10 Questions With ....
Cadenza Granite and Marble
Calling Ron Hannah a fabricator is much like calling a diamond a really hard rock -- it's technically correct, but it misses the point.
Certainly he's built Cadenza Granite and Marble in Concord, N.C., into a top-notch shop in the Charlotte metropolitan area in the past quarter-century. It's his work in the industry-at-large, though, that's made a lasting difference.
As one of the founders of the Stone Fabricators Alliance (SFA) and its first executive director, he worked to launch the group. More-importantly, he helped the nascent group to build an early influence on the trade, including fabricator representation on key issues and the SFA's successful business tours of Italian industry.
This spring, Hannah's work with the SFA would've come full-circle with hosting the spring workshop at Cadenza -- the site of some of the initial SFA gatherings in the 2000s. (Unfortunately, Covid-19 concerns caused the meeting's cancellation.) Stone Update caught up with Hannah in mid-February as the shop prepared for the occasion.
You’re about ready to host the latest Stone Fabricators Alliance workshop. How have these gatherings changed since the early days of the SFA?
HANNAH: Coincidentally, we hosted two workshops, one in 2007, one in 2008 which I think were the SFA's second and third workshops. We did those way back when, and now we're about to do another one with a big gap in between. We've attended numerous workshops over the years. We've seen the SFA move towards smaller more regional workshops, some that have been well attended and some that have been poorly attended. For years, the SFA tried to figure out what was driving the attendance and sometimes it was the economy, but there was really no rhyme, no reason for the attendance. If the economy was slow, people would attend workshops because they had nothing else to do or they wouldn't attend because they couldn't afford to. Conversely, when the economy was good, guys didn't show up because they were too busy making money. So it was a real hard thing to gauge. But the SFA has always done a good job of being somewhat nimble, and, constantly trying to tailor the workshops to the fabricators. What has changed over the years is that the workshops have become more focused on the suppliers of equipment and consumables, that being blades, glues, tooling, that sort of thing. There's been a drive recently to get workshops back to being more fabricator-focused. So, the upcoming workshop here at Cadenza will go back to that original format; educating the fabricator on how to work with stones whether they be natural or man-made, but less focused on the sponsors. The sponsors will be here. They will have tables with their products -- but we're not turning our shop into their showroom.
How do you think the membership has evolved, in terms of what they get from being in the SFA?
HANNAH: Well, I think there's a lot more appreciation for what the SFA offers. The SFA has earned its stripes. Now that we're 13-14 years old we've earned and have great relevance. Members know and appreciate that being part of the SFA gives them a very quick learning curve and a huge step up in the industry, especially when they're new. I love going to the SFA sponsor-appreciation party at TISE. It’s something to listen to the comments from the new members, that they just can't believe that so many guys are willing to help them. This year I had a couple of sponsors with me -- they weren't stone-industry specific – and they said, “This is amazing, how come the plumbing industry doesn't have this? How come the electrical industry doesn't have this?" I don't know the answer, but the SFA is a very unique organization that everybody said would fail but has succeeded tremendously against all odds simply because we have no rules. We help everybody at no cost.
What's the most important thing you've learned from being with the SFA?
HANNAH: How little I know. I've learned that, no matter how long you do whatever you do, you can still learn something new. And I'm always amazed at workshops or events or at the shows, that I always walk away with some sort of nugget, some sort of, how come I didn't think of that? And sometimes I learn it from an old timer and sometimes from a rookie who came in so fresh that he thought outside the box. The SFA has opened a lot of doors for a lot of people. Nine years ago we started the SFA Italy tour, which really opened up some eyes as to how little we here in North America knew about working with stone. You take fabricators to Italy and show them what's really being done in the industry, and it was like, oh my God, we know nothing.
You and Cadenza were certainly part of the big build-up in the 2000s. You’re still here and a lot of others aren’t. What do you think made the difference for your company, both in the recession and in the post-recession era?
HANNAH: Well, getting through the recession was really tough; I mean, really, really tough. I made some business decisions that business strategists or business consultants would say were poor, but from a humanitarian perspective, I'm very proud of what I did. I vowed not to lay anybody off. Our team is family and they built Cadenza to what it is. I could have shut the doors and stayed home and rolled over like so many others did. We could have walked away with a lot more money. But instead we took on work we said we would never take on. We took on some big-box contracts. Everybody in the company agreed to take a 15% pay cut. We worked harder than we had ever worked before, exchanged four quarters for a dollar day in and day out. We worked together as a team and we kept everybody's families fed and we kept the lights on. But most-importantly, we paid for all of our equipment. So, when the recession started to turn and the economy started to rebound, we were very well-positioned. We had very low expenses. We were very lean, very mean and had become very efficient. Because of that we were ready to go. All of our fabricators had maintained their skillsets because they had worked right through that whole thing. I like to say that the second-best business decision that I ever made was taking on the big-box contracts; however, the best business decision I ever made was firing them when the time was right. When that day came and we knew we could survive without them, it was great. We came out of the recession strong and hard. But the most important thing is, we stayed nimble throughout the whole thing.
The industry went through a lot of shake-out in the past 10-12 years. What three things do you see that changed the most in the trade?
HANNAH: Well, the big-box stores commoditized natural stone. Before the recession, natural stone, granites, marbles, countertops were primarily for upper-end homes. But when the recession hit, they commoditized that product. There was a lot of importing of cut-to-size, and suddenly you saw granite going in everywhere. So, any home over $150,000 came standard with a granite countertop. In order to do business at that level, you had to cut your price, and that was a battle that a lot of guys got into and tried to compete, and a lot of guys went down because of it. Most of the shops that tried to compete in that market ultimately failed. The other thing that happened during the recession is people had to change in order to survive. They had to become leaner and more efficient, and so they started to embrace technology. They started to turn to digital technology, digital templating and digital cutting solutions, which made them more efficient with fewer people in their shops and improved the quality of fabrication. When you make that decision to go digital, you know you're going to become faster, and become more efficient. But the one thing you don't put a lot of stock in is the precision that you're going to start putting out. Digital technology brings aerospace tolerance to the stone industry which helps separate the custom shops from the production shops. It helps define the higher-end or better-quality fabricator from that big-box commodity product. As we came out of that recession and our niche market started to look to upgrade their home, flip their home, or to buy a new home, they were looking for something different, some product, or detail that was not available in that big-box store which allowed those fabricators that embraced technology to flourish.
Is stone fabrication still a business where you can start small and grow big, or is automation and scale-of-production making it more of a factory game?
HANNAH: That's a great question. I think you can still start small and grow big, but you have to choose your niche market wisely. And you can't go after the multi-family high-production market as a small custom shop. You just can't do it. There are some huge shops out there, and there are some small shops out there. There are very few middle-of-the-road-size shops out there. You have got to decide what you want to be. If you choose your niche market wisely and know your numbers you can still start small and succeed in the stone industry.
How has the fabricator’s status in the sales-design-production chain changed?
HANNAH: I always find it interesting, every year in Verona -- I sit on the International Stone Summit Panel– and the Italians especially are always amazed how involved the North American fabricator is in this aspect of the industry. I don’t think it’s changed at all. I think the fabricator still drives the decisions, the sales decision ultimately. The designers will come into your facility with a want, but the fabricator is the one who ultimately is the most knowledgeable about the various materials and steers the designer to the end product. I don't think it's changed in the 25 years I've been doing this.
There was plenty of resistance to quartz surfaces when they first appeared on the scene. This isn’t happening with porcelain slab and other tile-type derivatives. What’s the difference in the reception?
HANNAH: Many, many years ago, there was a time when Cadenza would not allow quartz within its walls. I would simply not allow any man-made product in this facility. We were purists; we only worked with natural stone, marbles, limestones, granite. This quartz product came, and it came hard, and we still stuck to our guns. Then quartz suddenly ended up with the majority of the market share and we were late getting into the game. Because of that hard-headed attitude we lost a lot of opportunities. We had a lot of catching up to do. Years ago, when somebody walked in and asked for quartz, I would send them on their way. Now, if somebody walks in and wants a countertop made out of pudding, we’ll find a way to do it. Now this porcelain thing is coming down the road: I preach whenever I speak on behalf of this industry “Do not make the mistake that Cadenza made 20 years ago”. This is something new, it's here to stay, jump on board, learn how to work it, learn how to be the best with it. Because there is huge opportunity coming with it. The industry is embracing porcelain this time. There are a few naysayers, there's a little bit of pushback from certain sectors of the market, but for the most part, fabricators are embracing porcelain. Two years ago I went to Coverings with one question to be answered: This porcelain thing, is it a trend, a flash in the pan? And I sat down with, our mutual friend, Alberto Antolini (of Antolini Luigi) and I asked him, "Alberto, talk to me about porcelain. Where do you think it's going?" And he looked at me, he said, "We have 50 colors so far." When the patriarch of the natural stone industry is investing heavily in porcelain, you know something's up. Later that year in June I hopped on a plane and went to Modena, Italy, and toured a couple of the porcelain manufacturers. I was overwhelmed with the amount of money that they have invested in porcelain. And I was also overwhelmed with the quality. Despite being in this business 25 years, from 12 inches away, I could not tell you if it was real stone or an imitation. I came to the realization very quickly that porcelain is here to stay. If you don't get onboard, then the same thing that happened to Cadenza with quartz is going to happen to you with porcelain.
How do you see the product mix evolving? Will certain materials follow certain categories, or will consumer marketing drive product use, or what?
HANNAH: Another great question, and one that was posed to me at the International Stone Summit. The Italians are very concerned that the market share that marble enjoys is going to be eroded by porcelain, and I disagree with that. I think marble will always have its market share but I think that you're going to see porcelain eat away at the quartz market share. The fabricators are going to become much more comfortable dealing with and working with porcelain very soon. And when that happens the pricing will even out and then you're going to see porcelain and quartz on an equal playing field. The designers love porcelain because it gives them the opportunity to recommend the marble look to the North American market. And one of the things that's very unique about the North American market is that North Americans like everything to look brand new forever. While the Italians love the patina that marble takes on over time the Americans do not. With porcelain you now have the opportunity to have beautiful Calacatta Gold or beautiful Bianco Carrara that is essentially a porcelain knockoff, but it's perfect and it's bullet-proof if fabricated properly. You're going to see the designers pushing hard for porcelain, you're going to see the better fabricators working it and installing it, and I think you're going to see a lot more colors / variations on the market. I really don't see that going away.
What kind of countertops do you have in your home?
HANNAH: This is a good one. We have granite on the kitchen countertops. We have quartz on our master bath vanities. We have large-format porcelain slab flooring, heated obviously, in the master bathroom. We have a porcelain-slab shower. And we have a floor-to-ceiling book-matched marble fireplace. We've got everybody represented. No discrimination, and not playing any favorites.