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Blue Print For Profit

[ 0 ] Jan. 1, 2008 | SBO Editor

Next to marrying his wife Trudy, the late Ward Britt often said, the smartest thing he ever did was take her advice. At his wife’s gentle prodding, Britt made a dramatic—and surprising—career change in 1953: He gave up his position as postmaster of Winter Garden, Florida, and bought a lumberyard. Great decision!

“Mother said people always need building supplies,” recalled the Britts’ son Neil, who bought West Orange Lumber Co. from his parents in 1979. “She said she thought a lumberyard would be a good business. And that was before anyone knew Disney World was coming to Orlando and building construction would boom.”

The Britts paid $25,000 for the Groveland-based business, which included inventory, a pickup truck, good will and a list of mills and suppliers. When Neil Britt bought the business from his parents—also for $25,000—sales were $300,000.

The company sold traditional supplies—lumber, pre-built windows, doors, trusses, hardware and building materials—but in the late 1990s Neil Britt added a new dimension: The company began manufacturing doors and trusses, and revenues catapulted to $50 million.

Neil Britt said he learned to run a lumber business from his parents who started out with no experience in retail, knew little about construction, marketing, employee relations, customer service or accounting—for years they kept books by hand in a ledger—but became adept at all of these things. How did they do it?

“By offering contractors and home builders the convenience of one-stop shopping,” explained Neil Britt. “They realized that customers like buying from one source. They said if you let a lumber customers go to another supplier for something you don’t stock, you’ll lose him as a lumber customer,” said Britt.

Ward Britt had thought about owning a business but he never pursued it until his wife called him at the post office and announced West Orange was for sale. “She encouraged Dad to check it out,” said Neil. “He liked what he saw. They scrapped together $25,000 and, just like that, were in the lumber business,” he explained.

They operated on a shoestring, recalled Neil. Suppliers provided credit so they could bring in top-quality lumber—Southern Yellow Pine, Spruce and Cedar from Canada, Europe and Northeast and Southeast U.S.—and plywood, hardware and nails. Ward handled ordering, sales, loaded the truck and did deliveries. Trudy kept the books. They had two employees.

Growing up in the business, Neil learned to order, sell, set up deliveries and keep books. He learned another important lesson from his parents: How to build a customer base and hold onto it. “The trick is to sell more products to your existing customers.”

For example, when lumber customers asked for pre-built doors, which the store didn’t stock at the time, the Britts raced around and found doors. “That’s how we started selling doors and windows, trusses, siding, exterior trim, toilet seats and so on,” explained Britt. In fact, 40 percent of sales are from products the company doesn’t keep in stock, he explained.
Construction was booming in the late 1980s, and Neil Britt started expanding the business. He relocated the lumberyard to Oakland, Florida, and erected a 2,000-square-foot sales building, at a cost of $250,000. “I mortgaged everything—including my home,” said Britt. “I had lots of sleepless nights,” said the biz owner.

By 1993 company revenues reached $6 million. Britt thought it was time to bring in professionals to grow the company. He recruited John Arellano, who later became general manager, and Ross Bitterling, who had an impressive marketing background, to head the sales division.

Soon West Orange landed big customers such as Universal Studios and Disney’s Animal Kingdom and built relationships with high-end residential and commercial builders and developers.

Sales surged—20 percent to 25 percent annually—and then hit a snag: The manufacturers who supplied pre-built doors and pre-built trusses, the framing structures that roofs sit on, couldn’t keep up with orders.

Britt huddled with Arellano and Bitterling, explored options and made a decision: They would manufacture doors and trusses themselves. “We thought we could do a better job for less money than we were spending,” said Bitterling. “We’d have better control over production and quality and thought we had enough business to sustain it,” he added.

Britt and his team realized they needed experienced pros to design and build the manufacturing facilities and then to run them. Through word-of-mouth they found Craig Stiles, a veteran manufacturer of doors; Doug Hill, whose résumé included 27 years of manufacturing trusses; and Ernie Cox, who had a track record in sales and installation of pre-built aluminum, vinyl and wood-framed windows, sliding glass and French doors
Next, Britt bought an 18-acre tract and built 370,000 square feet of facilities for the truss, doors and window divisions. Land and buildings cost $10 million, plus $5.5 million for manufacturing equipment, and took eight years to complete. Stiles got the door factory open in 2000; it generates sales of $10 million a year.

Late in 2006, they company’s 40,000-square-foot, state-of-the-art truss factory came on line. “The designs are computer-made,” said Hill. “We just assemble the trusses.” Bitterling expects truss sales to reach $15 million to $20 million annually.

Competition doesn’t faze West Orange. “Our one-stop shopping gives us an edge,” said Britt. “Unlike other lumberyards, ours are covered; we work—and deliver—rain or shine, night and day.”

Big box operations like Home Depot and Lowe’s aren’t factors, either. They mostly sell lumber piecemeal to handymen and homeowners, explained Bitterling, while West Orange sells and delivers 50 semi-trucks of 40,000 linear feet of lumber every month. Biz is booming!

Looking ahead, Britt said revenues of $100 million a year is a realistic goal. “We have a strong customer base, knowledge of construction, state-of-the art facilities and upgraded technology,” he explained. “And we know how to hold onto customers.”

For more information on West Orange Lumber, visit their website www.westorgangelumber.com or call the company in Groveland, Florida at 352-429-0395. •

Neil Britt bought the lumber yard from his parents in 1979 for $25,000. Neil has catapulted the company to revenues of $50 million in the 1990s and has now set a goal of $100 million for the very near future. A strong customer base, knowledge of construction, state-of-the-art facilities and upgraded technology are the winning elements to make this sales target a reality. The business continues to boom despite lumber sales from the big box operators such as Home Depot and Lowe’s. The big guys simply can’t compete with the inventory from West Orange Lumber.

Category: Magazine, Small Business Opportunities, Small Business Opportunities Jan 2008