Soon after founding West Shore Home nearly 20 years ago, B.J. Werzyn envisioned turning the home-remodeling business into a nationwide brand.
It was not a vision that was readily embraced, given the company’s humble beginnings in an industry long dominated by local contractors.
“When you’re one location here in Mechanicsburg, Pennsylvania, with 50 employees and you say, ‘I’m going to be a national brand,’ most people say you’re crazy,” said Werzyn, president and CEO of West Shore Home.
But now, with 41 branches in 21 states, West Shore Home is closing in on Werzyn’s goal.
The goal involves more than just blanketing the country with the company’s blue-and-white logo. It also involves changing how Americans think about shopping for home improvements – and how they go about it.
“What Uber did to their industry, what Amazon did to e-commerce, we’re going to do that for home remodeling,” Werzyn said.
It’s harder to replace a bathroom than order a ride to the mall, Werzyn acknowledged. “That’s why the AI piece of this is going to be so important.”
The ultimate goal is an AI-driven platform that allows consumers to design, schedule and pay for a remodeling project using the West Shore Home app, Werzyn said. In addition to making the shopping experience more convenient, the platform will allow West Shore Home to venture beyond its traditional niche of windows, doors and bathrooms into the broader $500 billion world of home remodeling, which includes kitchens, cabinets and flooring.
“That’s the game changer,” said Werzyn, who owns 80% of the company. The remainder is held by Leonard Green & Partners, a private equity firm based in Los Angeles.
Glimpses of West Shore Home’s future can be seen in its latest product – a suite of full-bathroom remodeling designs that can be ordered and completed in a matter of days.
In an interview with biznewsPA, Werzyn discussed his company’s growth and its plans for the future, including preparation for an IPO if it chooses to pursue that option. Founded in 2006, the company currently employs more than 3,000 people and has annual revenue of more than $750 million.
The following Q and A has been edited for length and clarity.
biznewsPA: When you started West Shore Home in 2006, did you envision the company as it is today?
Werzyn: At an early point, I had the vision of a national brand. But having that vision and then executing on it are two different things. At first the growth was slower. We opened an office in Pittsburgh and then we opened an office in Florida, and we spent a lot of time building the company for scale, building the systems and processes. And then from 2017 or 2018 to 2023, it was exponential growth. We were doubling or tripling the size of the business every year. We went from hundreds of employees to thousands of employees. To say that I knew we would be here someday is probably untrue, but now that we’ve done it, I can easily see us 10Xing the business again and going from a billion dollars in sales to $10 billion in sales because we know what it takes to scale a company, because we have the technology, because we see the product market fit and the way technology is moving and the way people are going to adopt AI. It is going to allow us to not just scale geographically, but be able to launch flooring, kitchens, cabinetry, facing, countertops, all these other product lines.
biznewsPA: Is the market that big?
Werzyn: Home remodeling is a $500 billion industry. It’s the same size as the restaurant industry. We could sit here for the rest of the day and name national restaurant chains and brands. There’s not one national home remodeling company.
biznewsPA: Do you feel West Shore Home is a national brand now or that you’re still pushing toward it?
Werzyn: I wouldn’t say we have a national footprint just yet. We go as far west as Salt Lake City and Phoenix, but we’re still heavily concentrated on the East Coast, the affordable Sunbelt, North Carolina, South Carolina, Florida. We have a big presence in Texas. We’re moving into the Midwest. We’re not really on the coastal areas, though. We’re not in New York or Boston. We’re not in California. Those are higher regulatory states, harder to do business in. We’ve intentionally kind of stayed away from them for now. But to be a national brand, we will have to be in Chicago and Boston and Seattle someday.
biznewsPA: West Shore Home’s early expansion strategy was through M&A. But lately it has been through de novo offices. Is that a deliberate strategy?
Werzyn: We did nine acquisitions from 2018 to 2021. We were buying smaller operators, $10 million to $20 million in revenue, and then growing them. And then private equity got interested in the space. They saw that it was a $500 billion industry. They saw that it was very fragmented. They saw the opportunity to start consolidation. So, three or four big private equity firms came in and started doing acquisitions, which drove the price up. But we had the ability to do greenfields. So instead of overpaying for an acquisition, we started choosing the markets that we wanted to go into. Texas was one of those, so were Denver, Phoenix and Salt Lake. But I think we’re going to see the opportunity later this year, definitely next year, to start doing some more acquisitions again. There’s still a bunch of smaller operators that are looking for exits. And as these private equity firms have bundled some of these together, at some point they need to exit those. So, we may have the opportunity to make some larger acquisitions, as well.
biznewsPA: What makes a good greenfield market?
Werzyn: We look for states where it’s easy to do business. It’s not a big regulatory industry, but you have licensing, you have permitting, you have different things you have to deal with, HR laws, consumer protection laws. And we look for areas of the country that are growing. We want housing to be affordable. If housing is so expensive, consumers may not have discretionary income to do home-remodeling projects. We’ve done really well in areas like Cincinnati and Indianapolis, areas where people have strong economies, where people are moving, but the housing is still affordable.
biznewsPA: Have high interest rates made any difference in terms of growth?
Werzyn: We’re starting to see a little softness in the consumer. We’ve been in an inflationary environment now for over two years. Everything’s more expensive, groceries are more expensive, gas is more expensive, housing is more expensive. And then couple that with higher interest rates. Some consumers may be deferring a discretionary purchase, saying, ‘Hey, we want to do the bathroom, but we’re going to wait till we see what happens in the election, and we might push it off till next year.’ The demand isn’t quite as high as it was coming out of Covid. But we’re still growing because we have all those different ways to grow.
biznewsPA: You are still on the young side. What do you think of in terms of an exit strategy, and what are your thoughts as far as IPO or private equity?
Werzyn: We started IPO readiness a few years ago just to give us optionality. We run the company like a public company from a compliance standpoint, from an accounting standpoint, so if we wanted to try to do a public offering, that option is available to us. It’s nothing that we’re contemplating here in the near term. I’m still relatively young. I still see the big picture that we can be this national brand and change the dynamic and the paradigm for how people shop for home remodeling. I don’t see myself going anywhere in the next five to 10 years. So, in terms of an exit strategy, I’m not really thinking about exiting the business, but I do think about raising capital, whether that’s through private equity or traditional commercial banks or public markets. There are different pools of capital that I could go to to continue to develop technology, to buy companies and do acquisitions, to build out infrastructure and things like that.
biznewsPA: Is there a decision point or turning point where you might say, ‘Yes, this is the route we want to take versus other options for capital?’
Werzyn: It has to be the right thing for the company. We’re not going to do it just to do it. The IPO markets need to be receptive. There were a lot of IPOs in 2021 and beginning of 2022 and the market really got overheated. And then the IPO window kind of closed. You haven’t heard of many IPOs in the past 18 months. So, of course, the market needs to be receptive. It needs to be the right thing for the company. I think eventually we’ll have to be public if we’re going to be a big national brand. Most are publicly traded just for the liquidity and the access to capital to continue to grow. But really from a consumer perspective, it’s really a mindset shift. There are not a lot of DIYers out there anymore. They don’t want to go to the home-improvement store and buy the materials and remodel their kitchen over the weekend. They want someone to do it for them. And I think as it really shifts to a do-it-for-me mentality and we build the technology, it’s possible that we could be bigger than a Lowe’s or Home Depot someday. So having access to that capital, having access to the public markets, is a reason why we run the business the way we run it. There are a lot of things we do from a compliance standpoint, from a marketing standpoint, from a legal standpoint, accounting, that we don’t have to do as a private company, but we do it to maintain that discipline to give us the optionality.
