Building a Future for Distributors and Dealers of Building Products
January/February 2005 Volume 44, Issue 1
At the “Route” of the Matter
Distributor’s Trucking Beginnings Give it an Advantage
Minnesota may be the land of lakes, but every local knows each lake tells its own story. And not far from some of those beautiful lakes sits the 250,000-square-foot Bayer Built Woodworks facility in Belgrade, Minn., a distributor with its own unique story.
“Since we began operation in 1982, the original building has been added onto and expanded more than a dozen times—before we were able to build a facility that was planned and had a working flow pattern to it. The management team and team leaders were all involved in the planning process and we are proud to say it is a huge success in its efficiency,” Joe Bayer, president and chief executive officer, said.
A Trucking Influence
The company began as a family business in trucking, dating back to a drayage business owned by Joe’s grandfather in the early 1900s. The railroads first came through the area at that time and his business evolved into a livestock and freight hauling business between Minneapolis/St. Paul and rural Minnesota communities. Joe’s brother and partner, Mike, eventually bought this family business and moved it from town to the company’s present location.
In 1982, rural areas were suffering from a depressed agricultural economy and the family business was struggling. The creation of a pre-hung door business was suggested by Mike’s father-in-law, who had a small pre-hung door operation in northern Minnesota. In the meantime Joe and Mike’s youngest brother, Brian, was finishing up cabinet-making school. Together, Mike and Brian started Bayer Built Woodworks in the pole building that had housed the company’s trucks. (Mike and Joe are the current owners. Brian sold his interest to his brothers in 1996.)
In 1982, pre-hung doors were a relatively new concept in rural Minnesota, and next-day delivery was unheard of anywhere. But the concept caught on and grew with the pending economic growth and building boom.
“To this day the company still operates as it did then, building pre-hung doors from today’s orders and delivering them tomorrow,” Bayer said.
The Company’s Territory
Initially, the two-step distributor and prehanger of exterior and interior door units and associated millwork products focused on rural West Central Minnesota and the lake area to the north. The company currently distributes in six states, primarily in Minnesota and parts of the bordering states.
“I think we are somewhat unique in that not only do we deliver our product to our customer, but we also bring in product from our manufacturers on our own trucks,” Bayer said. “We operate a companion company, Bayer Trucking, which is a separate entity. Eighty percent or more of our product from manufacturers is brought in on our trucks. Having grown up in the trucking industry has given us an edge in knowing how to operate efficiently and profitably.”
The company doesn’t only sell mainstream millwork products.
“In addition to the traditional millwork products, we also stock the Schulte line of shelving, as well as Spectis polyurethane mouldings. This past year we added an aluminum rail system by Regal,” explained Bayer. “Approximately 18 months ago, we built a prefinish facility that allows us to prefinish custom jobs in minimum lead times with enhanced control and quality.
In addition to this service, we stock our most common product lines in four standard colors plus a clearcoat. This allows us to ship prefinished jobs of doors and trim the next day.”
To help get orders to the shop quickly, Bayer Built relies on its Computer Associates Inc. software—Ponderosa.
“The heart of the CAI’s Ponderosa software is the Product Configurator. I have never seen anything like it … It really does a tremendous job for us,” Bayer said. “Its simple design allows our salespeople to take 80 percent of our orders over the phone and enter the order while talking to the customer. When the call is ended, the order is complete, the acknowledgement is being faxed to our customer, shop time is scheduled and work orders are ready.”
Bayer admits that it’s a challenge keeping customers up-to-date with all the new products entering the market, as well as the value-added services being offered.
One way Bayer Built keeps in touch with its customers is by hosting an annual customer appreciation event that consists of a golf outing and fishing contest, followed by a hog roast.
The company works to make its employees feel appreciated too. Bayer Built offers its employees medical benefits, a 401K plan along with a revenue sharing plan. The company has found it a challenge to keep up with insurance increases, but it’s been able to absorb the amount so far, according to Bayer.
“We must continue to offer benefits that will continue to attract and keep the best employees in the market, which we proudly do. Even though we are out of the metro area, we are not without competition as far as the employee market goes,” Bayer said.
He added, “In the summer months, we’ll use just about any excuse to cook meals for the employees when the weather is nice. We also offer our employees the opportunity to attend business-related conventions and shows throughout the year.”
Influx of Foreign Products
The company’s suppliers help them sell their products by helping train its employees and sales staff and through consumer advertising, according to Bayer. Bayer also says that suppliers offer co-op help for its training and advertising programs.
The company’s biggest challenge with suppliers is lead times.
“Our suppliers are feeling the squeeze, from imports and custom orders,” Bayer said.
Bayer attributes the influx of foreign products to consumers, primarily through the mass merchants.
“It’s not any different than the influx of foreign products in any other market … We aren’t going to be able to stop it, but we have to be prepared for it and sift through the glut of these products to find the best quality at the right price. Initially, many of the imported products were a compromise in quality compared to domestic products, but this is changing and in some cases have actually swung the other direction,” Bayer said. “These products are creating a larger challenge for our domestic mills and manufacturers. They are the ones that will ultimately be forced to find greater efficiencies in their processes to compete.”
Being located in the North where the Canadian wind blows south, you may think Bayer Built might have weather challenges. You’d be right, but it doesn’t seem to slow them down too much.
“When blizzards hit, things slow down,” Bayer said. “However, many builders have overcome the frost issue and continue to dig footings right through the winter.”
“From a product standpoint, all exterior door systems are subjected to more difficult conditions [here] than most of the rest of our country,” he said.
In May, the company introduced an answer to cold-weather issues when it rolled out its “Acclimated Entry System™.”
“We focus on the frame, seal and sill components with this system because the components are far more important to the integrity of the system than the door itself,” Bayer explained.
While Bayer Built did not want to publish its revenue for last year, the company—whose roots began in trucking—believes its figures for last year will be a growth of 10 to 12 percent.
Samantha Carpenter is editor of SHELTER magazine.
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