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Vol. 45 No. 7

JULY/AUGUST 2019

2019 oard e h T oreb l, and c S rfu stry Indu s a powe p 10 To de inclu sruptive, di


Kirk Reams Hooten’s Hardware Texas

“Working with Orgill, we have the freedom to be Hooten’s Hardware, not a generic cookie-cutter store. We run the business the way we know it needs to be run.”


Being Independent Orgill provides solutions that drive profits and help us grow our business!

Why We Like Working With Orgill: • Flexible, comprehensive retail programs • Broad product selection • Impressive retail knowledge • Supportive of our independence

Click the video link to find out how Orgill’s offerings help Hooten’s be successful!

1-800-347-2860 ext. 5373 • information@orgill.com • www.orgill.com


HBSDEALER HARDWARE + BUILDING SUPPLY

MARKET INSIGHTS 32 Transcendence

at the job site Dealing with the primary disrupter in housing construction: the labor shortage.

40 True Value Company Report Investing is a major theme of the Chicago-based distributor.

48 Notes from the “2019 State of the Nation’s Housing Report.”

44 Carter Lumber’s expansion playbook for Pennsylvania and New Jersey.

46 The White House Council on

Eliminating Regulatory Barriers to Affordable Housing: The NLBMDA’s take.

COVER STORY THE INDUSTRY SCOREBOARD

16 From Home Depot to Stone’s Home Centers, here are the Top 300 hardware and building supply dealers in the United States, ranked by sales.

FROM THE EDITOR 8 Research rescued from the cutting-room floor.

NEWS & ANALYSIS 10 Readers respond to the

wisdom of “Closed on Sunday.”

12 Some major lumber producers have curtailed production.

14 Meet the HBSDealer

ProDealers of the Year for 2019.

10

14 Orgill sets in motion plans for a

36 PRODUCTS 36 Summer Decking:

Fun, sun and sales opportunities New boards, railing and trim — plus warranties and software — hit the market.

IN EVERY ISSUE 12 News Map 14 Product Knowledge 52 People in the News 54 Quikrete Industry Dashboard

new distribution center.

Hardware + Building Supply Dealer (ISSN 2376-5852) is published monthly, except for July/August and November/December, which are double issues, by EnsembleIQ, 8550 W. Bryn Mawr Ave., Suite 200, Chicago, IL 60631. Subscription rate: $119 per year in the United States; $139 in Canada and Mexico; $279 in all other countries (air mail only). Periodical postage paid at Chicago,IL, and additional mailing offices. POSTMASTER: Please send address changes to HBSD, Circulation Fulfillment Director, P.O. Box 3200, Northbrook, IL 60065-3200. Subscription changes also may be emailed to hbsdealer@omeda.com, or call 847-564-1468. Canada Post: Publications Mail Agreement #40612608. Canada Returns to be sent to Bleuchip International, P.O. Box 25542, London, ON N6C 6B2. For change of address, six weeks notice to Hardware+Building Supply Dealer, P.O. Box 3200, Northbrook, IL 60065-3200 is requested. Give old and new address and zip code. If possible, enclose address portion from cover on previous issue. Vol. 45, No. 3, March 2019. Copyright © 2019 by EnsembleIQ. All rights reserved.

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HERE’S WHAT’S ONLINE

@HBSDealer

Tweet Central

Top Women in Hardware & Building Supply HBSDealer is now accepting nominations for the awards, which will recognize honorees for the key role they play in the hardware and building supply industry in the following two categories. The eligibility rules, and the official nomination form are at HBSDealer.com

The STIHL Hardware All Stars Ride Again The HBSDealer daily newsletter continues to recognize the 2019 class of STIHL Hardware All Stars — 50 stores from each of the 50 states — including Stoneway Hardware in Seattle, Wash. (at right). For this and other stories, subscribe to the daily newsletter at HBSDealer.com.

Poll Results

Q

How prepared is your business for Generation Z (born after 1996)?

7%

36%

27%

Somewhat unprepared Very unprepared Somewhat prepared Very prepared

30%

Follow us @HBSDealer

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Participate in a new poll question each week on HBSDealer.com

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FROM THE EDITOR

Let’s hear it for the Top 300 bathroom remodels, widening doorways and changing floor surfaces to accommodate individuals in wheelchairs. Well done.

For years, “From the Editor” has made the case that ranking the Fortune 500 – the gold standard of corporate listings – is a relatively easy affair. The numbers of those giants of Corporate America jump of the pages of their SEC filings. The HBSDealer Top 300, which we are proud to present beginning on page 16, is another matter. For the vast majority of companies of our Industry Scoreboard, the researcher must roll up his sleeves, order coffee, make the phone calls, appeal to the sportsmanship of the privately held dealers, search for clues in news articles, order another cup of coffee and – and (in many cases) put on his estimator hat.

• Not their first rodeo. C-A-L Ranch Stores (no. 117) sells a fully automatic roping chute for $4,299. It’s partially solar-powered. • Stand up for graduates. Builders Discount Center (no. 187) — the “Drive in/Load up/Drive out“ people — highlights its “Now-Hiring” manager trainee program front and center on its web site. Benefits include “aggressive salary” and in a sign of the times, “ help paying off student loans.” The accelerated program promises to prepare candidates for a full-time management position within 12-18 months. (Suggestion: put HBSDealer on the curriculum.)

• Back in the game. Acme Tools (no. 232) was an early pioneer Special note: Thank you of online sales for tools Alpine blitzed into the top 50. to all the companies who and equipment. It sold its participated in our annual survey. We e-commerce business to Amazon. couldn’t have done this without you. com in 1999. Then, after a decade of expanding brick and mortar stores in During the course of our internet the upper Midwest, Acme re-entered research, the editors uncovered (and e-commerce in 2010 with AcmeTools. then discarded) some little-known fun com, offering more than 50,000 facts. These few were too good to toss. products. Take that, Jeff Bezos. • It’s a Blitz! Alpine Lumber (no. 42) participates in an annual Home Builders Foundation Blitz Build. 12 to 15 ramps are built all throughout the Denver area and the not-forprofit arm of the Denver HBA rallies resources to provide life changing modifications to homes such as building wheel chair ramps, complete

8

HBSDEALER HARDWARE + BUILDING SUPPLY

Meanwhile, Bezos’ company -- strictly as a retailer of home improvement and building products -- improved to number 10 on our list. See page 16. HBSD

Hardware + Building Supply Dealer An EnsembleIQ Publication 8550 W. Bryn Mawr Ave., Suite 200, Chicago, IL 60631 hbsdealer.com HBSDealer On The Web • HBSDealer Info Services SENIOR VICE PRESIDENT (HBSDealer, Drug Store News, Chain Store Age) John Kenlon, jkenlon@ensembleiq.com, 212-756-5238 EDITOR IN CHIEF Ken Clark kclark@ensembleiq.com, 212-756-5139 LBM EDITOR Andy Carlo acarlo@ensembleiq.com, 845-891-5108 CONTRIBUTING EDITOR Ken Ryan ryankgr@aol.com, 516-567-3034 Editorial Inquiries: Direct questions to Editor in Chief Ken Clark. ADVERTISING SALES

Midwest & Southeastern States SENIOR REGIONAL MANAGER Amy Platter Grant agrant@ensembleiq.com, 773-294-8598 Northeast and Great Lakes States REGIONAL MANAGER Greg Cole gcole@ensembleiq.com, 317-775-2206 PRODUCTION/ART

VICE PRESIDENT, PRODUCTION Derek Estey destey@ensembleiq.com, 877-687-7321 PRODUCTION MANAGER Michael Kimpton mkimpton@ensembleiq.com, 647-557-5075 CREATIVE DIRECTOR Colette Magliaro cmagliaro@ensembleiq.com ART DIRECTOR Bill Antkowiak bantkowiak@ensembleiq.com PRODEALER INDUSTRY SUMMIT OCT. 8TH TO 10TH, COLORADO SPRINGS, COLO. WWW.PRODEALER.COM IN PARTNERSHIP WITH THE NLBMDA, WWW.DEALER.ORG CONTACT: AMY PLATTER GRANT agrant@ensembleiq.com, PDIS DIRECTOR OF SPONSORSHIPS PUBLISHER OF HARDWARE + BUILDING SUPPLY DEALER, DRUG STORE NEWS, CHAIN STORE AGE. CIRCULATION LIST MANAGER: ELIZABETH JACKSON, MERITDIRECT (847) 492-1350 X318. PERMISSIONS: MATERIALS IN THIS PUBLICATION MAY NOT BE REPRODUCED WITHOUT WRITTEN PERMISSION. TO ORDER REPRINTS CALL PARS INTERNATIONAL AT (212) 221-9595, EXT. 435, OR EMAIL LF-REPRINTS@PARSINTL.COM. CONTACT COPYRIGHT CLEARANCE CENTER, 222 ROSEWOOD DRIVE, DANVERS, MA 01923, (978) 646-2600 OR (855) 239-3415, OR ON THE WEB AT COPYRIGHT.COM FOR IMMEDIATE AUTHORIZATION TO PHOTOCOPY FROM HARDWARE + BUILDING SUPPLY DEALER (ISSN 2376-5852).

Corporate Officers EXECUTIVE CHAIRMAIN Alan Glass CHIEF EXECUTIVE OFFICER David Shanker CHIEF FINANCIAL OFFICER Dan McCarthy CHIEF OPERATING OFFICER Joel Hughes CHIEF COMMERCIAL OFFICER AND PRESIDENT RETAIL Jennifer Litterick CHIEF INNOVATION OFFICER Tanner Van Dusen CHIEF HUMAN RESOURCES OFFICER Ann Jadown EXECUTIVE VICE PRESIDENT, EVENTS & CONFERENCE Ed Several

connect with us

Ken Clark Editor in Chief

JULY/AUGUST 2019 HARDWARE + BUILDING SUPPLY DEALER

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NEWS + ANALYSIS

Readers Respond to Sunday Hours Retailers who keep their stores closed on Sunday point to a good reason. Sunday is family time, they say. And a mandated day off makes for loyal, happy employees. And happy employees make for happy customers. Then again, a store can’t help customers when it’s closed.

“Closed on Sunday — good move or bad move for a retailer?” Here are the results:

21%

Bad move – seven days of sales are better than six.

HBSDealer also received several messages on the topic of Sunday hours, including these:

as, , never h Sundays NOT work s e o d r ff. ork fo oting for ne day o pany I w o. After n at least o The com all need t here, als e n turday W re a e . S ill iff d d w n a never gs a little one calls in to h th p t le e d g m n fro 9–5 uld We ha n we wo op ss hours just whe y busine nd, we st a u rs a rd ro a tu ye a s o S e tw m ur o o c t d u c n e ke wee rs, w April. custome r nksgiving turday in reak. Ou once Tha e first Sa th r winter b l u ti o 9–2. Plus, n u to urs, rd ays o a h rd rw tu se a fo e S k th g e all loo opening acceptin to say, w snow or better at Needless eset with en much b tt o e g b to ve a h ing on ely n rs lik e e p m re o o a in st e w cu int a where much po re Two a ’t . n n rs is a e m In re o e too. winter, th t 2-3 cust e e ry g th ve ly g e n n o ri t ay, so rain du you migh g Saturd ay where kes for a s workin a rn m tu It . a Saturd ke ff o ta for that weekend pervisors the most get a full of our su am” sells nd, they e ke “t e h e ic w h r othe see w petition to nice com k. c lo b Saturday s, L Rickard — Terry ger ve mana ti a tr is in adm er b m u L Falls Yosemite . lif a C t, Oakhurs

More than 260 readers voted in a recent HBSDealer poll:

79%

Good move – for employees, for families, for communities.

While we have been closed on Sundays sinc e the beginning in 1936, we are consid ering opening on Sun days beginning in the fall. I would be  curious as to the feeling s of retailers that have a Lowe’s or Home Depot in close proximity. I feel we are currently failing our customers that sta rt a project on a Saturday and need materials to finish on Sunday. In this we are driving them to the competition. — Anonymous

Openin g the ow on Sunday w ner, no as the rest o health worst r , and decisio genera days off to n I eve ok lly burn r mad t me o a toll on my e. As — Kev ut. life, fa in Min mily, g

Friends of ours ran a hamburger stand and opened it on Sundays. When the ice cream machine broke down on a Sunday, they had to pay the repair ma n extra. They starte to look at other exp d enses related to bei ng open on Sundays They found that the . y were actually los ing money by being open 7 days a we ek. Additionally, I find that I am much bet ter after having a day away from the business, sharper, rested, and renew My family supports ed. the store more wh en they know I am theirs on Sunday, not feeling like the y are competing for my time. And then there’s the comma ndment to honor the Sabbath. As a result, I do not sho p at other places on Sunday, to encour age those owners to enjoy a day off renew and be with to their families. — Escalante Home Center Escalante, Utah

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JULY/AUGUST 2019 HARDWARE + BUILDING SUPPLY DEALER

HBSDealer.com


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NEWS + ANALYSIS

Mill shutdowns: What’s hammering the lumber climate? Norbord Inc. is one of the latest major Canadian lumber producers to announce a production curtailment. The Toronto-based company said it will close its 100 Mile Mill in British Columbia starting in August. Norbord will continue to supply its current customers and meet expected future customer demand with production from its 11 other operating North American OSB mills, including High Level and Grande Prairie, Alberta. “This is a difficult decision in response to extraordinary circumstances,” said Peter Wijnbergen, Norbord’s President and CEO. With this move, Norbord joins a

collection of lumber giants who have been forced to curtail operations, including Canfor, Interfor, West Fraser and Western Forest Products. All have cited a challenging, soft lumber market as the reason for the temporary shutdowns. More than a dozen mills, primarily in British Columbia, are being temporarily shut down. Steve Sallah, president and CEO of LBM Advantage — one of the nation’s largest buying groups serving independent lumber dealers — says the climate of dwindling demand and prices didn’t happen overnight as homebuilding has yet to truly surge in 2019. “From a micro point of view, weather

has impacted demand,” Sallah told HBSDealer. “This alone is contributing significantly to prices being off year to year.” Regarding the longterm, Canadian and U.S. mills have have increased capacity, up to 1.1 billion more board feet since last year, by improving operations and capital investments. The theroy is that demand will grow steadily back to historic levels, he said. “A small mismatch in supply and demand in lumber and OSB has an unbelievably leveraged effect on pricing,” Sallah said. Looking ahead, Sallah believes pricing will increase in the second half of 2019 as weather and labor begin to turn more cooperative. “Dealers are buying only what they need right now,” he said.

News Map: Openings, Closings & Acquisitions Illustration of stores in various stages of coming and going. For more retail news, visit HBSDealer.com. washington

idaho

Lakewood

Homewood Holdings Homewood Holdings acquired the assets of Custom Choice Door, which was founded in 2007 by Ted Matthews and Alan Pascoe. CCD joins the Homewood Holdings family of companies as its sixth overall investment and its third business in Washington state.

Rexburgh OPENING

CLOSING

ACQUISITION

Mikelsen’s Home Center Owner Dave Mikelsen told the local newspaper that the last few years have been “a struggle.” He pointed to e-commerce competition, the impact of a highway expansion and loss of parking as factors. The store had operated since 1937.

georgia oregon

Nyssa

Nyssa Mercantile From hardware store, to dance studio, to hardware store. That’s the path taken by Nyssa Mercantile, owned by Liz Haun a third-generation retailer. Her family operated a store in the same location for eight years. “I am now realizing my dream,” said Liz.

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JULY/AUGUST 2019 HARDWARE + BUILDING SUPPLY DEALER

Forsyth

Griffin Lumber It’s been a busy year for Forsyth Lumber, which now operates five retail locations in Georgia. The latest purchase was Dodd Builders Supply in Forsyth. Earlier this year, Griffin acquired Blake Builders Supply. It also added a second manufacturing plant when it acquired Specialty Structural Products.

HBSDealer.com


NEWS + ANALYSIS

Meet the Dealers of the Year Service, resilience and versatility are the operative words for this year’s 2019 ProDealer award winners: “ProDealer of the Year:” Mead Lumber. Columbus, Neb.-based Mead Lumber is an employeeowned Midwestern leader in residential and commercial building materials since 1910. Today, the company’s 44 locations in eight states represent a tremendous variety of services and offerings. Its banners include Knecht Home Center, Black Hills Truss & Components, Farm & Ranch Building Supply and — the newest addition

to the family — H.L. Munn Lumber of Ames, Iowa. “Independent ProDealer of the Year:” BLDRS Supply & Home Center Operating out of Trinidad, Colo., this single-unit dealer has served its community on the historic Santa Fe Trail for three generations of continuous family ownership. Karen Sandbeck and her husband Cal Sandbeck acquired the business in 2017 from Karen’s brother, Scott Sandlin, who continues to serve as general manager. The annual awards, chosen by editors of HBSDealer in concert with the

Orgill plans new DC in Rome, N.Y. A 780,000 sq. ft. distribution center is expected to come on line in early 2022.

Memphis-based Orgill will be expanding its network of distribution facilities with the addition of a 780,000 square foot distribution center in Rome, New York. The new facility — expected to be fully operational by early 2022 — will be Orgill’s eighth full-service distribution center, in addition to locations currently operating in Tifton, Georgia; Inwood, West Virginia; Sikeston, Missouri; Hurricane, Utah; Kilgore, Texas; Post Falls, Idaho; and London, Ontario. “We are excited to announce this expansion to our distribution network

14

and look forward to the enhanced efficiencies this will create for our customers as we move forward,” says Ron Beal, Orgill’s chairman and CEO. The primary reason for the addition of the new Rome, NY, facility is to provide faster and more efficient service to Orgill’s growing customer base in the Northeast. The new facility will service customers in seven states throughout the Northeast, including New York, Vermont, New Hampshire, Maine, Massachusetts, Connecticut, and Rhode Island. These customers are currently served out of the Orgill distribution center in West Virginia but the addition of the new facility will streamline the delivery process. “As we continue to see our customer base expand, we are committed to making the investments that will deliver better, more efficient service to them both now and well into the future,” says Boyden Moore, president.

JULY/AUGUST 2019 HARDWARE + BUILDING SUPPLY DEALER

H.L. Munn is Mead’s latest acquisition

BLDRS Supply in Trinidad, Colo.

National Lumber and Building Material Dealers Association, are designed to recognize a high-performance company with a commitment to best practices and the best values of the LBM industry. BLDRS Supply and Mead Lumber will be recognized at the upcoming ProDealer Industry Summit in Colorado Springs, Colo. Oct. 8-10.

Product Knowledge Product: WD-40 Specialist Industrial Strength Cleaner & Degreaser Manufacturer: San Diego, Calif.-based WD-40 Company. Knowledge: This industrial strength — and biodegradable — product has three bullet points: non-toxic, low-odor and multi-surface. It breaks through grease, oil and grime on tools and engine parts, making it an essential tool for the garage. Plus, it meets U.S. EPA Safer Choice standards. And check out the handy refill port — no funnel required. Fun fact: WD-40 Company (which derives its name from the historic 40th attempt to create a waterdisplacement formula) calls its employees “tribe members” and cultivates a “tribal culture.”

HBSDealer.com


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e oard 0 b . Th e r reau ase o u c 1 B s incre ensu try S ive, Top s u S. C , saw an . d U n t I s he ntry store by t aler nd disrup the e w e ured ardware . n s a a D h e t m er s h llion t sho BS ,a l H u s, as h include 334.3 bi play. Oth 10 didn’ re be f r r e e l e a $ e is e c Th f d up, whi .7% to a also on d , the Top ut, let th warp pow a ate o s B 4 ro t s r i . f g a r a im s o t a p e g s r e e n le d ea e to ler of S vious y movi viors and e tota HBSDea last y ility at th the exit inclu pre a were t’s th h

he Stab on and . Tha n the anies er be om t 7,972 panies o az d ge fr 10 comp consum 8 e m n 2 s , a A ts of s 1 h a m f o co am ging 3,40 hligh ing. f a c ese top 0 n 2 g o 0 e d i a 3 r 3 h h h h $ t a e c c e st ebo p to of th rd. from ar. mu istake, th up with pe. of th 00 li , Scor dds u a ales 7% m p ye ome ll Top 3 l figures ca e r o s s e n It all a mbined s Scorebo 0 of the at’s up io d k e r r n u p o a a f a t l . e t c l s i i e h h s y d 1 o r t t e a li h e the c 0 Industr the top lion, panies in f the full t, spe ifting ret ing pag g with t nd histo 0 o h s 6 bil a w n Top 3 a group, of $252. ten com tal sales p of the li 3 the s the follo ers, alo DIY % e . d to to On As ding t lea sales f the of $7 s e sam very arke ta, inclu . gain ated ales of th for 78% o er at the ie m s n im a e t a le s p h d t s e w sa om m ined unted re po year more ealer.c ht co For comb p 10 acco rate the fi ear-over- ll but eig D S B 1 H o st 444 t’s y ales of a ess. visit The t rther illu in s Depo AICS To fu e Home the total upply bus ed the N supplies Th rm nd gs han no. 1 is larger t nd buildin outperfo aterials a 0 a n m 0 e o 3 r li a bil ing op hardw the T — build in the group, n o i t As a lassifica r c e l i a t re

p o T A avy He

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JULY/AUGUST 2019 HARDWARE + BUILDING SUPPLY DEALER

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THE TOP 10

The Home Depot

Rank: No. 1 Sales Increase: 7% Skinny: It’s called “The One Home Depot Experience.” The $11 billion investment in stores, employees and the digital experience finished its first full year. Their building a “frictionless” shopping experience across multiple channels. Many in-store sales are influenced by an online visit, the company says, and nearly 50% of all online U.S. orders are picked up inside its stores.

Rank

Company Location of Headquarters

1

The Home Depot

2

Lowe’s

3

Wal-Mart*

Atlanta, Ga. Mooresville, N.C. Bentonville, Ark.

4

Menards* Eau Claire, Wisc.

5

ABC Supply

6

Sherwin-Williams

7

Tractor Supply

8

Builders FirstSource

9

Beacon Roofing Supply

10

Beloit, Wisc. Cleveland, Ohio Brentwood, Tenn. Dallas, Texas Herndon, Va.

Amazon.com* Seattle, Wash.

11

Sears Holdings* Hoffman Estates, Ill.

12

84 Lumber

13

BMC

14

US. LBM Holdings

15

Harbor Freight Tools*

Eighty Four, Pa. Atlanta, Ga. Green Bay, Wis. Camarillo, Calif.

16

SRS Distribution

17

GMS

18

Foundation Building Materials

McKinney, Texas Tucker, Ga.

Sales ($ mil.)

Stores

Type of Business

108,203,000,000

2,287

Home Center

71,309,000,000

2,015

Home Center

15,580,000,000

3,956

Home Center

10,700,000,000

328

Home Center

10,500,000,000

783

SD

9,630,000,000

4696

Paint store

7,911,045,000

1,940

Farm & Ranch

7,724,800,000

401

LBM

6,418,310,000

530

SD

4,650,000,000

1

Home Center

4,251,000,000

850

Home Center

3,865,717,000

264

LBM

3,682,448,000

155

LBM

3,348,400,000

251

LBM

2,950,000,000

1002

2,750,500,000

248

SD

2,657,500,000

216

SD

2,044,300,000

175

SD

1,709,848,000

100

Home Decor & Flooring

1,482,000,000

162

LBM

1,449,948,000

677

Hardware Store

1,345,000,000

43

Hardware Store

Tustin, Calif.

19

Floor & Decor Holdings

20

Carter Lumber

21

Sears Hometown and Outlet Stores

Atlanta, Ga. Kent, Ohio

Hoffman Estates, Ill.

22

Fleet Farm* Brainerd, Minn.

Farm & Ranch

* Estimate

HBSDealer.com

HARDWARE + BUILDING SUPPLY DEALER JULY/AUGUST 2019

17


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THE TOP 10

Rank

Lowe’s

Rank: No. 2 Sales Increase: 4% Skinny: Like its Atlanta-based rival, Lowe’s is investing heavily in its tech systems, most recently unveiling plans for a global technology center in Charlotte. Lowe’s is sharpening its focus on its core omnichannel powers. In the past year, Lowe’s closed all 99 of its Orchard Supply stores and then revealed that it was closing 47 stores in the U.S. and Canada while exiting its business in Mexico. The company shut down its Iris smart home platform and jettisoned its internal design services.

Company Location of Headquarters

44

Riverhead Building Supply

45

Meek's Lumber and Hardware*

Calverton, N.Y.

46

National Lumber Co.* Mansfield, Mass.

47

Westlake Ace Hardware

48

Rosen Materials*

Lenexa, Kan. Sunrise, Fla.

49

E.C. Barton* Jonesboro, Ark.

Idaho Pacific Lumber* Boise, Idaho

51

Lampert Lumber* St. Paul, Minn.

Rank

23

PPG Paints* Pittsburgh, Pa.

24

Northern Tool + Equipment*

Sales ($ mil.)

Stores

Kodiak Building Partners

26

Sutherland Lumber*

Denver, Colo. Kansas City, Mo.

27

Lumber Liquidators

28

Rural King Supply*

Toano, Va. Mattoon, Ill.

29

McCoy's Building Supply

30

Harvey Building Products*

San Marcos, Texas Waltham, Mass.

31

Lansing Building Products* Richmond, Va.

32

American Construction Source*

52

1,250,000,000

605

Paint Store

53

Parr Lumber* Hillsboro, Ore.

34

Orscheln Farm and Home* Moberly, Mo.

35

Foxworth-Galbraith Lumber*

Professional Builders Supply* Shelter Products* Portland, Ore.

Hardware Store

54

Mead Lumber*

1,125,000,000

102

1,121,300,000

80

LBM

1,045,000,000

49

Home Center

1,028,933,000

392

Home Decor & Flooring

1,000,500,000

95

Farm & Ranch

58

Hammond Lumber

884,400,000

91

LBM

59

Raymond Building Supply*

702,500,000

49

LBM

60

574,300,000

77

SD

61

566,300,000

73

LBM

541,500,000

34

LBM

480,000,000

165

473,000,000

32

LBM

445,000,000

62

Farm & Ranch

437,300,000

8

LBM

437,000,000

11

LBM

426,000,000

6

LBM

395,000,000

81

Farm & Ranch

357,254,000

140

Home Decor & Flooring

356,800,000

20

350,900,000

104

Columbus, Neb.

55

Kelly-Moore Paint* San Carols, Calif.

56

R.P. Lumber* Edwardsville, Ill.

57

Runnings Supply* Marshall, Minn. Belgrade, Maine Fort Myers, Fla.

Sunroc Corp.* Saint George, Utah

Ring's End* Darien, Conn.

62

Curtis Lumber* Ballston Spa, N.Y.

Springfield, Mo.

33

Type of Business

348,035,000

18

LBM

347,600,000

55

LBM

338,000,000

14

LBM

329,700,000

120

315,000,000

27

LBM

311,000,000

102

LBM

308,000,000

11

LBM

307,400,000

31

LBM

306,700,000

8

LBM

300,300,000

6

LBM

291,000,000

44

LBM

290,000,000

147

277,000,000

69

Home Center

265,000,000

43

Farm & Ranch

252,000,000

21

LBM

236,000,000

5

LBM

218,300,000

11

LBM

215,000,000

8

LBM

210,900,000

21

LBM

197,700,000

25

LBM

197,100,000

14

LBM

Hardware Store

Morrisville, N.C.

Burnsville, Minn.

25

Type of Business

Stores

Sacramento/Springfield

50

Company Location of Headquarters

Sales ($ mil.)

63

Mill Creek Lumber & Supply

Paint Store

Tulsa, Okla. Farm & Ranch

64

Franklin Building Supply* Boise, Idaho

* Estimate

Dallas, Texas

36

Atwoods Ranch & Home* Enid, Okla.

37

Matheus Lumber* Woodinville, Wash.

38

Ganahl Lumber Co.

39

Golden State*

Anaheim, Calif. Petaluma, Calif.

40

Bomgaars Supply* Sioux City, Iowa

41

The Tile Shop

42

Alpine Lumber*

Plymouth, Minn. Westminster, Colo.

43

20

CNRG Collierville, Tenn.

THE TOP 10

LBM

Wal-Mart

Rank: No. 3 Sales Increase: 3% Skinny: In an effort to ramp up hiring efforts, Walmart raised driver pay in February. According to the world’s largest retailer, a one cent per mile increase and additional pay for every arrival means that Walmart drivers will now earn on average $87,500 a year with an all-in rate close to 89 cents per mile. More than 1,400 new Walmart truck drivers were added in 2018 and hundreds more are slated to join the fleet in 2019, the company said.

Home Center

JULY/AUGUST 2019 HARDWARE + BUILDING SUPPLY DEALER

HBSDealer.com


THE TOP 10

Rank

Menards

Rank: No. 4 Sales Increase: 6% Skinny: Bigger is better, reasons the privately held, Eau Claire, Wis.-based company. Menards made a steady stream of expansions, most recently entering the Cleveland market, pushing its store count to 328. The year 2018 saw the retailer complete a plan to enclose all garden centers, expand warehouses and expand its stores. Additional space to carry products, cuts down on the need for replenishment and shipping from its distribution centers, according to Menards.

86

Company Location of Headquarters

Scherer Brothers* Brooklyn Park, Minn.

87

Valu Home Centers* Buffalo, N.Y.

88

Honsador Lumber* Kapolei, Hawaii

89

Consolidated Lumber* Sitllwater, Minn.

90

Standard Companies* Grand Rapids, Mich.

91

Guy C. Lee Building Materials* Lezzer Lumber* Curwensville, Pa.

65

Company Location of Headquarters

Reliable Wholesale Lumber*

Sales ($ mil.)

195,000,000

Stores

2

Type of Business

LBM

Huntington Beach, Calif.

66

Bridgewell Resources* Tigard, Ore.

67

Erie Materials* Syracuse, N.Y.

68

Stine Lumber* Sulphur, La.

69

Ridout Lumber Company* Searcy, Ark.

70

Friedman's Home Improvement Great Floors* Coeur d’Alene, Idaho

72

W.E. Aubuchon* Westminster, Mass.

73

Alexander Lumber* Aurora, Ill.

74

Feldman Lumber* Brooklyn, N.Y.

75

T.W. Perry Enterprises

76

M.G. Building Materials*

Gaithersburg, Md. San Antonio, Texas

77

Hancock Lumber Co.

78

Drexel Building Supply*

Casco, Maine Campellsport, Wis.

79

Erickson Framing Operations*

93

Hines Supply

94

McCray Lumber & Millwork

95

Burton Lumber*

Buffalo Grove, Il. Overland Park, Kan. Salt Lake City, Utah

192,800,000

7

LBM

96

Gilcrest-Jewett

192,700,000

10

LBM

97

Forge Lumber/Sims Lohman*

Type of Business

156,300,000

5

155,000,000

41

151,400,000

7

LBM

151,400,000

17

LBM

151,000,000

18

LBM

149,900,000

8

LBM

149,800,000

14

LBM

149,000,000

10

LBM

147,800,000

7

LBM

144,000,000

10

LBM

142,000,000

5

LBM

139,000,000

22

LBM

138,900,000

9

LBM

138,500,000

8

LBM

135,500,000

13

LBM

134,500,000

6

LBM

133,750,000

10

LBM

133,200,000

7

LBM

132,800,000

7

Home Center

131,800,000

9

LBM

130,100,000

26

LBM

130,000,000

34

LBM

LBM Home Center

Waukee, Iowa

Cincinnati, Ohio

192,400,000

11

Home Center

190,000,000

13

LBM

190,000,000

6

Home Center

25

Home Decor & Flooring

98

185,000,000

111

183,000,000

21

Hardware Store

Hayward Lumber* Monteray, Calif.

100 188,600,000

Central Valley Builders Supply* Napa, Calif.

99

Santa Rosa, Calif.

71

Stores

Smithfield, N.C.

92

Rank

Sales ($ mil.)

Wisconsin Building Supply* Green Bay, Wisc.

101

Zeeland Lumber & Supply* Zeeland, Mich.

102

American Builders Supply* Sanford, Fla.

LBM

103

The Building Center* Pineville, N.C.

183,000,000

4

LBM

182,057,909

7

LBM

180,000,000

12

LBM

180,000,000

10

LBM

178,500,000

8

LBM

173,600,000

4

LBM

173,000,000

10

LBM

169,000,000

136

168,000,000

22

165,000,000

9

164,000,000

16

LBM

156,800,000

8

LBM

104

Star Lumber*

105

Koopman Lumber*

Wichita, Kan. Whitinsville, Mass.

106

Bloedorn Lumber* Torrington, Wyo.

107

T.H. Rogers Lumber* Edmond, Okla.

* Estimate

Chandler, Ariz.

80

Poulin Lumber/Wallboard Supply Company*

THE TOP 10

Londonderry, N.H.

81

Dunn-Edwards Corp.* Los Angeles, Calif.

82

Parker's Building Supply* Port Arthur, Texas

83

The Hardware Companies

84

Capitol Building Supply*

Atlanta, Ga. Manassas, Va.

85

Kuiken Brothers* Fair Lawn, N.J.

22

Paint Store LBM Hardware Stores

JULY/AUGUST 2019 HARDWARE + BUILDING SUPPLY DEALER

ABC Supply

Rank: No. 5 Sales Increase: 13% Skinny: The Beloit, Wis.-based specialty distributor increased its number of locations from 716 on last year’s listing to more than 780. The company, a leader in roofing, exterior and interior building products, emphasizes its ability to provide personalized support for contractors.

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THE TOP 10

Sherwin-Williams

Rank: No. 6 Sales Increase: 6% Skinny: The company with the largest fleet of paint stores in the U.S. made its biggest news last year on the manufacturer side of the business, making a deal with the home improvement giant Lowe’s. Sherwin-Williams became the only nationwide supplier to Lowe’s U.S. retail outlets for interior and exterior paints — including its Valspar and HGTV Home by Sherwin-Williams brands.

Rank

Company Location of Headquarters

129

NexGen* Britton, S.D.

130

Lyman Companies* Eau Claire, Wisc.

131

Jerry's Home Improvement* Eugene, Ore.

132

Florence Building Materials* Huntington, N.Y.

133

Your Building Centers

134

Mans Lumber & Millwork*

Altoona, Pa. Trenton, Mich.

Rank

Company Location of Headquarters

Sales ($ mil.)

Stores

Type of Business

135

D&B Supply*

136

Armstrong Garden Centers*

Caldwell, Idaho Glendora, Calif.

108

Big C Lumber* Granger, Ind.

109

U.S. Fence Solutions* Littleton, Colo.

110 111

Custom Choice Door Seattle, Wash.

North 40 Outfitters* Great Falls, Mont.

112

HPM Building Supply* Keaau, Hawaii

113

Spahn & Rose* Dubuque, Iowa

114

Big R Stores of Ind. N Ill., and NW Ohio*

127,700,000

18

LBM

137

John H. Myers & Son

127,000,000

12

LBM

138

McLendon Hardware*

125,000,000

8

LBM

139

Renton, Wash.

Keim Lumber* Charm, Ohio

116

Avalon Carpet Tile & Flooring*

120,000,000

10

120,000,000

8

LBM

119,600,000

24

LBM

Farm & Ranch

140

C-A-L Ranch Stores* Idaho Falls, Idaho

118

Woodhaven Lumber & Millwork*

141

119

Omaha, Neb.

120

Blain's Farm & Fleet* Janesville, Wis.

121

Western Building Center* Kalispell, Mont.

122

Homewood Holdings* Loomis, Calif.

123

Jackson Lumber & Millwork* Lawrence, Mass.

124

Universal Supply* Hammonton, N.J.

125

Great Lakes Ace* Farminton, Mich.

126

Tibbetts Lumber* St. Petersburg, Fla.

127

Marvin's Building Materials and Home Centers*

142

LaValley/Middleton Building Supply* Newport, N.H.

K-I Lumber* Louisville, Ky.

119,000,000

24

Farm & Ranch

143

Farm & Home Supply* Quincy, Ill.

115,000,000

1

114,000,000

14

Home Decor & Flooring

111,000,000

25

Farm & Ranch

LBM

144 145

Higginbotham Brothers

146

Graves Lumber*

4

110,000,000

1

Comanche, Texas Copley, Ohio

147 110,500,000

Dunn Lumber* Seattle, Wash.

Robert Bowden* Marietta, Ga.

LBM

LBM

148

Millard Lumber

149

Ellsworth Builders Supply*

Omaha, Neb. Ellsworth, Maine

110,000,000 105,600,000

42 14

Farm & Ranch LBM

150

Gutherie Lumber

151

Viking Lumber*

Livonia, Mich. Belfast, Maine

104,900,000

6

LBM

103,000,000

5

LBM

102,000,000

15

LBM

100,100,000

50

Hardware Store

98,500,000

5

152

Harbin Lumber

153

Russell Do it Centers*

154

LBM

Lavonia, Georgia Alexander City, Ala.

Type of Business

95,000,000

4

LBM

94,000,000

6

LBM

92,000,000

2

Home Center

92,000,000

4

LBM

89,800,000

16

LBM

89,200,000

2

LBM

89,000,000

14

Farm & Ranch

88,000,000

31

Lawn & Garden Store

88,000,000

7

LBM

87,500,000

7

Hardware Store

87,000,000

8

LBM

86,500,000

10

86,300,000

2

LBM

86,100,000

7

LBM

85,000,000

13

84,000,000

9

82,000,000

39

81,700,000

1

LBM

81,000,000

3

LBM

80,772,164

3

LBM

80,600,000

10

LBM

80,100,000

1

LBM

78,600,000

9

LBM

77,572,433

7

LBM

77,500,000

9

Home Center

Jennings Builders Supply and Hardware*

76,200,000

4

LBM

76,000,000

38

75,000,000

7

73,500,000

10

Paint Store

73,500,000

17

Lawn & Garden Store

Home Center

Farm & Ranch LBM Home Center

Cashiers, NC

155

J.C. Licht

156

Doug Ashy Building Materials*

Addison, Ill.

Paint Store

LBM

Lafayette, La.

98,000,000

28

Home Center

157

Leeds, Ala.

128

Ashby Lumber* Berkeley, Calif.

Lakewood, N.J.

Builders Supply Co.*

Buccheit* Perryville, Mo.

Cherry Hill, N.J.

117

Williams Lumber & Home Centers*

Stores

Renton, Wash.

Watskeka, Ill.

115

York, Pa.

Sales ($ mil.)

Janovic Paint and Decorating* Long Island City, N.Y.

95,000,000

12

LBM

158

Stein Garden & Gifts* Milwaukee, Wis.

* Estimate

24

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THE TOP 10

Tractor Supply

Rank: No. 7 Sales Increase: 9% Skinny: The company’s “ONETractor Strategy” chart for anytime, anywhere and anyway service includes a quadrant for core and foundational capabilities. To that end, here’s what CEO Greg Sandfort said about the company’s new distribution center in Frankfort, N.Y. The facility “allows us to expand our store base in the Northeastern Corridor of the country and better serve our existing customers with faster, more efficient delivery to our stores, while expanding our digital fulfillment strategy.” Tractor Supply currently operates seven other primary distribution centers.

Rank

Company Location of Headquarters

181

Big Creek Lumber* Davenport, Calif.

182

Ed Herrington * Hillsdale, N.Y.

183

Tindell's Building Materials

184

McSwain Carpets & Floors*

Hillsdale, N.Y. Cincinnati, Ohio

185

Moynihan Lumber

186

Jaeger Lumber*

North Reading, Mass. Union, N.J.

187

Builder's Discount Centers* Rocky Mount, N.C.

188

Oldham Lumber* Dallas, Texas

Rank

Company Location of Headquarters

159

Christensen Lumber* Fremont, Neb.

160

NorCal Lumber* Marysville, Calif.

161

Building Component Supply*

Sales ($ mil.)

Stores

Type of Business

189

Allenton, Wis.

190

73,500,000

2

LBM

73,400,000

1

LBM

72,800,000

2

LBM

Arizona Tile* Tempe, Ariz.

72,000,000

26

Home Decor & Flooring

193

163

Rocky's Ace Hardware* Springfield, Mass.

72,000,000

35

Hardware Store

194

164

Theisen Supply* Dubuque, Iowa

72,000,000

24

Farm & Ranch

165

Chelsea Lumber Company

166

Airbase Carpet Mart*

Chelsea, Mich.

72,000,000

3

Home Center

New Castle, Del.

71,700,000

12

Home Decor & Flooring

167

City Mill Co.* Honolulu, Hawaii

71,500,000

8

Home Center

168

Costello's Home & Garden* Deer Park, N.Y.

71,500,000

30

Hardware Store

169

Cassity Jones Lumber* Longview, Texas

71,400,000

13

LBM

170

Zarsky Lumber * Victoria, Texas

71,000,000

9

LBM

171

O.C. Cluss Lumber* Uniontown, Pa.

71,000,000

5

LBM

172

Timberland Lumber* Brazil, Ind.

71,000,000

3

LBM

173

Vista Paint* Fullerton, Calif.

69,000,000

46

69,000,000

5

191

174

Desert Companies* Las Vegas, Nev.

175

Garris Evans Lumber* Greenville, N.C.

176

Gillman Home Centers* Batesville, Ind.

177

Nonn's Flooring* Middleton, Wis.

178

The Lester Group

179

Buck Lumber*

180

Arlington Coal & Lumber*

Martinsville, Va. Charleston, SC Arlington, Mass.

LBM

Shelly's Supply* Telford, Pa.

192

Paint Store

Belletetes* Jaffrey, N.H.

Wheelwright Lumber Company

Stores

Type of Business

67,000,000

5

LBM

67,000,000

7

LBM

66,600,000

6

LBM

66,500,000

10

66,000,000

3

LBM

65,000,000

7

LBM

65,000,000

11

64,500,000

1

LBM

64,000,000

4

LBM

62,500,000

9

LBM

62,500,000

8

LBM

62,300,000

1

LBM

62,000,000

33

62,000,000

6

Home Center

62,000,000

6

LBM

62,000,000

1

LBM

62,000,000

17

61,800,000

1

61,000,000

43

60,000,000

1

60,000,000

16

Lawn & Garden Store

60,000,000

28

Farm & Ranch

59,600,000

24

Home Decor & Flooring

59,500,000

2

Home Center

59,200,000

6

LBM

59,000,000

9

LBM

59,000,000

6

LBM

58,600,000

2

LBM

58,000,000

3

LBM

58,000,000

7

LBM

Home Decor & Flooring

Home Center

Ogden, Utah

Jacksonville, Fla.

162

Zuern Building Products*

Sales ($ mil.)

Hirshfield's* Minneapolis, Minn.

Seattle Lighting Fixture* Seattle, Wash.

195

Mid-Cape Home Centers* South Dennis, Mass.

196

Kleet Lumber* Huntington, N.Y.

197

Taylor's Do it Center* Virginia Beach, Va.

198

Yoder's Building Supply* Fair Play, S.C.

199

Ricciardi Brothers* Maplewood, N.J.

200

Cape Cod Lumber* Abington, Mass.

201

Star Nursery* Henderson, Nev.

202

Big R Stores of Pueblo* Pueblo, Colo.

203

Floridatile* Lexington, Ky.

204

Ziegler Lumber* Spokane, Wash.

205

East Haven Builders Supply*

Paint Store

Hardware Store LBM Paint Store LBM

East Haven, Conn.

68,800,000

5

LBM

206

Warner Robins Supply* Warner Robins, Ga.

68,400,000

12

Home Center

68,300,000

3

Home Decor & Flooring

68,000,000

5

LBM

67,400,000

1

LBM

67,300,000

5

LBM

207

Rio Grande Building Materials* Denver, Colo.

208

Wilson Lumber* Huntsville, Ala.

209

Building Solutions* Tulsa, Okla.

210

Direct Cabinet Sales* Dayton, N.J.

* Estimate

26

JULY/AUGUST 2019 HARDWARE + BUILDING SUPPLY DEALER

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THE TOP 10

Builders FirstSource

Rank

Company Location of Headquarters

233

Farm King* Macomb, Ill.

Rank: No. 8 Sales increase: 10% Skinny: CEO Chad Crow summed up the year of double digit growth this way: “As overall market growth moderated, we managed to produce solid growth driven by our differentiated platform in the single-family end market, delivered on our long-term strategic priority of deleveraging, and demonstrated the strength of our close customer relationships across our national footprint.”

234

Schenectady, N.Y.

235

Rank

Company Location of Headquarters

211

United Builder's Supply* Westerly, R.I.

212

Builders' General Supply* Little Silver, N.J.

213

Niehaus Lumber* Vincennes, Ind.

214

Potter's Ace Home Center

215

Bailey Lumber & Supply*

Jamestown, Tenn. Gulfport, Miss.

216

Bender Lumber* Bloomington, Ind.

217

Texas Plywood & Lumber Co.*

Sales ($ mil.)

Stores

236

Humphrey's Building Supply Center*

57,500,000

4

LBM

57,500,000

4

LBM

56,000,000

4

LBM

Baltimore, Md.

237

Concord Lumber* Littleton, Mass.

220

GBS Bulding Supply* Mauldin, S.C.

221

Sterling Lumber & Investment*

55,500,080

21

238

Meadows Farms* Chantilly, Va.

223

Coastal Roofing Supply* Clearwater, Fla.

224

Building Supply Association* H.J. Martin & Son* Green Bay, Wis.

226

Dolan's Lumber* Benicia, Calif.

227

Arnold Lumber* West Kingston, R.I.

228

Marine Home Center* Nantucket, Mass.

229

Hardware Hawaii* Kailua, Hawaii

230

Pike Nurseries* Duluth, Ga.

231

Beisser Lumber* Grimes, Iowa

232

Acme Tools* Grand Forks, N.D.

Prince Lumber* New York, N.Y.

240

55,500,000

241

PMC Building Materials*

7

LBM

244

55,120,000

8

Home Center

245

55,100,000

1

LBM

LBM

Floor Covering Associates* Shorewood, Ill.

The Forest Group* Oklahoma City, Okla.

Cancos Tile & Stone* Farmingville, N.Y.

246

ISC Building Materials* Dallas, Texas

247 3

The Lyon & Billard Lumber Co.*

Dykes Lumber* Weehawken, N.J.

248

Builders Supply Co* Lancaster, S.C.

54,700,000

10

LBM

54,300,000

5

LBM

54,000,000

11

LBM

54,000,000

21

Lawn & Garden Store

54,000,000

2

LBM

53,800,000

2

LBM

249

6

Farm & ranch

3

LBM

52,000,000

2

LBM

51,972,000

1

LBM

51,300,000

13

Home Center

51,000,000

3

Home Center

51,000,000

3

LBM

50,600,000

3

LBM

49,500,000

30

49,000,000

5

LBM

49,000,000

5

Home Decor & Flooring

48,500,000

4

LBM

48,500,000

12

48,000,000

5

LBM

47,500,000

9

LBM

47,200,000

1

LBM

46,700,000

2

LBM

46,200,000

1

LBM

46,000,000

24

46,000,000

9

Hardware Store

45,500,000

9

Home Decor & Flooring

45,400,000

8

Home Decor & Flooring

45,000,000

3

LBM

45,000,000

40

45,000,000

8

LBM

45,000,000

4

LBM

45,000,000

11

44,300,000

2

52,000,000

Howard Lumber & Hardware* Champion Lumber* Riverside, Calif.

251

Busy Beaver Building Centers*

Home Decor & Flooring

53,500,000

4

Home Center

53,005,386

3

LBM

53,000,000

3

Home Center

52,800,000

5

Home Center

52,500,000

17

52,500,000

3

Lawn & Garden Store

252

Ace Hardware Home Center of Round Lake* Round Lake, Ill.

253

Western Wholesale Flooring*

254

Carpet Weaver’s* Champaign, Ill.

255

Builders* Kearney, Neb.

256

Farrell Calhoun* Memphis, Tenn.

257

Hughes Lumber* Catoosa, Okla.

258

Preston Feather Buiding Centers*

52,000,000

10

Hardware Store

Home Center

Paint Store

Petoskey, Mich.

259

HEP Sales* Waterloo, N.Y.

LBM

Home Decor & Flooring

Pittsburgh, Pa.

Salt Lake City, Utah

2

Lawn & Garden Store

Statesboro, Ga.

250

53,600,000

Type of Business

Meriden, Conn.

243

55,000,000

Earl May Nursery & Garden Center*

52,000,000

Stores

Shenandoah, Iowa

Powder Springs, Ga.

225

Snyder Diamond* Santa Monica, Calif.

Home Center

Westminster, Colo.

222

Alamo Lumber Company* San Antonio, Texas

242

Tiverton, R.I.

219

Louis J. Grasmick Lumber*

Marietta, Ga.

Grand Prairie, Texas

218

Haynes Brothers Lumber* Murfreesboro, Tenn.

239 Type of Business

Bellevue Builders Supply*

Sales ($ mil.)

260

Virginia Contractors Supply*

Home Center

LBM

Manassas Park, Va.

* Estimate

28

JULY/AUGUST 2019 HARDWARE + BUILDING SUPPLY DEALER

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THE TOP 10

Company Rank Location of Headquarters

Beacon Roofing

282

Rank: No. 9 Sales increase: 47% Skinny: The acquisition of Allied Building Products was the big reason for the company’s surge in 2018. All told, three acquisitions brought 215 new branches and $2.64 billion in annual net sales to the company, which describes itself as “more than roofing.” It’s also a major player in siding, windows, wallboard, ceilings, waterproofing, insulation and solar, among others.

Botello Lumber* Mashpee, Mass.

283

Pierce Flooring & Design Center* Lummus Supply Company* Atlanta, Ga.

285

Herrman Lumber* Springfield, Mo.

286

City Lumber* New York, N.Y.

287

Montalbano Lumber* Houston, Texas

288 Company Rank Location of Headquarters

261

Channel Lumber* Richmond, Calif.

262

Uresco Construction Materials*

Sales ($ mil.)

Stores

Type of Business

44,000,000

1

LBM

44,000,000

4

LBM

43,500,000

3

LBM

43,500,000

23

43,000,000

2

LBM

43,000,000

5

Home Center

42,500,000

6

LBM

Richmond, Calif.

263

Crenshaw Lumber* Gardena, Calif.

264

Barbeques Galore Limited* Garland, Texas

265

Jones Lumber* Boca Raton, Fla.

266

Ritter Lumber* Nederland, Texas

267

Gordon Lumber* Fremont, Ohio

268

Parks Building Supply & Interiors*

Lawn & Garden Store

Huskey Building Supply* Franklin, Tenn.

270

Maner Builders Supply* Augusta, Ga.

271

Eastern Pennsylvania Supply Co.*

Window Depot

290

Gill-Roy's Hardware*

LBM

42,300,000

3

LBM

42,000,000

3

LBM

42,000,000

10

LBM

Tucson, Ariz. Flushing, Mich.

272

Wilkes Barre, Pa.

273

Aboff's Paints & Wallcoverings*

42,000,000

33

Paint Store

42,000,000

16

Hardware Store

42,000,000

3

LBM

41,900,000

6

LBM

41,500,000

21

41,500,000

4

41,000,000

21

41,000,000

4

LBM

41,000,000

1

LBM

40,000,000

7

Home Decor & Flooring

40,000,000

5

LBM

40,000,000

5

LBM

40,000,000

1

LBM

40,000,000

2

LBM

40,000,000

8

LBM

40,000,000

7

LBM

40,000,000

27

Hardware Store Paint Store

27

292

Mason's Mill & Lumber* Houston, Texas

38,500,000

1

LBM

293

A.G. Mauro*

38,000,000

5

Home Decor & Flooring

38,000,000

3

LBM

37,800,000

3

LBM

37,000,000

3

LBM

37,000,000

2

Home Center

36,500,000

5

LBM

36,000,000

1

LBM

35,500,000

9

Home Center

Pittsburgh, Pa.

294

W.E. Shone Lumber* Stanton, Del.

Tulnoy Lumber* Bronx, N.Y.

A.C. Houston Lumber* Las Vegas, Nev.

Hacienda Home Centers* Albuquerque, N.M.

298

Orange County Building Materials* Vidor, Texas

Nisbet Brower* Cincinnati, Ohio

300

4

Home Center

39,000,000

299

42,000,000

1

McCormick Paints* Rockville, Md.

Stone’s Home Centers* Bainbridge, Ga.

* Estimate

Wilkes Barre, Pa.

Lumber Investors*

40,500,000

291

297

Fayetteville, N.C.

269

289

296

2

Peter Lumber* Pleasantville, N.J.

295

42,500,000

Stores

Billings, Mont.

284

Type of Business

Sales ($ mil.)

Source: Company reports and HBSDealer research. For more data on the Top 300, visit the Special Reports section of HBSDealer.com.

LBM

Huntington, N.Y.

274

Crown Ace Hardware* Huntington Beach, Calif.

275

Truitt & White Lumber* Berkeley, Calif.

276

Goldsboro Builders Supply* Goldsboro, N.C.

277

Gebo’s* Plainview, Texas

278

Thrifty Building Supply* Collierville, Tenn.

279

Calloway’s Nursery* Fort Worth, Texas

280

Fullerton Lumber * Plymouth, Minn.

281

Clay Ingels* Lexington, Ky.

30

THE TOP 10

Farm & Ranch LBM Lawn & Garden store

JULY/AUGUST 2019 HARDWARE + BUILDING SUPPLY DEALER

Amazon.com

Rank: No. 10 Sales increase: 16% Skinny: According to some informed estimates, there’s about a 15% overlap of merchandise where hardware stores and Amazon compete for customers. The retail disruptor saw huge gains in groceries and pharmacy in 2018 that pushed its total sales up more than 30%.

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YOUR COMPETITIVE EDGE


MARKET INSIGHTS

Transcendence in residential construction By Andy Carlo

O

the declining availability of highly skilled trades people at the job site,” says Ed Hudson, director of market research at Home Innovation Labs. Open construction jobs reached a post-Great Recession high of 434,000 this past April before openings settled back down to 369,000 in May, according to the latest data from the Bureau of Labor Statistics and the National Association of Home Builders.  Accompanying the labor shortage are rising land prices and costly regulations, and the industry is looking for answers. A promising solution has been a shift

Photo courtesy of Tarina Homes

ff-site construction isn’t necessarily new. But new products and techniques are helping to improve housing construction. And the primary disruptor in home building — a lack of skilled labor — is prompting today’s builders to turn to alternative methods. The result is a ripple effect leading to additional disruptors in how homes are built. “Off-site is getting a lot more attention from home builders today than it has in recent years, and the primary driver is

from on-site construction to a mix of offsite, pre-cut components and panels or complete framing packages. “What we are also going to see is an uptick in wall panels,” Hudson says. “Our data shows that wall panels and precut floor panels are among the leading off-site solutions that builders are considering at this point and expect to be adopting.” In addition to cost savings, an advantage of off-site construction is speed. Housing remains landconstrained with 2% fewer communities built this year than a year ago. At a recent summit conducted by John Burns Real Estate Consulting, land developed was rated the “worst risk adjusted by housing sector” by nearly 60% of the executives at the summit. “Builders who build their homes ‘fast’ are able to justify a higher purchase price on a finite supply of land, potentially leaving slower builders without lots,” says Todd Tomalak, executive vice president at John Burns. Tarina Homes in Bakersfield, Calif. uses SIPs (structural insulated panels) as a backbone for factory-built housing. Panelizing with sticks forces builders to shear at least one side of the wall for transport whether it’s needed structurally or not. But with SIPs, the panels are already insulated and sheared with code-qualifying 7/16” OSB for the faces of the panel.  “We found that if we stitch together multiple SIP panels and then install value added items such as doors, windows, drywall, and siding in the factory, then we can have the house completely dried in and secured within a few days,” says Chris Johnston, president of Tarina Homes.  Cycle times are what originally opened Johnston’s eyes to SIPs. 

Structural insulated panels, shown here, are among off-site building products and techniques that are transforming the industry.

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SELL MORE “WOW, NICE DECK!”

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MARKET INSIGHTS

These four ideas might be the future

“We were running between 62-64 days,” Johnston says. “The labor issues have been well documented in every market for many years. We started experiencing schedule slippage in 2015 and saw the cycle times increase to 70-80 days.” While Tarina Homes is still fine-tuning its formula, Johnston said that he believes the company will be able to get its cycle time down to 27 days. “Dropping that number makes a huge impact on the balance sheet. Being able to deliver a house before the buyer’s loan is complete is really a game changer and limits the developer’s risk,” Johnston explains. At MiTek, the term “the cassette movement” is used to define some of the changes in the building strategy. Various components of the home, including flooring and wall panels, are put together with utilities, siding, and wallboard pre-installed. The tactic avoids jobsite collisions with subcontractors running into one another and adding more time to the process. While just 10% to 15% of the industry might be building this way now, that number could grow to as much as 40% in the next 5 years, according to MiTek’s projections. But if the floor panels and wall panels aren’t arriving at the site at the same time, much of the cost savings can be lost.  Jamie Moore, senior VP of marketing for residential construction at MiTek describes residential construction as a tried and true industry that’s been building homes in a similar manner for decades.  “Changes are hard to adopt, integrate or bring to the forefront,” Moore says. “The company that is able to bring the right process, quality and leadership is really going to bring value to the industry long term.” Home Innovation Labs sees custom builders, making up about 20% to 25% of the market, using precut framing packages. Meanwhile, production builders, making up 70 to 75% of the market, appear to be utilizing more panels. “Home builders want to keep carpenters at their disposal and on their job site but are willing to get more done by lower-skilled workers,” says Hudson, who expects precut packages to increase in popularity to satisfy the need to get more done with fewer skilled people.  The industry has evolved from the early 1900’s with companies being more vertically integrated and employing tradesmen, to the late 1900’s with much of the work being subcontracted. Managing the quality and the schedule has become more and more difficult.  “To use a baseball analogy, we’re really in the top of the first when it comes to factory-built housing. It’s really an exciting time to be in the business. We’ll see more changes in the next 5-10 years than we did in the last 200,” Johnston says.  

More than 110 startups in the building arena — specifically, the “built environment value chain” — submitted their ideas in the first ever InNOVAate 2019 Challenge. The judges have selected four winners — each will participate in a six-month accelerator program to develop their disruptive technologies. The program is organized by a trio of companies — CertainTeed, the North American brand of SaintGobain; Saint-Gobain NOVA, the external ventures arm of the building products company; and Greentown Labs, a cleantech incubator.

34

And the winners are:

Hyperframe, based in San Francisco, Calif., is designing, manufacturing, and distributing a new class of building components that can be installed without tools or skills. Its products include a steel framing system for commercial buildings which can be installed up to 75 percent faster and 30 percent cheaper than traditional materials.

Inovues, based in Houston, Texas, is developing a nonintrusive building envelope retrofit system that enables the windows and glass facades of existing buildings to be upgraded as energy efficient and smart without requiring any replacement, alteration, or drilling.

The system can increase window insulation by up to 10 times and can save owners up to 40 percent on energy consumption.

Pre Framing Corp., based in Berkeley, Calif., provides partially pre-fabricated walls through automated machinery and software that can minimize cost by 45% and reduce labor time by a factor of 10 while simplifying installation.

Techstyle Materials, based in Providence, R.I., is creating smart multifunctional construction materials that can enhance building sustainability through increased energy efficiency, comfort and durability.

The chosen class of 2019 will receive intensive business training, hands-on mentorship from industry experts and a unique approach to startup and corporate relationship building.

JULY/AUGUST 2019 HARDWARE + BUILDING SUPPLY DEALER

HBSDealer.com


NEW PRODUCTS

Summer Decking: Fun, sun and sales opportunites New boards, railing and trim — plus warranties and software — hit the market. By Andy Carlo

D

ecking season is in full swing for the summer of 2019. With an estimated 25 million U.S. decks needing to be repaired or replaced, according to the North American Deck and Railing Association, new decking continues to be a go-to category for home centers and pro dealers. Additionally, there are tons of homeowners looking to add a new deck to an existing home along with builders putting decks into place in new residential construction. With the category and outdoor entertaining continuing to be arguably more popular than ever, HBSDealer has collected some of the latest decking products from the industry’s top manufacturers. Whether it’s new boards, railing, trim, or expertise, this collection includes some of the hottest players in the summer decking season.

Deckorators Deckorators Picture Framing Board Deckorators has entered a new industry category with the introduction of a composite picture framing board. The picture framing board is designed specifically for use as a picture-frame or breaker board that complements Deckorators decking. Featuring patented Eovations technology, picture framing boards are available in a Dark Slate color and 21-foot solid profile. Matching fascia is available in 12-foot lengths and both 8-inch and 11 ¼-inch widths. Deckorators picture framing boards and fascia are covered by the industry-leading Deckorators 25-year structural, 25-year stain-and-fade and 25-year removal-and-replacement limited warranty that includes water and ground contact. Deckorators.com Deckorators has also introduced its ALX Classic aluminum railing in Weathered Brown, a popular color that can add a warm, natural finish to a deck. ALX Classic aluminum railing in Weathered Brown is available in 6and 8-foot lengths and 36- and 42-inch heights with Deckorators Classic or Estate balusters. Joining Satin Black, Matte Black and Textured White in the ALX Classic aluminum railing color lineup, the durable yet minimal product is easy to install whether deck builders choose the pre-assembled or top-and-bottom rail kit option. Deckorators.com

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Armadillo Deck Armadillo Deck has met the 2019 deck season by introducing five new bold and vibrant colors to the Armadillo Lifestyle lineup. These new colors add a more pronounced streaking pattern to the already beautiful, realwood appearance and texture of our composite deck boards. With many homeowners opting for two-tone decking, the new colors complement each other perfectly to offer every deck a unique and individualized look. Trendinspired colors in the lineup include Bronco, Foothills, Smoke, Sunset, Walnut and the most popular, Campfire. Armadillodeck.com

Tam-Rail from Envision Tam-Rail is a patented triple-layer railing system from Envision decking that adds striking beauty to decks, porches and stairs. It is manufactured with a state of the art, patented triplelayer technology that provides stiffness and rigidity in a product that is light in weight. Designed for commercial and multifamily applications, TamRail features two different postmount options to accommodate either wood or concrete installations. Tam-Rail is available in white. It can be customized with square or colonial balusters, and multiple post caps including New England, Ball, and Pyramid. The Tam-Rail system includes pre-measured bracket templates and pre-drilled holes for accurate spacing and quick installation overall, ideal for a do-it-yourself project. Whether a project involves composite or wood decking or a concrete porch, Tam-Rail provides a beauty and strength of three protective layers and is offered with a 25-year warranty. Envisiondecking.com

DiamondDefense from MoistureShield MoistureShield, a division of Oldcastle APG, a CRH Company, has introduced the DiamondDefense Coating, an all-polymer cap on its MoistureShield Vision line of capped composites. This exclusive technology provides the strongest composite cap in the industry to resist damage from scratches, stains and fading. DiamondDefense technology brings peace of mind to customers who want the look of interior hardwoods with the strength that’s needed in outdoor environments. Moistureshield.com

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HARDWARE + BUILDING SUPPLY DEALER JULY/AUGUST 2019

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NEW PRODUCTS

Versatex Canvas Series As architects, builders and luxury homeowners turn to rustic, vintage textures for outdoor ceilings that shelter entries, patios and decks, they face challenges. Reclaimed materials like silvery-gray cedar can be maintenance-intensive, especially in warm, humid environments. Uniform quality is often elusive. And milling destroys that coveted, sun-bleached surface when ordering matching profiles like crown and bed moulds. Versatex Building Products answers all of those concerns with the latest addition to its Canvas Series of authentic-looking, wood-toned PVC trimboards. Dubbed Weathered Grey, the new product simulates the pale color, matte surface and deep texture of upcycled cedar planks. Wood-like workability and extra-high resistance to sunlight, moisture and heat distinguish all of the Canvas color options—Amber, Black Cherry, Macore and Walnut, as well as new Weathered Grey. Versatex.com

Zuri Premium Decking by Royal Zuri Premium Decking from Royal Building Products combines the natural beauty of exotic hardwood with unsurpassed durability and exceptionally low maintenance requirements to create a one-of-a-kind outdoor living environment. Zuri is available in Square Boards and in Grooved Boards, which offer a hidden fastener application with pre-threaded screws for fast installation. Zuri Grooved Boards are offered with a 3/32” spacing or a 3/16” gap. All of the Zuri products are available in Chestnut, Walnut, Pecan, Brazilia and Weathered Gray, and are backed by a 25-year Color Fastness Warranty against color shifting. Royalbuildingproducts.com

Simpson Strong-Tie Deck Planner Simpson Strong-Tie has launched an enhanced online Deck Planner Software tool to help deck builders and homeowners quickly and easily design their dream deck. Featuring 3D software, design guides and an in-app user tutorial, the free web-based design center provides a suite of intuitive tools and resources for designing and building stronger, more beautiful decks. Deck Planner Software from Simpson Strong-Tie lets homeowner DIYers and professional deck builders plan for beauty and design for strength. The software allows users to select shapes, modify dimensions and choose from various deck board and railing options. One-click toggling between 2D and 3D design modes makes it easy to view and design in different perspectives. The software also highlights the critical connections for building a strong, safe deck and recommends hardware based on any design the user customizes. When the design process is over, a full output report is generated that includes a bill of materials for all lumber, decking, railing and hardware necessary to build the deck. Strongtie.com/deckplanner

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JULY/AUGUST 2019 HARDWARE + BUILDING SUPPLY DEALER

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Trex Enhance Trex has re-engineered its Enhance line to provide homeowners with a high-performance, lower-cost deck board designed to compete more directly with wood. Differentiating the reimagined Enhance collection is a scalloped profile that is lighter weight for easier handling and installation. This innovative design also contributes to its lower cost. Trex Enhance is comprised of two color collections – Basics and Naturals. Enhance Basics boards are offered in three proven and popular monochromatic shades, Clam Shell, Beach Dune and Saddle. Enhance Naturals come in five contemporary, multi-tonal hues that resemble the streaked looks of natural wood. Foggy Wharf, Rocky Harbor, Toasted Sand, Coastal Bluff and Sunset Cove feature the authentic charm and color variations of wood, without the hassles of ongoing maintenance and upkeep. Trex.com

Fortress Infinity Decking Fortress Infinity Decking is a bamboobased, fully capped co-extruded composite. Slip and splinter resistant, the decking is designed for use with the HULK Fastener system, also produced by Fortress, to ensure the longevity and stability of the deck. The decking is available in a collection of traditional wood tones and stylish modern alternatives. Fortressdeck.com

TimberTech Vintage Collection TimberTech continues to innovate in the outdoor living space with the launch of two new multi-width boards in the TimberTech AZEK portfolio. In addition to its existing, standard-width deckboards, the Vintage Collection now offers — narrow (3 ½”) and wide (7 ¼”) giving customers the option to think beyond the traditional deckboards everyone else has. This groundbreaking approach gives homeowners the unique opportunity to customize their decks by adding style, dimension, and the option to play with patterns. Contractors also have the opportunity to get creative while continuing to deliver the ultimate in durability to their customers. TimberTech.com

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HARDWARE + BUILDING SUPPLY DEALER JULY/AUGUST 2019

39


TRUE VALUE REPORT

A release of equity inspires True Value makeovers Here’s what happened to these True Value retailers when the check came in the mail. One of the key drivers behind True Value’s decision to convert from a co-op model to an open-for-all distributor was the delivery of invested capital back to the store owners. That was the idea: the untapping of this equity would allow dealers to make investments in their retail operations — particularly at a time of retail disruption and digital competition. HBSDealer talked to a handful of True Value dealers who received their share of the sale of 70% of their co-op to ACON Investments, returning about $230 million. And here are some of the stories of cash-infused retail makeovers.

Kootenai Drug True Value

Troy, Montana As investments go, a big concrete slab in the back might not be the most exciting renovation for a retailer — until one considers that moving

products from the truck to the store is an essential facet of retailing, and that it affects morale and efficiency. That was the thinking of the braintrust of Kootenai Drug True Value, which installed a covered loading dock in the fall of 2018 — a $25,000 project. “The release of our equity came at a pretty good time for us,” said Tyann Hermes, co-owner. “We completed the enhancement right before winter — and it was a tough winter." Before the dock arrived, staff loaded merchandise off the truck one item at a time. They walked it in to the 9,000 sq. ft. hardware store that also operates as a pharmacy, and gift shop (a little bit of everything,” says Hermes). And if it rained, or snowed, or if a delivery truck came late, the staff suffered the inconvenience. But with the dock in place, deliveries just roll in. “For sure, employees are grateful,” Hermes told HBSDealer. The store also used its check to replace the lighting in the store with energy efficient bulbs. “The change is amazing,” she said. "Wow, you can really tell the difference.”

Store employees Mike Cratty and Dana Wallace on the new dock.

40

JULY/AUGUST 2019 HARDWARE + BUILDING SUPPLY DEALER

Guiterrez and Missouri Flat True Value celebrated a 40th anniversary with plenty of parking.

Missouri Flat True Value

Placerville, Calif. Missouri Flat True Value is celebrating its 40th anniversary this year. and the party is in and around the parking lot. Explanation: for years customers had inadequate parking to shop the Placerville, Calif, hardware store and rental yard. And lack of parking was a particular challenge for rental customers, who required the space to pull up their trucks to the door. Jeff Guiterrez had his sights on a vacant lot adjacent to his store and made a move to acquire it. Then came an equity check of about $100,000, which turbo-charged the plan — new parking, expanded inventory and a new home for the growing rental business. Before the acquisition of the lot, Guiterrez said store traffic had essentially “hit its max.” The inventory-to-customer ratio was light on customers, who had difficulty navigating to the front door. “I could daily look outside and

HBSDealer.com


watch drivers slow down when they approached the store, and then just keep going,” he told HBSDealer. “It was that packed here.” Missouri Flats Hardware moved its rental yard to the acre-and-a-half lot next door. Additional parking spaces were created. And inventory went up to match what the store thought it could handle in traffic. Instead of carrying 5 to 10 John Deere tractors, the store now carries 40 to 50. And sales in that category are up 100% for the year. In addition to gains in tractor sales, Guiterrez said STIHL sales were up 90%; and business in general is humming along with 40% growth over the prior year. “Getting that [equity check] just made my net worth improve on all sides,” he said. “It made the business grow, it gave me some cash flow, and it sped up our expansion.”

Pipestone True Value

Pipestone, Minn. First-generation hardware store retailer Chad Koep, was listening to a conversation at a Chinese restaurant in Lakeview, Minn. Talk turned to the transformation of the local mall, and the disappearance of J.C. Penney. Then he heard the comment: “I’m just thankful that we have this True Value over here, because they do the things the Amazons

and the Walmarts can’t do. “At that moment I was just so proud of my staff,” Koep told HBSDealer. “I was grinning ear to ear, because that’s one thing we pride ourselves on. You’re going to get greeted, and you will be treated as the most important thing in that store.” It was a welcome, memorable moment for Koep. And so was the time he received his equity check from True Value. “For me, it was huge,” he said of the equity distribution. “I had just started the acquisition process for the Pipestone store, and when I learned about the deal, it allowed me to free up more capital.” He broke it down: “Instead of buying a Chevrolet, I bought a Cadillac.” The Pipestone store, formerly known as Carrow’s True Value, is Koep's third True Value Hardware Store. When he purchased it, he gave it the upgrade and redesign it needed, along with the rebranding to Pipestone True Value. The store measures 13,000 sq. ft. in a town of 4,000. Koep added the new Inspiration Realized paint center, which sets the tone for the customer entering the store. He updated the lighting to efficient LEDs, and the added a lot of interactive POP, as well as 55-inch display monitors that broadcast specials and home improvement tips throughout the store. He also brought in whole new categories of merchandise. “We made it a destination,” he said. “And we’re getting a lot of positive feedback from the community.” The Pipestone (Minn.) True Value store is Chad Koep’s third.

HBSDealer.com

The Inspiration Realized paint center.

D&E Hardware & Outdoors

Mims, Fla. Fred Gumieny’s family business on Florida's Space Coast, specializes in irrigation and well drilling. He branched out into the hardware business in 2006. He survived the housing recession, and eventually thrived --taking on the True Value banner in 2012. When the check from the True Value transaction came in 2018, Gumieny had been considering a store makeover and paint center investment. The windfall “closed the deal,” he said. “It was a great time to invest in the store.” As part of the D&E Hardware and Outdoors makeover, he purchased the True Value paint center program — called “Inspiration Realized,” — hired a contractor to renovate the floors, added Lozier shelfing and painted the store interior. “It was a win-win for me, and the store,” he said. “And customers love it.” With the colorful paint display prominently featured in the center of the store, category sales have increased 10% to 15%, he said. “Success breeds success,” Gumieny said. “When people walk into the store and they see a renovation and a fresh new look, it encourages them to invest in their own home. “There’s competition all over,” he added. "We’re in a small town but we have competition, and you gotta stay in front of the competition. Or at least, try.”

HARDWARE + BUILDING SUPPLY DEALER JULY/AUGUST 2019

41


TRUE VALUE REPORT

True Value’s Hartmann emphasizes investments The former co-op crafts a Reunion theme: “Built for This.” True Value President and CEO John Hartmann would like to emphasize a point about the company’s supply chain investments. The Chicago-based distributor — not the retailer — is picking up the tab. “I want to put this in bold and in italics and underline this — my pencil is ripping through the paper: our investments are not on the backs of our retailers, “ he told HBSDealer. “There’s no decrease in dividends, no increase in prices. This is an investment the company is making.” Chief among the company’s investments is a $150 million supply chain optimization project that includes a one million square feet distribution center near Wilkes Barre, Pa. It’s scheduled to open later this year. Other big investments are taking place in the area of people and technology. The company’s field sales team is being retrained, reorganized and expanded. And inventory management technology and marketing support for stores – including local online pricing – are rolling out to dealers. These kinds of investments descend from the company’s transformation — the blockbuster

True Value Reunion When: Oct. 3-6 Where: Chicago, McCormick Place Theme: “Built for This.” Entertainment: Chicago’s own “Chicago”

42

At the Gloversville True Value in Gloversville, N.Y. (from left): Kristin Havens, Pete Havens (store manager), Tammy Capano (co-owner), John Hartmann, and co-owner Matt Capano. The store celebrated its grand opening on June 29.

sale of 70% of the company to ACON Investments in April of 2018. That move shifted True Value from a co-op structure to an open-to-all distributor model. In doing so, it released more than $200 million to former members. “Releasing that equity to our retailers more than a year ago — that’s what it’s all about,” Hartmann said. Even so, True Value nation is looking ahead to growth, not back at the transaction. “People aren’t talking about the ACON transaction very much anymore,” Hartmann said. “Time has passed and True Value has kept all of its commitments. True Value has done exactly what it said it would do. We’ve changed our structure, but not our relationships.”

JULY/AUGUST 2019 HARDWARE + BUILDING SUPPLY DEALER

The company’s investments and its programs are paying dividends, he said, pointing to recent recognition from the J.D. Power Home Improvement Retailer Satisfaction Study in which True Value and Ace tied for top honors. In the interview with HBSDealer, Hartmann offered congratulations to both True Value store owners and Ace store owners for their recognition. “We’re not about the brand, we’re about the independent retailer,” he said. “So congratulations to both groups.” The company’s upcoming Reunion in Chicago Oct. 3-6 will hammer on the theme of “Built for This.” Hartmann explained: “The them represents the coming together ow what our members do every day in our communities, and we do to help them.”

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MARKET INSIGHTS

Carter Lumber plays offense Carter Lumber is in attack mode. The Kent, Ohio-based pro dealer made some significant moves in July as it drew up plans to open a new prehung door manufacturing facility in York County, Pennsylvania, and acquired the assets and New Jersey locations of the former DuBell Lumber. In Pennsylvania, at Penn Township Industrial Park, Carter will establish a manufacturing facility with the location also serving as a millwork distribution hub. The facility will serve Eastern Pennsylvania, along with markets in Baltimore, New Jersey, Virginia, and Washington, D.C.

The pro dealer said the expansion is a result of market demands. The project includes the purchase and renovation of a 64,300-square-foot warehouse. Renovations include expanding truck docks and parking areas, laying stone, and installing fencing to provide for additional parking and storage. The company will also renovate an existing facility to accommodate manufacturing and storage. “Carter Lumber is grateful for the support of Governor (Tom)

Wolf, the commonwealth of Pennsylvania, and York County, as we expand our operations with our new manufacturing facility in Hanover,” said Jeff Donley, president of Carter Lumber. “The manufacturing done at this location will not only add jobs but will also allow us to better serve the homebuilders building homes for Pennsylvania families, now and well into the future. We are excited to get the renovations of the facility completed and to begin shipping products to those homebuilders as early as the end of this year.” Carter Lumber plans to purchase equipment and machinery, as well as 5.39 adjacent acres for future expansion. The company has committed to investing at least $6 million into the project, which is expected to create 35 new, full-time jobs at the new

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manufacturing facility and retain 177 existing jobs across Pennsylvania over the next three years. Gov. Wolf — the former head of Wolf Distributing — applauded the public-private partenship. “As a former business owner in York County’s hardwoods industry, I know Carter Lumber will be right at home in this area,” he said. Carter Lumber operates 14 retail and showroom locations across the Keystone State. Altogether, Carter operates more than 160 units, including truss manufacturing and nine prehung door manufacturing locations. In New Jersey, Carter’s acquisition of DuBell includes locations in Cherry Hill, Pleasantville, Winslow and

Medford; the latter being the former headquarters of DuBell Lumber. DuBell ceased operations this past February, but Carter Lumber was quick to acquire the locations within weeks of the DuBell exit, according to Mark Ely, director of marketing at Carter Lumber. “We worked with their creditors to purchase the physical locations. We have done everything we possibly could to get them up and running quickly,” Ely told HBSDealer. The yards provide Carter with access to

the metro-Philadelphia market, in addition to southern New Jersey. Prior to the acquisitions, Lancaster, Pa. had been Carter’s closest location to the market. “These are some of the fastest locations we have ever opened. It took a lot of teamwork. We had people coming from our corporate office and stores all across our footprint to help out,” Ely says. Also included in the acquisition is a truss plant in Millville and a kitchen warehouse location in Vineland, N.J. Carter Lumber is in the process of upgrading the Millville truss plant with state-of-the-art equipment. All of the New Jersey locations will operate under the Carter Lumber banner.

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MARKET INSIGHTS

Ace cultivates California Ace Hardware Corporation will open new Ace Hardware stores in 11 former Orchard Supply Hardware locations in California. Ace Hardware anticipates the opening of most locations this summer with the average size store around 30,000 square feet. Nine of the stores will be owned and operated by Westlake Ace Hardware, a subsidiary of Ace Hardware Corporation. Two of the eleven stores will be owned and operated by independent retailers, the co-op said. “Ace is delighted to fulfill a need by bringing back the local, neighborhood hardware store in 11 California communities,” said John Venhuizen, president and CEO of Ace Hardware

46

Corporation. “Ace intends to honor the tremendous legacy Orchard Supply Hardware established in these communities while infusing them with Ace’s unique culture and helpful service for which Ace has become famous.” Orchard Supply Hardware had a long run in California retailing history, before Lowe’s made the decision in August 2018 to close all 99 stores. Orchard was founded in 1931. In May, Orgill’s Central Network Retail Group announced plans to open seven Outdoor Supply Hardware stores in former OSH locations. With 173 new domestic store openings in 2018, Ace Hardware has more than 4,400 stores across the country. The former OSH stores where Ace intends

JULY/AUGUST 2019 HARDWARE + BUILDING SUPPLY DEALER

Ace is reviving several former Orchard Supply locations.

to open are located in both northern and southern California. “The entire Ace Hardware team and I are very excited about our upcoming expansion into California. Our growth in the Golden State is the latest example of the vibrant and positive evolution the Ace brand has gone through during the past several years,” said Joe Jeffries, president and CEO of Westlake Ace Hardware. Jeffries added: “We also look forward to joining the many other wonderful Ace retailers in the state and partnering with them to consistently deliver an outstanding consumer brand experience each and every day.”

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New, and looking to grow: Fulcrum Building Products South Bay Lumber of Santa Rosa Beach, Fla., and Navarre Lumber of Navarre, Fla., are the first two companies of Fulcrum Building Group, which is described as a new, multibrand operator of pro-focused lumberyards in the Florida Panhandle. And Fulcrum is looking to make more acquisitions. Silver Canyon Group, a San Diego, Calif.-based private equity investment firm, formed Fulcrum Building Group to acquire a majority interest in South Bay Lumber Navarre Lumber July 1. The owners of South Bay, brothers John and Jay Pugh, and owner of Navarre, Bobby Killingsworth, are significant owners of Fulcrum and each business will continue to operate under its current management structure and brand name. Tyndale Advisors, a wholly owned subsidiary of Orgill, has been engaged to provide management services. Craig Cowart of Tyndale will serve as CEO of Fulcrum and oversee strategy and growth. “South Bay and Navarre both have impressive histories of success and by partnering with Fulcrum, we can provide immediate benefits for the owners, our local teams and the customers they serve,” said Cowart. The move draws easy comparisons to Tyndale Advisors’ venture with the Central Network Retail Group.  CNRG has successfully served as a similar platform, and in less than 10 years has grown to 104 hardware stores, home centers and lumberyards in 14 states. CNRG is wholly owned by Tyndale Advisors, a subsidiary of Orgill, Inc. However, neither Orgill nor Tyndale have an ownership stake in Fulcrum. Killingsworth, owner of Navarre since 1990, said “One of my biggest concerns with any potential sale of the

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Navarre Lumber is one of two Florida dealers under the Fulcrum Building Group umbrella.

business was to find partners with the same goals. Fulcrum’s long-term focus matches my desire to take care of our customers and associates in the best way possible.” South Bay’s president, John Pugh, shared “Jay and I are

very excited to see the combination of these two great companies, and we couldn’t be happier with the partnership with Silver Canyon and our great friend Bobby.” Tim Kelleher, managing partner of Silver Canyon added: “We have waited for the right opportunity to invest in the building and home improvement sector and look forward to working collaboratively with the Pughs and Bobby to strengthen the businesses under the new Fulcrum platform and to make selective add-on acquisitions.” With investments totaling more than $1 billion in 50 companies, Silver Canyon is a growth-focused private equity investment firm with 28-years of experience solving the challenges of growth and scale of lower-middle market family-owned businesses.

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MARKET INSIGHTS

Affordability issues Notes from the “2019 State of the Nation’s Housing Report.” The number of people forming households in the United States has returned to a more normal pace. But housing production has not.  The 2019 State of the Nation’s Housing report from the Harvard Joint Center for Housing Studies documents how the housing shortfall is keeping pressure on house prices and rents, eroding affordability for modest-income households in many markets.  Center researchers found that household growth is now back from post-recession lows, but new home construction remains depressed, with additions to supply barely keeping pace with the number of new households.  Several factors may be contributing to the slow construction recovery, including excess supply following the housing boom, which took years to absorb, and persistent labor shortages.  “The most significant factors,

however, are rising land prices and regulatory constraints on development,” says Chris Herbert, managing director of the Joint Center for Housing Studies. “These constraints, largely imposed at the local level, raise costs and limit the number of homes that can be built in places where demand is highest.” Meanwhile, a large percentage of new housing being built is intended primarily for the higher end of the market, Herbert said.  The limited supply of smaller, more affordable homes in the face of rising demand suggests that the rising land costs and the difficult development environment make it unprofitable to build for the middle market.  The report also finds that the number of homeowners rose sharply, even as the ratio of median home price to median household income rose from a low of 3.3 in 2011 to 4.1 in 2018, a sign of

Price-to-income ratios are near peak levels Under 3.0 3.0-3.9 4.0-4.9 5.0-5.9 6.0 and Over

Source: Harvard Joint Center for Housing Studies, The State of the Nation’s Housing 2019, www.jchs.harvard.edu. All rights reserved.

deteriorating affordability. Conditions for would-be buyers vary widely across the country, with home values more than five times greater than incomes in roughly one in seven metro areas, primarily on the West Coas, compared with less than three times in about one in three metros, primarily in the Midwest and South. (See chart.) On the renter side, the number of renter households fell for the second consecutive year in 2018, a stark contrast to the increases of the 12 preceding years. Rents are rising at twice the rate of overall inflation.  Even as the market continues to lose lower-cost rental units, the share of US households paying more than 30% of their income for housing declined for the seventh straight year in 2017.  Looking forward, the report predicts that millennials and baby boomers will continue to push household growth, spurring demand in the remodeling market and the demand for entry-level homes.  Rental growth is expected to be solid as well, with 400,000 additional renter households per year expected between 2018 and 2028.  Whether these projections come to pass depends on a number of factors, including economic conditions, housing affordability, and the pace of foreign immigration. One big question mark is whether the market can supply housing that is within reach of most household incomes.  “To ensure that the market can produce homes that meet the diverse needs of the growing US population, the public, private, and nonprofit sectors must address constraints on the development process,” says Herbert. “And for the millions of families and individuals who struggle to find housing that fits their budget, public efforts will be necessary to close the gap between what they can afford and the cost of producing decent housing.” — Andy Carlo

48

JULY/AUGUST 2019 HARDWARE + BUILDING SUPPLY DEALER

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MARKET INSIGHTS

NLBMDA responds to White House affordable housing action With a lack of affordable housing holding back many Americans from purchasing a home, President Donald Trump has taken action. On June 25, the President signed an executive order that establishes a White House Council on Eliminating Regulatory Barriers to Affordable Housing. “For many Americans, access to affordable housing is becoming far too difficult. Rising housing costs are forcing families to dedicate larger shares of their monthly incomes to housing,” President Trump wrote in the executive order.

50

“Driving the rise in housing costs is a lack of housing supply to meet demand. Federal, State, local, and tribal

JULY/AUGUST 2019 HARDWARE + BUILDING SUPPLY DEALER

governments impose a multitude of regulatory barriers — laws, regulations, and administrative practices — that hinder the development of housing,” Trump said. “These regulatory barriers increase the costs associated with development, and, as a result, drive down the supply of affordable housing. They are the leading factor in the growth of housing prices across metropolitan areas in the United States. Many of the markets with the most severe shortages in affordable housing contend with the most restrictive State and local regulatory barriers to development.” The National Association of Lumber and Building Material Dealers Association (NLBMDA) issued the following statement regarding the council’s establishment: “NLBMDA is encouraged that the Trump Administration will be examining

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The Council has been tasked with accomplishing the following directives by January 2021:

Engage state, local, and tribal leaders to identify and remove obstacles that hinder the development of new affordable housing.

Examine the impact federal, state, and local regulations are having on the costs of developing affordable housing and the economy.

Take action to reduce federal regulatory barriers to affordable housing development.

Support state and local efforts to reduce regulatory barriers.

Recommend solutions to reduce statutory, regulatory, and administrative burdens at every level of government that hamper affordable housing development.

Low-Income Housing Tax Credit have been an effective means to expand the supply of affordable housing and we hope the Administration will complement these incentives with smart regulatory reforms.” The Council will be chaired by the

Department of Housing and Urban Development (HUD) Secretary Ben Carson and will consist of members from across eight federal agencies including HUD, Treasury, Labor, Interior, Agriculture, Transportation, Energy and the Environmental Protection Agency.

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ways to make housing development more affordable,” said Jonathan Paine, NLBMDA President & CEO. “Regulatory barriers at all levels of government, while well-intentioned in many cases, can impede the development of affordable housing. NLBMDA stands ready to work with the Administration to make housing more affordable for all Americans. Incentives such as the

“NLBMDA is encouraged that the Trump Administration will be examining ways to make housing development more affordable.” — Jonathan Paine, NLBMDA President & CEO

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PEOPLE IN THE NEWS Nardelli joins GrowGeneration GrowGeneration, the retail chain of hydroponic and organic gardening products, has hired former Home Depot CEO Bob Nardelli as a senior strategic advisor. GrowGeneration’ stated mission is to own and operate its branded stores in all the major legalized cannabis states in the United States and Canada. Currently, GrowGeneration has 23 stores — five are in Colorado and five in California. The company estimates that roughly 1,000 hydroponic stores are in operation in the U.S. By 2020 the market is estimated to reach over $23 billion with a compound annual growth rate of 32%. Nardelli’s role will be to explore potential partnerships. He’ll also provide advice on matters relating to supply chain, merchandise, branding, distribution, new product introductions, pricing and channel selection, the company said. “I believe GrowGeneration has a solid execution track record, is strongly differentiated from its peers, has achieved scale throughout the supply chain of the hydroponic industry, and is poised to go to the next level,” Nardelli said. He exited the Home Depot in 2007. 84 Lumber names new CPO 84 Lumber has hired Troy Dally as the company’s new chief procurement officer (CPO). Dally will oversee purchasing, pricing, cost forecasting, inventory, national sales, and specialty purchasing and delivery services, the pro dealer said. Dally brings more than 25 years

52

Do it Best LBM team moves Do it Best Corp. has named four senior leaders to new roles on the lumber and building materials team. Todd Hixson will serve as the company’s LBM business development manager, a new leadership position. Hixson, who previously served as the division manager for lumber and panels will be in the field, growing existing member relationships as well as developing exceptional new ones. Josh Ratcliff will move into the role of division manager for lumber and reload operations; Joe Corah will serve as the newly created division manager for panels, distribution and specialty products; and Jean Fahy will take over as the division manager of building materials.

of experience in sales, purchasing and supply chain to his new role. He previously served as a senior vice president at Lowe’s for eight years, spending the majority of his time in merchandising. In that role, Dally managed up to $26 billion in purchasing across eight product divisions that included lumber, millwork and building materials. He also directed numerous processimprovement initiatives for the company’s stores and support services that resulted in operational efficiencies. WD-40 leadership moves WD-40 announced that CEO Gary Ridge will be appointed as chairman of the board at its annual meeting in December. The San Diego, Calif.-based manufacturer also said

JULY/AUGUST 2019 HARDWARE + BUILDING SUPPLY DEALER

Cockwise from top left: Hixson, Ratcliff, Fahy and Corah

that current chair Linda Lang plans to retire as of the date of WD-40’s next annual meeting. Lang joined the board in 2004 and has served as board chair since 2016. In connection with Lang’s retirement, a lead independent director will be appointed. Ridge also currently serves as a member of the board, which includes 10 directors. The company has also appointed Steve Brass to the role of president and chief operating officer of the company and Patricia Olsem has been promoted to the role of division president, Americas. Ridge will no longer serve as president but will continue to serve as CEO of the company. Beacon Roofing names new CEO Beacon Roofing Supply appointed Julian Francis as its new president and CEO. Francis, will also become a member of the board of directors and is expected to join the company on Sept. 1. Since October 2014, Francis has served as the president of the insulation business at Owens Corning. He also

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served as vice president and general manager of Owens Corning’s residential insulation business from 2012-2014. In February, Beacon announced that current President and CEO Paul Isabella would be leaving the company in 2019 after 12 years of service. New CEO for Knauf Insulation Knauf Insulation, the manufacturer of glass mineral wool insulation, has named Matthew Parrish as the company’s new CEO.

Parrish’s elevation to the position of president and CEO is part of a broader reshaping of the Knauf Group global leadership teams following the company’s acquisition of USG Corporation. Parrish

replaces Christopher Griffin, who was recently named CEO of USG Corporation. Parrish has over 29 years of experience in the building materials industry with a primary focus in insulation and cement.

Acme Tools new head of store ops Acme Tools named Bob Feeley director of store operations, marking the return of the experienced executive who used to be director of human resources for Acme Tool from 2014 until July of last year. Feeley has 25 years of corporate management experience and has held senior management positions with Fortune 100 companies.

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53


Residential Construction/Sales

Monthly Retail Sales, not adjusted

13 months of housing starts and existing-home sales

home centers and pro dealers (NAICS 444) and hardware stores (NAICS 44413)

Total starts

NAICS 444

(in thousands, SAAR) June: 1,253,000 40

1400

37.9 2.67

34.6

33.1 30.8

(sales in $ billions)

3

39.1

30

1300

NAICS 44413

(sales in $ billions)

30.5

2.28

2

2.31

2.24

2.69

2.39

20

1200

1 10

1100

1000

0

MARCH

J J A S O N D J F M A M J

2018

SOURCE: COMMERCE DEPARTMENT

APRIL

0

MAY

MARCH 2018

2019

APRIL

MAY

2019

SOURCE: MONTHLY RETAIL TRADE REPORT FROM THE U.S. CENSUS BUREAU

Single-family starts (in thousands, SAAR) June: 847,000 1000

HBSDealer Stock Roundup

950

the percent-change performance of stocks based on July 18 prices 50

850

40

800

30

750

ANNUAL CHANGE

900

J J A S O N D J F M A M J SOURCE: COMMERCE DEPARTMENT

Existing-home sales (in millions, SAAR) May.: 5.34 million 5.75

TSCO

20

DE SHW

10

DJI

LOW

0

SWK

HD

BMC

-10

BLDR

5.5

-20

BECN WY

5.25

-30 -5 -4 -3 -2 -1 0 1 2 3 4 5 6 7 8

5

MONTHLY CHANGE 4.75

BECN (BEACON); BLDR (BUILDERS FIRSTSOURCE); BMCH (BMC STOCK HOLDINGS); DE (DEERE & CO.);

M

J

J

A

S

O

N

D

J

F

M

A

M

HD (HOME DEPOT); LOW (LOWE’S); SHW (SHERWIN-WILLIAMS); SWK (STANLEY); TSCO (TRACTOR SUPPLY);

SOURCE: NATIONAL ASSOCIATION OF REALTORS

WY (WEYERHAEUSER); DJIA (DOW JONES INDUSTRIAL AVERAGE)

Consumer Watch Unemployment rate

Consumer confidence

Gas prices

for the entire United States

indexed to a value of 100 in 1985

average price per gallon (regular)

5.0 4.5

100

5.5

$2.50

Current

$2.00 80

6.0

Prior month

120

Prior year

4.0

3.7% 3.5

54

June

6.5 60

121.5

$2.78

June

July 18

140

$1.50

JULY/AUGUST 2019 HARDWARE + BUILDING SUPPLY DEALER

$3.00

SOURCES: LABOR DEPARTMENT, THE CONFERENCE BOARD, AAA

HBSDealer.com


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