Replacement contractors showed resilience and flexibility during the darkest days of COVID-19 when, between mid March and early May, entire sectors of the nation’s economy were shut down.
Business in April “fell off the cliff” for WindowWorld’s 220 franchises in 48 states, recalls Steve Kamody, president of the North Carolina-based company. But, he adds business bounced back for many franchises in the first two weeks of May, thanks in part to strategic marketing that promoted virtual consultations. “Stores that operate nimbly and with strong cash reserves can weather any storm,” he states.
Thompson Creek Window furloughed around 200 of its 413 employees but continued to pay 100% of their health insurance. Many of its other associates worked from home, so Zoom meetings became the norm. The company imposed social distancing within its factory, erecting plexiglass shields to separate its workers. It also distributed PPEs, some bearing the company’s 40th anniversary symbol.
Since Easter Week—Thompson Creek’s lowest point during the pandemic—through mid May, all but its field marketers had been called back to work. “It’s been a wild ride,” says Rick Wuest, president of the Maryland-based contractor. “This looked at first like it was going to be a wrecking ball, but that turned out not to be the case.”
Thompson Creek Window furloughed around 200 of its 413 employees but continued to pay 100% of their health insurance.
Now that most states and cities have reopened their economies, replacement contractors say they have learned valuable lessons about their businesses, employees, and customers. “This was an opportunity for us to get better, to reach out to customers, to train our people, and to improve our processes,” says Richard Begalia, president of Window Depot of Northeast Ohio and Western Pennsylvania, which through mid-May was down only 8% from the same period a year ago.
Amy Zimmerman, chief marketing officer for Wisconsin-based Tundraland Home Improvements, also sees a silver lining in the virus’s turmoil. “It was never more clear how we were together when we were [physically] apart.”
New Normal for Employees
Tundraland furloughed 25-30 face-to-face marketers after Sam’s Clubs and shopping malls in its Midwest and Arizona markets—from which the contractor solicits leads—had to close. Leads that Tundraland normally gets from its partnership with the Milwaukee Brewers also disappeared when Major League Baseball put its season on hold.
To fill that void, Tundraland “went bullish” on TV advertising, says Zimmerman. “People were home, watching TV in the middle of the day.” That effort sparked an uptick in leads from Home Advisor and QuinStreet. And Tundraland was ready, technologically, when it moved its call-center personnel from offices to their homes. “Thank God we upgraded our phone system a few months before,” Zimmerman says.
The business it transacted during a mild winter gave Lindus Construction a cashflow cushion it needed to get through the early weeks of the pandemic. Andy Lindus, chief operating officer, says his key people spent the weekend of March 13-14 securing protective gear and disinfectant for its offices in Minnesota and Wisconsin. The following Monday they came up with cleaning and social distancing protocols for its 20 office workers and 130 field staff, and for dealing with customers. A week later, Lindus secured 38 trucks so its installers could travel to jobs individually.
To maintain morale, each of Lindus’s nine offices in the Midwest offered their employees gift cards for personal use.
Lindus says he didn’t stop advertising “even when the phones were quiet,” and business started picking up again in April. He believes this was because people were stuck in their homes and became more aware of what improvements were needed. Inquiries increased for outdoor kitchens, decks, and Leaf Guard for gutters, he says.
To maintain morale, each of Lindus’s nine offices in the Midwest offered their employees gift cards for personal use. The company’s offices in Wisconsin and Minnesota alone handed out $30,000 in gift cards.
Contractors mostly expressed surprise that revenues didn’t shrink more during the crisis. Business at S&K Roofing, Siding and Windows’ two locations in Maryland and Virginia was off “significantly” from 2019, but that was an extraordinarily good year for the company. Compared to a more typical year, S&K’s sales through late May were down between 5% and 10%, depending on the product installed, says chief financial officer Scott Hanel. He thinks there’s a “good chance” that S&K can hit its revised budget goal for 2020.
At a time when homeowners were wary about letting anyone into their houses, contractors like S&K—which typically gets 60% of its business from roofing projects and 25% from siding—seemed to have an advantage. “Our installers could pretty much stay outside,” says Hanel.
During the first two weeks after the shutdown, Chantilly, Va.-based WindowWorld of D.C. received a lot of cancellations. “There were no phone calls,” says owner Greg Deathridge. “I’m 61 years old, and I started thinking I’d have to dip into my cash reserves to stay alive.” But by mid May, his business for the year was up at three of his four locations, including a 20% increase in his Fresno, Calif., office.
At a time when homeowners were wary about letting anyone into their houses, contractors like S&K—which typically gets 60% of its business from roofing projects and 25% from siding—seemed to have an advantage.
Deathridge initially reduced his advertising by 60%, in line with the corporation’s recommendation for “strategic” pullbacks. Then he started promoting WindowWorld’s virtual consultation service, and “The phones were ringing again... We found customers were willing and eager to engage in virtual consultation,” which required them to download an app and take eight pictures of their houses.
During the pandemic, replacement contractors reached out to customers in various ways. Window Depot, for one, increased its ad spending in March and April by 60%, and used TV and social media primarily to promote its products and incentives that included zero downpayment, 0% interest, zero payments for the first 12 months, and 9% interest on payments for the next 10 years.
After closing their showrooms, Martin and Debbie Bomba, co-owners of WindowWorld of Texas, with three locations, produced a video that included an introduction to their company as well as a full window demo “that we otherwise would be doing face to face every day,” says Martin Bomba. Year-to-date through mid May, sales at WindowWorld of Texas were down only 2%.
Lindus Construction established social distancing protocols for its salespeople who, despite the availability of virtual consultation, were still giving customers prices “at the driveway,” says Lindus. The new rules included disinfecting samples before and after each customer visit.
Tundraland brought some levity to its marketing with a Singing in the Shower contest, which asked customers to send videos of themselves warbling while wet. Daily winners received a $50 gift card for a local merchant. Tundraland also encouraged local musicians to send videos of themselves performing in their tubs. (It might be a coincidence, but bath install requests rose during the pandemic, says Zimmerman.)
Lessons Learned From the Virus
Along the lines of “never let a crisis go to waste,” replacement contractors say the coronavirus has provided useful insights into their businesses.
“We’re way too paper dependent,” admits S&K’s Hanel. He also concedes that his company needs to come up with a Plan B in the event the virus intensifies in the fall or winter.
Given that remodeling in many states was deemed an “essential” business, Lindus sees the crisis’ aftermath as an opportunity to attract more young people to the trades.
Lindus gained a new appreciation for his competitors. “The more they advertised, the more everyone was helped,” he observes. Competitors seemed more willing to share information during the pandemic, a trust that Lindus hopes continues post COVID-19.
Lindus says he also appreciated the virtues of “staying calm and overcommunicating.” During the pandemic, he sent daily emails to his employees and regular videos. And given that remodeling in many states was deemed an “essential” business, Lindus sees the crisis’ aftermath as an opportunity to attract more young people to the trades. His company has been working with local trade schools to offer free courses for which the schools would be reimbursed from future installation jobs that the graduate performed as employees.
The coronavirus exposed the quality of replacement contractors’ leadership. Bella Friday, corporate marketing trainer for Tundraland Home Improvements, was impressed that her company’s management team was on a conference call with the troops every morning at 9 a.m., during which topics of conversation included compliance with Center for Disease Control and Prevention work safety guidelines.
Friday adds that she and other employees received “constant communication” and “positive reinforcement” from Tundraland’s management. “Strong leadership can take you very far,” she says.
And sometimes, so can luck. Bomba says that a month before the pandemic was declared, WindowWorld of Texas was looking at a space that was three times larger and double the rent of its location in San Antonio. “It was a blessing that the deal didn’t happen,” he says.