Playing the ‘Quality Game’
CustomRetailer: How has the central vacuum category held up during 2009, in this recessionary period, compared with the similar period the previous year?
Grant Olewiler: M.D. Manufacturing has been around for almost 50 years now, and we've watched the vicissitudes that have occurred in markets. This has been one of the larger dips that we've seen for the industry. We had planned for it somewhat, and had shored up a few different aspects in our company, so we have not been affected at the level we're hearing the rest of the industry has been hit.
Some numbers I've heard about the industry drop have been up to 50 percent but we're nowhere near down that level, probably because we have always pushed and identified the major interest category to be existing homes. There's a huge market there for central vacuums compared to new construction. We've pushed that for years.
We have training video tapes, DVDs and a lot of printed material on how to put these systems into existing homes, and our dealers that have made that shift in time are actually doing quite well.
Retrofit was my forte back in the '90s, when I had my installation company and the recession occurred then; it was when I had my best year ever. When people aren't building new homes, they're willing to invest small amounts of money into little fix-ups to make their homes nicer to live in. Central vacuum in an existing home might be only $2,500 to $3,000 installed, and when they re-sell their house, they get their money back for it. The economics are actually very good. Typically, an installation in a 3,000-square-foot home takes less than a day. The profit potential is very strong.
Also, a lot of our dealers have found that a great way to fend off recessionary blues is to pursue previous customers—and there's a series of ways they do it. For example, as the central vac installation is being installed, the installer snaps a photo of the home and saves it in his file for six months to a year. He then sends the photo to the client with a note, "Had this picture of your home in my files. Hope you love your central vac"—it's a great way to show after the sale that you remember them, you thought about their installation, and that you wanted to make sure everything was working fine. It's great timing—now that they have all their pictures up on the wall, all their boxes unpacked, and they're having people over. If you sent a thank-you card much later, you can say you have value you can add after the fact. It doesn't take a lot, but it works. I've heard from dealers that central vac, if it's been installed properly with high-quality equipment, is something homeowners can't live without—it's a great way to get referrals.