Matt’s Building Materials: Balancing Business & Charity

Donating time, money, or goods after a disaster is a natural human reaction. Seeing families struggle, especially those in your own community, creates a desire to help them.

Everyone helps in a way that fits them best. For some, that is donating money; for others, it is their time or resources. So how can a business whose products are essential to recovering after a natural disaster distribute their resources in a way that is available to anyone in need, without setting a budget, and not bankrupting their company in the process? One local company came up with an interesting solution to the problem.

When the flooding in the Rio Grande Valley began in late June of this year, Danny Smith, owner of Matt’s Building Materials, knew there would be many people who would need help rebuilding their homes. The rains hadn’t even stopped before families came by to ask for any donations or assistance that Matt’s could provide. “It’s heartbreaking, having people come in and talk about the damage and the loss,” Danny said. As a lumberyard, their family-owned business is uniquely suited to helping rebuild after a natural disaster. But when selling building materials is your livelihood, you have to balance the desire to assist with the realities of running a business. “We knew we needed to do something, but we didn’t want to have to pick and choose whom to help. It was important for us to do something accessible to everyone.”

Less than a week after the rains began, Danny sat down with his three sons, Jeremy, Isaac, and Ben, along with his longtime business co-owner, Luis Mancillas, at a local restaurant a short walk away from their store in Pharr. Over coffee and breakfast tacos, they discussed their options and the challenges that each approach brought. Prices for materials in short supply usually go up for local retailers as demand rises. That puts retailers in a troubling position where they, in turn, have to raise prices to cover costs. “You want to raise your prices to reflect the increase in cost, but you don’t want to be seen as price gouging to profit off of someone else’s suffering,” Danny explained. What they usually do is raise the prices a little and let the profit margin take a hit.

Eventually, the group of owners decided that a discount program offered by Matt’s Building Materials would work best. They could at least partially predict how it would affect their revenue and profit margins while still helping as many people as possible. It took a few days to look at all of the products and their margins to figure out what would be a meaningful discount while not undercutting the business’ profit too much. One person in the group, Jeremy, felt uncomfortable that the program would be seen as profiting off of others’ losses. “I told him that as long as we’re doing this for the right reasons, and we are genuinely giving something to the community either through the loss of product or loss of profit, then there is nothing to worry about,” Danny said. They settled on taking a small loss on sheetrock and selling insulation at cost. The rest of the discounts ranged from 10% to 25% off on most of the large ticket items, from molding and flooring to doors and cabinets. It was understood and accepted that the program would result in a sizable loss in revenue—but worth the cause.

The next challenge was to design a way to implement these discounts for the new program. Matt’s Building Materials couldn’t offer these special discounts to everyone that came into the store; there needed to be a way to make sure that the discounts were being given to those actually affected by the flooding. Ultimately, they came up with a successful application and vetting process to ensure that the right people were being helped.

This past summer, nearly three months after the program launched, over 200 families have been approved, and more people are still coming in to apply. “I’ve talked to a lot of people in the last few weeks about their stories. They come in and they want to tell you about what happened, how high the water got, how they got out, what they took with them, and what they left behind,” stated Isaac. “A young man came in and told me he forgot his guitar under his bed when he left their house. As soon as he realized he had left it, he went searching for a replacement because music is what brings him happiness and gets him through hard times. A mother told me that she brought her parakeet along with her on a neighbor’s boat when they were evacuating. But it hasn’t been completely sad—they’re still smiling. They’re coming here and are happy to know that there are people who want to help.”

Matt’s Building Material’s discount program has been a success so far. With careful planning and attention to detail, the company has found a combination of discounts that are available to anyone who needs the assistance. While it has reduced profit margins in some departments significantly, it’s a sustainable model. They will be accepting new applications for the foreseeable future and will offer these discounts until at least December so that those without FEMA assistance or flood insurance can make purchases when they are able to. “It’s the right thing to do. That’s how we do business,” Danny said with a charming grin. “Doing the right thing ultimately rewards you. Create a win-win for everyone involved. We help people when they need it most, and we get the satisfaction of knowing we were a part of that.”

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For more information about this program, email Natan Cain at ncain@mattsbuildingmaterials.com or visit Matt’s Building Materials website.