Tin Men

You think you've got problems? Imagine trying to build a reputable business in an industry like aluminum siding, pawnshops, or barter

You haven't seen Tin Men? You gotta see it. Get the tape," says Steve Bedowitz as he leans forward in his chair. "All the scams they pulled in that movie are true. Those things happen in this business."

Bedowitz fishes a wad of cash from his pocket. "I liked the one about the salesman who says to his client, 'Now Joe, if you re-side your house with me, I'm going to give you $100 for every person you refer to me.' " Bedowitz peels three $100 bills from his money clip, laying them neatly, Ben Franklin side up, on his desk. "Now, let's face it, a lot of people in this world haven't seen $300 in one place before. The client signs that contract for $6,000. The salesman has, of course, included the $300 in the cost of the contract. Greed takes over."

Bedowitz sells aluminum siding, or -- to be more precise and up-to-date -- vinyl siding and other home-improvement products. His company, Amre Inc., grossed $252 million last year. The largest company in the siding business, Amre was #84 on the 1988 INC. 100 list of the fastest-growing small public companies. "I'm proud of this business," he says. "When people ask me what I do, I always look them in the eye and say, 'I'm in the siding business.' "

Some around Bedowitz have lost -- or never had -- the faith. "My ex-wife was so ashamed of what I did for a living," he says. Bedowitz recalls one vain effort to save the marriage by driving into a posh neighborhood of Austin to show his wife that even the rich used siding. "I told her, 'Pick a street.' Three houses down I pointed to a house and said, 'What's that?' She said, 'Wood.' 'Look again.' We got out of the car and walked up to the house. It was aluminum siding. When people think of aluminum siding, they always think of people on the poor side of town hanging crap off their houses."

Bedowitz's career began its lucrative descent 12 years ago. As a partner in an Austin ad agency, he had a client who was a siding wholesaler. In doing market research, Bedowitz discovered that the business was, well, kind of screwy. "Siding was a $3-billion-a-year industry, and the biggest company I could find did $8 million. I said to myself, Wait a minute."

It was an industry in which shiftiness had been honed to an art form. Salespeople closed deals, took down payments, and then took off. Siding companies went bust on Friday, only to resurface again on Monday in another town. Salespeople once traveled the circuit like preachers in search of a flock to fleece -- the Midwest in summer home-repair season, then to Florida and Texas in winter to work the retirement crowd. Conventional wisdom held that any effort to consolidate the industry would end with partners who would rip one another off and employees who would leave to go into business for themselves. Steve Bedowitz disagreed.

He and a partner each put up $3,000 and borrowed another $10,000 to start Amre in 1979. "The first thing I did was get a storefront in a shopping center. You could drive by and see my place of business. I wasn't working out of the back of a pickup truck. People knew where to find me."

Amre prospered, and Bedowitz started wondering how he could expand beyond the city limits. But who in his right mind would trust an out-of-town siding salesman? That's when Bedowitz became a licensee of Sears, Roebuck & Co., paying the company 15% of his sales in return for recognition as a Sears-approved seller and installer of siding. That was just the ticket. Now when people opened their homes to charming strangers bearing slick brochures and asked the inevitable question, What other work have you done in the neighborhood?, Amre salespeople could forthrightly invoke the Sears name.

If siding is the business from hell, Sears is the paragon of retailing. Last year 78% of all U.S. households shopped at Sears. Sears has been around for a century. Today Amre, which has been around for a decade, sells and installs siding in 77% of the country. It might as well be Sears's siding division. Says Bedowitz, "We represent Sears, and Sears is known for value, not for cheap."

Cheap is something Steve Bedowitz had been struggling a lifetime to escape. His father died when Bedowitz was four, forcing his mother to go to work. She scrimped; she saved. She bought things secondhand, and they were always breaking. Bedowitz vowed that he would always go first-class, always buy the best. "Look, the single biggest investment 99% of people make in their lives is in their house. I'm not going to go around putting a lot of junk on people's homes."

Bedowitz's philosophy of "telling the truth" and using the best materials and local contractors "we can get our hands on" dovetails a third strategy that has driven the company's success: the intensive use of computers. When the siding business first caught Bedowitz's attention, he visited the $8-million company that led the industry. He noticed something that gave him hope: "They didn't believe in computers." By the time Amre reached $4 million in sales, it had a mainframe. It has since bought four more. The computers are constantly crunching demographic data to generate an unending stream of information for advertising and direct-mail campaigns.

Bedowitz, who started his market research with a box of 54 crayons he used to mark return envelopes mailed to different zip codes around Austin, believes that Amre's use of the latest technology defines the company's essence. "We are experts at generating leads. We are not necessarily a siding company. We are a direct-consumer-response company. I can sell someone BMWs. I can sell someone computers. I can sell anything."