‘Kev’s’ thrives in challenging QLD market
Business: Kev’s – Fasteners, Construction, Insulation
Owners: Shannon Lamb
Location: Kawana, QLD
Buying Group: HBT (Hardware and Building Traders)
While Central Queensland has proven to be a very tough environment to run a small business in over the past few years, Shannon Lamb, owner of ‘Kev’s – Fasteners, Construction and Insulation’, has found a way to grow and evolve his business, in the struggling Central Queensland economy.
It seems small business owners throughout Central Queensland have faced many challenges lately, with the down grade in the mining industry just the beginning of local economy concerns. It was around the same time that banks became tougher on lending, again slowing down the new home market, and leading prominent builders to close throughout rural towns.
This then led to a lot of pressure being put on sub-contractors and suppliers due to the trickle down effect, leading to the last few years being quite tough in general, according to Shannon.
When ‘Kev’s’ was first established by Shannon’s father, Kev, in 1995, business was booming. However, when the economy took a turn for the worse a few years ago, Shannon knew it was time to tweak the store’s offer to ensure the business remained in good stead.
“My father started the business 24 years ago after gaining extensive experience in the fastening industry. He was initially a chippy for about 20 years and then he became a sales rep for a fastening company, working his way up to manager,” Shannon said.
Back then, the store was branded ‘Kev’s Fastening Supplies’ and it ran very smoothly for the last 22 years, according to Shannon.
“However, the market has become quite tough in recent years with everyone chasing the same carrot and we now have about eight competitors in town who all sell fasteners,” he said.
“It would remain a very tough market to compete in if we just sold fasteners. I came into the shop about seven years ago and the first thing I addressed was diversity and how I thought the store would survive and thrive over the next 22 years,” he said.
Moving into insulation
Shannon said when he started to make big changes to the store, he first looked at the store’s branding, simplifying the name to just ‘Kev’s’, before deciding on taking a new approach in the business.
“Luckily it was around the same time that we started implementing changes to the business, that a supply and instore insulation person in Rockhampton had retired. We purchased his business, and brought in the supply and install aspect of insulation into our store. We now have three installers on board who supply and install around 250 jobs a year. It is going very well,” Shannon said.
“After buying the insulation business we began promoting to builders who already sold ceiling insulation as part of their package. We asked them to upsell acoustic insulation to their customers, particularly in their media rooms, and also additional wall insulation in in areas of the house that could be susceptible to the cold or the heat. We then used social media and hipages to market our business, which has been very beneficial to us.”
“Our goal was to train builders to on-sell acoustic insulation and remind customers how this product can control noise throughout the house, particularly if they have a young family etc. It is amazing how many people just do not think about this. Consumers often do not want to spend $1500 on insulation because they cannot see what they are spending their money on. However, if they spend money on a new kitchen, they appreciate this more because they see it and use it every day,” Shannon said.
Expanding into timber, doors and locks
Incredibly Shannon then went onto expand the business even further by opening another new section – this time in timber, doors and locks.
“We decided to implement timber, doors and locks into our store after a business closed down quite close to us in March this year. I always wanted to get into this area but I did not want to step on any toes by doing this, as we worked very closely with this local business. When they closed, they approached us to take over their remaining customers because they knew we would be interested.”
“We took it on and we had just two weeks to get everything up and running. We had eight customers come on board straight away and since this time the business has just exploded because we have now become a one stop shop for our builders in the morning. They now drop into ‘Kev’s’ to not only get their bolts, but also their timber and whatever they need for that day,” he said.
Although Shannon said they did not have the space to implement the timber business initially, he worked with his landlord to see if they could take on more space in the complex of four sheds that the business resides in.
“Our landlord allowed us to store our insulation while we set up another shed, to take on all the timber etc. Our business plan moving forward was to only spend on infrastructure as we needed it and we have really utilised space as much as we can to achieve this. Business has boomed ever since,” he said.
Instore and online success
Shannon said he has also increased his business by ensuring it is an information driven business, not product driven.
“We want to be selling information – we do not want to be selling products. Anyone can sell products. You can go to Bunnings and buy a batten screw and it will be the same batten screw that you get from me,” he said.
“This is why we have targeted a sales process where we explain to the customer how and why these products should be used, ratings or specs that the customer needs, and then we say ‘by the way we have it here in stock’. We find this works a lot better. It is about going on-site and asking customers if they have seen how a new product works, or asking them if they are using a specific product and if they knew a more innovative product can do X,Y and Z as well.”
“It is similar to the insulation thing when we are talking to builders about acoustic products. We tell builders to not look at it as an additional cost to the family. They need to see acoustic insulation as a relationship saver because when the footy is being blasted on the TV and the baby is not being woken up, it is worth its weight in gold. When the product is put into a perspective that the customer can understand, it basically sells itself from there,” Shannon said
Shannon believes this is the perfect approach to not only stand out from competitors but also upsell products in a realistic manner to its customers.
“We have worked very hard at this and I look for recognition from our bigger customers when we do this to make sure we are on the right track. What we have found from our feedback is that we need to keep doing what we are doing.”
“When sourcing feedback from one of our customers the other day, he was telling me that he bought a product from another supplier. He had problems with a product and when he took it back to the supplier, he was told by the retailer they knew nothing about the product, ‘they just sell it’. We do not want to be sellers, we want to be information givers. That is our point of difference,” Shannon said.
Part of this point of difference is also offering a comprehensive website to the customer, with Shannon planning to update the store’s to include the new timber, doors and lock business very soon.
“The ecommerce side of the business is going well. We have also created a website for the ‘Onsite Solutions’ business, which is the insulation side of the business. It was more about having an online presence, particularly because we knew that the mines would turn at some stage. Our customers want this type of information at their fingertips which is why we got on board with this,” he said.
Business growth and the future
With team meetings held every Monday morning at the store, Shannon says he uses this time to remind staff of being careful not to become a victim of their own success.
“We need to make sure that we still deliver on what we said we would do and not get out of control with schedules. Especially at this time of the year when everyone wants everything yesterday. We only have a certain amount of time during the day, and we need to watch how we are going and make sure we are not going too hard too fast. We have also had a lot of customers come to us enquiring about some of the new services we have implemented, which is again growing the business.”
“The hard part of running two new aspects of the business is that we have no history of figures as well, so we have no idea how busy or slow we are supposed to be. It has been crazy busy which is why we need to be sure we are comfortable in what we are doing and we do not overstretch the boundaries. We are better off telling customers if we cannot help them, particularly with a big delivery, because they will respect this more than a poor delivery,” Shannon said.
With the business initially being 90 per cent trade and 10 per cent DIY, this figure is slowing changing to about 80/20, with a few more DIYers coming through via social media.
“We have also made one of the offices upstairs into a door and lock selection room. We have Netflix in there so customers can go in with their kids and they can make some decisions in a comfortable surrounding instead of standing in a Big Box trying to pick designs,” he said.
‘Kev’s’ also joined the HBT group in recent years, deciding that the extra support was required if the business was going to grow and evolve into the future.
“After receiving the Australian Hardware Journal for some time, I read quite a bit of information on some of the groups, including HBT, and I started to think about joining a group to help us take the next step in growing our business. I asked one of my reps about it one day and he suggested I contact HBT as well. After chatting with the regional manager, we realised HBT’s features, benefits and rebates all lined up for us and we have not looked back! I found them to be personal and supportive and there is always someone to talk to,” Shannon said.
Strategies for growing the business into the future not only include continuing to think outside the square, but also sourcing business in industries other than residential or commercial.
“We are starting to push for extra business at the mines or with any business that has stores on site, as well as any other facets of the construction industry we can get into and supply. This may include cutting timber for a company. This is the plan anyway, but at the moment I want to maintain the business for a year and really bolt down what we have so far and be comfortable in how we are travelling,” Shannon said.
“I do not want to turn our store into a Big Box, because we have a legacy here with my old man. I am second generation with a family myself, and I want to keep it as it is. We will need more space at some stage, but I am happy for now.”
“We are just a family business having a go. I do not want to be a seller. I want to be a specialist. We are the guys you ring when you need an answer. Tradies crave information and this is what we will continue to give them. This has come through in some of the awards we have won in the past in that our customer service is certainly up where it needs to be,” he said.