Thank you to all of our friends and colleagues–the more than 100 thought leaders from the U.S. building industry–who came together online for the Building Industry Leaders COVID-19 Crisis Summit, April 22-24, 2020.
This website’s intent is to relay the insights shared during the Summit. It contains live video recordings of all introductory remarks, nine panel discussions, and closing remarks from the Summit, as well as additional relevant and timely curated resources to supplement each panel topic. We hope you find all of it helpful.
For three days, many of our industry’s greatest leaders shared questions, challenges, wisdom, and ideas in navigating these unprecedented times.
We exchanged best practices for keeping our people safe while continuing to supply and install the products necessary to keep our country’s shelter intact. We explored how to navigate economic uncertainty by scenario planning as well as by tracking and adjusting to key indicators. We discussed organizational action across sales, human resources, operations, financial management, and capital structure. And we did all this with realism as well as resolve, knowing that great challenge inevitably creates great opportunity–to learn, to adapt, to innovate, and to evolve.
We came together for this Summit, during a time of personal isolation, because by combining our collective intelligence, talents, and time, with open minds to learn and open hearts to help one another, we give ourselves and our industry the best chance to survive this crisis and ultimately thrive.
Because of our sector’s massive economic and employment scope (which together with our supply channel partners makes up north of 10% of the U.S. economy and workforce), our industry’s success is critical to our country’s success.
Thank you again for all you’ve done during these unprecedented times. We are grateful for your participation and look forward to future collaboration.
Sincerely,
| Matt Ogden Managing Partner Building Industry Partners |
Craig Webb President Webb Analytics |
The Summit kicked off by addressing the most critical questions top of mind for industry leaders during this unprecedented crisis. What can we do to ensure our workforce operates safely? How sustainable are current safety measures? What can each player in the supply chain do to ensure we collectively maintain the sector’s viability? This panel offered a view into the best practices that some of our industry’s most astute leaders are employing to operate safely during the COVID-19 pandemic.
“I’m optimistic that a lot can come out of this for our businesses. I’m not optimistic that what we’re doing right now is going to fundamentally look different a few months to a year from now. So I think the big challenge is going to be maintaining the discipline on [many] of these measures. And that’s on us. I know we can handle that.”
Matt Kuiken“Priority #1 for everybody is the health and safety of our team, our families, our community. And then right behind that, Priority #2 is economic health of our businesses, our communities, our states and our nation. Our industry is uniquely positioned to support both of those priorities. … We can support our economy and keep people working … and we can do it safely.”
Ruth Kellick-Grubbs
What impact on sales volumes have our peers seen from the pandemic and what are our customers telling us about our sales outlook for the next six months? What are the key health and economic drivers of this sales outlook and what scenarios for those drivers are possible? Which segments will be impacted most and which least? This panel of operators and analysts with a national housing market purview addressed the near-term sales volume outlook for dealers, as well as some specific growth segments which seem to be surfacing despite overall challenging economic conditions.
“Maybe 10% of the households are going to emerge from this financially impaired, and so therefore unable to act in a manner to increase their investment in housing. But we think roughly 100% of people are going to emerge from this semi-quarantine kind of state wanting to upgrade their dwelling situation in a way that is a result of an exogenous effect that we’ve really never seen before. Something of this magnitude affecting everybody pretty much is going to have an impact on psychology and desire which we think could be extremely powerful.”
Stephen Kim
As this panel of economists and housing analysts revealed, predictions on when, how, and at what rate the U.S. economy and housing market will recover from the COVID-19 crisis vary greatly. A group of experts shared a range of potential recovery scenarios, shedding important light for prudent business planning.
“I don’t see exciting growth in the economy going forward, even after this crisis is over. I think we’ll be flying down, come back up into a “J” form, and then kind of ride a plateau from there. Those individual companies that do well or don’t do well, it’s largely going to be determined based upon their innovation, their ability to adapt, their ability to apply new technologies that will separate themselves from what we’ve done in the past.”
Mark Boud“What we’re recommending to builders is just kind of think about things [in terms of] two months, two quarters and two years. The next two months of data are going to be terrible. Two quarters is basically going to be required for stability, and then the beginning of a recovery that’s going to take about two years to get to recovery. So I think that’s something not V- shaped. It’s more U- shaped. And I worry about a W—a W being resurgence and outbreaks going forward.”
Rob Dietz
Capital structure and cash flow management are mission-critical under starkly shifting and uncertain economic and business conditions. The U.S. government has added enormous sources of liquidity for those businesses who qualify and successfully negotiate the maze in time. Understanding what government financial assistance options exist and how to evaluate and obtain them is key. This panel, comprised of corporate finance practitioners from inside and outside the industry, offers insights for business leaders.
“You want to get with your existing lenders, sit down with them and figure out what next steps could be … Are we going to look at a new stimulus program? Are we going to look at an old stimulus program? Because the SBA does have some historic programs that help small businesses, that have been expanded because of the CARES Act. So I think the first thing is getting with your lender and discussing some of your options, because if you are going to approach or apply for one of these government programs, your current existing credit facilities are going to be affected.”
Jeff Makovicka“I would hope that companies will be looking at their capital structures and checking with … shareholders in small companies to see if the shareholders can either add to the equity or even lend to the businesses on a short-term basis to try to establish liquidity and maintain their going concern issues.”
Greg Lucas
How are customers’ buying expectations and behaviors changing because of COVID-19, and how can business’ sales and marketing functions adapt as a result? What product and customer segments may outperform others going forward? How can salespeople maintain and even deepen relationships with customers? What business capabilities must change to adapt to a revised future? This panel of progressive sales and marketing thought leaders sheds light on how companies are adapting to the new reality where the effectiveness of traditional, tried-and-true sales and marketing strategies has waned.
“This is the time to work on your craft. This is the time to understand your customers better than you’ve ever understood them. Research, research, research … Look at their social media, look at their Twitter, their Facebook, their Instagram. Understand what drives them to help their customers and make sure that we’re thinking about as from our marketing standpoint, if they’re marketing to customers, how do we supplement that? Not give them up, not give them a special or whatever the case may be, but how are we supplementing what they’re doing? Changing those mindsets around time management and the importance of the face-to-face, flesh-to-flesh. Because it’s going to be different on the other side …”
Jon Vaughan“One of the things that this whole situation is teaching us here in marketing is that we need to be more proactive on how we can help. We need to help break down some of those silos between salespeople and marketing and how we can work together and giving them an inside look on how we can reach our target customers. What kind of metrics we can provide. Just different resources, whether it’s video content that we’ve produced that maybe would resonate with a potential partner or just different digital brochures or whatever it might be.”
Amy Smiley
The COVID-19 crisis has intensified the stakes around operational decision-making and prudent financial management. From credit terms to inventory management to rightsizing operating costs, this panel of leading operators discussed some of the changes to regular business practices—and budgets—being made to weather the current storm.
“We’re very, very protective of those people who are highly skilled in our trades. We’re doing everything we can to make sure that we don’t lose connection with any of those people. We know that we can’t rebuild without them. We have an outreach program in place that’s administered by our HR team. We’re trying to make sure that they stay connected and feel like they’re still part of the team here.”
Kendall Hoyd“As I think back to the last downturn, we do have more information now and we can get it faster. So, we have to rely more on that. And that’s what we’ve worked so hard to do: take the emotion out of this and [use] those leading indicators.”
Mike Howell
Business leaders are navigating their people through unprecedented conditions. What are the core leadership principles leaders draw upon to move their organizations forward prudently? How have corporate culture and communication factored into their effectiveness? Hear directly from industry veterans who share their insights during this inspiring panel discussion.
“Today, I would say that answer [to effective leadership] is completely different. It’s caring for, communicating with, supporting and cheering on our team. Underlying all that is trust. If you develop that with your team, if we have consistently trusted folks out in our yards to take care of the customer and keep the customers safe and to meet their needs, and if they’ve trusted us in the corporate office to make some of these decisions that we handle every day, that’s where we come together in a crisis.”
Steve Swinney“I think the key to leadership in the 21st Century is really to disperse it, to share it, and to try to create a culture where everybody understands that, like it or not, want it or not, that they are a leader. That is the only way you can go about managing through this crisis. It’s got to take leadership from every single person in your company.”
Kevin Hancock
From great challenge springs great opportunity. While the COVID-19 crisis is creating unprecedented challenges for our industry, it is also accelerating necessary as well as opportunistic change. This thought-provoking panel brought “silver linings” such as technology/innovation, workforce efficiency, industry recruiting, and more to the fore.
“I can be so much more productive if I can just not only embrace going virtual, but master it. And you can actually, if you’re using more of a virtual model, you can save probably about 50% of the time. That then results in so many additional appointments, additional touch points, which then results in probably 50% to 75% more revenue.”
Mark Richardson“What this crisis really put into [play] is that digital is really possible in our industry. So now you have a customer base that cannot walk into a branch to do business. And our digital revenue mix has shot up 15, 20 X. Now, customers are using our online system to do their business.”
Patrick Garcia
Federal and state governments are playing a vital role in determining whether building material dealers and their customers can operate and survive the pandemic. Therefore, it is critical that elected officials understand our sector’s importance to economic recovery and the steps our channel is taking to ensure safe operation. Representatives from the industry’s leading associations and lobby groups focused on our sector’s relationship with government during the Summit’s final panel.
“So, if I were getting up on Monday morning, what would I do? I would send a thank you letter to my governor for allowing me to be open as an essential business. I would contact my local building inspector and say, ‘Hey, we want to make sure we’re a part of the solution to end this. Please stop by my yard. I think we’re doing everything according to plan, but if we’re not, please tell us what we need to do because we want to do this right.’ And, you know, then if you have a problem down the road, they’re going to know you’re acting in good faith and doing the right thing.”
Rita Ferris“… hearing these business people of a much higher stature in an industry than I am, and their level of confidence and their level of commitment to making the American workers safe, the American community safe, and the American economy strong was really inspiring for me, and it’s something else NAHB is going to focus on in spades to make sure that we are letting people know we’re going to come back from this quickly and everything’s going to be all right.”
Jerry Howard
Building Industry Partners (BIP) is the leading private equity investment firm focused on the U.S. building industry. Since its 2008 founding, BIP has sponsored some of the marquee and fastest-growing middle-market manufacturing, distribution, and service businesses in the U.S. building industry, including: U.S. LBM Holdings, Kodiak Building Partners, Rugby Architectural Building Products, Homewood Holdings, United Cabinet Holdings, and U.S. Fence Solutions.
BIP’s investment and business principles are: Unwavering integrity; a people-first approach to business; alignment of interests with our partners; respect for the advantages of local, entrepreneurial businesses; and a prudent approach to risk and reward.
In 2020, under the leadership of Founder Matt Ogden, BIP kicked off the process of relaunching the firm to accelerate and scale our people-first investment and impact initiatives. BIP is engaging like-minded business and thought leaders who share a vision of advancing the building industry and its workforce over the next decade.
To learn more about BIP, or for contact information, please visit buildingip.com.
Webb Analytics helps construction supply insiders and investors make better strategic and tactical decisions by identifying and explaining the trends, threats, and opportunities that shape their business. Its key offerings include custom research, custom content, strategic consulting, data, analysis, and business development services. Its president is Craig Webb, the longtime editor of ProSales and Remodeling magazines. To learn more, visit webb-analytics.com or call 202-374-2068.
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