It's no longer about the price
In the Tampa market, kitchen and bath stores are popping up everywhere. Many are granite shops that now offer cabinets and lavatory fixtures. Some have tile as well, while still others offer the whole enchilada.
Most such kitchen and bath stores just subcontract out their stonework. A few of these companies are very well run and offer very attractive showrooms that rival the Big Boxes. I assume at this point that the Big Box stores are for the most part steering clear of this new phenomenon, as they do not want to compete with themselves. Satellite granite showrooms are also a large industry trend. Many granite shops are opening sales offices in mall kiosks and strip shopping centers, and they are utilizing outside sales agents to increase their reach and visibility. There are also granite franchises being offered across the country.
Moreover, the customer now has more choices other than granite and marble. Offering quartz, granite, marble and soapstone is now almost a requirement. Try to look forward at diversifying your offerings as best as you can and increasing your reach into more lucrative markets.
Outside of stone materials, we are now offering a pretty good line of prefabricated breakdown cabinets. We sell the cabinets and subcontract the installations.
Quality of service is paramount in all industries, and this goes beyond the stone materials. You now need to offer a quality finish as well as a quality buying experience. Not having a showroom - or one that is not professional - will certainly become more important as time goes on. I have heard talk of “digital showrooms” and large flat screen monitors to enhance the buying experience. The industry is maturing, and your shop will have to mature with it. Turnaround times will also be increasingly important.
Controlling costs is yet another thing we are confronted with. Because we have hit bottom in most markets, there is very little room to raise or lower prices. A microwave oven is now $100 and will not likely go lower, but I can remember when they were $1,500 and up. Thus is the case with granite. You can charge a reasonable amount for quality service, but there are limitations to that. Therefore, we must now focus on our costs and keep them in line. Large stone plants continue to be funded by deep pockets. Their cost of production can be very low, and thus yours must be as well. The cost of labor and insurance increases every single day, and that trend is expected to continue. It is difficult, if not impossible, to compete as a manual shop in some markets.
Luckily, there are also new machines on the horizon that will offer freedom to the small- and medium-sized shops, and they offer fabrication costs and digital capability close to that of the large “super shops.” This technology is a 100% digital cutting and profiling center that can produce a slab’s worth of parts to full polish in a couple of hours. It will also significantly reduce material handling, which is a large part of what we do.
Software is also being improved rapidly. Now it is possible to select a slab digitally and show the customer a dynamic rendering that includes edges, cutouts and grain patterns exactly as it will appear in their house. No more tripping out in the remnant yard looking for that special piece that is 1 inch too short. It is also good if you are operating a remote sales center where you do not stock the material. Digital images can be displayed, and customers can choose their slabs from 100 miles away.
I am glad that we are finally in a position where it is no longer about the price. Most shops around here have already gone as low as they can go in terms of price.
The market jeer is at the bottom. Fortunately, those that can run a business and offer a quality service and diverse product line while controlling costs will succeed, and those who cannot will fail. It’s time to sharpen your pencil and keep your finger on the button at all times. Keep your business fresh and new, your costs where they need to be and, as always, your quality near the top.