Builders' Merchants News
BMF Conference: Industry Panel Session
Published:  30 June, 2015

Four industry figureheads representing builders’ merchants and building materials suppliers took part in a forum to discuss how they have built momentum and focus in their respective businesses.

The Industry Panel Session comprised Richard Hill, managing director of ACO Technologies, Ron Walker, managing director of Heating Plumbing Supplies (HPS), David Hebdon, operations director of Fortis Merchants, and Stephen Thompstone, formerly a director with the Grafton Group and non executive director of the Builders Merchants Federation (BMF).

Mr Hill of ACO Technologies spoke about the importance of building brand momentum and stated that developing your brand isn’t just down to the responsibility of the marketing department. He also highlighted what the company has learned over the years by introducing different advertising campaigns.

After winning a Queen’s Award for Enterprise: Innovation in 2001, ACO was encouraged to launch innovative advertising campaigns. Its first biggest marketing campaign was the 4X4 Construction Challenge. Run in partnership with Land Rover, the competition was open to the entire UK construction industry.

More than 1,000 organisations from across the industry registered online to enter the competition, with some of the most prominent names in the architectural, contracting and engineering sectors taking part in a series of driving, skill and knowledge challenges to win a variety of prizes.

A couple of years later, ACO partnered with New Civil Engineer to launch the 'Clever Clogs' competition. Intended to be a bit of light-hearted fun, civil engineers were given math challenges to solve. According to Mr Hill, the competition was so popular that when one of the questions was posted on the website at 12pm, a civil engineer completed the equatation in just 43 seconds.

As part of ACO’s knowledge share initiative, the manufacturer also launched ACO on Air - a resource for planners, designers, policy makers, budget holders and engineers - to access original video content relating to issues surrounding water management and water sensitive urban design. Its aim, according to Mr Hill, “is to encourage collaborative thinking, by bringing together leading thinkers and practitioners from across the industry to demonstrate best practice, educate, challenge and respond to the issues affecting us now - and in the future”.

Mr Hill acknowledged that ACO has learned a considerable amount about building brand momentum over the past years, and believes that it comes down to the '7 ates':

  • Differentiate – Be prepared to be different and challenge convention. If done correctly it will keep your brand interesting and will create long-term engagement
  • Participate – Target your audience through social media and invite them to participate back
  • Allocate – Engage staff to take an active role in building brand principle. Engage them with the audience you are trying to convey your message to
  • Collaborate – This is something that you (as an audience) might have done before by inviting competitors to take part in industry forums. Partnering with others can help build a brand
  • Innovate – Be creative and think ‘outside the box’. Keep your brand message fresh and interesting
  • Validate – External validation is important and brings credibility to what you say. If you use external experts to support your views, you will gain from it
  • Cultivate – Keep audience engagement constant and consistent. Digital media helps to achieve this as it allows for a two-way conversation.

“Strengthening your customers awareness about what your business is and what you can offer them can create a greater sense of what you are doing,” said Mr Hill. “It is important to remember that brands exist through time, but the meaning of a brand is actually about perception.”

10 factors to achieving a great performing buisness

Stephen Thompstone of the BMF was the next person to take to the stage. “Over the last 35 years, I have gained a vast amount of experience when it comes to building momentum and focus,” he told the audience. “I have met and worked with some amazing people in this industry. If there is one piece of advice I can share with you, it's the fact that no one has the monopoly on good ideas and we never stop learning.”

Mr Thompstone identified that there are 10 critical success factors when it comes to achieving a great performing business:

  • Teamwork – It isn't about luck. The best teams win in the end, whether it be in sport, business or battle
  • Have a plan – Most businesses say they have a plan, but I think they have a wish list. Have a target, a timescale and a road map. Everyone in the company needs to understand the plan and drive it every day. People will buy into a company plan
  • Excellent customer service – This is a must! Customer service expectations are growing everyday. Without excellent customer service no business can thrive
  • Measure – What gets measured will get done - that's a fact! Target, measure and reward
  • Invest – You have to put your money where your mouth is. Invest in staff, premises and a good delivery service. To be a successful business you need the best tools. Businesses that don't invest will not succeed
  • Communicate – Would your business pass the ‘forklift truck driver test’? Are the aims and service aspirations of your company communicated clearly throughout the business to ensure that your staff understand them and can articulate them?
  • Staff motivation – A positive attitude is the difference between success and failure. Money is important but it isn't always the key driver when it comes to staff motivation. It's about recognising someone's hard work and rewarding them for their efforts
  • Promotion – Shout out about it
  • Review - Challenge performance, be prepared to change the plan, and celebrate success
  • Keep it simple – Merchanting is a simple business. We often complicate it at times, but it really doesn’t need to be.

Staff involvement key to growth of HPS

Ron Walker of Heating Plumbing Supplies (HPS) gave delegates an overview of how the company was formed in October 2001, after it barrowed £1.5m from a small number of investors and the bank.

Starting out with four branches, HPS quickly expanded by opening another four the following year. Over the course of 14 years, the company has continued to open around two stores a year. It now boasts a branch network of 31 and a turnover of £50m.

What is the magical formula of HPS Mr Walker asked? “Ten years after we borrowed £1.5m to set the company up, we paid off our original investors. For every £1 they put in, they received £5 back,” he told the audience.

The company has also had a management buyout in the last 10 years, which saw four directors and 60 members of staff invest in the business. Today, HPS is owned by the staff and management, with no outside shareholders.

So how has HPS achieved its success? Mr Walker explained: “Our culture is the bedrock of our company. It is based on people with a 'can do' attitude and we try to build a positive atmosphere within all of our branches. It is about structure, empowerment, recognition and reward.

“Our business starts with our branch managers. We treat them as the king of their branch as it is their name above the door. We like our managers to focus on providing high levels of service to the customer, and to generate sales for the business, rather than being consumed by admin.”

Mr Walker continued: “We have built energy by growing the company and engaging it with our staff, customers and suppliers. We now grow our own people too. Success is the key to our business.”

He then went on to share some facts about the company:

  • Eleven out of 16 branch managers have been appointed from within
  • Ten percent of the branch profit is paid as a bonus (if successful) to the branch manager at the end of the financial year
  • HPS offers its staff the opportunity to earn 15% of their salary on an annual basis, based on achieving targets.

Mr Walker concluded his presentation by saying: “HPS has built momentum by linking profit with continued success and maintaining our focus by encouraging our people to prosper within our business.”