Build Manufacturer Relationships for Success - PODCAST TRANSCRIPT

Editor's note: The following is the transcript of a live interview with John McDermott from KARNAK. You can read the interview below or listen to the podcast.

Intro: Welcome to CoatingsCast, the ultimate podcast dedicated to the science, art and innovation of liquid and fluid-applied roofing, coatings for surfaces and waterproofing. It's time to roll up our sleeves, put on our lab coats and dive headfirst into the world of liquid protection that keeps your roofs and surfaces in prime condition. The future is here and it's liquid, so don't miss out. This is CoatingsCast where every drop counts in the world of roof and service protection.

Karen Edwards: Hello and welcome to CoatingsCast by CoatingsCoffeeShop. My name is Karen Edwards, and today we're going to be talking about how contractors can satisfy their business needs by building relationships with their manufacturers. And I'm pleased to welcome John McDermott from Karnak to this episode to dive in deeper on this topic. John, welcome.

John McDermott: Thanks for having us, Karen.

Karen Edwards: Yeah, it's great to see you. I always see you running around trade shows, and we never seem to have some time to talk, so this is going to be a great conversation today.

John McDermott: Yeah, yeah.

Karen Edwards: Why don't you just go ahead and introduce yourself to everyone and tell us a little bit about your background and your role there at Karnak.

John McDermott: Okay, yeah. I started with Karnak in 1997, so going back 27 years ago, in my basement as the regional manager with our regional office in St. Charles, Illinois. It was since grown dramatically, of course, and built plants here in the Midwest and the West. So it's been a really good run. I was a roofer by trade, started in the roofing business in 1986 and worked out with some other distribution and manufacturing companies and sales prior to joining Karnak 27 years ago.

Karen Edwards: Wow!

John McDermott: Basically, in charge of all our commercial sales group in North America.

Karen Edwards: Okay, yeah, that's a nice long history in the industry, as well as with one company, which says a lot I think for the type of company that Karnak is because people like to job hop a lot nowadays. And when you have some people that have that longevity, I think it says a lot about your culture, as well as your products. So for those who don't know, and I don't know how anybody couldn't know, but there may be some new folks who don't know what Karnak does, what kind of products you have. Can you give us that high-level look?

John McDermott: Oh yeah, sure. Karnak was well-founded in 1933 by Marty Jelin. His daughter, Sarah Jane Jelin, is our current president, and Jake Schwartz, her son, is our national director at [inaudible 00:02:37] so we're in our third generation. Karnak was started as a waterproofing company, waterproofing products way back when and evolved into liquid roofing products, namely black goods like flashing cement and then aluminum coatings and reflective coatings.

And now everything has really evolved even in the 27 years I've been there. Karnak is approximately half of our business is in the reflective restoration coatings and the other half being black goods and aluminum coatings, et cetera. So quite an evolution. I could say a lot about Karnak. I could keep going on, but go ahead, ask the next question.

Karen Edwards: Well, we hinted at the beginning that we're going to be talking about helping contractors meet their business needs through relationships with their manufacturers, and there are a lot of different roofing products out on the market today, and it's important for manufacturers to listen to the needs of their contractors. And I just want to hear from you a little bit about how Karnak does that and why it matters.

John McDermott: Well, I can tell you the reality of that. If you went to one of our trainings, nearly everything we'd profess or teach or recommend or share with our contractor clients came from a contractor at some point in time. We listen to better ways to do things. We can have the greatest research and development and the greatest quality. It's the roofing contractor that will take that in real life situation on the roof and find better ways to apply it for better long-term performance and different things like that.

So it's critically important. We start off every presentation with, listen, this is not just us talking. We're going to share with you our best practices. We want to hear from you as well. And anything that's better, we're going to incorporate it into our systems. And it's worked rather well to be open like that.

Karen Edwards: And you mentioned a contractor event or training. What does that look like? How often do you do that for contractors?

John McDermott: Well, quite often now. I mean, every week there's a training event or multiple training events going on across the United States here and Canada. We have a variety of levels. Our Qualified Applicator program, which we're going to hit on later, is almost a full day technical training, hands-on and classroom.

And then we do short dose trainings for say just repair and maintenance, just under care products or just on a specific product or just on selling restoration coatings and the value to the owner and how to sell it to the owner. There's probably a dozen modules that we actually present. And to answer your question, it's all the time every week.

Karen Edwards: And it's growing, right? I think the restoration and the coatings product and even repair and maintenance, it's just taking off. And you're seeing this every day. Why do you think that is?

John McDermott: My boss likes to use the term rising tides lift all boats. It's an easy entry into that business. You don't have to be a geared up commercial industrial roofer to be in the repair and maintenance business or to restore commercial roof. So there's a little bit easier entrance into that business, into that space. Basically the owner clients are much more aware now of restoration options.

If you want to go to the whole environmental part of it, that's a whole nother thing that the owners are very, very aware of and they're looking to restore and sustain these roofs instead of tearing them off. So they're getting ahead of it when there's still time. That's driving a lot of that. We can talk about the cost. The cost has always been better and the cost has always been a lot lower than re-roofing, but there's a lot of other reasons why people might do it.

Karen Edwards: So, we're talking about supporting contractors and not every contractor is the same, right? Some are going to have different needs than others. So how do you identify what their needs are, I guess, and then deliver the support that they need?

John McDermott: There's quite a difference actually, and you can talk about cuttings and restoration, just the general roofing contractors. There's quite a difference. As I mentioned before, there's more contractors entering the commercial industrial space in different ways, and they do need things differently. Some of the names we know so well in the commercial industrial, they have significant education and training programs, not only on the technical and application side, but also on the sales side.

They don't need as much from a Karnak or any of us. They do a lot of that themselves. We provide it anyway. And then other companies are just coming up or they have staff that's new to the industry, whatever, and there's quite a lot that they need from the sales side and from the technical and application side. So it can vary widely.

Karen Edwards: So yeah, contractors are, as we mentioned, in different places in their business. And like you mentioned, the larger commercial contractors, they're going to pretty much have their ducks in a row and not need as much support as somebody just getting started. So how do you help out that person that's newer to the industry?

John McDermott: We don't start with a full day of training. Perhaps a systems overview and an overview of the opportunity in restoration coating systems and repair and maintenance. We do an extensive presentation on just about repair and maintenance, why it's important, why it saves the owner money and it just gets them thinking about their client base.

And yeah, I should be in this business because I can take this information Karnak's providing and go to owners and share with them that this is actually the more cost-effective way to maintain my roof. Just information they didn't know before. So we start off with that and we can do the technical stuff at any point in time. And then if they're interested and they want to go pursue this type of business, they have a client base for it, then it works out perfectly.

Karen Edwards: Well, that's nice. You do it a little bite at a time, right? Not overwhelmingly.

John McDermott: Mm-hmm, yes, absolutely.

Karen Edwards: I mean, you work with contractors obviously all the time. You're out in the field. You're talking to them. Do you see any trends with the contractors and their product loyalty? Why is someone picking one product over another?

John McDermott: Well, that varies widely as well. Some people got into the business through a particular vendor. I will say this, what we're searching for we're finding and the contractors we're finding are searching for us also. They're searching for consistency. That just doesn't mean quality, but consistency in everything. They want the consistency in the representation, who they can call. Can they get their warranty administration done easily? Are we easy to do business with?

Is our service great? And when we find each other, we're both looking for each other, we find each other, there's some great loyalties built immediately. And then of course, we have contractors we've been doing coating restoration work with for since the '70s for that matter. We have that loyalty as well from just previous generations of representatives and et cetera. It's a mixed bag, but there's a lot of competitors out there, so there's a lot of work to do.

Karen Edwards: Well, that's true. There's a lot of options. So as I mentioned when we were talking earlier, I think that the history and the longevity of not only the company and the products, but the team members. In five years, they know if they pick up the phone to call John McDermott, he's going to answer the phone and he's going to still work for that company, right? That's important.

John McDermott: Yeah, and we've had something we're kind of proud of. We've had two regional managers just since I've started that retired after 21 and 22 years. Chris Salazar, chief operating officer who hired me back in 1997, is I think on year 44. I hope I was correct there. And then I've got two other regional managers that are in year 11. Another regional manager in year nine. And then we've got some youth in the program as well, some folks that are in year two and year four.

Karen Edwards: Nice. Nice. Yeah, it's always good to bring them in young and get those fresh perspectives too, because we're seeing the roofing industry in general, we're all getting a little bit older, right? And the next generation is coming, taking over their family business or taking over their dad or grandfather's company. So it's great to be able to have that knowledge and history and experience, but also have a youthful perspective as well. And it looks like you guys are doing that.

John McDermott: Yes. Yes.

Karen Edwards: So, let's talk a little bit about we mentioned loyalty, loyalty to brands. A lot of manufacturers have loyalty programs. What does Karnak's look like?

John McDermott: So, within what we call our KQA program, Karnak Qualified Applicator, within there, there is some loyalty rewards. And primarily there's a cash incentive where they can get cash back based on product purchases of qualifying products, and they also get discounts on warranty fees. Warranties have become a much bigger part of the coating restoration business as we're developing systems and not just putting a coating on a roof.

And with those comes warranty fees. In some cases, they get discounts on those as well. So those are two of the loyalty rewards. We have some other smaller things. We'll do co-branded marketing for them. If they want to have shirts made or if we want to do postcard advertising stuff, we have limits on that and we'll do that sort of stuff as well. So those are the primary just rewards programs.

Karen Edwards: So, you mentioned KQA, the Karnak Qualified Applicator. What does that mean and what does it entail to earn that designation?

John McDermott: We started this just in 2019. We had thousands of roofers using our product literally, many thousands. It was very difficult to get it started. We just didn't know where do you start? We pre-qualified a very small group across the US, and we built a training program. Our national director of technical services built a full technical training program that basically covers everything. And we started presenting this to contractors that wanted to be a part of it.

Really owners who were hiring a roofer, they want someone that's qualified. Roof consultant specifiers on a project, they want these applicators to be specified. And the contractors themselves, some of them take quite a lot of pride in spending time learning from us, sending a lot of their personnel at a great cost to them to our training because they want them to be top level trained in these types of products and they want to do the things right. So that is the KQA program.

And what that really entails is approximately a six or seven hour program. It's all done in one day. We can split into two partial days, pardon me. And part of it is hands-on and part of it is classroom. And again, it's not even a Karnak commercial, we promise. It's a very, very good technical training, just trying to help them understand how we're going to get this done right. Because for a restoration system to have any value, it has to last.

We preach that over and over again, how to get it done right, how to get it done efficiently so that there's a cost value to that other client as well and obviously how to get it done profitably. That's the business they're in, turning the profit for themselves and their employees and their families. That's the basis of the program. And once they're in, we communicate with them obviously.

We do have a lead generation program through our website and some other things that we're doing through the internet. And any of our lead referrals, you would say, would only go to the Qualified Applicators in that particular area.

Karen Edwards: Sure. So you may get a roof consultant or a building owner making an inquiry on your website saying, "Hey, I would like to maybe use you on my building," and then you connect them with one of your KQA contractors in their area. Is that how it works?

John McDermott: Yes, and that's ideal and that's a very regular occurrence. It's not every market in every corner of the United States, but it's a very regular occurrence. We come up quite strong in searches for roof restoration, roof repair, roof coating. Our brand, just the longevity of the brand and the performance of the brand long term really puts us at a high level when you go to search for something like that. And owners, again, are getting more savvy and they're more educated and they're coming directly to us for information and wanting our Qualified Applicators.

Karen Edwards: Sure, sure. So you mentioned with the Qualified Applicators that there's a lot of technical training. There's obviously installation training because we all want a quality installation. Nobody wants to go back, right?

John McDermott: Correct.

Karen Edwards: Is one of the topics that you cover, and I believe Chris Huettig was actually on one of our webinars a few months ago talking about how to... And I don't want to go down a bunny trail here, but maybe real high level, do you talk about how to identify if a roof is a candidate for restoration?

John McDermott: Yes. We beat that to death at the beginning of the program. Because if it's not a candidate, we're all going to lose. It's going to be a bad situation for everyone. So there's a whole series of slides and recommendations, information on how to get the thermal imaging done on this, moisture scan, doing core cuts, looking for different things. Different types of roof are harder than others. Like on a metal roof that's pitched, what you see is what you get. You can see what the problems are going to be and you'll know how to correct them.

When it comes to a low-slope roof that has a membrane or a built-up roof or a modified and it's got three layers of insulation and it's got a concrete deck, you have no idea what's underneath. And those can be pitfalls for coating. So we want to make sure it's in a restorable condition, again, because in order to have any value, it has to last. If it's all soaking wet, it will not last.

Karen Edwards: Right, yeah. So that's a shout-out to go to coatingscoffeeshop.com and look up that webinar. You get a full 45 minutes to an hour of information on that from Chris.

John McDermott: Yeah, we can spend a lot of time on that.

Karen Edwards: Definitely. Oh, I had one more question about the Q Applicator. Oh, where are they? How do I get this training? If I want to get my KQA, do I have to go is it one specific location? Is it through distribution? How does that work?

John McDermott: No. Right on our website, you can make the inquiry and your representative will be contacting you very, very soon right away. It's under the resources tab, karnakcorp.com. That's K-A-R-N-A-K-C-O-R-P.com. And under the resources tab, there's something on the KQA program. If you click on that, then that inquiry will come right to me and our regional management staff immediately and we will connect with you.

Karen Edwards: Excellent. Okay. So go to the website, submit your information and John will reach out or someone on the team and get you all set up for it. That's really exciting. And you said there are a lot of these sessions. So it's not like I go to the website and I'm going to have to wait three months for the next one to come up because they happen pretty frequently.

John McDermott: No. I mean, we have to schedule them. We do them right. They are quite involved. There's a lot of we ship materials in, et cetera. A few of our plants have training centers. And so that's simple enough. We have everything there in Chicago and in Kingman, Arizona. But what we'll do, we'll do them anywhere. We've done them in the back parking lot of the contractor's office.

Some of our distributor partners have been very gracious and allowed us to use their conference room and their facilities. And we've rented a roofing association. They have training centers. We've done that. Anywhere, anytime. It's not going to be three months. It may be three weeks or a month, but it's not going to be three months. We'll get it scheduled.

Karen Edwards: Okay. And then one last question that I'm curious about. I'm a contractor. I've gone through the training and I'm about to do my first job. Will you come out and help me?

John McDermott: Yes. Yes. We want to be there.

Karen Edwards: Okay.

John McDermott: One thing we'd like to do in addition to that, let's just have a pre-job tech review. We'll get our tech people, our salesperson, the roofer online. Let's have the pictures of the job. We may have approved it already. We have a notice of intent to warrant kind of thing if it's a warranted job. So we have approved it already, but let's all just get on a Zoom like call this.

Let's take a look at the different details and the different flashing situations, the access to the roof. And let's give them a whole bunch of pointers that might save them a lot of time and trouble ahead of even going to the job. And as far as being on the job, we absolutely like to do that. Our tech staff and our regional management staff are both... They're all tech people really, and myself, and we're happy to do a job startup.

We'll spend the whole day with them. We'll come back the next morning. The cleaning process is critical, so we do like to do it then just to make sure they know how to get it done right and efficiently. We would prefer to be there as opposed to not.

Karen Edwards: Excellent. That makes me feel a lot better. If it was me, I would want you guys there too. So that's really great to hear. Done. It has been a pleasure having this conversation and learning all about how Karnak builds these relationships with contractors and supports them throughout their lifespan, I guess. So thank you very much.

John McDermott: It was a great opportunity for us. I appreciate you thinking of us, and we're here for anything else.

Karen Edwards: Yeah, that's fantastic. And I want to thank everybody for listening and watching this CoatingsCast. Be sure to visit Karnak's directory on CoatingsCoffeeShop.com. All their contact information is there with a link to the website in case you didn't have a pencil to write down when John gave us the website. It's all there. Be sure to subscribe to CoatingsCast on your favorite podcast platform and set your notifications so that you don't miss a single episode. And we'll be seeing you next time on CoatingsCast.

Outro: Thanks for joining us on this coating adventure. Stay tuned for more episodes. And in the meantime, be sure to follow us on social media to stay updated with all things roof coatings. Until next time, stay coated. For more information, go to CoatingsCoffeeShop.com.