October 20th, 2022
Enhance Your Demand Curve
Many window manufacturers are reporting that sales are slowing down. The last few years we really didn’t have to worry about demand. We had other things to deal with like supply chain. Now, many fabricators are finally seeing a slowdown and are feeling uncertain about 2023.
Well, when it comes to demand, it would be a huge mistake to just throw your arms up and take whatever the marketplace gives you. The leaders in the industry will do whatever it takes to enhance their demand curve. So, what can be done to enhance your demand curve for the remainder of the year and give you a boost heading into 2023? There are three strategies to consider.
One – bring back creative financing. The last few years saw a decline in the use of financing for home improvement projects. Interest rates were lower, and consumers had plenty of cash on hand from canceled vacation plans and government stimulus payments. But now, with interest rates being much higher and the cost of everything rising, it may be time to bring the creative financing plans back into play. There are six, 12 and even 18 month “same as cash” programs that may entice potential customers into buying sooner, especially if they expect to be coming into some money soon. There are also unsecured loan programs with zero percent interest all the way out to 60 months that could entice homeowners into upgrading their windows and doors.
Oftentimes when I ask window dealers about these finance programs, they say that they do not offer such programs because they don’t need to do so. They say that their customers simply don’t ask for them. I once sold dealer financing programs, and I learned that most consumers who need such programs are embarrassed to ask for them. However, they seek out the dealers that offer such programs.
Therefore, dealers who do not offer financing programs may be missing opportunities with customers that called them in the first place but were subsequently drawn to a competitor who is advertising that such financing is indeed available. Many of these finance programs involve dealer fees, but you can build these into the price of the window and offer discounts to customers who are willing to pay with cash.
Secondly, consider broadening your product line to appeal to a wider array of potential customers. Just because most of your windows no longer meet Energy Star when version 7.0 kicks in doesn’t mean you can’t fabricate and market a higher-end window that does meet or even exceeds the new requirements while still offering a standard window that appeals to the budget-minded of the market. With supply chain issues still fresh on the mind, many window fabricators are more open to the idea of bringing a secondary vinyl extrusion supplier into the mix, and why not do so with a higher-end extrusion?
The newer platforms have better insulating frames that are also capable of accepting wider triple pane IG configurations. This can lower u-value to .22 or even better. This is an opportunity to broaden your market appeal serving both the budget-minded consumers who simply want to replace old windows with more modern technology, as well as performance-minded customers who want state-of-the-art windows. There is a certain percentage of the population that is willing to pay a premium for something that is above the standard.
So, re-evaluate your product line. Is it broad enough or are you stuck playing in the middle? Many manufacturers can run premium spacer systems on the same equipment they already own or add a smaller secondary IG line, with a relatively small capital outlay, that can be used to fabricate triple pane units. Also, there are many low-e glass offerings and skinny triples that can significantly improve thermal performance benefits, especially when combined with the enhanced frame configurations of the newer platforms that vinyl extrusion suppliers have recently introduced.
Employing these technologies along with premium Warm Edge spacer and argon will enable a manufacturer to add a higher end offering that meets or exceed Energy Star 7.0. to those who want such a product while still having a product line that meets the needs of the budget-minded segment of the market.
Thirdly, invest in sales training and tools- even in the face of a potential decline in the market. I have oftentimes heard Marketing Managers complain that their budget for sales training has been cut due to a decline in sales, and that they will get more money for training when sales figures improve. This is totally backwards. Strategic sales meetings and training should not be a reward for hitting sales targets, but rather the ammunition to do so. Then sales bonuses become the reward.
The time to invest in sales training and sales aids is now to make the sales curve rise, not after it has already risen! One can have the best window system on the market, but customers are not going to buy it unless they know exactly what makes your window better and perceive that it is the best value. I have seen window manufacturers and dealers with mediocre window systems outsell otherwise superior products because their sales people were simply better trained and better equipped.
So, don’t let changing market conditions dictate your sales growth. Use these three strategies to enhance your demand curve!