Business Spotlight: Calling on Contractors

The owners of Arrowhead Building Supply Inc. admit they’re rolling the dice by investing millions into a shiny new facility during a slow construction market.

“We’re betting on Springfield. That’s why we committed a $3 million facility,” says Rick Pogue, the company’s sales manager and son of co-owner Jerry Pogue, standing in the new warehouse on the outskirts of Partnership Industrial Center. “Times are tough, the economy is down and building is slow. We believe this area really is going to pop. People have been telling us we’re crazy for doing this.”

“We’ve heard that before,” adds co-owner Larry Saxe, in town for the Sept. 21 opening but also the owner representative on site for months during construction of the 42,000-square-foot building.

Saxe and Jerry Pogue own the St. Peters-based company they’ve worked at since its founding in 1997. Arrowhead Building Supply – a seller and distributor of construction materials such as siding, roofing, decking, doors and windows – is not new to the Springfield market, having entered via a Strafford store in 2008 and a $2 million Hollister site in 2010. The company has relocated the Strafford operations to the northwest Springfield property bought from the Martin family.

Arrowhead Building founder Steve Schulte died in 2000 and Pogue and Saxe took over operations. At the time, the supply house operated a single store and was building a second, in Pevely, outside St. Louis. Annual revenues hovered around $7 million.

During the next decade, Arrowhead Building grew revenues to $53 million across five sites in 2011, and company officials are projecting nearly $70 million by the end of the fiscal year in March, when the Lowell, Ark., store will have a full year under its belt.

In addition to the new stores, officials credit a change in adding an outside sales force in 2007 for the rise in revenues. In the last four years, Arrowhead has opened 450 client accounts each year, says Rick Pogue.

“Our outside guys are cheerleaders,” Pogue says, noting the salespeople, 20 inside and five outside, are salaried employees. “They go out there and get somebody excited about us, and they drive the phone call to the counter and the counter guys take it over. That way, they’re able to see 10 or 12 guys a day. And their feet are held to the fire.”

While working more than 400 contractor accounts locally, Arrowhead moves 2,000 squares of shingles per week – its top selling item – and 100 squares of siding a week, says Shawn Saxe, the regional manager in southwest Missouri and northwest Arkansas and son of co-owner Larry Saxe. With product vendors such as TAMKO, Owens Corning, GAF and Royal Building Products, 90 percent of Arrowhead sales are in the residential market. A few jobs, such as the thermoplastic polyolefin roofing system on the TA truck stop in Strafford, are in the commercial sector.

Demand is largely in remodeling work with homeowners reinvesting, says Jerry Pogue. “It’s been that way for several years – just fix up the house they have,” he says.

Pat Campbell, a GAF territory manager who works with Arrowhead and a handful of other distributors in southwest Missouri, says Arrowhead sells mostly the Timberline and Royal Sovereign shingles, a lower-end three-tab roofing product. Campbell is trying to promote GAF’s higher-end Woodland and Monaco product lines, though he acknowledges the slow construction market isn’t helping roofing manufacturers.

“Our goal is to train these guys on getting into these higher-end products,” says Campbell, who was down from Kansas City for Arrowhead’s opening. “With the lack of business down here, it’s been tough to push those.”

Arrowhead officials say the residential work is often storm-driven, but Joplin’s 2011 tornado hasn’t yet caused a spike.

“There was nothing going on at the time, so everybody went there,” Shawn Saxe says. “Everybody flooded the market with product. There was enough product there to roof Joplin twice over.”

With Joplin in Saxe’s territory, he says the company is maintaining its contractor relationships in anticipation of meeting needs should they arise. The sales force also will have more products to push with the addition of doors, windows and other exterior elements at the larger Springfield store that fronts Interstate 44.

“We plan on that part of the business growing a lot more because of our location,” Jerry Pogue says.[[In-content Ad]]