Diversification. It’s something you hear a lot about as companies struggle to stay afloat. For example, I’ve written stories recently about residential companies moving into the light commercial market as a way to gain market share. We also hear often about window dealers that have expanded outside of windows, into areas such as gutters or roofing. Yes, windows are still their bread and butter , but adding these products has helped some companies survive.
I spoke to Jeff Nowicki recently, who was a silent co-owner of Winstrom Windows, based in Toluca, Ill., and he got me thinking about diversification. I called to talk to him about the fact that Winstrom closed and what might have led to this (the company ceased operations on June 11).
First, he said the reason for the closure was pretty simple.
“It was due to economic times,” says Nowicki. “We could not get enough volume to keep going.”
Winstrom had changed ownership a few times over the years and Nowicki purchased the company with Tom Rauscher, who served as president and handled the daily operations, almost five years ago. (Rauscher told DWM magazine he has no comment on the company’s closing.)
Nowicki continues to serve as owner of Beaver Dam, Wis.-based Hometown Glass, which he has been involved in for nearly 20 years. The company installs windows, including Winstrom ‘s products prior to its closure, in both residential and commercial applications.
I asked him what makes the two companies different.
“We are very diversified,” he says. “At Winstrom we built aluminum, double-hung, single-hung, etc., and vinyl replacement windows. Here, we do more than that—we offer all materials. We install every type of door that is made, three season and four season rooms, auto glass, decking, siding, etc. That’s the big difference.”
“That’s the key right now to any business,” he adds. “Adapt to the times.”
Diversification could make the crucial difference for many companies. But how much is too much? If you offer everything under the sun, are you an expert at anything? Does the fact that a company specializes in doors and windows give them a competitive edge?
I’d love to hear your thoughts. Also, please visit dwmmag.com to answer our latest poll regarding diversification.