H.J. Martin and Son in Green Bay and Neenah, Wisconsin: Best Practices - Dec 2016

By Jessica Chevalier

Considering that double-digit annual growth is something of a pipe dream for many small businesses in the present market, including many flooring industry retailers and commercial contractors, H.J. Martin and Son’s 36% annual increase is easy to dismiss as a fluke, a windfall of good fortune perhaps, or the result of one of those growth-at-all-costs strategies that prioritizes top line increases above all else. But the fact is that H.J. Martin’s success is the outcome of empowering employees, diversifying heavily and simply having its metaphorical ducks in a row. This year, the Green Bay-based retail flooring and commercial contracting business expects to hit $41 million in flooring sales, leaving 2015’s $30 million firmly in the dust.

But H.J. Martin isn’t finished there. It also anticipates a near 30% increase in its overall business, which includes six different commercial divisions, lifting total annual sales from $101 million last year to $130 million when all is said and done in 2016.

How has the firm, which began with Henry John Martin selling tile out of his garage four generations ago, evolved into the forward-thinking powerhouse that it is today? In large part, it comes down to the leadership’s belief that employees are the heart of the company—not assets used to achieve a corporate goal, but rather partners in a business where the leadership’s main objective is to support them by offering stability as well as the opportunity to learn, grow and advance as they desire.

EMPLOYEE PARTNERS
If all that sounds a bit like touchy-feely mumbo jumbo, consider that H.J. Martin and Son has 54 employee installers on the residential side of the business and 85 on the commercial side. In an industry where many choose to keep installers at arm’s length and pay them only for yards installed or jobs completed—thereby offering little with regard to stability or opportunity for advancement—H.J. Martin’s approach affords installers the ability to abide in the security of employment and focus on doing a good job, rather than worrying about whether there’ll be a next job.

To keep all those installers not only employed but also working, H.J. Martin has to keep the jobs rolling in. As David Martin, Henry’s great-grandson, explains, “My biggest goal is to get as much work as we can handle…we want to support the families in this business. I’m always chasing work.” While that might sound like more of a mad dash than a sound strategy, it’s worth noting that this approach has kept H.J. Martin in business for 85 years, currently employing 600 individuals.

What’s more, H.J. Martin has a number of employees who have been with the company for more than three decades, as well as several families with multiple members working in the business—the VandenLangenberg family, for instance, has four—the value of which comes down to more than just loyalty, in David’s opinion. “There are a lot of families here who are generational, and a lot of those skill sets get passed down.” David notes, adding that the value of hiring a young installer who grew up in the business, working at the side of a father or uncle from a young age, is something that simply can’t be minimized—nor can that depth of training be taught in a classroom.

Because H.J. Martin’s core commitment is to providing opportunity for its employees, hiring decisions are made very carefully. “When we hire, we are making a commitment to the employee and their family long term,” says David.

In another savvy, yet somewhat out-of-the-box approach, H.J. Martin awards compensation on performance, rather than tenure—creating a tangible incentive for employees to do their best. “We really look at an individual’s capabilities, rather than just saying, ‘You’ll have to work here 20 years to get that pay rate,’” says David. The company evaluates employees annually, issuing raises, bonuses and incentives based on how each employee performs.

In addition to financial incentives, H.J. Martin strives to make sure that no one feels locked in their caste. “Many here start as an installer and elevate themselves to superintendent or project manager or department leader,” says David. “We support them in whatever path they choose.” This strategy also makes strides towards solving one of the industry’s most pressing problems: how to make installation—a physically demanding profession—a viable long-term career.

Along with this, H.J. Martin cross-trains its installers in its other offerings, a boon to both the individual, who emerges with more practical and marketable skills, and the business, which has greater flexibility to serve market demands.

With nearly 140 installers in its ranks, H.J. Martin is a bit immunized from the installer crisis and can chase down jobs knowing that it will have the staff—and, what’s more, competent and well-trained staff—to execute the tasks at hand. Of course, that doesn’t mean that the company doesn’t face challenges with regard to scheduling. David notes that, on the retail side of the business, today’s consumers are often itching to have their flooring installed as soon as the sales transaction is complete. In these situations, having staff installers means David can promise homeowners both a quality installation and the guarantee that the company will stand behind its work—both of which, he believes, sets H.J. Martin apart from competitors, especially the big boxes—providing customers with added value that offsets the wait time. And on the commercial side, because flooring installation jobs are often squeezed for time as one of the last trades on a job site, H.J. Martin has the ability to flood a job with skilled and cross-trained installers, thereby meeting the many tight deadlines that rear their heads.

David also notes that, because the company commits to long-term employment, it is careful not to over-hire, and finding the right balance of employees to work can be challenging, but to ensure that it keeps the next generation of the work force flowing in, H.J. Martin partners with Northeast Wisconsin Technical College and Fox Valley Technical College, donating both materials and training with its established installation professionals. The company is also aligned with a local veterans agency to retrain veterans in floorcovering installation.

CUSTOMER CARE
Martin has a full-time quality assurance employee, who focuses his efforts solely on handling customer claims. If a problem arises due to product imperfection, H.J. Martin doesn’t expect the customer to battle it out with the manufacturer for product replacement. Instead, it replaces the product on its own dime and negotiates with the manufacturer behind closed doors to resolve the issue.

DIVERSIFICATION
While many flooring retailers and commercial contractors diversify their businesses by adding an additional product offering or two—say, window treatments, cabinets or showers—and many commercial contractors extend their businesses to include floor maintenance services, H.J. Martin has diversified into many additional areas beyond flooring.

The company’s first foray into diversification came after World War II, when David’s grandfather Patrick Martin joined the business his father had started and added a glass and glazing division. Then, in 1978, when David’s father, Edward—the current president and CEO—came to work in the family business, he added the walls and ceilings department.

Today, the company has six commercial divisions—flooring, glass and glazing, walls and ceilings, doors and hardware, retail fixture and millwork, and floorcare—in addition to its retail business and residential floorcare work. The commercial divisions of the business accounts for 75% to 80% of business overall, and the residential part for 20% to 25%. “We can support our retail flooring department because of diversification,” says David.

In some ways, growth on the commercial side is exponential because the separate-but-united arms feed business back and forth one to another. The strategy is especially successful because it creates efficiencies for H.J. Martin’s clients. Says David, “A lot of general contractors want one reliable solution to manage a project.” Because H.J. Martin has the ability to provide services in so many aspects of commercial interiors, it can serve as something of a one-stop-shop for general contractors, which streamlines communications, scheduling and ordering.

The company’s willingness to listen to the market and chase leads as they materialize has also helped evolve the company from a Midwest-only firm to one with a national presence. In 1988, while Christmas shopping at a burgeoning electronics chain known as Best Buy, Edward was informed by a Best Buy employee that the retailer would soon embark on remodeling its interiors. Edward followed the lead and established a relationship with Best Buy founder Dick Schulz, which led to H.J. Martin’s first national account as well as the establishment of its fixtures division. Today, H.J. Martin installs the interiors for Best Buy stores across America.

In addition to always having an eye open for available work, H.J. Martin stays atop training, sending employees to classes offered by manufacturers and industry organizations, such as Certified Floorcovering Installers, and is always on the lookout for emerging products to stay ahead of the curve. Currently, the company is setting up training on Crossville’s large format Laminam tiles and investing in the specialized tools needed to install the product.

Recently, in order to establish a closer relationship with specifiers, the company added a commercial library to each of its showrooms, where it stocks larger format samples. “A&D can start with us first, and we can help them specify product,” says David. “The libraries have helped us win jobs and trust.”

TOOLS OF THE TRADE
In many cases, flooring installers are expected to supply their own tools, but H.J. Martin provides a tool room with $10,000 worth of the latest and greatest equipment for its installers. The company believes that having the right equipment within easy access enables its installers to focus fully on doing their best work.

A PROACTIVE ONLINE PRESENCE
Over the past several years, H.J. Martin has invested heavily in its website, which has a landing page for each commercial division as well as an extensive lookbook of ideas.

Nicole Jensky, director of marketing for the business, explains, “We look at online as huge opportunity, and, within that, we look at our target audience. Everything comes back to considering who our demographic is and how we can best reach them. We utilize a lot of remarketing ads. If people are interested in décor, we can target them based on their interest and behaviors. We use Houzz heavily and encourage reviews. We make videos and post them. We still advertise on radio and television but pay a close attention to brand awareness in the market. If it’s high, we don’t need a brand campaign, so we’ll do more promotion. We really make our dollars work based on what we know of the market, and we consider our installation schedule. If we’re booked far out, it doesn’t pay to advertise the traditional way because a customer who wants something will have to wait. We really try to be a thought leader in the industry.”

THE ANNUAL SALE
Each spring, H.J. Martin throws opens the doors of its 80,000-square-foot distribution center for a one-day sale. Products are priced at or below cost, and customers line up around the block for the opportunity to snag floorcoverings for a song. The sale serves the company two ways. First and foremost, it raises community awareness for H.J. Martin, and, secondly, it enables the company to clear inventory that is both taking up space and weighing down the company’s bottom line.

Copyright 2016 Floor Focus