Growth in construction may slow somewhat in 2001, as many experts predict, and sales of power tools, very strong last year, could slow as well.

Many distributors had record and near-record sales years in 2000. Others had solid years, boosting profits and keeping shelf items moving. Power tool sales are closely linked to fluctuations in the construction industry. Construction forecasts see slower growth for 2001, but not a negative turn that would start people using the word "recession." Growth should continue, if slowly, and come in for a soft landing as the year winds down, according to industry experts.

Jim Smith, president of Nail Fast, Inc., in Albuquerque, and president of STAFDA for 2001, suggests that distributors focus on service because growth in 2001 "will be harder and harder as more sellers are added to the mix." Small distributors will feel even more heat from consolidated companies and large retailers. Nail Fast has one branch and nine employees serving New Mexico and the El Paso, Texas area. They do some business in Mexico, as well.

Nail Fast, he says, is keeping a close eye on products that are "commoditized," versus those that remain specialty items.

"What's a commodity and what's a specialty? Distributors need to realize it's the service and pricing. Don't price the same way for specialties; they need to be sold and priced differently. If you know your customer better than someone else, you will know what specials he needs," he says.

Extra service, like last-minute deliveries to out-of-the-way job sites, will help keep small distributors' sales up, Smith adds. New items that will be big sellers in 2001 include cordless contractor's portable tools. They are getting more reliable and heavy-duty, Smith says. "Everyone's wild about cordless, in particular a new finish nailer," he says.

Smith also says that communication will be a key for customer service in the coming year. Something as mundane as a new phone system he installed has reaped many rewards.

"We are using voice mail, paging and scheduling, and text messaging in better ways. It's hard for some people to get high-tech like the Internet right away, but our customer base is in the same fix. Now, our customers can call and have many ways of getting the right person," he says.

So, Smith notes, distributors need to match their technological purchases to their customers' abilities. Many on-site contractors, the bread-and-butter customers, can't order over the Internet, and may need a salesperson in a hurry.