One of the things that makes selling in the lumber market more interesting than just selling a product, is that the market moves, sometimes dramatically. This movement creates hazards to be avoided and opportunities to be taken advantage of for those with enough moxie and risk tolerance to do so.
Because sellers have so much pressure to perform, many lose sight of the long-term goal of creating a partnership relationship with clients we can count on and who count on us. Most sellers:
- Present product and wait for the customer to buy.
- Don’t ask for the order.
- Don’t overcome objections.
- Don’t tell the customer why the product is a good deal for the customer.
- Don’t ask questions about the customer or customer’s business!
- Don’t give market information or advice that will help the customer.
All of these don’ts send a crystal-clear message: “I don’t care about you or your business. I’m just here for the order.”
Sell Our Opinion
Part of bringing value to our customer is giving them our opinion on the market direction. We can hustle and be a shopping service for our customers; there is value in that. But in most cases, we will be able to save them some money with hustle, but we can save and make them a lot of money by helping them navigate the market.
Most sellers are so afraid of being pushy that they don’t ask for the order at all. These same sellers are also so afraid of being wrong that they will never give their opinion of the markets and strategies to navigate them.
Develop Our Opinion
We develop our market opinion by:
- Asking our customers lots of questions about their sales, their inventory turns, what they are paying out of distribution, what are they being offered.
- Doing the same with our suppliers.
- Listening to the best sellers in our office.
- Reading. There’s a mountain of detailed information about the lumber market online—get curious and read.
Delivering Our Opinion
Write out bullet points of the reasons we think the market is going to continue to be strong:
- Interest rates at all-time low. Great time to borrow and build.
- Housing starts at 1.545 million. Ten-year high.
- Stock market at all-time high. Even with COVID-19, smart money is betting on the future.
- Holiday and COVID-19 production shut-downs.
- Trucks are tight.
- Imports are tight.
- Inventories nationwide in all sectors of the lumber industry—mills, office wholesalers, distributors, retailers and manufacturers—are low and all segments are busy.
Then we write it out and practice it until it sounds natural. Then we deliver it.
Us (after the greeting and small talk): “Sara, I’ve got two great deals for you, but before we get into those, let’s talk about the next six weeks. I know it’s winter and all and normally there would be a buying opportunity somewhere between now and March 1, but let me tell you why just the opposite is going to happen. Housing starts are driving this market. We are at 1.545 million housing starts which is the highest it’s been in 10 years. Interest rates are so low the money’s almost free, so it’s a great time to borrow and build and that is happening in single and multi-family. Home Depot’s sales are up 7% over 2019 and they had a fantastic 2019. Have you gone to a Lowe’s or Home Depot on the weekend? You’d think the Rolling Stones were playing it’s so crowded. We are going to have holiday shutdowns and possible shutdowns because of the virus. But even without those shutdowns inventories are low in all segments of our industry. My advice is that we look at whatever we’re going to need before March 15, and we buy it now.”
What If We’re Wrong?
Most of the lumber sellers I know who sell their opinion are wrong about 13% of the time. That means they are right 87% of the time, which brings huge value to their clients. Their customers appreciate and will pay for this expertise. In addition, and almost more importantly, it sets them apart from the crowd. They are an expert that uses their expertise to help their customers make important decisions.