Review of the Summit: Product Diversification (Part 2)
With the ongoing review of the last Home Improvement Summit, let’s continue to look at the benefits of product diversification within your business.
The next panelist was Frank Farmer who is the founder and President of American Metal Roofs located in Flint, MI. In 2007, his company was recognized by Inc. Magazine as one of the fastest growing in the United States. Frank attended Michigan State University, College of Osteopathic Medicine. Prior to entering the metal roofing business, he built an apartment locator business, was a salesman and then a sales manager for a prominent window replacement retailer – – and he developed a tax business with 12 franchises throughout Michigan. His reputation as an innovator and creative marketer has made him a recognized “guru” in the metal roofing industry.
Frank has been enormously successful in diversifying his product offerings in the last few years and he shared a few of his secrets with us.
As you would expect his main product is metal roofs; however, he has diversified this product line by offering four separate types of metal roofing: Rustic Shingle, Oxford Shingle, Country Manor, and Standing Seam. Each offering has specific benefits so they are able to target different homeowners with each brand.
But one of the things Frank learned early on in his business was that it was vital to add other products so that his revenue stream would not be entirely dependent upon the current demand for that specific product. So he developed a set of goals that he would hold hard and fast to:
- Expand with products that were associated with their core business
- Sell more volume with the same advertising dollars
- Increase profitability
While this may seem easier said than done, he has been extremely successful and has come up with the following ideas:
Do It Yourself Seminars
- The attendee registers online
- The seminars are held once per month and are four hours in length (the first 45 minutes is an educational portion on how to chose the right metal roof).
- The attendee brings drawings of house roof so it can be priced
- There is a great support system, manuals, DVD and access to a trained installer
- The “Golden Hammer Program”: Rent a man and his equipment for a day for $1,000.00
- Sets them aside by solving homeowner’s ventilation problems
- 10% – 15% up-sell in contract price
- Pink Owens Corning blown fiberglass insulation (high profit margins)
- Heat Barrier XP: Fast install (2 men, 1 hour per 1,000 sq feet attic), low start up ( Toro Leaf blower), low material costs (50 cents / sq foot), high profit margins
For any questions on any of Frank’s product offerings or for ideas on how to diversify your product line you can contact him directly.