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NBC Solid Surfaces in Vermont closes
I had sent over a fax on Teusday for quartz project and never got a reponse back so I called and was informed that today they were closing and were not taking orders.
Then today we received a few faxes for quotes for solid surface and when we called the kitchen dealers they said the fabricator they have used is closing, that being (NBC).
They were a large fabricator, the first in the nation to receive MIA accrediation, the owner also a founding member of Artisan Group and past president of ISSFA.
It leaves me wondering?Wondering what? I am not trying to be condescending but over the past three years, I have seen many of these larger companies fail.
When the economy went to hell, these companies had huge overhead they had to cover. They just couldn’t bring in the revenue to cover it.
I, like you, would be interested in exactly what happened. From the outside looking in, it appeared they had their act together.
Might be a great opportunity to get more clients and get some quality used tooling.
Andy, I agree.
What this leaves me wondering is when will fabricators mostly the larger shops who work with the marketing machine home centers realize these ridiculous sq. ft. marketed prices are hurting themselves and the real value of these products.Had an auction this week here in Phoenix, a large stone shop. From what I was told the equipment went for almost nothing. A sign of the times. The race to the bottom on pricing is complete, no one can make any money. Sad knowing someones dream went down, and took jobs with it. Anyone really think the real economy is improving ? With real unemployment hovering around 20%, can there really be a “recovery” ?
I know of one long time shop in San Diego county that closed it’s doors. Not because it was going broke, but because it could no longer do business profitably…mostly a volume problem. So rather than drain away funds month after month, they just closed. I’d have to give them credit actually, for knowing when to quit.
When you are a volume based business and volume slips, it must be a very quick decline unless you take fast action at the start. The owner of NBC did a great job growing the business he purchased and got into stone and quartz very early in the game.
There are some personal issues involved, as there usually is. That’s a private matter.
I do have a friendly competitor who was hurt pretty bad as a result of this. They lent a hand and got burned.
I think the problem with the volume guys is they have no idea how to sell retail. Retail is very difficult business and requires a skilled sales staff. Order takers are much different than sales people.
I have often thought that the large shops that rely on volume have hurt the perceived value of the product. Yes with the home centers advertising like crazy with tv and print adds, it does drive in customers. Unfortunately they have set the price. Then when the large shops agree to fabricate for these set prices it gives people the mindset that the product isnt worth anymore then it is sold for at the national home center. Countertops are not an item the homeowner needs to buy every year or for that matter every 10 years. They have lasting value and can last for decades in the home.
I can only imagine the cost to develop these products over the years with all the brands. The fabricator invests in education, training, machinery etc. and then only to foolishly sell it at prices for planned obsolescence. Volume slows and the fabricator folds meanwhile the homecenter continues to make money from the financing of the sale.
Stop fabricating for the home centers. They are the walmart of our industry.Posted By Matt Kraft on 19 Mar 2012 02:45 PM
Can I have them call some of the guys in my market and give them the rationale for shuttin er down?
Matt,
Did you use them for some of your fabrication?
No Andy, I think I spoke with Don once or twice. Really don’t know much about his company at all.
I was just making a crack about some of the lowballers in my market that lay out the expectation to the end user that everyone can sell at that price.
I don’t know if I’m too late to get in on this discussion, but I love a good thread about volume. I am a volume guy. I will tell you that there are a lot of misconceptions about what companies like us do. Compared to the MIA survey from last year, my prices are in line nationally, even though I’m in a low price market (Atlanta). We also sell mostly (almost all) retail. We have maintained and increased margins by focussing on COSTS.
It is a fact that costs can be lowered by increasing volume. In our business, you can benefit from increased volume in a lot of ways. Automation leads to lower labor costs with increased output. Material costs go down when buying in bulk.
I think it is a mistake for smaller, custom shops to dismiss larger shops as low price sellers that don’t make money. Try to learn a little from what they’re doing and use what can make your business more efficient.
Miles,
I don’t think anyone disputes economy of scale. Buying cheaper, better labor allocation, better use of shop area all contribute to lower cost of business without sacrificing volume. That’s not all of it, however. Other ways large volume fabrication shops save is by standardization, which by definition does not promote customization. I’m not talking about 25 1/4″ deep tops versus 25 1/2″ deep tops. I’m talking about setting up jigs and equipment to streamline a process, generating a resistance when you may have to break down a jig or change a machine over for a custom operation. This costs more, but it still does not affect quality.Where I see the best examples cost saving that harms quality is in the installation. I hear other fabricators measure their success at how many installs each crew does in a day. That kind of attitude does not lend itself towards quality, but rather expediency. When every decision depends on how fast a problem gets solved, quality often suffers. I do not have a problem with a fabricator holding that standard, but it certainly makes them different from us, where we feel that the measure of success is based on how happy we can make a customer.
Tom,
I agree with that. One place that we don’t really have any advantage cost wise is on installation. We may be a little cheaper because of volume, but not much. It has been consistant since we started that our install costs are the same as when we were doing 2-3 kitchens a week. I haven’t really found a way to lower the cost of installation, other than subcontracting installations. And when we tried that, we found that the subcontractors did cut corners because they were motivated to get more installed.
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