Inside installs: for many dealers, installed sales has evolved from a reluctantly thrown-together add-on to a full-service, profitable department. Successful programs combine a conservative yet deliberate commitment to the service with more aggressive, creative, and market-driven sales tactics to achieve sustainable profits

Prosales, Feb, 2006 by Rich Binsacca

Gaining Support

Burleson looks at installed sales as a three-legged stool, with the dealer, the right manager, and the upstream supplier (the distributor and/or the manufacturer) as equally necessary components. "If one of the legs is weak, the program will have issues."

While dealers seem to be getting on board with the proper corporate support and managerial hiring practices for their IS ventures, most suppliers lag behind. "They have their channels defined, and supporting installed sales is a cost they either have to absorb or add to their pricing," says Burleson, thus curtailing their motivation to provide handling and installation training, tools, sales education, and even a reliable supply of product to support the effort.

Butts goes further, contending that some manufacturers--specifically window makers--are concerned about their liability if they get too involved or even write more specific installation specs to support a dealer's installed sales program for their products.

That said, he and others do see some movement among manufacturers to wake up to their role in a dealer's IS success. In addition to reaping a portion of impressive sales revenues and enjoying steady orders, a few vendors also are gaining the proper vision. "The future is installed sales," says Butts, "not just products."--Rich Binsacca is a contributing editor for PROSALES.

Tips for Installed Sales Success

* Hire (and properly compensate) a manager dedicated solely to the installed sales program, ideally with vision and a commitment to customer service. Look outside the industry (or at least your own sales or management team), if necessary.

* Approach installed sales as a profit center initially, not simply a value-added service.

* Consider packaging products or categories to gain more of the ticket and boost revenue and profitability.

* Hire subs to start, then bring the best ones in-house once the program gains a foothold in the market.

* Actively determine which categories to install and/or package based on market need and untapped opportunities instead of as a reaction to competitive efforts and/or upstream pressure.

* Seek out relative benchmarks and targets for sales and profitability to use as measures of growth and success.

* Request (or perhaps require) upstream suppliers to provide sales and installation training, detailed specifications and instructions, and the proper tools to support an installed sales program.--R.B.

Growth Mode

Overall, PROSALES 100 dealer participation
in at least one installed sales category
grew 9 percent between the 2003 and 2005
growth in some categories on the near horizon.

                                             Percent
                      2005        2005        change
                    ProSales    ProSales     vs. 2003
                       100        100       ProSales
                     dealers    dealers        100
                      that        that     dealers that
                    currently   plan to     currently
Category              offer      offer        offer

Windows                49%        12%          -2%
Entry doors            47%        12%           7%
Cabinetry              47%         3%          21%
Doors                  46%        10%          15%
Locksets/hardware      35%        10%          21%
Molding/millwork       35%         8%          21%
Framing                31%        10%          19%
Insulation             31%         6%           0%
Siding                 27%         4%          -18%
Roof trusses           25%        15%          19%
Floor trusses          24%        17%           9%
Wall panels            23%        13%          -4%
Stairs                 22%        14%          10%
Shelving               21%         7%          n/a *
Decking                21%         5%           5%
Mirrors                17%         8%          n/a *
Roofing                16%         4%          45%

SOURCE: PROSALES 100, 2003-2005 * NOT CALCULATED UNTIL 2005