showroom design specialist. But if you try to include all the overhead and intangibles — such as all of his time that’s been gobbled up on this project — you end up with quite a bit of guesswork. Suffice to say any estimate ought to start at $100,000 and work its way up from there.
At one point I asked what makes him so sure this showroom will draw enough traffic to justify the large expense. “It has to work; I have too much money invested in it!” was his reply.
There are encouraging signs that his blind faith is justified. Scheduled to open officially about the time this magazine goes to press, Master Bath & Tile had a head start serving customers even while the place was under construction. Word got around about what they were doing, and one or two customers a day started coming by to order faucets and fixtures.
All of this reinforces Judd’s gut belief that the remodeling business is wide open. Reasons Judd: “I found out from attending the Kitchen & Bath Industry Show that there’s so much product out there that I don’t know about. If I, as an industry professional who reads all the trade magazines, don’t know, then the general public is completely in the dark about the wealth of stuff available. I see people going all the way to the Merchandise Mart in Chicago (more than 200 miles away) just to get remodeling ideas. If we can tap that market even a little bit, we’ll have more business than we can handle.
“I just know remodeling is a good business,” he continues. “I can tell by the number of cars in the ‘big box’ parking lots.”
Cedar Rapids, a town of about 150,000 with a strong agricultural-industrial economic base, has its share of places like Menard’s and Payless Cashway. But so far the biggest boxes — Home Depot and Lowe’s — have not yet found their way to town. Judd counts this as another factor in his favor, but is realistic enough to know they could move in at any time, which still wouldn’t alter his plans.
Judd belongs to a kitchen industry buying group that enables him to buy quite a bit of product at wholesaler prices, including plumbing merchandise. This is an important ingredient in his recipe for showroom success. It gives him the option of “double-banging” his profit margin, or else have considerable room for discounting. “I can compete with the really big boxes when they come to town,” he insists.
Late Bloomer: Judd learned the plumbing trade as a Navy Seabee, serving a couple of stints in Vietnam. Afterward he got a degree in psychology at nearby Cornell College, and worked as a drug abuse counselor and in other social service jobs before falling back into the plumbing trade. He’s been in business for himself since 1986, but “mostly it’s been a real struggle,” he says.
The blood, sweat and tears mostly were shed in the commercial plan and spec market, which he’s all but evacuated. Since breaking up with a former partner several years ago, Judd has repositioned Master Plumbing as a residential specialist, doing mainly construction work. A member of Contractors 2000, Judd would love to increase the service portion of his business, which now ties up merely two of his 10 trucks. Once he gets Master Bath & Tile running the way he wants, that will be his next area of focus.
Judd has a fun-loving demeanor that translates into a flair for creative marketing. He was one of the winners in PM’s “Best Contractor Marketing Contest,” published in the October 1996 edition. Judges were captivated by his practice of giving out a jar of plumb jam (“Call us when you’re in a jam!”) to every customer. Attached to the jar with a purple ribbon are the firm’s purple business card and signature slogan, “We’re Plumb Crazy.”
Showroom Principles: “What a plumber does is basically transfer water from one point to another,” Judd observes. “That’s basically the theme of this showroom, movement of water. We have three areas where huge whirlpool tub spouts are running all the time (recycled water holds down the bill). All 11 whirlpools are operational, as are the bidets and showerheads.”
Two areas will be keyed to motion detectors that activate the whirlpools whenever customers walk by (with an override switch for when Mom brings junior, who thinks this is the neatest toy he’s ever seen). They also have 21 operating showerheads on display. “It’s hard to describe in words showerhead features like fine spray, adjustable and so on,” Judd explains. “Seeing it in action is worth thousands of words.”
Looking to be the general contractor on remodeling projects, they will also carry tile and accessories, along with one working kitchen at the start. Eventually Judd hopes to have cooking demonstrations going on throughout the day in the kitchen, giving out munchies to showroom visitors. “What better way to show people how a convection oven works,” he remarks.
At 2,000 sq. ft., the showroom is not uncommonly large. But Judd is counting on giving customers a memorable experience with certain dramatic touches, such as all those activated whirlpools
Other attention-getters include items such as Kohler’s $10,000 shower Body-Spa, $900 Harrington faucets and an oversized showerhead that resembles a recessed fire sprinkler and seems big enough to flood the Pentagon. He may not sell more than one or two of these items a year, but, “It gets people talking — ‘Did you see what they’ve got over at Master Bath & Tile!’” While the big ticket items are likely to draw the oohs and aahs, Master Bath & Tile will have displays catering to every budget.
Showroom Economics: The showroom will start up with two staff people, adding others as needed. The showroom staff are not yet certified designers, but are learning as they go and with the help of CAD programs should be able to serve immediate customer needs. Judd notes that most of his preliminary remodeling customers had their plans already drawn up. “Right now we’re thinking of the retail end. The design end will evolve over time.”
David Lyon told Judd that based on his experience, Master Bath & Tile ought to generate between $50,000–$100,000 monthly revenues once it gets rolling. That would be fine with Judd. Having financed the showroom entirely out of retained earnings, even if the numbers fall short, Judd has some room to ride things out. “Since everything is paid for, anything we get is a bonus. My plan is to creep along until we get proficient at what we’re doing, then throw a bunch of money at marketing.”
One of the factors that led him toward a showroom venture was its potential resale value down the road. He has seen too many plumbing contractors without anything to sell when they retire. “Many are forced to liquidate modest assets, and that’s it. A showroom is marketable. It gives me a way to get some value out of this company,” says Judd.