In Episode 22, Patrick speaks with Jeremiah Rivers, President of Rivers’Edge Countertops, Inc. in Oklahoma.
Listen to this episode to learn:
- How to set yourself apart in a saturated market
- The importance of having a great relationship with one distributor
- How financial guarantees help secure long-term loyalty from retail and wholesale customers
- Why keeping your employees happy is the key to keeping your customers happy
- The most important quality to hire for is integrity, not skill
Be sure to subscribe to the podcast in iTunes… and please let us know what you think! You can leave comments for this show on the StoneTalk Facebook page or on this site.
If you have stories or insights that you’d like to share with other fabricators, please reach out to Patrick.
Transcript
Patrick: Welcome to Stone Talk, the podcast for countertop fabricators. Brought to you by Moraware, makers of Job Tracker scheduling software and Counter Go estimating software for countertop fabricators. I’m your host, Patrick Foley.
Today I’m speaking with Jeremiah Rivers, president of River’s Edge Countertops in OK. Let’s give him a call.
Jeremiah: This is Jeremiah.
Patrick: Hey, Jeremiah. Patrick. Let’s get started then. Start by just telling me about River’s Edge Countertops. How did you get started in this business?
Jeremiah: I actually started it whenever I was in high school. [Not my] business. I started working in the industry in high school. [So let’s] correct myself there. I worked for a guy just doing Formica laminate countertops after high school. And just paid for school and then stuck with it through, was making okay money, so stuck with it to pay for my college. And then after that in the company, I just liked the industry a lot. So I decided to stay with him and worked with him until at the age of 23 I was running his sales department and really just saw at that time that there was no room for advancement for myself. So chose to open my own business. And [in the] beginning I went back to what I knew which was laminate countertops. And we started doing some concrete and recycled glass countertops. We started that in 2008 and then in the fall of 2012, we added granite and quartz at that point and shut down the other side to the business.
Patrick: Oh, you actually shut them down? So you don’t do both? You switched to granite and quartz and stuff?
Jeremiah: Yep. Yep. And most of that was due to just the facility size that we had and everything. Those two were dying out and the granite and quartz were rapidly growing. So we chose just to go that direction for now. And we’ve been doing that ever since.
Patrick: So I noticed you had a video of you talking about the Titan CNC. Did you start from the beginning of your granite business then with digital equipment?
Jeremiah: No. I wish. No we started at the beginning with just a blue ripper rail saw and just doing it by hand. And then we bought a ten year old Achilli saw that we ended up using for I think about six months. And after that we were going so fast that we switched to a Yukon bridge saw and we added a Pro Edge III. Just kept growing. Outgrew that capacity. We only kept the Yukon for about a year and then we got rid of it and added the Fusion 4045, the Titan 2800, and a Fastback.
Patrick: And how did that change affect your business.
Jeremiah: It didn’t necessarily help with getting more work out. But it did decrease the risk on the business because we were extremely labor-driven. It required a lot of people to get done what we were doing. And so it allowed us to redistribute some people into some other roles and get some people moved into out of the business. They needed to be out of the business. Just really mitigated our risk on that end of the spectrum.
Patrick: And so when you were growing fast, what do you think accounted for that continued growth? Was it something you were doing or do you think it was just the market demand needing someone to make those countertops?
Jeremiah: Our market’s really saturated with fabricators. I think there was a few different factors. One is our reliability. Whenever we say we’re going to do something, we do it. I have a [pretty good] guarantee behind it. This week we actually ended up, we upped our guarantee to where basically if we don’t show up on the day that we say that we’re going to be there, we give the customer 50% off of their invoice.
Patrick: Holy cow. That’s pretty significant.
Jeremiah: Yeah. So we live and die by our word. And on the other side of that, we’re rapidly pursuing new accounts. And a guarantee we’ve developed for our builders is that, “Just try us once. Whatever you don’t like on the first job that we do, you can mark out on the invoice our charges and write in what you think its worth.” That mitigates their risk on using a new fabricator and we have never had to change any of that but it gives people peace of mind.
Patrick: Yeah. That’s gutsy. So that commitment to showing up on time and even putting your money where your mouth is giving a pretty darn big discount if you don’t make it on that day. How did you come to learn that that was important to your customers? Just by talking to them? Just by understanding, by seeing what makes them mad with other businesses or even with yourself? How did you learn that was important?
Jeremiah: It was a few different things. The company I came from was notoriously terrible for not doing what they were saying they were going to do. And just talking, as we were calling on builders and other accounts and trying to figure out what their pain was, that was one of their biggest things. Especially for production style builders is that if you missed a day that you were supposed to be there, that could cost them a lot of money and time and frustration. And so by guaranteeing that we won’t miss that, it eliminates that risk at least on one end of their construction process.
Patrick: Yeah. And how has that type of that guarantee and your ability to back it up has that affected your price at all? Does that allow you to charge a price premium over someone who is less reliable?
Jeremiah: I can’t say that we can charge a whole bunch more than other people. We’re pretty fair on market value. But it does give us the ability if someone comes in and says, “Hey, I’ll do it for two or three dollars a square foot less.” Our builders are good about saying, “No, we’re willing to stay where we’re at and know we’re going to get what we want when we want it.”
Patrick: That’s very cool. And just with price in general, how do you think about price? What made you decide to charge what you charge versus charging more or charging less?
Jeremiah: That’s a good question. Came about it in a few different ways. One was just talking to our builders and things like that about what they’re paying and what they felt like was a fair value. And it’s been interesting because here in OK we have not been able to raise prices on granite for really the past about 3 to 5 years. But we have to give people raises and labor keeps going up. And so it’s becoming tougher and tougher in our industry to fight that. We try and push a lot of retail because it helps give us the ability to get [our merchants] a little better so we can keep the cash flow up and everything.
Patrick: So you mentioned not being able to raise prices with granite. What about some of the more exotic materials or even a [deck done]? Are you able to charge more for those? I mean like a better margin or no?
Jeremiah: Yeah. Exactly. And we have done that. We stock a lot of material here. And we stock a lot of exotics and that has allowed us to increase our margins in those areas because it’s tough to sell to a customer whenever you have to just bring one, or two, or three slabs for their job and there’s so much waste and having to tell the customer they’re having to pay for all this waste. And with the way we buy and the way we do it, we can save a lot of that waste for that customer. And then we can also buy it at a more competitive price where we can make a better margin and they can get a better deal all at the same time.
Patrick: Yeah. And I saw that you go to Brazil a few times a year. Is that better or strictly because it gets you a better margin or why is that better than using a distributor? What are the advantages to doing it that way or disadvantages?
Jeremiah: We still use a distributor for that. They take us down there and they give us.
Patrick: Oh, really?
Jeremiah: Yeah. They take us down there and then they give us a discount actually to buy from them while we’re there. There’s that side of it. The nice thing too is you get to put your hands on it. Especially when you’re dealing with exotic materials. [You] really want to put your hands on the slabs and look for any imperfections and things that a customer might make it unappealing to them. And plus it gives it a nice appeal to the customer saying that we go down there, and hand select their material for them, and the designers really like it, and things like that.
Patrick: That’s cool. And it sounds like you have a good relationship with Cosentino. How did that develop and what makes you want to nurture a relationship with a primary manufacturer, vendor like Cosentino versus spreading that out across multiple vendors?
Jeremiah: That’s a good question. We used to buy a lot from some other suppliers and they basically came in and said, “Hey, here’s what we do. Here’s how we do things.” And just really jumped on board with their business model. And they’re very relationship driven is a lot of how we do business. And their culture just really fit with us. And so the more time we got to spend with them, the more time we just clicked. And so we are more friends than anything. So we go on all these trips together and that builds a lot of the comradery. And another thing is they always take care of us. If they send us bad material or if they’re out of stock, they don’t go, “Man, you know what? Sorry. We’ll get to it when we get to you.” It’s, “Okay, we’ll figure it out right now. We’ll hot-shot it to you.” It’s, “We’ll get it to you ASAP.” Even if they have to lose money on it to make it happen. Obviously that’s not what they want to do. But they’re pretty much just saying they’ll do whatever it takes to make the customer happy.
Patrick: Nice. Those are all real good reasons. And to paraphrase, it sounds like it’s fun to have a relationship like that.
Jeremiah: No it’s exactly right. It is fun. We value it and we use it in all of our marketing. And they even partnership with us and our marketing strategies. And even refund some of it.
Patrick: Really? That’s interesting. So two more questions about material. First from a craftsmanship perspective, what’s your favorite material to work with these days? What do you just really like putting your hand on and cutting, making countertops with?
Jeremiah: Well, there’s two answers to that question. As a business owner, we like quartz. I like quartz because it’s easy to manufacture. And it takes a lot less time. And there’s quite a few patterns that I like. But I still love granite. [Still] love the look of granite. I love the elegance of it. I love the uniqueness of every slab. So I love granite. I like to mix the designs. Whenever I’m working with a customer, I like to encourage mixing them.
Patrick: What do you mean mixing the designs? Like mixing the vein?
Jeremiah: Yeah. Mixing the quartz and granite together. Doing maybe an exotic granite on an island that can be the feature of the kitchen and do quartz around the perimeter. A little more subdued color. Mainly making a feature piece in the kitchen. Making it more like an artwork.
Patrick: That’s interesting. I think I saw something on your site, if I’m not mistaken, like a big table looking thing. And I seem to recall it was a different color than the counters. Yeah. And I did like that actually. That made me think in my kitchen, that would work. I liked that. So I think you answered my second question which was, “If you were going to remodel your kitchen, what material you would choose?” I think you answered that. You really like granite still.
Jeremiah: Absolutely.
Patrick: Cool. All right. Let me step back a little bit and just, I left out a basic question. How big are you now? Either in terms of kitchens, square feet, revenue, employees, whatever you’re comfortable saying. How big is River’s Edge Countertops?
Jeremiah: We’re doing about 1500 square feet a week. With that we have about 20 employees. We have three sales people. And basically our shop staff is about six people. And then we have six installers. And the rest of that is support staff.
Patrick: Okay. And one of the most common issues that I hear, the challenges in anyone’s business is finding and keeping good employees. How do you tackle that challenge and how successful do you think you’ve been?
Jeremiah: I feel like we have been very successful in that and it’s something that it is a battle every day. I still actually have the very first person I hired. So he still works here. And a lot of my guys that are here [have] been here for years. And some of that is just your culture of your business is extremely important. It’s a lifeline to how you keep people. And we run business differently. I came from a company where the owner would yell, and scream, and belittle you. And I vowed to always treat my people with respect, hold them accountable obviously. But you can still respect someone and give them constructive criticism. And the other side too is we do a lot more groundwork in our hiring process now versus in the beginning where it’s like, “Hey, you can breathe and you know how to do get in here.” [inaudible 00:14:23] so much stuff. And now we do several different kinds of surveys and personality profiles and they go through several interview processes. It doesn’t matter if they’re going to be a sales person, or if they’re going to be a shop laborer, or what they are. They still go through the same process. So that’s helped us reduce our turn-over rates and everything as well.
Patrick: Sounds like that would help you ensure not just that they could do the job, but that they’re a cultural fit as well. Is that correct?
Jeremiah: Well, that’s exactly right. I have a business coach and one of the most [powerful] things that he’s ever told me, he said, “Think about the last five people that you’ve hired and the last five people that you fired.” He said, “Why did you hire the last five people?” I said, “Well they could do the job that I needed them to do.”, “Okay. Why did you fire the last five people?”, “Well, because they lied to me, and they stole, they cheated.” He said, “So you hired for skill and you fired for integrity.” He said, “Now what if you hired for integrity?” That blew my mind. I was like, “I [never] really thought about it that a way because they just knew what they were doing.” So we now do it that way and it’s really changed the atmosphere of the business. And we’ll fire someone just for being a, they can be a cancer in our culture. And they can be one of the best people in my business that does the best work, but if they’re causing bad attitudes and tearing down the company culture, then they’ll be dismissed immediately.”
Patrick: That’s an awesome story and it reminds me of something I’ve heard somebody say about software, “It’s easy to think your job is building software but it’s not. Your job is building a business.” And I think you could say the same thing. It’s easy to think that your job is to build countertops but first and foremost, it’s to build a business. And that’s what you just described I think.
Jeremiah: Exactly. And as the owner, my job is not, to be honest, it’s not to keep my customers happy. My job is to keep employees happy who then keep my customers happy. And their job is not to make countertops, it’s to make my customers happy.
Patrick: That’s a really, really good point. That is awesome. So what’s the biggest challenge you face in your business? If you had a magic wand and could change one little thing about your business, what do you think it would be?
Jeremiah: That’s a tough question. There’s obviously things I would change from things I’ve made mistakes from. But I think still even though we do have a good culture, really figuring out a good way to teach every employee to have an ownership mentality instead of it’s an all about me mentality. You’re going to struggle with that in any business no matter what you do. I’d say that would be one of the main things. But I guess if I could wave a magic wand, it would be for me, myself to be a better leader and to have the drive and the passion, even more than I do now, to grow the business and to just want to train my employees to be better people. I would say of all things that would probably be the biggest thing I would like to grow and wave my magic wand to make better would be myself.
Patrick: That’s really awesome. And you mentioned that you see a business coach. I assume that’s the sort of thing you’re working on with the coach. How did that come about? How did you think to go to a business coach and how did you find the specific business coach you’re working with?
Jeremiah: Well, basically we met at a networking event. I thought it was weird at first and then we got to talking and we really hit it off. And so he asked me to go to one of his group coachings and so I agreed to it. And we were pretty small at the time. I think I maybe had three or four employees. And so basically he just took me through six months of a group coaching. And I got hooked at that point. I realized I truly had no idea what business was, that, at that point, I had a job. I wasn’t a business owner. I was an employee to my own business. And that was probably the very first thing he taught me was owning a business is not making countertops. If you’re going to do that and add to the stress of it, then just go work for somebody. He said, “Being a business owner is completely different.” And so I really started diving into that, and seeing what that looked like, and realizing that I could have an impact on people more than just out there doing the countertops. Not that that’s a bad thing, but I could have a greater impact leading the team. And so he taught me that. And so I signed up for his one-on-one and we meet every week. [inaudible 00:19:29] business and some weeks it’s just me venting about my frustrations. And some weeks we talk about numbers and business. And again it’s another deal with [it’s about] relationship. He’s become one of my absolute best friends and my business father figure and he’s a huge part of my life now. I would highly recommend anybody to get a business coach. It took us from, we were doing about $200,000 in revenue whenever I first met him. And last year we did about three and a half. So he just really teaches you a lot. And the nice thing too is he holds you accountable. If you’re being a little wuss, and whining, and complaining about everything, he’ll call you out and tell you, “Step up.”
Patrick: It sounds like he’s not specific to countertops.
Jeremiah: No. He coaches anyone from manufacturing to lawyers, doctors, any designer, any kind of business owner.
Patrick: And I don’t know if it came from him or from you but I the word to pops to mind that I hear you working toward is generosity, that you’re not just looking at making money, it’s more that is an output of doing work of being generous with your employees, with your customers, really giving of yourself. Am I reaching too far or is that correct?
Jeremiah: No. That is correct. And that has always been a passion of mine. He just really told me if that really is a passion of mine, then the larger you can make your business, the larger your impact can be. It gives you a platform to be able to do those things. And so it’s a struggle. This is a tough industry. You have to find that healthy balance of letting people take advantage of you versus truly helping someone. And that was probably the biggest battle as a business owner I faced because I just wanted to believe the best in everybody and that everybody was just going to respect me and not take advantage of me. And you get people who are borrowing money from you to go buy drugs. And things like that really burn you. And make you want to not do things for people. But that was something I’ve always told myself, is that you can’t let a few bad eggs ruin it for everybody. So it’s definitely a balance you have to find in not enabling. Because that’s one of the things, “Oh, well, I’m helping them.” No. You’re enabling them. And so helping them to fend for themselves, and to give them the strength, and the support, and truly figuring out when it is a need that you need to step in and help. And it doesn’t even have to be financially, just anything. Then, at that point, helping them go through it. We’ve done financial classes to help the guys understand finances.
Patrick: Nice. One of my favorite pieces is software, by the way. I don’t know if you’ve heard of You Need a Budget at youneedabudget.com. Have you ever heard of that?
Jeremiah: Uh-uh.
Patrick: If ever you do financial classes with people, it’s just my favorite piece of financial software. Just for anyone listening. Great, great piece of software. Yeah. Called You Need a Budget. Well, awesome. One last question. You’ve mentioned growth a couple times. From a marketing perspective, how do you think you’re going to get that next level of growth? Where do you think you’re going to find new customers or how is your marketing going to help with that?
Jeremiah: That’s where we’re at right now. That is exactly where we’re at. We’ve set some pretty big goals this year. And we’re really struggling to hit them. And we’ve had some pretty rough weather in OK too for the winter and spring. And it’s caused a lot of delays in construction. So that’s hit us pretty hard. So we’re actually looking at expanding our territory, [inaudible 00:23:38] that we serve is one thing. Upping our guarantee. We’ve got a few other projects that we’re working on. We’ve got a project called the Concept Home here in OK. And so it’s a home tour where it’s a big 8,000 square foot house. And we do all the countertops and they advertised it on TV for three months. And you do commercials. We’ve never done any type of TV advertisement so this will be our first venture with that. We’re really hoping that will do. And we’re also in the process of creating some loyalty reward type programs for our designers, and builders, and things like that to encourage them to refer people to us and to continue to do business with us. And then as far as the rest of the marketing side, we’re currently in talks with another marketing company to help take things to the next level. So we just really haven’t seen the growth this year like we were hoping for. But we’re very optimistic about the next six months.
Patrick: Cool. Well a couple interviews ago, I spoke with a marketing expert Marty Gould of the Customer Store. And when I was reading his book describing, and he works with a lot of stone companies, a lot of fabricators. And at the general level, I liked the concept of, “Figure out who your best customers are and just really focus on where you would have reached them to figure out how to reach the next versions of them.” Whether that’s TV, or post cards, or radio, or whatever, it’s just what are the customers you want and figure out how to reach those customers and be persistent.
Jeremiah: Right. And that is something we have figured out really over the last three to six months was what type of customers we serve the best. And we’ve really honed in. We do individual retail and we do a lot of builder work. Builders is really, we do a lot of production for here in OK. So we’ve been focusing on that and that’s why we want to start moving outside of our territory because we don’t necessarily know at what point you reach a market cap to where you’ve taken the market share that you’re going to get for the most part. To really start to take it to new levels, you have to start going outside of your market.
Patrick: Right. I suspect that you are expanding your retail. And expanding the builder business will be very, very different how you approach that. So I’m intrigued by your idea of using loyalty programs with your builders. It will be very interesting to hear from you in a year and see how that went. That’s interesting.
Jeremiah: Yeah. We’re going to launch it actually next week. And I don’t know all the details exactly yet. We’re going to have a meeting tomorrow to finalize it. But it’s an idea that I’d had one morning when I was running on the treadmill. And it just hit me. I fly quite a bit. It’s like why do I always fly with United. Well, I’m part of their reward program there, get the miles, and those types of things. So just using those types of concepts to try and get customers to continue to do business with us and we reward them for it.
Patrick: Very interesting. And one other thing I always have found interesting about reward programs is it crosses the company personal boundary. So specifically if you fly United, it’s not a corporate decision. It’s almost always a personal decision. So the company usually has a little flexibility. They don’t care who you choose. It’s the individual who is the boots on the ground making the decision of which airline to choose. They get the rewards. And it’ll be interesting again, if that applies in your situation, that okay I’ve got this maybe a big nameless, faceless builder but there are individuals within those companies who have to make the decision on which countertop fabricator to use. Hopefully you can do things in a way, without being unethical, that incent them to, “Well, of course I’m going to go with these guys.” Similar to your relationship with Cosentino, frankly.
Jeremiah: Exactly. Yep. You’re exactly right.
Patrick: Well, thank you so much for chatting. Is there any parting thoughts you’d like to share with other fabricators before we wrap up?
Jeremiah: I can’t think of anything at the moment. I think that the main thing we need to do as fabricators is work together as teams to continue to grow our industry and build a good name for our industry and not beat each other up over prices and work together to make sure that everybody can stay around for the long haul.
Patrick: Well, that’s actually a pretty good message. Again I really, really enjoyed talking with you and wish you great success and hope to talk to you again soon.
Jeremiah: You as well. Thank you, sir.
Patrick: Thanks.
Thanks for listening to Stone Talk, the podcast for countertop fabricators. If you liked this episode, be sure to visit stonetalk.org or subscribe to Stone Talk in iTunes for more. Visit the Stone Talk Show Facebook page to join in the conversation and join @stonetalkshow on Twitter. Stone Talk is brought to you by Moraware, the makers of Job Tracker scheduling software Counter Go estimating software for countertop fabricators. I’m your host, Patrick Foley, and I look forward to spending time with you again on the next episode of Stone Talk.
