Picking the Bones
What to Save, What to Toss, & Making Money with Remnants
Previous page: Carrara Marble Company of America; Above: Photo by Pam Schipper
By K. Schipper
Let’s face it, the world is full of leftovers. But not all leftovers are created equal. What’s sitting in the kitchen after Thanksgiving dinner stirs anticipation – at least until the pie’s gone – but that part of a slab left after you cut the Smiths’ new kitchen may fill you with dread. The surface is still attractive, but is it big enough to squeeze something else out of it, such as a vanity or bar top? Obviously, you’ve got money tied up in it, but you also have to think about the costs of storage and marketing. The electronic world makes inventorying and marketing those remnants a little easier than in the past, but there’s still not a perfect answer to the problem –unless maybe you let someone else take on the job. (See "Skip the Dumpster, Try the Database.") As one fabricator says: Remnants can be moneymakers, but you have to pay attention to your core business.
COMMON THREADS What makes a piece a remnant? Each shop may define it a little differently, but a common thread is that it must still be a useful size. Mike Ruggieri, owner of Trinity Granite Inc., in Johnson City, Tenn., says his definition includes what else is in the shop. “We get our material in bundles, and once we’ve gone through a bundle, anything that’s less than a slab is a remnant,” he says. “It doesn’t have any match with what else we have, and that is dependent on what material we keep.” Even then, he says the remnant also has to be big enough to do a 36” vanity with both side- and back- splashes. Mark Scheibelhut, owner of Custom Stone Interiors in St. Cloud, Minn., also considers the bundle when he’s defining remnants. “If we’ve got more of it in inventory, then it goes back into inventory as a partial slab,” Scheibelhut says. “Otherwise, we don’t keep anything that’s not big enough to make a vanity. Typically, that’s 54”. However, if it’s something real pretty that people will pick just because it’s exotic, then we might keep smaller pieces.” As for who makes that momentous decision on what stays and what goes in the scrap bin, that can vary. Sometimes the decision is made at the saw, while at other times, those a little higher up the ladder have the final say. Both Scheibelhut and John Baltzegar, founder and president of StoneWorks in Beaufort, S.C., say the decision is made at the saw. “Once the parameters are set (his company saves pieces that are at least 26” X 48”), the guys at the saw decide,” says Baltzegar. “They either put it in the dumpster, or they load it on the remnant cart.” On the other hand, both Brian Rooney, president and CEO of Warminster, Pa.-based Suburban Marble, Granite & Tile, and Jim Hogan, a senior vice president with Carrara Marble Company of America in Industry, Calif., say that decision comes from higher up the chain. “We have a quality-control manager and he’s in charge of inventory,” says Rooney. “He’s been around the business for 20 years and knows generally what a good stone is and what isn’t.” “We’ve got our plant manager and our inventory manager, and they’re coordinating with the purchasing agents who know the market,” says Hogan. “The guys out there know what’s going to fetch top dollar and what really doesn’t have a market.”
“They won’t rot, so they can sit there for a long time.”
Jim Hogan Carrara Marble Company of America
“If someone would buy a whole kitchen, we’d throw in a bathroom vanity for free out of one of our remnants.”
Brian Rooney Suburban Marble, Granite & Tile
"NOT LIKE TOMATOES” Making that initial decision might be the easiest part of the remnant process, although the advent of stone-management software can bring some order to tracking and managing the smaller pieces. Baltzegar, Ruggieri and Rooney all mention employing software packages (Baltzegar and Ruggieri use Slabsmith™ and Rooney utilizes Stone Profit Systems) to help them manage their remnant inventories. “It’s tagged and photographed in our shop, and then we keep a live inventory on our website,” says Rooney. “If we have the stone in-stock and somebody wants to see it, we’ll pull it out of where we’re storing it and bring it out for them to inspect.” Among the hassles with remnants are how to store them and how to show them. Just about everyone has some sort of racks for storing remnants, although it’s generally more for the convenience of shop employees than for shoppers. As Rooney says, “We like to keep the whole slabs for people to see.” “We store them in remnant racks,” says Trinity’s Ruggieri. “They’re like small bundle racks. We’ll put them back in the bundle racks if we’ve got big pieces. Of course, they tend to get a little overcrowded, so sometimes the guys will have to move a piece for somebody to look at it, but generally they can see what they’re buying.” One advantage with natural stone, of course, is that it can be stored outside. “We tend to accumulate the remnants in our yard, because it’s not like tomatoes,” says Carrara Marble’s Hogan. “They won’t rot, so they can sit there for a long time.” Hogan’s experience is somewhat different from the average countertop fabrication shop, because the size of its projects means that a lot of stone is already fabricated. However, it still finds itself with remnants. “Once we’ve got a project crated up, we will keep some stone for a while in the event that an owner has an issue with damage or breakage,” Hogan says. “We call it ‘attic stock,’ and after the project is done, we’ll offer it to the building owner to provide him with some additional material.” Minnesota-based Custom Stone’s Scheibelhut uses outside storage to his advantage. He and his sales staff are happy to walk the yard with potential customers, waiting for what he calls the “ooh moment” when they see what they really like. “The winter helps because they’re less inclined to spend half-a-day walking around out there,” he says. Having photos of what’s available in remnants, whether in a dedicated spot on a company’s website or on a computer in the showroom, may be the most-efficient way to market them. Scheibelhut admits to trying to move some of his remnants through a promotion utilizing coupons, but he says the process did little more than generate a lot of bargain hunters who thought he was charging too much. However, he is willing to offer them at a low – really flat—rate to someone for whom the shop may be doing a kitchen. “They might look around and say, ‘You know, we’ve got that bathroom in the basement.…’” Scheibelhut says. “They might get a fairly expensive stone for the same price as a cheap stone if they’re picking from remnants. My pricing schedule says this presumes that we’re already at the house doing the kitchen. It doesn’t take two guys too long to put in a 6’ vanity, and I can still make money.” Suburban’s Rooney takes a somewhat similar approach – or he did before COVID gripped the nation and ramped up the remodeling market. Before that, he utilized them to boost sales during slow periods. “We would have remnant sales and usually vanity specials,” he explains. “If someone would buy a whole kitchen, we’d throw in a bathroom vanity for free out of one of our remnants.”
BASIC ASSUMPTIONS The whole idea behind keeping remnants is to make some money on them, although just how people charge for projects involving them is all over the board. As Trinity’s Ruggieri notes, everybody’s costs and markets are different. He, too, assumes that most of his remnant buyers have already purchased a kitchen. “We sell our remnants with a kitchen installed for $35 a square foot,” he says. “That’s unless it’s a quartzite, when we go to $70 a square foot because of the extra labor. We look at it that the cost has already been accounted for.” Stonework’s Baltzegar says his basic price is based on the initial cost of the stone per square foot, plus a mark-up for taxes and a commission base. “Then, we have the labor,” Baltzegar says. “Labor is always separate. I started charging that way in the late ‘70s and I still do it that way.” Rooney says he can’t even give a remnant buyer a quote over the phone because it depends on the job. “Our pricing includes the template, the fabrication and the installation,” he says. “Then, there are standard edges and upgraded edges. We don’t charge for standard edges, but we do charge for upgraded edges, sink cutouts, that sort of thing. If they call, I can give them a ballpark.” He adds that Suburban is particularly meticulous about managing – and charging for -- high-end hot sellers like Calacata Gold. “Even if you have a small piece left, you can get a small vanity out of it, or even a tabletop” Rooney says. “You know that somebody will want to have something nice out of it.” Carrara Marble’s Hogan agrees that there seems to be a constant demand for the higher-end Italian marbles, even in remnant form. However, he says it’s important to remember that tastes in natural stone tend to change about as fast as other fashions, and something hot today can easily become tomorrow’s striped bell-bottoms. He relates the story of when the company moved to a new location in Las Vegas several years ago and was faced with moving a whole yard of remnants, some of which had been outdoors so long the crates were falling apart. “We posted signs and put-up notices on the web that they were free for the taking,” Hogan says. “We even offered to load it on vehicles, because it was going to cost us to move it. It goes against your capitalist mind to throw stuff like that away, but we were actually able to get a fair amount of it taken off our property for free.” Both Rooney and Ruggieri believe the secret to a good remnants program is to manage it by keeping them organized and doing more than just assuming someone will walk through the yard and take a liking to a particular piece. “It can be pretty worthwhile because if you don’t sell those remnants, you’re not getting anything out of them,” says Ruggieri. “If we can use them to increase the size of each job we do by adding something cut from a remnant, we’re adding to our margins, getting more throughput and adding dollars in profit at the end of the year.” However, both Hogan and Stoneworks’ Baltzegar say that means truly making the hard decisions on it. Hogan says he tries to regularly walk the yard with his superintendent to identify remnants that need to be trashed. Baltzegar agrees. “Don’t get sidetracked by the remnants,” he advises. “If you have a carefully thought-out plan to keep a certain size and nothing less, and then keep those neat and clean for people, it can be a moneymaker. “But don’t be a hoarder. Pay attention to your business and get over that you might have to throw out a perfectly good piece of onyx that you paid a fortune for.”
“Pay attention to your business and get over that you might have to throw out a perfectly good piece of onyx.”
John Baltzegar StoneWorks
Skip the Dumpster, Try the Database?
AUSTIN, Texas – If you’re tired of trying to manage your remnants or figure there must be a better way to do things, it may be time to hire help. Call them online brokerages or clearing houses or what have you, they see that applying a little management to those remnants can mean profits for you – and them. One example is CountertopSmart.com. Started in Austin in 2018, company co-founder and CEO Zach House came to the stone industry from behind the sales counter. For eight years, he operated a kitchen and bath showroom in Texas’ capital city, and his countertop customers were often frustrated because quotes would be based on the price of full slabs. “Customers would come in and fall in love with a sample,” he says. “Then, when it was time to provide a quote, it might be a small galley kitchen or a laundry room, but they would be told they had to buy a full slab.” At the same time, he recognizes that fabricators may be holding hundreds of thousands of dollars in remnants and even full single slabs. He acknowledges they might also be poorly organized and getting a piece out for a client to look at would take time and a forklift. “They don’t love it when you have a walk-in customer because they have to dedicate a salesperson to accompany that potential buyer around the yard,” House says. “And, even if they’re well-organized, it can take three or four hours and the customer ends up purchasing $400 of material.” Looking for a solution to both sides of the problem, House and a partner came up with CountertopSmart, which begins by getting a fabricator’s remnant inventory online. In some cases, that can take two people a month to get a shop’s remnants photographed and organized, but it’s then available not only to homeowners, but also to interior designers, remodelers and general contractors who are looking for a particular piece to set off a guest bath vanity, a small bar or even an outdoor kitchen. “They still can go to view it at the seller’s location, but we’ve reduced their effort,” House says.
However, that may not translate into a fabrication job for the remnant-seller. “Our users can work with a seller for the fabrication and installation,” he says. “They also have the option of just purchasing the material, and we’ll facilitate transfer within the marketplaces we work in. We do charge a flat fee for that. Or their fabricator can pick it up directly from the seller, which works out well.” House’s use of the word “marketplaces” is no mistake. Although the company is based in Austin, it’s recently picked up a couple fabricator clients in San Antonio, and the company’s plan is to expand into the Dallas-Fort Worth and Houston markets in the future. The company also utilizes LTL shipping services to serve a wider market, and House says for the right remnant it can make sense to some buyers.“We have shipped to Alaska,” he says. “The furthest we have shipped something so far – and we didn’t actually handle the logistics for it – was South Korea. It wasn’t even a tier 1 granite. It was Silestone®, and I don’t know why they did it; maybe they just couldn’t get it there.” The cost to the shop owner is a percentage of each sale. As for keeping up with the never-ending growth of remnants in most shops, House says CountertopSmart is working on a proprietary app that will allow them to photograph remnants and upload them, like the software the company’s employees use initially on a shop’s inventory. The bottom line, House says, is Countertop Smart is a technology company that happens to operate in the countertop space. However, thanks to its digital marketing the goal is to get both fabricators and buyers to think of CountertopSmart when they think remnants. Of course, the biggest advantage in terms of time and effort is to the buyer who’s looking specifically for a Silestone Et Marquina or a Calacatta Gold marble that must be 22” X 72”. “If they walk into a fabricator’s yard, it’s going to cost the fabricator a lot of time,” he concludes. “It doesn’t make sense within their core business to spend the resources to inventory and sell it. "We have a large selection that’s easily located, and that adds a lot of value to both sides.”
– K. Schipper