General Electric remains the dominate appliance supplier to the high production home builder market, but in recent months Whirlpool Corp. has grabbed some high-profile market share.
"They (Whirlpool) came in and they wowed us both financially and by presentation," said Mike Smith, Toll's vice president of purchasing and product standards.
He said Whirlpool's acquisitions over the years of Maytag, Amana and Jenn-Air gives the company a breadth of product offerings that meets all of Toll's price points, from high-end homes to the occasional low-income housing project.
Smith also said GE lost some of its edge as an incumbent when it changed three out of three primary company contacts approx. six months before the contract was up. It wasn't that the replacements were bad but "this is a business of relationships," said Smith, "They lost some of that relationship when they made those last minute changes."
So far, Smith said he is impressed with Whirlpool's efforts to change out the appliances in its homes quickly. It should be completed by the middle of June.
"We didn't give them whole lot of time and they have really worked hard," Smith said. "We are excited."
Toll has donated the more than 1,500 GE appliances that it is replacing with Whirlpool products to HomeAid, which provides non-profit housing to the homeless. In regions where HomeAid doesn't operate the appliances will go to Goodwill, The Salvation Army, Habitat for Humanity and Covenant House.
"It's simply a matter of doing the right thing," said Zvi Barzilay, President and COO for Toll Brothers and a HomeAid board member. "The only option here is to find a place where these like-new appliances can be put to good use, and I can't think of a better organization to handle the dispersal--we are proud to be able to contribute."
Whirlpool's presentation and hunger for Beazer's business also impressed Tony Callahan, the company's senior vice president of national purchasing, planning design.
Beazer decided to ink an exclusive agreement for appliances with Whirlpool for a number of reasons that go beyond price. The company is building high-performance homes and Whirlpool's products fit well with that approach.
"They are really focused on that," Callahan said.
Another plus is that Whirlpool uses one carrier across the country and he expects that will make delivery performance more consistent across the company's markets.
Ashton Wood has also been impressed with Whirlpool's performance since it signed a partnership agreement.
"We carefully select building products and locations that best satisfy the lifestyles of local homebuyers, and Whirlpool Corporation does a great job understanding the needs of each market," said Ralph Farrell, vice president of operations in an announcement of the agreement. "Since partnering with Whirlpool Corporation, service and delivery have been beyond our expectations, and we are ahead of schedule with appliance training for our sales and construction teams. The company is a good fit for who we are and what we work to achieve."
Whirlpool's "recent surge" in big builder contracts has not escaped the attention of GE, said Matt Rose, GE's general manager for contract sales.
"Our plan is to stick with our plan," said Rose, in answer to a question about whether the surge has triggered any new GE initiatives. "We think we provide builders with some things our competitors don't."
"It's a competitive business and we compete against Whirlpool every day all over the country," said Rose. "We clearly have had and still do have, even with those builders who have gone to them lately, the No. 1 position in the country as far as (builder) contracts are concerned.
Rose pointed out the contracts the company has been able to resign within the last two years, as well as some where they managed to grab 100 percent of the builders' business.
--Recently GE picked up all of NVR's business. It had been serving the Ryan Homes division and now supplies appliances to its smaller NVHomes division as well.
--K. Hovnanian Homes recently signed up again with GE, for 100% of its business.
--Ryland Homes, a longtime GE customer re-upped this year.
--At the end of 2009, GE resigned for 100% of Richmond American's business
--In the middle of 2009 Meritage resigned and gave GE 100% of its appliance business. Before, GE supplied part of the company's appliances.
--David Weekley Homes also re-upped its contract with GE last year.
"Our plan as far as maintaining our No. 1 position is competitive pricing as well as what we think is a superior model in terms of support of builders," Rose said. "Our delivery capability is a strength for us and we think it's unmatched."
Another strength is that it's the only manufacturer to maintain its own service arm. "It's costly, but we think it's a big competitive advantage for us," he said.
Not that Whirlpool's new deals haven't caused GE some irritation.
"We are happy with our position but we are not satisfied," he said.