Q&A with pool retailer Matt Gohlke

Ogg 510 Aq1. You said that things have been pretty decent for your company lately. What's the secret?

I think having really, really good people at your retail store to take care of customers is critical. We really focus on hiring people with good attitudes. I'd say 90 to 95 percent of the people we hire come from outside the industry. We hire really good attitudes, positive people, and then we train them the way we want them trained. I hope the industry is doing that in swimming pool and spa stores. We've found that it's easier to teach them about the pool industry than it is to teach them to have a good attitude.

Customer loyalty is something that pool companies have to deal with. There's so much focus on price, price, price, and sometimes that can be difficult to overcome. You just have to really take care of them, really make them believe in you and set yourself apart by being more professional. And that goes across the board. Tattoos and piercings and all that kind of stuff? (laughs) You've got to be very professional in all aspects of your retail store to build credibility.

A lot of people think they know a lot because they've done research on the Internet, and obviously cost comes into play a lot, and that's something stores just have to face. We live in a town where a lot of people are loyal to us.

2. A lot of people we surveyed told us their biggest business concern was consumer confidence.

In 2010, we don't know what's going to happen, but in 2009 we saw people coming in to buy parts to fix something instead of buying new pumps or filters. So equipment sales were way down. We sell quite a bit of new equipment because we train our people how to do that. They'll tell the customers, "You can fix it for this, or get a brand new one for this that'll be energy efficient and have a longer warranty." Well, people didn't seem to go for the new stuff at all, and that was the first year that we'd seen that. People were struggling in 2008, too, but it didn't seem to affect us as much. We used the same methods, we just came against more resistance: "I'll just fix it this time and maybe get a new one next time."

It's the same with our pool construction. And I understand it probably because I'm fairly conservative financially. It probably should affect our construction. A lot of people need to get their financial houses in order, and pools are really a luxury item, not something that you've got to have. Sometimes it's difficult. I'll go there and say, "Gosh. They really need to paint their house and here I am doing this." You know what I'm saying? I'm really into financial planning, and sometimes I just say, "I can't believe you're doing this." But I can't think of a better company to use than us! It's the same with pool equipment and retail, too.

3. People were also concerned about bank financing for customers and inventory financing for themselves. Have those been issues for you?

We have not had trouble. In the retail store the consumer financing doesn't affect us that much. But inventory financing has changed. It used to be you could just call and say, "I want $100,000 for inventory." Now they want backup materials, current financial statements, they need income statements on the business. I mean, I think they're still loaning money, but they want to make sure they have their house in order because they don't want to loan money on a bad deal. And I don't blame them for not wanting to loan into a bad situation. We've been using the same bank forever and that's what we've seen. Every bank is different.

We use a local bank, and we keep a line of credit. I think that's important. You should really have a line of credit. You give them the financial statements when you really don't need to borrow the money, you know? Every January I'll give them my personal tax returns, company tax returns, income statements, bank statements. We've been doing that for as long as I can remember. Then, if you need money, it doesn't look like you're begging for it. "I've got to have it right now! I'm desperate!" So I think it's important to establish that.

4. What about staffing? Last year 38 percent of those surveyed laid people off, which wasn't that surprising. But 20 percent hired new employees.

We feel like there are some really good people in the job market right now. We're loyal to our employees, but when someone comes in that's really good, well, we've got to find a place for that person and we'll hire them.

We've got more employees now than we've ever had, mainly because we're trying to grow our service department. But there are a lot of good people out there, and I don't want to say that you should have a shorter fuse with the ones that work for you, but you're really only as good as your worst employee. So we've replaced a few that, I don't want to say we were overpaying them, but we weren't getting the value out of what we were paying them. So it's really allowed us to be more flexible. Again, we're very loyal as long as they're true to the company. I'm not going to get rid of somebody that's really trying their hardest and being honest with us. But if somebody isn't that way, you don't have to say, "Well, there's nobody better out there," because that's not the case.

We'd probably rather have more people working fewer hours, because then you can always step it up when you get busy, rather than everybody working 45 or 50 hours when it's slow and then all of a sudden it gets busy and you can't keep up. So we work them 35 or 40 hours a week, so when it gets busy we'll be able to step it up and take care of our customers. It's so seasonal in this business that it's kind of difficult.

5. Some retailers are taking on new lines like billiards, casual furniture, hearth products. Have you thought about doing that?

Nope. We just decided to really focus on our service department. We feel like we really know how to run a service department. So in the last three years we've doubled the number of vehicles we've got on the road. We live close to Dallas-Fort Worth, so we can try to reach out to that a little bit. We might have to go another five or 10 miles, but we'll find there's another 5,000 or 10,000 pools in that area.

6. Do you have any thoughts about when things might pick up again?

January and February were not real good, but we've had some weather issues here, so it's hard to judge. This might sound negative, but I'm not sure we'll ever get back to those 2005 numbers. Maybe we will eventually. But I think it's different now. People are managing their money a little bit better, and pools and spas won't be as big a player, I don't think. But on the other side, people want to stay home more.

But here we're just trying to keep our financial house in order and grow in some areas where we can. We expect a little growth - not a lot, just a little bit - in retail. Last year we were down 1.4 percent in retail, while our service department was up 14.6 percent. We look for similar growth in service this year. Our construction has been pretty bad for a couple of years.

But I do worry about hot tubs. I love hot tubs and I wish more people had them, but for one reason or another people aren't buying them.

Comments or thoughts on this article? Please e-mail [email protected].

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