What housing downturn?
by Cape Business staffThe housing market is in the doldrums. Builders are pulling back. Commodity prices are rising.
So why is Tony Shepley expanding his Shepley Wood Products company beyond his longtime Hyannis base?
And why is he opening up a spanking new $1.3 million facility in Wellfleet – a seasonal community?
Several reasons, explains Shepley:
• He’s coveted the Route 6 location for a long time, and jumped when it became available.
• He’s experienced housing downturns before, and remains bullish about the short-term and long-term prospects for the market. He actually goes a step further: The decline was to be expected given the long run-up in home prices, and the current cool down should contribute to a more stable economy.
• The Wellfleet location serves among the wealthiest second-home markets on the Cape. These owners not only are inclined to remodel their homes, but they want to play an active role alongside the builder.
• The new facility is designed to serve his own customers better, the hundreds of builders and remodelers across the Lower and Outer Cape who now can avoid traveling to the Mid-Cape for supplies.
On the morning of the ribbon-cutting in late May, Shepley was pacing in anticipation – while observing last-minute construction touchups. “I view us as a 29-year-old startup,” he said. It may be nearly three decades since he began his company, but success requires a perpetual entrepreneurial attitude.
The Wellfleet operation has been designed as more than a lumberyard. Shepley calls it a social center for builders and tradesmen. “In the old days, the lumberyard was a community hub, much like the post office,” he explained. That’s his goal here.
It’s evident by the coffee machine next to the front door that requests a quarter for a cup – with the money identified as “civic rent,” destined as a contribution to the Cape & Islands United Way. It’s underscored by the flat-screen TV, which is alternately tuned to the Weather Channel or CNBC’s stock report. (The television has another purpose, he explained – productivity. It can project teleconferences live from Hyannis, letting his Wellfleet staff stay on the job without wasting time and money commuting).
The atmosphere he’s designed underscores Shepley’s recognition that while many builders are inclined to order by phone, those on the Lower and Outer Cape like to shop for and pick up supplies personally. He expects his customers will inspect supplies in Wellfleet and drive away with an initial order to begin the day’s work. Then, the remaining larger part of the order can be trucked directly to the builder’s site from Hyannis.
Is the timing right?
Is Shepley’s expansion a harbinger of a housing upturn?
“The early ’90s was a bad time. That’s when banks pulled lines of credit for builders,” he explained. “This time, it is a good, healthy reshuffling after unsustainable appreciation.”
Shepley said the first quarter of 2007 was challenging. “We could not catch a break with the cold weather.” However, May was his busiest month in history – and it renewed his confidence that the investment will pay off sooner rather than later.
Inevitably, the timing was not as important as the location, which Shepley coveted so much he was willing to abide by Wellfleet zoning regulations that prohibit sales directly to the public. Employees at the gate will have to turn away anyone without a business card.
But they will give out gift certificates for a local restaurant to cushion any disappointment – and they’ll offer directions to other suppliers.
While he will lose some retail business, Shepley observes that more and more homeowners are choosing to work alongside builders and remodelers. Thus, he will encourage them to come together. He also views his business as a “portal.” He is prepared to refer homeowners to his own best customers among builders, contractors and tradesmen.
“It’s the three-legged stool of supplier, builder and homeowner. We have to help our customer help their customer.”
He has built the Wellfleet operation with this philosophy in mind – including meeting areas for builders to host their customers and for Shepley employees to teach homebuilding and remodeling practices to homeowners.
“A builder cannot constantly educate the customer on everything by themselves. That’s where we come in.” It’s one reason he is encouraging builders to bring homeowners along with them.
Meanwhile, Shepley is pollinating his Wellfleet operation with many of his long-time staff – currently numbering 160 – who have been based in Hyannis. In many cases, they are dividing their workweek between both locations.
And the ones he is depending on the most are those who have proven not only technically adept, but customer-service oriented. First impressions, he noted, serve as lasting impressions.
Published in Cape Business July/August 2007
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