From here to eternity

Store name:Johns Building Supplies
Owners:Ernest & John Lindsay

Buying group:Natbuild

Johns Building Supplies has a client roster of over 800 accounts spanning across Western Australia that is being built purely by word of mouth Mark Daffey reports.

There aren’t too many independent Australian building supplies outfits servicing clients as far as 3,000 kilometres from their home base. But this is exactly what Johns Building Supplies (JBS) has been doing successfully for almost three decades. It has earned a reputation for competitive pricing and high level service. In addition, it has an ideal range of products for building projects of any kind.

Despite its achievements, JBS has also faced challenges that are typical in the hardware industry today. General manager, Korinna Messere says, “I don’t think there are too many businesses in Australia that have not felt the economic downturn. We are no different to the next company, but we have certainly held our own in what a lot of people are calling one of the worst market downturns since ‘the recession we had to have’”.

To this end, sales figures at the store for the last quarter have tracked similar to the previous year, according to Messere. “Our loyal customer base in conjunction with our service, competitive pricing and ability to listen to our clients will ensure JBS will be a part of the industry in the future.”

Service culture

With the exception of some indirect marketing via sponsorships of local sports clubs and children’s charities, any spending on advertising is kept to a minimum at JBS. Instead what it focuses on is service, which translates into having the product in stock and being able to get it to its clients as quickly as possible.

“We have a strong focus on providing our customers with material onsite or to country transport to a deadline,” says Messere. “This has been achieved by retaining ownership of our own fleet and allows flexibility that others may not have. It is also complemented by the warehouse being open for pickups between 6am and 5pm Monday to Friday, and 7am to 12pm Saturdays.” After further prompting, Messere explains that the fleet is comprised of six trucks and a ute, all of which are used to deliver to metropolitan account holders or logistics companies.

The fleet of delivery vehicles allows flexibility that its competitors may not have. “We are conveniently located close to transport depots which help ensure deadlines are generally met for our country clients. Our warehouse which measures over 4000m2 undercover has drive-thru access which means efficiency and the right facilities for all pick-up needs,” explains Messere.

“Having account holders up north has been an important part of us staying in business. Despite what you might hear about the resources boom over here, the city (Perth) is quiet. We have a diverse product range, as well as a diverse customer range and that’s helped us do well in what is really a languid economy over here.”

But why, I ask her, don’t these account holders just buy from a hardware store or building supplies yard closer to home, rather than ordering through JBS in Perth then freighting them thousands of kilometres? “Service,” she replies. “Talk to anyone over here (in Western Australia) about JBS and they’ll tell you about our service. Our pricing is very competitive due to long term relationships with our suppliers and our stock holdings are generally second to none.

“JBS has many strong attributes, but its ability to carry a diverse range of products and then deliver those products to our customers on time is a massive attribute. To have a successful business in this industry, we are very reliant on the people within the business. In each department, we have a fantastic team of people who make it all happen every day. To be renowned for the level of service you provide to the customers on your doorstep, and to the customers in the far reaches of Western Australia, is a strong reflection on our staff and our business model.”

A total payroll of 38 fulltime staff, including several long-serving employees, ensures that JBS customers have access to correct, up to date information when required. “Experience within the team is something that can’t be substituted,” Messere says. “Our friendly and helpful staff members have been encouraged to promote customer service as the most important aspect of our business. The importance of building a strong relationship between our staff and our customer can never be underestimated and will only enhance our business. Our staff are also expected to make themselves available for product training which increases their knowledge, which in turn, has a flow on effect to our customers.”

JBS knows what it does well but is also aware of the current issues facing the industry. Messere nominates the following as ongoing issues for the business: “Client liquidity problems as a result of the decreased availability of work; banks’ tight lending policy making the financing of large projects difficult to obtain; and the increasing activity from competitors wanting to get in our patch”.
Continuous expansion

JBS is a well respected, family-owned company that’s been supplying building materials to the Western Australian market for nearly 30 years. Until June 2005 the business operated from a 1,800m2 premises in Star Street, Welshpool, southeast of Perth’s CBD. Land became available across the road in 2004 from which JBS negotiated a tailor-made 6,200m2 block, and they haven’t looked back since.

“Being in a bigger building enables us to stock more of the required products. It means we can be ready to go when an order comes in instead of saying we’ll be able to get it to our customers in two or three days,” says Messere. “In fact, it’s got to the stage where we could probably do with something bigger again”. Additional land for storage measuring approximately 1300m2 has come up since the move in 2005.

The current premises includes a 3,500m2 main warehouse adjoined to a 700m2 showroom stocking “most accessories that a tradesman needs,” explains Messere. There are also bulk stock timber and door warehouses, a storage area and administrative offices located upstairs. “The new operation has lifted the profile of JBS substantially and it now boasts relationships with many of the major players in the building industry. This has been further complemented by the development of strong long-term relationships with most of the key manufacturers in the industry.”

Product offering

JBS stocks six core ranges from a shortlist of suppliers including James Hardie, CSR Gyprock, Bradford Insulation, Rondo, Kingspan (Aircell) and Cockburn/Swan Cement that comprise the bulk of what’s stocked in its warehouses. Corinthian, Hume Doors & Timber, Gainsborough, ASSA ABLOY, Gunnersen and Amerind products also contribute to a strong offering in doors, door hardware and second-fix (skirting, architraves, melamine shelving and shelf supports, etc.) and hardware ranging.

That list of suppliers obviously points to a strong trade slant, with the trade side of the business contributing to around 70% of total sales. Retail sales account for a further five per cent with 20% attributable to resellers.

JBS is confident about its point of difference that focuses on service and on-time delivery to his customers. It also seems to serve an important niche that seems to give it an additional advantage in the WA market. “We provide easy access to job lots for the smaller city and country stores who don’t have the space to stock most of the products we sell. These job lots are delivered in one go and in most cases untouched by the store,” explains Messere.

“The store arranges payment through the customer allowing them to maintain business they might not normally get. This enhances the small store chances of survival against some of the bigger players in the industry. And it’s in all our interests for those little guys to succeed, because if they don’t, someone else who’s bigger is just going to move in and take their place.” And that, as we know, is an all too familiar tale.

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