Lawn & Landscape: What was it about LESCO or this industry that appealed
enough to you to make this change?
Michael DiMino: LESCO’s brand is well established, and it is the professional’s choice. To me, to have a brand that is the professional’s choice is an awfully big statement by itself, and that made me feel very comfortable in wanting to get involved with that. It wasn’t like I was going into the lower end products - this is a premier product with a premier service, and to be able to continue to make it grow and to continue to develop it was very exciting.
And then the other thing we can do is use our assets more soundly. For instance, this building gets locked up in the night and that’s it. If we have a hub 200 miles away, he can come at night, unlock the doors and restock the center so it’s ready to go the next morning. We’re not doing that now because we don’t have these hubs. The inventory is closer to our manufacturing facilities and not close to our customers, and we want to get it closer to the customers.
L&L: What’s the status of the Independent Marketer Program (IMP)?
MD: That’s a good program that is working. We consider that strategic growth. On a per-relationship basis, we’re exceeding our plans. When they
sign up, our goal may be $50,000 to $80,000 a year, but that has already been exceeded and sales are moving into the six-figure range for the people we’ve already signed up. We need to always be careful, ever vigilant, about not letting our store locations and an IMP not cannibalizing each other, so we’ve really studied that and we’re careful about not letting someone have a location that we’ll either sell into or possibly open up a new center in.
L&L: How many IMPs are there right now?
MD: We’re closing in on 10 partners, and there are another 47 or so that are close to signing. Those are all candidates who we have either visited or they’ve visited us and we’re in some stage of negotiations. Again, there are 500-plus areas out there where we should have one of these, so this can really be a good growth vehicle for us. Essentially, we’re just shipping the product and they get to carry the LESCO brand.
L&L: What is Marty Erbaugh’s role going to be for LESCO?
MD: Marty is the chairman of the board, and his main focus is corporate governance. We have a lot of work to do with governance to make sure we report information correctly that we share, managing the committees, and he
helps me tremendously with his expertise. But it’s an advice and counsel type of thing on a variety of issues.
He’s not involved on a day-to-day basis, so it’s a good mix between the operational team and the board.
L&L: Are you happy with your current golf/lawn care mix?
MD: I would love to see both of them grow more, of course. We have a challenge in golf getting the Store-on-Wheels to do a better job of reaching
the right customers at the right time. Maybe we haven’t been as focused there as we should be, regarding issues of when does that truck show up because it’s expensive to get that truck somewhere. That means that truck has to go to someone who wants it and uses it vs. just seeing it as an expensive missionary sales approach.
Also, in golf, we do have outside sales representatives who are supposed to call on golf courses that the truck has yet to develop a routine with because we don’t have the volume or relationships established with that customer. That needs work. Once we sort of work out some of the issues there, that will help golf grow faster. We’ve also just completed reracking and remerchandising everything in the trucks, and it actually looks better than the stores do in some ways. There’s signage up, so when you walk on a Store-on-Wheels, it’s very clear here’s irrigation, here’s fertilizer, here’s control products. It’s much nicer than it used to be, and it has helped make the buying experience nicer than it
used to be for the customer. Again, it’s fine tuning our approach and getting disciplined about how we do it.
L&L: What challenges are created for you when your suppliers consolidate
like is taking place in the market?
MD: It’s always interesting what happens with the molecules and who owns
what, which set of people we’re going to end up talking to. In some ways, these things are positive for us because when our volumes get combined,
instead of two entities we’re dealing with one and our volume just doubled so we’re even bigger to them. They’re also bigger, but we have a lot more of a way to go to them and say, ‘We’re now $X, and this is what we need to stay healthy.’
Plus, I think they look around and see that we keep surviving. There have been issues with some of our suppliers doing deals with different people, and those folks have gone under or the deal didn’t come to fruition, but we’re still here so maybe they should’ve run that deal through us. That keeps happening, so we’re getting a lot of opportunities to add to the product line, and we’re being selective about what we’re doing.
I want to continue providing a value to our suppliers, being a big
distributor. We’re the best way to move their product in the professional
side.
L&L: Do you view the regional distributors as your primary competition?
MD: Mostly. There really isn’t another national player who does what we do going after the lawn care professional. There are a lot of regional players out there who do go after this market and do it fairly well.
The author is Editor of Lawn & Landscape magazine and can be reached at bwest@lawnandlandscape.com.