Customers buy extra value

Providing extra value is Paramount"s only secret of success, Augustine says. The 36-year-old remodeler says he developed a customer-focused service philosophy by learning lessons from his father, a former independent contractor who now works for Paramount, and by working as a salesperson and junior partner from 1985 to 1991 for another local remodeling company.

"I had opened a successful branch office for the company and had a million ideas on how we could do it better," Augustine says. "I wanted to improve the product line and change our marketing, too. When I tried to explain my ideas to the senior partners, no one seemed to want to listen. They felt they were successful in their own way.

Eventually, I decided I had to start my own company to do what I wanted to do.

In October 1991, Augustine quit, and started Paramount Builders the following month. He and a part-time canvasser began working over the holidays. They sold their first siding and window job on Jan. 2, 1992. The job was completed on January 8.

"Fast turnaround is important to clients," he says. "The most common question a new client asks after signing a contract is, "When can you get started?" Many companies can't answer that question right away. They're just focused on selling the job, and once it's sold, then they think about production.

"Paramount provides fast installation turnaround because that's what the client wants. We are averaging a 33-day turnaround on jobs from initial sales to completion. Even custom window jobs take no more than six weeks. Our job cost-out forms include a line that asks how long it took to complete the job. If it's longer than 60 days a written report must be attached to explain why."

Client satisfaction is further assured by requiring that crew leaders show the client what has been done when a job has been completed, answer any questions, and make sure they know how to operate windows if they were installed. Clients then sign a certificate of completion form and are also asked to complete a customer satisfaction questionnaire that covers sales, office personnel and installation. Any problems must be resolved immediately.

One result of this attention to detail, Augustine notes, is that the local Better Business Bureau, which Paramount belongs to, has had no unresolved customer complaints in its 10-year history with more than 10,000 customers served.

Upstairs focus is all sales

Paramount's 9,600-sq. ft. two-story red brick headquarters building reflects the company's approach to sales and service. The building's second floor is dedicated to sales, telemarketing and training. The first floor houses accounting, finance, corporate compliance, service and production.

The mission "upstairs" is to generate a current average of $1.2 million in monthly sales, no small feat when remodeling contracts average $6,800. Central to this effort is a team of canvassers who go door to door in targeted neighborhoods. A canvassers goal is to knock on 80 doors in four hours. An average of 40 homeowners will be home and 20 will listen to the canvasser's presention about the company. An average of two out of the 20 will agree to a product demonstration by a company sales representative.

Paramount telemarketers follow up with homeowners who have agreed to a product demonstration to confirm the day and time. About half of the leads will cancel at this point.

Company salespeople who make demos close on about 40 percent of their calls. Product demos are simplified because Paramount sells only one brand of premium siding - Wolverine HP-55, and one brand of premium replacement windows - Alside Ultimate 2000. By arrangement with the manufacturers, Paramount offers both products on an exclusive basis in its service area, which is an important competitive advantage.

The company also offers a custom trim package using Alcoa PVC-clad aluminum coil and Wolverine 6-in. beaded Invisivent soffits. The custom trim service gives the sales team a service to sell for brick homes with wood trim, new homes, or homes that have already been sided, but the owner wants to make the exterior maintenance-free.

Limiting product brands gives Paramount more leverage in dealing with the manufacturers, Augustine says, but it also makes sales and service easier because the products provide premium performance with industry leading warranties. Streamlined product lines make it easier for sales because they are selling only products and don't have to sell against themselves with a good-better-best product line The streamlined product line also makes it easier for installers to master.

Downstairs is all service

Paramount's ground floor takes over when the contract is signed. Paramount makes it easy to finance improvements. The company offers zero money down financing - an option used by 95 percent of its clients. The finance department works with several leading lenders and has maintained a 93.5 percent loan approval rate. Some lenders have a preapproval arrangement with Paramount for clients meeting financial criteria - an important point in speeding up the loan approval and job completion timetable.

Clients who opt to pay cash are only required to deposit a small binder when the contract is signed. For larger jobs, Paramount may require a down payment or arrange financing. Augustine is a licensed mortgage broker and lender and he owns and operates a separate mortgage company, Northstar Lending, Inc.

While a contract is in financing, the company sends out a representative to take final measurements and prepare the order. This keeps the process alive with the customer and speeds up job completion. While final measurements are being made each client is provided with a form explaining how to prepare the home.

As soon as financing is approved, Paramount places the order. When orders arrive, Richard Worden, operations manager, and Ricky Mayhue, assistant production manager, check the order. For window replacements they will pick and unload every unit to make sure all are undamaged and the right size. If anything is damaged or wrong it is re-ordered and the job is held until everything is ready. Installers are informed that the order is in and homeowners are told when their job will begin. The installation date has already been set weeks before. All installations are handled by installers willing and able to meet the company's high service standards, and all must agree to comply with a number of company policies. In return, installers receive premium pay and priority assignments on upcoming jobs. Most work on a steady, but nonexclusive basis for Paramount. Worden supervises up to 26 installation crews during peak periods, while Mayhue helps supervise crews and gives personal attention to clients having questions or complaints.

Augustine says Paramount's requirement for a steady volume of business has been helped by a highly transient population in the Virginia Beach area. Norfolk is the largest naval base in the world and the Master Jet Base at nearby Oceana is the center for naval aviation and fighter pilot training.