Est. 1876
By Bill Sendelback
Photos: ©2017 Christian Giannelli Photography. www.christiangiannelli.com.
Many retailers find it complicated to be successful. But Dreifuss Fireplaces in Philadelphia, Pennsylvania, uses the KISS theory – keep it simple, stupid. “Do what we do and do it well” says owner and president David Waldman. What Dreifuss does well is hearth, especially fireplaces, and that has kept Dreifuss Fireplaces successful for 141 years!
Yep, you read that right. Dreifuss Fireplaces began in 1876 right down the street from Philadelphia’s historic Independence Hall. The building that later housed the Dreifuss store previously was a lodge where it’s rumored our Founding Fathers stayed after signing the Declaration of Independence a hundred years earlier. But that history is now lost; since Dreifuss Fireplaces moved its location, the building collapsed and the property is now a parking lot.
When the Dreifuss family began their fireplace shop, the store specialized in the famous cast-iron Franklin stoves. Later, Dreifuss Fireplaces was purchased by Gene Cantor, a member of Dreifuss family, and Waldman bought the operation in 2000. The company now offers wood, gas and electric fireplaces, wood and gas stoves and fireplace inserts, gas logs, fireplace accessories and a very infrequent grill.
Waldman grew up working in his father’s pharmacy and hobby shop, learning and loving the retail business. After graduating from college and earning his CPA credentials, he became a bean counter at Price Waterhouse.
“I wasn’t happy in the corporate world,” he says. “I wanted to get back into the retail environment.” After looking at a number of companies in which to invest, he found that the numbers and the business environment at Dreifuss Fireplaces made sense. In 2000, he purchased the company, more keen on the opportunities than the fact that the company sold fireplaces.
“The seasonality of the company was interesting to me. It had a long, great track record, having made it through the depressions. I felt it was something I would be able to do for quite some time, and potentially grow the company.” He found that much of the hearth industry’s dealer business was “antiquated,” and felt that his business experience would offer him benefits in the venture.
“Dreifuss has evolved significantly,” he says, “and what we do now from a business operations standpoint is night and day from what we did 17 and a half years ago.” Waldman says the sophistication of the paperwork today is “insane” compared to what was required back in the day. “When I bought the company, a sale was just a piece of paper as a receipt. Now, especially with commercial jobs, I have folder upon folder of contracts, billing applications, waivers and releases. It’s crazy how sophisticated, and complicated, sales have become.”
Despite these complications, Waldman still operates on the KISS theory, and part of keeping things simple is that Dreifuss deals almost entirely in hearth products – 99%, in fact. “I’ve said for a long time, ‘Do what we do and do it well,’ he says. “We know fireplaces. We know commercial fireplaces. But we don’t know patio furniture. We don’t know grills. If a customer wants these, we can get them, but we try not to, and we don’t want to spin our wheels figuring it out.
“I have found that when we stray from our core business, hearth products, especially fireplaces, we make mistakes. That’s when the sales aren’t profitable and the customers aren’t happy. So we do what we do and we do it well.”
Everyone knows the hearth products business is very seasonal, and despite the fact that Dreifuss’ seasonality was intriguing to Waldman during the purchase, he has found a profitable way to even out his sales to be less seasonal.
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| The showroom has more than 50 burning fireplaces. | |
“Our builder and commercial business kind of offsets the seasonality of our retail business,” he says. “When our retail dies off for the summer, the builders are busier in the summer, so we can maintain our same workforce all year. Our commercial and builder clients don’t care if it is winter, summer, fall or spring.” Demonstrating how Waldman has diversified his markets to overcome seasonality, 40% of Dreifuss’ business is retail, while the company’s growing commercial business is now 35%, and home builder business is 25%.
Commercial business for Waldman is mostly installing gas fireplaces in hotels, resorts, office buildings and similar facilities. “The main category for our commercial installations is amenity spaces such as lobbies in condos, apartments and office buildings. Besides putting a fireplace in the lobby, we also may put one in the lounge or dining area or outside pool deck. We’ve also put units into quite a few hotels.
“It seems like each job tries to outdo the other. Once we start getting jobs approved, new jobs just keep rolling in.” Waldman’s commercial installations are all gas models with about 85% in contemporary linear styling; a sizable number of commercial jobs require custom products.
While commercial work is a growing 35% of Dreifuss’ sales, retail is still 40%. “We cover Philadelphia, trying to stay within an hour and a half of our store. In the past, we tried to cover nearby New Jersey, but there is so much work for us on this side of the Delaware River, we’re now concentrating closer to home.”
Dreifuss’ retail market covers a diverse range of customers, middle class to high end. “We have a very strong economy here with strong remodeling activity,” he says. “Where I live there are five dumpsters at houses doing remodels. On the nearby Jersey Shore, there is something getting demolished or rebuilt everywhere you look.”
With all these sales opportunities and a very strong economy, Waldman says he “enjoys” the competition in his market. “We’ve got a couple of good competitors, good people. We know where our niche is and we know what their niche is. So if we find a project that doesn’t fit us, we refer it to a competitor. As I have said, we do what we do and we do it well.”
The Dreifuss showroom is 5,000 sq. ft. with traditional-styled fireplaces and products taking up about 2,500 sq. ft. on the right of the store entrance. Modern and linear fireplaces and products are on the left side, and the showroom has more than 50 burning models.
“When I purchased Dreifuss Fireplaces, the former owner had just bought an entire product display from the HPBA show and tried to squeeze the whole thing into the showroom with things stacked from floor to ceiling. You literally needed a tour guide to find what you wanted. Over the years we’ve cleared it out, so now, when you walk in you can see everything in one glance. But our showroom is still a work in progress.”
The “we” in Dreifuss Fireplaces is eight full time employees including Waldman, general manager Ian Zankman and four installers plus a part-time bookkeeper. “Everyone here is key to our operation,” he says. “Two key inside salespeople have 25-plus years with us. My installers range in service with us from four to eight years. We don’t have any dead weight; in fact, we would like to add salespeople and installers.” But Waldman has trouble finding qualified people who want to work.
“On the installer side, one of the biggest difficulties is finding someone with a driver’s license, believe it or not. On the inside-sales side, finding someone with experience is near impossible because we need someone with an understanding of fireplace products since we do so much commercial fireplace work. To train someone will take a long time, but that is probably the only way to do it.” Several of Waldman’s staff are NFI certified, and one, Mark Gildersleeve, is NFI-certified as a Master Hearth Pro.
Training of salespeople and installers may be more difficult for Waldman because of the very extensive number of hearth suppliers Dreifuss uses.
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| Dreifuss has an impressive variety of hearth accessories. | |
“Years ago, when we had just a couple of manufacturer suppliers, I found we tried to push a specific fireplace because we had it rather than making sure that fireplace was right for that job and customer. With the broad selection we now have, we can really make sure we’re selling the right product for the customer. That has definitely been a benefit for us, and certainly for our customers.”
Dreifuss does carry some similar, and maybe overlapping, lines. If Waldman gets a sales lead from a manufacturer, he tries to sell that customer that product – until he determines it’s the wrong product, and then he switches to a manufacturer and product that best meets the needs of that sale.
“The manufacturers don’t necessarily appreciate it, but our customers do,” he says. Most of Waldman’s purchases are dealer direct “just by us and our predecessor doing this for so long,” he adds.
In keeping with Waldman’s KISS theory, he also keeps his advertising and marketing simple. “The most effective advertising by far is good old-fashioned word-of-mouth,” he says. What little advertising Dreifuss Fireplaces does is in Philadelphia magazine, a high-end publication in that market, and perhaps a little radio on a local sports talk show. Dreifuss also participates in the magazine’s annual design show, and installs a fireplace in the magazine’s annual Parade-of-Homes show house.
“I’m a numbers guy from my days at Price Waterhouse,” he says. “Advertising is an art, and I’m not really an artist, so word-of-mouth is the best.” All of Waldman’s advertising is branding of the Dreifuss Fireplaces name, primarily just to keep the store’s name out there. “We really do no ‘call-to-action’ advertising anymore,” he says.
Social media, the darling of most retailers, has not yet found a place with Dreifuss Fireplaces. “It has zero impact on our company,” he say. “The only social media efforts we do are to ask the customer to go online and rate our services. Our manufacturers have great web presences, and we typically are the top search result in our area on these websites. But I know this is something we need to embrace.”
Waldman has no plans for any showroom, relocation or product category expansions. “But possibly different vendors and different lines of fireplaces as things evolve,” he says. He jokes that Dreifuss Fireplaces is really his “second job.” Since his wife has a “great job” as a pediatric neurologist, he takes care of their three small children. “I’m not looking to have anything else on my plate,” he says.
That philosophy carries over to his advice to other retailers. “I’ve seen people over extend,” he says. “I’ve seen people reach for different sales avenues through a different product line or category. I go back to ‘do what you do and do it well’. Stay true to what you know you can do well, and your customers will reward you for that.”
Besides the joys of family and his success with Dreifuss Fireplaces, Waldman has one more simple joy. “I have the pleasure of bringing my dog to work every day. His name is Dawkins, named after one of the greatest Philadelphia Eagles of all times.”
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Store Name: Dreifuss Fireplaces Location: 6610 Hasbrook Avenue, Philadelphia, Owner: David Waldman, president Year Established: 1876 Web Site: www.dreifussfireplaces.com E-mail: email Phone: (215) 924-3500 Number of Stores: One Number of Employees: Gross Annual Sales: N/A Sq. Ft. of Building Space: Lines Carried: Advertising: 1.5% to 2% |
