The power to buy resides in the hands of the customer; that’s the way it is, that’s the way it’s always been and that’s the way it always will be.
The role of the contractor, then, is to work to influence that buying decision as much as possible in his (or her) favor. Some contractors do this by price. Some do it by service. Some do it by establishing relationships with customers.
Miller Sealcoating & Striping influences the buying decision by empowering the customers – and last year that empowerment resulted not only in a huge increase in sales but in a shift by buyers from a conventional asphalt-based sealer to a polymer-modified refined coal tar sealer that is more expensive.
“It turned out to be a powerful thing for us because 90% of our 2011 sales went to the higher-quality material,” says Dan Miller, owner of Miller Sealcoating & Striping, Fairmont, WV. “Everybody who wanted to get greater value for their dollar opted for the higher-end material. We were pleasantly surprised at the response.”
Started in 2001 with an old state highway department tar kettle that he converted into a gravity-fed tank, Miller Sealcoating & Striping has grown steadily over the years to today’s business which relies on six employees in peak season handling 120 clients, many of whom control multiple properties. The contractor, who also leases a 1-800-PAVEMENT vanity phone number, operates a 2000-gallon tank, a 1500-gallon spray application machine, a 1000-gallon spray machine, a 325-gallon squeegee buggy, an infrared repair machine, a 200-gallon cracksealing melter/applicator, two sealer storage tanks (6000 gallons and 5500 gallons), a 30-ton sand silo, a John Deere tractor fit with a power broom, and five Graco LineLazers.
Like many sealcoating contractors Miller started in the business doing driveways but today he generates virtually 100% of sales from commercial work.
“Initially we were strictly driveways but every now and then we picked up a parking lot and I quickly saw the benefits of doing large parking lots vs. 10 small driveways,” he says. “Then at the end of the first year I helped out a big job that used a big spray rig and I quickly saw the benefits of that.”
At the end of his first year he’d totaled a whopping $8000 in sales. That was followed by $20,000 in year two and $70,000 in the third year. “Since then we have grown incrementally each year,” Miller says. “We haven’t had any real boom years, just steady growth.”
Offseason Planning Pays Off
Part of that steady growth is the result of Miller’s offseason efforts to improve the company – which is where the idea for offering a higher-quality sealer option came from.
“I have a bad habit of over analyzing everything and in winter time I start thinking about where we need to go,” Miller says. “I’m not afraid to try new things and I look at the parking lots we’re going to do and try to figure out what equipment we need to maximize each job and be as productive as we can be.”
Over the years this offseason approach has led to the company’s expansion of its sealcoating fleet, the addition of a small squeegee machine (he says not many people in the Mountain States have a squeegee machine, which helps him especially in subdivisions that require two coats – one squeegee and one spray), the acquisition of the infrared unit (because area pavers were too busy to take on small patching jobs) and additional striping equipment.
“But you really have to be careful because more equipment doesn’t necessarily mean more profitability,” he says, citing the company’s approach to striping as an example.
“Just because we have the equipment and can do the work doesn’t mean that it’s a good use of our time. It’s better for us to run two sealcoating crews instead of one sealcoating crew and one striping crew, so now we subcontract 80% of our striping work.