Vol. 7, No. 25 – December 8, 2008

In this issue:

40% of Dealers Seeing Big Sales Drop in 2008

Black Friday 2008 Sales Statistics

Holiday Hours

Great First Impressions

Save the Date

Lumber News - Quick Glimpses

Housing Stimulus Proposal Gains Momentum

IRS Announces 2009 Standard Mileage Rates

By the Numbers

Green Building Could Triple by 2013

Senate Leaders Push Small Biz Stimulus

Federal Reserve Announces Plan to Buy Up Loans

It's Worth a Call

Today's Quote

40% of Dealers Seeing Big Sales Drop in 2008

Nearly 40% of dealers responding to a ProSales survey last month said sales at their facility are down by at least one-fifth this year and only 55% think their location will turn an operating profit.

The online poll's results also revealed big regional differences: only 16.6% of dealers in the Northeast expected sales would be down at least 20% versus 50.6% of dealers in Southern states, 30.6% of dealers in the North Central United States and 39.5% of dealers in Rocky Mountain and Pacific states.

To see entire story, click here.

Source: Craig Webb, Editor, ProSales Magazine, December 3, 2008

BLACK FRIDAY 2008 SALES STATISTICS

From the National Retail Federation's 2008 Black Friday Weekend survey, conducted by BIGresearch: More than 172 million shoppers visited stores and websites over Black Friday weekend, up from 147 million shoppers last year.* Shoppers spent an average of $372.57 this weekend*, up 7.2 percent over last year’s $347.55. Total spending reached an estimated $41.0 billion.

Friday was clearly the busiest day of the weekend with 73.6 million people hitting stores and websites for door buster sales. Though traffic did subside after Friday, retailers were also buoyed by two-day sales as 56.9 million people shopped on Saturday, up from 48.3 million last year, while another 26.2 million people planned to shop on Sunday. Thanksgiving Day also continues to increase in importance as the number of people who shopped on Thursday was up 48 percent over last year (16.2 million people vs. 10.9 million people).

Those who shopped on Black Friday lived by the adage that the early bird catches the worm. The survey found that 23.3 percent of shoppers were at stores by 5 a.m. while more than half (57.6%) were at stores by 9 a.m. Bargains appeared to be so good that people have more of a jumpstart on shopping. According to the findings, Americans have completed slightly more shopping than they had one year ago (39.3 percent vs. 36.4 percent), indicating that traffic and sales over the next several weeks will moderate.

Where they shopped:
54.7 percent of this weekend’s shoppers visited discount stores
43.0 percent shopped at a traditional department store
36.0 percent shopped at specialty stores
34.0 percent shopped online

What they bought:
50.9 percent of Black Friday weekend shoppers purchased clothing and accessories
39.0 percent bought books, DVDs, CDs and video games
35.9 percent purchased consumer electronics
28.5 percent purchased toys
18.7 percent of shoppers purchased a gift card

NRF continues to project that holiday sales will rise 2.2 percent this year to $470.4 billion.

* Spending data includes Thursday, Friday, Saturday and projected spending for Sunday.

Source: Retail Adventures Newsletter, published by Rich Kizer and Georganne Bender, December 2008, http://www.kizerandbender.com

Holiday Hours

The MLA Office will be closed December 24-26 for the Christmas holiday; open December 29-31; and will close the afternoon of December 31 – January 2 for the New Year’s holiday. The entire staff of your Association wishes you and yours a very happy holiday season and a prosperous new year!

Great First Impressions

Current trends show more retailers are concentrating on the skills that create good first impressions and build customer loyalty.

Therefore, when analyzing your staff – look for behavior that builds lasting relationships, such as:

Strong eye contact, friendly smile, personalized non-businesslike greeting and professional behavior.
A good first impression includes ease and skill in introducing oneself during the first minute of greeting a visitor/customer, asking for the visitor's name and using the name during conversation.
Ability to determine a visitor's needs through skillful questioning and listening before suggesting appropriate merchandise.
Knowledge of available inventory and complete familiarity with the products.
Ability to handle objections through clarifying and trust-building questions.
Skills in multi-selling and closing the sale.
Relationship-building skills that include requesting permission for future contact, offering a business card, thanking customers for their purchase or visit, confirming their purchase, inviting customers to return, and walking them to the door, if possible.
Professional telephone skills.

CONSIDER THESE FACTS:

96% of dissatisfied customers do not complain directly

90% will not return

One unhappy customer will tell nine others

13% will tell at least 20 other people

Superior customer service is one of the most difficult deliverables facing the business world today. Selling service is the easy part, delivering on that promise offers a tremendous challenge. So I ask you, what can you do to improve the service you provide and make a great first impression with your customers?

SAVE THE DATE

January 8-9 – Missouri State Committee Meeting – Holiday Inn Select, Columbia, Mo.

January 15-16 – Kansas Winter Meeting – Eldridge Hotel, Lawrence, Kan.

March 3-4 – Blueprint Reading & Material Take-Off Seminar – Kansas City, Mo.

April 30-May 1 – MLA Swing-into-Spring Event – Lake of the Ozarks, Mo.

June 13 – Kansas Sunflower Shootout – Salina, Kan.

Nov. 5-6 – MLA Fall Fling – Kansas City, Mo.

Call the MLA Office – 800-747-6529 – for additional information or email: mail@themla.com

LUMBER NEWS – QUICK GLIMPSES

Housing Stimulus Proposal Gains Momentum… The Treasury Department is reportedly weighing a housing stimulus proposal in which the Federal Government would effectively “buy-down” interest rates on 30-year fixed mortgages to 4.5% to help stimulate the housing economy and clear out excess inventory. NLBMDA has not yet seen the details of the proposal but is encouraged by the Treasury Department’s actions.

In addition, Federal Reserve Chairman Ben Bernanke called on Congress Thursday to do more to help troubled homeowners by easing mortgage and insurance terms under the Hope for Homeowners program. Over 250 emails have been sent to Congress through NLBMDA’s Build the Vote site insisting that Congress consider housing first when working to revive our economy. NLBMDA and its housing industry allies in the Fix Housing First Coalition (www.fixhousingfirst.com) continue to urge Congress and the Administration to consider an aggressive stimulus package that includes both a rate buy-down and a homebuyer tax credit. Visit www.buildthevote.org today if you have not yet contacted your Representatives.

Source: NLBMDA Bi-Weekly Update, December 8, 2008

IRS Announces 2009 Standard Mileage Rates… The Internal Revenue Service today issued the 2009 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes.

Beginning on Jan. 1, 2009, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:

55 cents per mile for business miles driven
24 cents per mile driven for medical or moving purposes
14 cents per mile driven in service of charitable organizations

A taxpayer may not use the business standard mileage rate for a vehicle after using any depreciation method under the Modified Accelerated Cost Recovery System (MACRS) or after claiming a Section 179 deduction for that vehicle. In addition, the business standard mileage rate cannot be used for any vehicle used for hire or for more than four vehicles used simultaneously.

Source: Internal Revenue Service, November 24, 2008

By the Numbers… The National Association of Home Builders/Wells Fargo Housing Market Index (HMI), which measures current sales conditions of single-family homes, fell five points to 9 in November, its lowest point since the index was created in 1985. The decline was attributed to "worsening problems in the financial markets, job market weakness and overwhelming uncertainty about the economy," according to the release. The HMI measures three components: perceptions of current single-family home sales, expectations throughout the next six months and prospective-buyer traffic. The index gauging current sales conditions fell six points to 8, which was a new record low. Also, the index gauging traffic of prospective buyers fell four points to 7, another record low. Meanwhile, the index gauging sales expectations in the next six months remained unchanged at 19, a record low.

Source: Hardwood Floors E-News, published by National Hardwood Flooring Association, November 24, 2008

Green Building Could Triple by 2013… The U.S. green building market is accelerating at a dramatic rate, says McGraw-Hill Construction’s Green Outlook 2009: Trends Driving Change report, released last week at the Greenbuild International Conference and Expo in Boston. The value of green building construction starts was up five-fold from 2005 to 2008 (from $10 billion to $36-$49 billion), and could triple by 2013, reaching $96-$140 billion. To read the entire article, click here.

Source: AED News, November 24, 2008

Senate Leaders Push Small Biz Stimulus, Tell Paulson to Buy Up Loans… Senate Democrats have recently appealed to their Republican colleagues to lend their support to a new recently introduced stimulus package that includes proposals targeted at helping small businesses and entrepreneurs. "As the lifeblood of our economy, small business owners bear much of the burden when our system struggles," said Sen. John Kerry (D-MA), chairman of the Senate Committee on Small Business & Entrepreneurship. "To keep our economy moving we need to help these everyday Americans who are pleading for help as they try to pay their bills and stock their shelves for the holiday season."

The new stimulus package would work primarily by using $615 million of its $620 million budget to temporarily eliminate fees charged to borrowers and lenders who participate in the Small Business Administration's (SBA) loan programs. The remaining $5 million would go toward supporting microloans and offering microloan counseling to troubled businesses looking to borrow. Kerry and his colleague Sen. Charles Schumer (D-NY), a senior member of the Senate Banking Committee, have argued that these actions would free up credit and give more businesses an outlet to help create and retain jobs.

Kerry and Schumer were also recently joined by Senate Small Business Committee Ranking Member Olympia Snowe (R-ME) in calling on Treasury Secretary Henry Paulson to use a portion of the better-known $700 billion stimulus package to buy up troubled small business loans. Like the new proposed stimulus, this would free up SBA lending capacity and free up liquidity for struggling small firms.

Source: Jacob Barron, NACM staff writer, NACM National eNews Weekly Update, November 25, 2008

Federal Reserve Announces Plan to Buy Mortgage Assets… Ending months of speculation, the Federal Reserve announced this morning that it would spend up to $600 billion to buy mortgage-related assets in an attempt to prop up the battered housing market.

Specifically, the Fed said that it would buy as much as $100 billion in direct obligations from the housing-related government-sponsored enterprises – Fannie Mae, Freddie Mac, and the Federal Home Loan Banks. In addition, it will buy $500 billion in mortgage-backed securities (MBS) backed by Fannie Mae, Freddie Mac, and Ginnie Mae.

Though the move was a positive sign that the federal government wants to help the housing market, analysts questioned whether financial institutions would use the funds to invest in the residential mortgage market, especially given the likelihood of further declines in home prices and rising foreclosures. The Fed hopes to at least improve liquidity and reduce mortgage interest spreads. Click here to read entire story.

Source: Boyce Thompson, Builder Business Update, November 26, 2008

It’s Worth a Call

The cost of pain and suffering from a vehicle accident is immeasurable for the injured parties and their families, friends, coworkers, and employers.

Medical expenses for treating injuries have risen at an alarming rate in the last few years. In addition, liability suits invoking the “doctrine of vicarious liability” may hold a business owner responsible if an employee’s negligence causes injury or damage. Court fees and settlements can drive the total cost even higher. Businesses have even been destroyed by the actions of an unfit driver. These trends translate into higher insurance premiums for everyone.

Federated offers a major risk management program to help our clients reduce the risk of auto liability. A safety video entitled “Make the Tough Call” and other materials are available to insured business owners and risk managers to help set up screening procedures for prospective drivers. We urge clients to call Federated’s convenient Driver Insurability Service (800-335-4687) before hiring a prospective driver or allowing anyone to operate vehicles on company business.

How many accidents may be averted by not allowing these individuals to drive company vehicles or use other autos on company business? It’s hard to say – but one accident avoided at your business certainly is worth the call.

It’s easier to pick up the phone than to pick up the pieces.

This article provided courtesy of Federated Mutual Insurance Company, your association’s recommended insurer.

MLA is proud to endorse….

THOUGHT FOR THE DAY

“I am not young enough to know everything.” – Oscar Wilde