A Word of Introduction from Ed Lim: Charlie Vaccaro liked to use last month’s cautionary tale, “A Fable for Our Time,” as a lead-in to a speech he gave many times when invited as a guest team building and motivational speaker at component manufacturer and lumber yard sales meetings. Here, I’m pleased to share Charlie’s speech (just without the many jokes he normally sprinkled throughout). Friends of Charlie will recognize his brilliance in these words.
Common Complaints About Truss Plants
Too many lumber sales associates complain about their truss plants. Common complaints include:
- Prices are too high.
- The truss plant is four weeks out, but you need trusses in one week—they can’t supply when you need it.
- Every time a job goes out, there is a problem with it.
- Cut your truss price so I can get the lumber package.
There are more, but let’s address these four objections.
Answer to No. 1 — “Your Prices Are Too High”
When a customer tells you your price is too high, do you question him about it?
- You may be his favorite lumber supplier, but are you his favorite truss supplier?
- Did he use price as an excuse to give the order to the sales associate he trusts more?
- Did you ask whether you’re bidding apples to apples?
- Did you ask to see the competitive bid so you could compare?
- Have you gotten orders from him before or are you trying to break in?
- Could a bearing wall or design change save cost where your competitor used something different?
- Are you bidding against a notorious low baller?
- What type of job are you losing?
Bring back as much information as possible to substantiate the “your price is too high” statement.
Answer to No. 2 — “They Can’t Deliver When I Need It”
When a sales associate brings in this complaint, it means he hasn’t kept up with:
- His customer’s schedule
- His truss plant’s schedule
If a customer is regular, he’ll push you for faster turnaround. You’ll push the plant. The plant will be forced to move jobs around—meaning someone else will get their trusses late, creating more problems.
All of this could have been avoided if the sales associate monitored scheduling and got the order submitted early enough to fit production capacity.
Answer to No. 3 — “There’s Always a Problem With the Job”
This is usually caused by:
- Misinformation
- Not enough information
Sales associates must ensure they provide all available details. Gaining a working knowledge of trusses reduces problems dramatically.
Remember: Most problems are created by the builder—who will always blame the trusses. With working knowledge, you won’t be so quick to blame the truss plant for something that isn’t their fault.
Answer to No. 4 — “Cut the Truss Price So I Can Get the Lumber Package”
Don’t fall for this.
Unless you can reduce your cost, you cannot afford to cut your price. Cutting 5%, 10%, or 15% means cutting 100% of your bottom-line profit.
Some lumber yards that followed this policy are no longer in business.
Don’t use components as a wedge to get the lumber package.
The truss plant must remain a profit center. Anything that goes into the plant “in the red” will only come out redder.
Lumber Business vs. Truss Business
You must separate the lumber business from the truss business—they are not the same.
Lumber Supply
- A distribution business
- Can increase volume quickly by adding trucks and a few more people
- Operates on buy right, sell right principles
- High inventory turns equal strong performance
Truss Manufacturing
- Labor intensive
- Equipment intensive
- Engineering intensive
- Lumber is only 30%–50% of truss cost
- Complex cost structure: lumber, labor, engineering, plates, admin, markup
Because of this, pricing trusses is not simple. Understanding this difference increases patience and helps you grow your company to the capacity you need.
What It Takes: Filling Lumber Orders vs. Truss Orders
The following charts depict Lumber Order Processing (the first image) vs. Truss Order Processing (the next three images). Five steps in lumber order processing vs. 19 steps in truss order processing drives home the complexity of truss orders compared to lumber. [For charts, See PDF or View in Full Issue.]
Your Role as Sales Associates
“You are the backbone of this company.”
A properly run truss plant yields the biggest profit in a lumber supply company.
A poorly run plant can become the biggest loss.
Contribute to the success—not the failure. The top sales associate in lumber is rarely not the top truss sales associate. The few exceptions occur when:
- One sells more lumber by dollar volume
- But the one who sells trusses creates more profit for the company
Why? Because they took the time to understand how a truss plant works.
How Top Sales Associates Operate
- They become allies, not adversaries, of the truss plant
- They make friends with estimators
- They take suggestions on how to cut costs
- They learn more about trusses
- They monitor scheduling
- They understand production time differences between jobs
- They avoid rushing orders ahead and delaying others
- They ensure the plant has complete, verified information
- They communicate design changes immediately
Teamwork drives company growth beyond expectations.
Final Advice for Young Sales Associates
According to Ed, to conclude the presentation, Charlie would share his own background and then discuss the future: Charlie had four years of engineering trusses, managing a truss plant, partnership experience, little lumber sales experience. But when he sold trusses, he asked for the lumber order—and got it nine times out of ten.
His engineering knowledge made him a consultant, a trusted advisor, a confidant. He carried this advantage into plate sales and succeeded.
But today the industry is changing. A new type of sales associate is emerging. If Charlie were starting over today, he would:
- Learn the truss software
- Work in the truss plant long enough to gain working knowledge
- Use the computer as a tool when calling on customers
Instant answers = instant credibility.
With that, you become their consultant and confidant.
Once you reach that status, a competitor must come in extremely low to beat you—and even then, the customer often comes back.
The advantage is there for the taking. Who among you will take it?