David Learns To Get Along With Goliath

Saturday, March 18, 2000
David Learns To Get Along With Goliath By Don Spatz


I've often championed the cause of the smaller shops trying to stay in business after the big chain stores come to town. It can be done, I've said, if the shop finds its niche and customers can see how it differs from the big boxes. 

Now comes a good example of a smaller competitor - A.D. Moyer Lumber & Hardware - that's not only still standing, but had its best sales year ever in 1999 despite a Home Depot opening up directly across the street from its Pottstown facility.

The results surprised even company owners Scott and Terry Moyer, and A.D. Moyer's marketing director, despite the four years of preparation the company undertook to get ready for a battle it knew was coming.

"We were cautiously optimistic," He said. "We were relatively confident we would stand our ground. We knew we would lose some of the do-it-yourselfers, but we figured we would make it up on the contractor end.

"But we did not at all think . . . we would have our best year ever in 60 years of being in business."

What did A.D. Moyer do?

The company began preparing in 1995, he said. Although there were no plans for a home improvement giant to move into the area then, the company knew someday it would face a Lowes or Home Depot.

A.D. Moyer spent months researching how other independent lumber dealers reacted when faced with the same situation. He compiled a list of companies of similar size and product mix and interviewed them, by telephone and e-mail, to see what they did right, and what they did wrong.

That report led management to plan what A.D. Moyer would do. But the plan would have been futile without a buy-in by the companies 110 employees among its three facilities in Gilbertsville, Pottstown and near Birdsboro.

"We are fortunate to have a very tight-knit team of employees here who care about this company as if it were their own," Scott Moyer said. "None of the changes that our management team proposed would have mattered or even been possible if the employees hadn't believed in the company or the plan themselves."

A.D. Moyer had picked up more do-it-yourself customers a year earlier when Rickel Home Centers closed, but believed it would lose some of that crowd to Home Depot. It decided to focus more on its best customers - the contractors to whom it had been catering for years.

Thus, it hired more outside sales staff and invested in specialized builder-friendly equipment, such as a knuckle-boom truck (for better placement when it unloads its deliveries) and a computerized estimating system.

And it decided not to compete with Home Depot on the same brands. Instead, it changed to other brands of products and tools aimed at professional builders.

"Were not trying to be all things to all people," he said. "The places that went out of business (tried) to compete on the price issue."

It also ramped up its specialty services, such as custom millwork and custom ordering. And it adopted a slogan - "Its all about quality" - they claim is not an advertising gimmick but the company's way of doing business and choosing products.

The plan worked: The builders carried the company, but it didn't lose as much of the do-it-yourself crowd as it thought it would, he said. And even Home Depot helped, by locating directly across the street and bringing customers to A.D. Moyer's end of town.

"We are much better off with them being across the street than across town," he said. "We've found that their existence actually has brought us more customers in some departments than we had before."

But he acknowledges the battle isn't over.
"We've got to change on the fly; we have to stay on our toes and change things as the business changes" and product or tool lines don't move, he said. "Were more cognizant of that now than we may have been in the past."


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