A steady stream of design/build leads. Ten-day turnaround on payments. A $79-billion company’s marketing power. What more could a business owner ask for from a strategic partner?
| CREATIVE EXTERIORS |
PRESIDENT: Dave Whitcomb HEADQUARTERS: Dillsburg, Pa. EMPLOYEES: 14 full-time, 12 seasonal KEY PERSONNEL: Todd Peachey, vice president of landscape, hardscape and landscape design; and Matt Josselyn, vice president of irrigation and lighting 2007 REVENUE: HOME DEPOT SERVICES: CONTACT INFO:
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Creative Exteriors in Dillsburg, Pa., has reaped these benefits over the last two years as a Home Depot Home Services contractor. President Dave Whitcomb’s arrangement to provide an array of landscape design/build services to Home Depot customers in his area has earned his company an unmatched opportunity for controlled growth. Starting out with a three-store territory four years ago, Whitcomb now services 21 stores in half the state of Pennsylvania. Business generated from Home Depot made up 12 percent of his company’s $2 million-plus in revenue in 2007. Whitcomb hopes to see the Home Depot portion of his business grow to 20 percent of revenue in 2008.
Though a lot of entrepreneurs might be weary about partnering with a colossal corporate entity, Whitcomb says the best part of the deal is Home Depot’s hands-off nature. “The great thing about this program is they ask you to change nothing about your business,” Whitcomb says. “You run it like you always have. All they want you to do is take care of the customer.”
PROGRAM DETAILS. Though Home Depot is commonly thought of as a mecca for do-it-yourselfers, the Fortune-500 corporation hasn’t passed up the opportunity to provide its aging baby boomer and busier-than-ever customers with do-it-for-me solutions. It offers installation services across a variety of contracting fields – remodeling, heating and cooling, landscaping and others – through its network of independent service providers who make up the Home Services program. Two million installations take place nationwide per year across the program’s entire inventory of services.
Home Services programs are structured three ways:
- Basic Install: Home Depot sells the merchandise and the labor charge required to install the product. The service provider is responsible for taking measurements prior to ordering product and installing the merchandise.
- Furnish & Install: Home Depot sells merchandise and labor for the installation. The service provider is responsible for measuring and procuring, fabricating and installing the final product.
- Sell, Furnish & Install: The service provider sells the product/service and the labor to the customer in the customer’s home, in addition to measuring and procuring, fabricating and installing the final product.
The services Whitcomb provides – and most of the landscape-related ones Home Services offers – fall under the Sell, Furnish & Install category.
HOW IT WORKS. When a Home Depot customer inquires about the store’s patio installation services, for example, he or she is asked to call an 800 number to make an appointment for a free estimate with a local licensed installer.
Home Depot then routes that lead to Creative Exteriors or the appropriate Home Services contractor in the customer’s market.
Within 48 hours Creative Exteriors qualifies the lead and confirms an appointment with the customer. Upon acceptance of a plan and quote, Creative Exteriors uses a Home Depot-supplied contract to spell out the details of the agreement.
Next, the contractor schedules the job, which the customer is able to pay for with his or her Home Depot credit card – a hard-to-beat deal with a 12-months no-interest, no-payment offer.
Upon the job’s completion, a Creative Exteriors field supervisor conducts a walk-through with the homeowner. They go over the warranty, product terms and care instructions, take care of any customer issues or concerns immediately and then sign off on quality and customer satisfaction forms. Finally, the contractor submits paperwork to Home Depot for processing. Creative Exteriors typically receives payment within 10 days.
OPERATIONAL INFO. Whitcomb says Home Depot is operationally hands-off in his business, but the Home Depot emphasizes it quickly will become hands-on if service providers fail to meet compliance requirements, perform quality work, hire good people with clean backgrounds and/or keep licenses and insurance up to date.
In addition, Whitcomb acknowledges the paperwork involved is time-consuming, but doable.
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Complete Online Marketing Solutions“If you are not a paperwork company, this program may not be for you,” Whitcomb says, noting his company generates weekly reports and submits them to Home Depot. “However, if you are organized and stay on top of it, it is manageable.”
A lot of data entry is required, as Home Depot tracks every lead, appointment, sale and follow-up. At first, when Creative Exteriors only worked with three stores, the company’s office manager handled all the reports. Now, with 21 stores in Pennsylvania – and a goal of selling one job per store per week – there’s a full-time employee just managing Home Depot administration.
LEAD LESSONS. In addition to paperwork, receiving unqualified leads can be one challenge of the Home Depot business, Whitcomb says. “I have had some leads that thought installing pavers meant installing asphalt,” Whitcomb says. Just like any design/build firm, it’s up to the salesperson to qualify the lead before spending the time to give an estimate. Creative Exteriors also has agreed on a minimum project amount with Home Depot to ensure a sufficient profit on every job.
TASK MASTERS. Creative Exteriors’ Home Depot agreement require it to complete several other tasks. The company maintains in-store signs about the program – both its own and Home Depot’s; conducts “How to Install” clinics for customers; teaches “product knowledge” classes for Home Depot’s garden and specialty services associates; and staffs lead generators in stores during high-traffic hours.
Though these aren’t typical jobs for a landscape company, they’re manageable and even can be beneficial, Whitcomb says.
For example, the landscape installation clinics often inadvertently drive business. It’s not the goal of these classes to deter homeowners from doing their own installations, but that’s often what happens when they see how complicated some of the projects are, Whitcomb says. Ideally, the clinics help Home Depot build brand loyalty so when customers who have attended classes decide to enlist professional help, there’s a good chance they’ll look into using Home Services. That, in turn, benefits Creative Exteriors.
“The reason the program is so successful is people don’t know Creative Exteriors or any company like they know Home Depot,” Whitcomb says. “It’s name recognition – people know that Home Depot will stand behind the work and they know that if I’m working with them I have to be good at what I do.” PLD
