Preparedness is the way of the successful businessperson, whether it be for risky situations, the off-season or even an unexpected influx of customers.
Activity starts around February for Nicholas Pools, Inc. in New Jersey, though it’s part-time work in the beginning. “We begin preparing for construction — submit permits, get mark outs, order pool kits and pray for the snow to melt so we can begin construction of our in-ground swimming pools,” says Theodora Sergiou, president of Nichols Pools.
Nichols Pools also kicks off around May, as Sergiou says most of its customers open their pools by Memorial Day weekend. A customer appreciation day at the showroom with food, drinks and special sales marks the start of busy season.
However, the off-season is when the real preparations begin for most pool professionals. “During the off season — October through February — we update our system with any new pricing and request new literature and displays for our design room,” says Annette Zacholski, purchasing and inventory manager for Colley’s Pools & Spas in Hamburg, New York, of the slower months. Colley’s also sets up a training seminar the first week in April with key vendors and does a full-scale inventory at all four locations.
This is also the time to stock up on products. Bi-State Pool & Spa in the St. Louis area does both an early buy of products and purchasing throughout the season. “Many manufacturers offer better deals during the early-buy season,” says Rick Woemmel, president, “but, from a cash-management standpoint, it is best not to overextend those purchases, whereas you don’t have the funds to pay for [more product] come April, May or June. Best motto is to purchase smartly.”
Nicholas Pools opts for an early buy to stock up in April, with the items purchased keeping the company in good supply for several weeks. Sergiou says it bulks up in case and pallet quantities to save on delivery charges. “A few years ago, when companies started adding fuel charges to the delivery charge, we began to order larger quantities to reduce the amount of deliveries and save on product costs,” she says. “We also recycle pallets and containers back to some of our suppliers for credit, adding to our cost savings.”
Chemicals are generally one big buy for Colley’s, which helps kick things off in February with the chemical sale they offer to customers. “All other products are somewhat smaller and more repetitive purchases during the season,” Zacholski says. “This helps keep the inventory turning and keeps the inventory levels lower.”
The Right Mix
Whether you’re buying in bulk or throughout the season, know how many chemicals and other pool building products to buy. Colley’s runs reports that show total sales for the year by product line and buys according to actual usage. “Also, we review our major product lines each year to see if we are going to change anything or keep the existing product mix,” Zacholski says.
Nicholas Pools buys in bulk for April and May, with a pretty strong inclination of what will sell based upon last year’s numbers. “We also take into consideration how long it will take to replenish stock when it’s sold during the peak months,” Sergiou says. “Sometimes we prefer to order extra so we don’t run out. We do not like lost sales due to not having something in stock. With two other pool stores half a mile away, we don’t want our customers going to the competition to purchase items we didn’t have in our store.”
Nicholas Pools makes up for any over-purchasing and leftovers by offering sales and discounts starting in August so that by October, there isn’t much left in the warehouse. Colley’s simply uses the products during the next season, or returns anything that won’t be used to the vendor. Woemmel warns that, if you aren’t able to use the inventory in two years’ time, it’s probably dead. “Look at it as a lesson learned in what to buy and what not to buy in the future,” he says.
Getting a Deal
With lots of products to keep stocked, a manufacturer discount may be worth considering. Colley’s negotiates additional terms or discounts with the major vendors every year, and takes some of the high running items to other vendors to see if there is a lower cost, which Zacholski says seems to keep the vendors honest.
Sergiou says Nicholas Pools is very loyal to its longtime suppliers. When approached by new vendors, Nicholas Pools takes the information to its loyal vendors and see if they can reach an agreement to lower the purchase price. “Sometimes we may have to agree to purchase a certain quantity and will hold the inventory for a year,” Sergiou says. “We may also receive discounts for prompt payment.”
Bi-State Pool takes another approach in seeking discounts from vendors. “I don’t know that we need the best deals,” Woemmel says, “but we need to be treated fairly like all other builders, retailers and service companies. You should be able to mark up the product [you purchase from vendors] and make a greater profit based upon your customer service and knowledge. If you base everything on selling it as cheap as possible while not offering great customer service, it is a recipe for a short business cycle.”
Sergiou turns to the customer to stay current on what to buy. “Occasionally our customers will ask us about something they read about, saw on social media, at a friend’s house or at a resort — and it will spark our interest to research and possibly sell the products,” she says. “I also like to let my children review the toy catalogs from our suppliers and pick out what they would want when I’m putting together the pool toys and games purchase order.”
Trade shows are another great way to find innovative products. “I love seeing the guys who invent things in their garage,” Woemmel says. “They don’t have the funds to hire sales crews, but their products can be very cool and unique. And we love being unique — we don’t want to be like other pool companies. We want to offer what nobody else does.”
Another way to prepare for the new season is to update the showroom. Nicholas Pools tries to update or rearrange the showroom every other year. While the basic layout remains the same, it doesn’t want the customer to get bored seeing the same thing every year, so it gets inventive with new features and displays. “We also renovate the pool park every other year, adding the latest technology and equipment to our in-ground pool displays, changing the liners so customers can see new patterns in the pool, and adding fire pits, benches or other trendy features,” Sergiou says.
“The major benefit is that the showroom always looks full and fresh, changing and updating signage for sales or new product,” Zacholski says. “Changing the showroom around makes it look fun and inviting so we get the customer to come back again and again.”
Woemmel says the Bi-State Pool showroom could use some updating. But preparedness for Woemmel comes down to how it treats the customer. “Being open and honest with our customers on lead times as we prepare for the busy season has always been our best policy,” he says. “Telling them we can build a pool in one month and not starting for three months is not beneficial to the customer-business relationship.”