Surfaces in Stone, Post Falls, Idaho

   A corporate veteran with knowledge of the building industry, Pignolet was looking for a change in lifestyle when a federal Small Business Administration (SBA) lender put him together with a fabrication shop owner wanting to move on.
   Almost two years later, he’s done just about everything from changing the name of the company to bringing in a CNC to automate production, as well as parting ways with some employees unmotivated to follow new procedures.
   The result? The shop is averaging about the same number of kitchens each week that it did when he took over, but with more efficiency and greater profits. And, while he says Surfaces in Stone will continue to evolve, “I think we’re focusing on the right things.”
  
GETTING STARTED
   Certainly the company to which Pignolet took title in March 2005 had plenty of history. The previous owner, Paul Terrell, had grown up in the stone trade in Montana and started his own business there.
   In the mid-1990s, Terrell relocated what was then Bella Marble and Granite to Coeur d’Alene, Idaho, where it was one of the first fabrication businesses for granite countertops in the Coeur d’Alene/Spokane, Wash., corridor.
   “He was very good with stone and had a lot of passion for it,” says Pignolet of Terrell. “He was also very good at conceptualizing how to put it in a house and he created a lot of really cool fireplaces and things like that.”
   In 2000, the business relocated to Post Falls, to put it closer to Spokane. At that time, Terrell built a 15,000 ft² building with a 2,000 ft² showroom, which it still occupies.
   However, Pignolet suggests Terrell may have been a victim of the boom in granite countertops. Aside from a bridge saw, the company operated with a hand router and hand polishers, and while it was growing at as much as 40 percent a year, he says the previous owner may have had a hard time keeping up.
   “I think one of his issues was that he was working hard and not making as much money as he would have liked,” says Pignolet. “An issue all of us have is getting quality employees who have experience because the business has grown so much. In our area, it’s also an on-going challenge to find people with the right skill sets and the right attitude.”
   In 2004, Terrell decided to sell the business to move nearer to family in California. At the same time, Pignolet says he was looking for a business – not necessarily a stone-fabrication shop – to buy.
   Pignolet spent most of his career in the building-products industry, including a stint as a brand manager for plumbing products manufacturer Moen Inc., and later as the general manager for Hanley Wood’s online building products guide, ebuild.com.
   He also says he was looking for a locale that would allow him to pursue his outdoor interests: skiing, biking and sailing.
   “In 2004, I started looking online for businesses, and I found a business in Sandpoint, Idaho, that was not related at all,” he says. “However, it’s a resort town that’s on a lake and is a ski town, so I decided to take a look at it.”
   Thanks to the provident arrival of a flight certificate, Pignolet flew out and visited the business – a ski shop – the next week. Although he quickly determined it wasn’t for him, on the way out of town he stopped to talk with a large SBA lender.
   “This guy never asked what I knew how to do,” he says. “He just started saying, ‘I have the business for you.’ He started dialing the phone before he even told me what it was. But, he hooked up a meeting between me and Paul, and that started the process.”
  
MAKING CHANGES
   Six months later, buoyed by research that showed the growing market in granite countertops, Pignolet found himself in Post Falls as the owner of a stone-fabrication shop. At the time, he had a great deal of optimism and some knowledge of how the industry works.
   “I thought I had some skills and gifts to bring to it that would help create an organization that achieves more than it thinks it can or otherwise would,” he says.
   Getting that organization in place has proven to be a challenge, though. Being new to the business, Pignolet says going in he hoped to keep everything status quo while he got his feet on the ground. However, that didn’t happen.
   “It was pretty clear, early-on, that one of the key managers wouldn’t be a fit, so we had to make a change there,” he says. “We also had a workforce that almost immediately came to me and said, ‘I have to have more money; we were told when the new guy came we’d get raises.’”
   While Pignolet says no one had told him that, he did feel that many of the then 25 employees were underpaid, and he gave everyone a small raise with a promise to review the situation in 90 days.
   “There were six or seven guys who couldn’t wait,” he says. “We had some pretty significant turnover in the first six months, but we did start to identify the people who would stick with us.”
   Realizing he would have a smaller staff, Pignolet says he made a commitment to those who stayed to train them, pay them appropriately, and give them opportunities to grow. Additionally, it encouraged him to start looking seriously at upgrading the shop’s technology.
   “It was pretty clear what we needed to do,” he says. “You can’t do eight to 10 kitchens a week effectively with a big saw and hand routers. In our huma- resources environment, where you’re struggling to find enough people of quality, it’s especially tough to do.”
   Luckily, he had a friend in the business in Cleveland whose company currently does 30-40 kitchens a week with the help of a pair of Intermac machines. After spending time with him on the phone and in his shop, Pignolet purchased an Intermac Master 33 from AGM USA (now Biesse America).
   Surfaces in Stone took delivery on its CNC in October 2005, and Pignolet says he’s been surprised by the steep learning curve involved.
   “We didn’t know what we were doing, and there seems to be a three-step process with this,” he says. “First, you have to figure out which machine to buy. Then, you have to figure out how to turn it on without breaking it. Finally, you have to make it run efficiently and improve the quality of your production.”
   Now, with more than a year’s experience behind them, Pignolet believes his crew is well into that learning curve. He also has two employees fully trained on it, and is in the process of training a third.
   The other major step Pignolet took in the shop was to clean up the work environment. Although the building has a water-reclamation system, he says when he took over the business the shop was a very dusty place.
   “We volunteered for an OSHA (Occupational Safety and Health Administration) inspection,” he says. “OSHA has a grant program that in Idaho is run through Boise State University. You call them up and tell them to come in like they’re doing an inspection, but it’s not punitive in any way. Then, you also volunteer to remedy all the problems they turn up on an agreed-upon timeframe.”
   Pignolet says the report he got back was more than 30 pages long, but it encouraged most of his shop employees to get their forklift certifications, and it also pushed him to cut down both the dust and the noise.
  
FORGING AHEAD
   The shop isn’t the only place where Pignolet has cleaned up. The property includes almost an acre of yard, and now three quarters of it is showing slabs for his customers.
   “We want the customer to be able to walk up and say, ‘I want that stone,’” he says. “We put their name on it, they sign the contract, and it’s been huge. We’ve brought in a lot of the stuff you cut every day, but we’ve also brought in some exotic stones on consignment.”
   The company’s name change was made in an effort to put a new image in front of the market, which extends out about 150 miles in all directions from Post Falls. However, to back up that new image, Pignolet has also done his best to upgrade and standardize practices across the board to ensure that customers are getting the best job possible.
   “Obviously, it takes more than my saying, ‘Just do a good job,’” he says. “We talk about specific things they can do. For instance, we can say that all our seams have to match the MIA (Marble Institute of America) standard, and I can measure that.”
   One of the things that’s taken time is to get checklists in place so that the same steps are followed for each job, whether it’s in the shop or during installation. Pignolet has also worked hard to make sure his sales staff is communicating well with customers, whether they’re walk-ins, local builders with whom the company is solidifying relationships or referrals from area designers and kitchen/bath shops.
   As he likes to say, “Once the blade hits the stone, we’re all in this together.”
   “A lot of people need to have it explained clearly that this is a custom product, and I can’t sell it to someone else,” Pignolet says. “We have a natural-stone variations page they have to sign. We make them sign off visually on their edge detail.
   “If they come in and inspect the stone, we have them sign that they saw the stone. We invite people to come in and see the template and the stone, so we can do the layout with them.”
   The trick, he says, is to make it fun for customers, while stressing clarity.
   Still, Pignolet has solid evidence all this work is paying off. The company surveys its customers after each job is installed, and he says in the past 100 jobs he’s only had one customer who said she wouldn’t recommend Surfaces in Stone to her friends.
   “It wasn’t that the quality was bad,” he says. “She didn’t like the stone; it turned out darker than she thought. She gave us a bad time, but I told her to call me in six months if she was still unhappy, and she hasn’t called.”
   With the company being recognized more and more for the quality of its jobs, Pignolet says his next goal is to speed up the entire process.
   “I’d like to average two-to-three weeks from order to install, and I’d like to average three-to-four days from template to install,” he says. “We’re getting there. We can do it, but we can’t do it every time.”
   Things are looking up in other ways. The company has landed the contract to provide granite fabrication for three Lowe’s stores in the area, and Pignolet says that after losing money for the first 10 months he owned the business, he’s now showing a sales increase of about 40 percent for 2006, with profits considerably higher than that.
   “We’re still averaging about eight kitchens a week, but we’re doing it with fewer employees,” he says. “I look at the percentage of direct labor, and we’ve reduced that about eight percent. We’ve also switched to 90-percent 3cm stone, and while the stone is costing us more, it takes less labor than to do a 2cm job laminated.
   “Basically, we have fewer people doing the same work, or more.”
   Having spent most of his time the past two years focusing on operations and personnel – areas he says will be ongoing – Pignolet says he’s ready to begin investing more in equipment to make production easier and still more-consistent.
   With the start of the new year he began actively shopping for both an overhead crane and an inline polisher. Also on his shopping list: adjustable fabrication tables.
   In the meantime, Wayne Pignolet is a long way from resting on his laurels.
   “This is one of the hardest things I’ve ever done,” he says. “It’s a whole different level of stress. Some days, I drive in and see 18 cars and think that there are all these people depending on us to do well, and that’s a big burden. Other days I look at it and think, ‘Man, we’ve come a long way.’ We’re continuing to evolve, but this is a fundamentally different place than when I bought it.”

This article first appeared in the February 2007 print edition of Stone Business. ©2007 Western Business Media Inc.