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“The ‘I’s Have It: in ation, Interest rates and International trade.” Expert analysis from John Burns Research and Consulting is applied to far-reaching economic forces in this free webinar series. Tune in Aug. 6 for the next in the series. And watch the replay at HBSDealer.com/webinars
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From the Editor
Past, present and future
“Time, thou must untangle this, not I. It is too hard a knot for me t’untie.”
— Viola
That famous line from Shakespeare’s “Twelfth Night” is one way to describe today’s conditions confronting the hardware and building supply market. Consider a recent Wednesday afternoon headline “Many of Trump’s tariffs were just blocked. Now what?”
That headline was obsolete—by a legal appeal—before it even hit email boxes on Thursday morning. But the question lingers: “What now?”
If you listen to the earnings calls of major companies in our space, you’ll hear a variety of responses to that basic tariff-infused question.
The global tool superpower Stanley Black & Decker put a brave face on price increases announced in April. “In light of the current environment, we are accelerating adjustments to our supply chain and exploring all options as we seek to minimize the impact of tariffs on end users while balancing the need to protect our business and our ability to innovate,” said Stanley CEO Donald Allen.
Floor & Decor said it will decelerate its
Ken Clark, Editor-in-Chief
store opening plans. Instead of 25 new stores in 2025 as once projected, it will now open 20 new stores. CEO Tom Taylor said this isn’t his rst uncertain macroeconomic environment (his words.)
“We successfully managed an increase in tariffs in 2018 and 2019 by pursuing strategies to grow our market share and protect our pro tability,” said Taylor, a former Home Depot exec. “Today, we intend to employ similar strategies to achieve these goals in 2025 and beyond.”
Home Depot and Lowe’s put an emphasis on their respective supply chain strengths. (See article on page 12.) Through strenuous efforts, HBSDealer tracks the top and bottom line performances of 30 publicly traded companies, and the data lives on our 10-Q Review.
The critical reader might respond: anybody can look back at the S.E.C lings of publicly traded companies for a rear-view mirror look at the market. But can you look into the seeds of time and say which grain will grow and which will not?
That’s where our partnership with John Burns Research & Consulting comes into play. The webinar series — Housing and Remodeling Market Update — continues on Aug. 6. Analysts Matt Saunders and Elizabeth LaJeunesse will deliver the latest on in ation, interest rates, international trade and immigration. And they’ll even look ahead at forecasts and projections. Round one of the webinar series is available for replay at HBSDealer.com/webinar Check it out.
And if you have a quote that sums up today’s business climate, share it with us at news@ HBSDealer.com
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EDITORIAL ADVISORY BOARD
Levi Smith, CEO, Franklin Building Supply
Christi Powell, Women & Minority Business Enterprise Market Manager, 84 Lumber
Neal DeLowery, Store Projects and Merchandise Manager, Aubuchon Co.
Brad McDaniel, Owner, McDaniel’s Do it Center Joe Kallen, CEO, Busy Beaver Building Centers
Tom Cost, Owner, Killingworth True Value
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Big boxes trumpet supply chain prowess
PRODUCT SOURCING FLEXIBILITY A MAJOR TALKING POINT
Home Depot and Lowe’s broadcast their earnings calls within 24 hours of each other. CEOs of both companies quickly jumped into a topic where they could point to strength: product sourcing.
At times, it was as if executives from both companies were reading from the same script, or at least a very similar script, when it came to supply chain diversity.
Home Depot CEO Ted Decker explained that more than half of the company’s purchases are sourced in the United States, after working for years to diversify its global supply chain.
“As a result, we now have tremendous sourcing exibility,” he said. “We are already taking action and anticipate that 12 months from now no single country outside of The United States will represent more than 10% of our purchases.”
Executive vice president of merchandising Billy Bastik added that one of the hallmarks of Home Depot has always been a diversi ed supply chain. “A majority of our suppliers have diversi ed their
sourcing strategies across several countries,” Bastik said. “We’ve got tremendous exibility here. I can’t emphasize that enough.”
That exibility is expected to pay off in the aisle in the form of price leadership, Bastik said.
Responding to a question from an analyst, the merchant added: “We don’t see broad-based price increases for our customers at all going forward. It’s a great opportunity for us to take share, and it’s a great opportunity for our suppliers to take share as well.”
The next day, it was Lowe’s CEO Marvin Ellison’s turn to trumpet its supply chain prowess. About 60 percent of Lowe’s purchases originate in the U.S., he said, totaling about $30 billion annually. Lowe’s, too, has been working to diversify global sourcing in recent years. Currently, about 20 percent of purchase volume
Stat of the month
is concentrated in China—largely merchandise related to holiday, trim-a-tree, ceiling fans, small appliances and tools, among others.
Ellison said Lowe’s was “pleased” but not “satis ed” with the 20 percent gure, and is working to lower it. “Our global sourcing team has identi ed exciting diversi cation opportunities in the U.S. and around the globe that we’re actively pursuing,” Ellison said.
Both Home Depot and Lowe’s described vendor relationships as tonic for tariffs, and, by extension, market share.
Ellison explained: “I think the key for us is the merchants have been cultivating and developing just wonderful relationships with suppliers for the last six years. And this is when those relationships start to pay off.”
Inside a Home Depot distribution center.
In the latest tale of the tape, Home Depot’s comparable store sales (positive 0.2 percent for U.S.) came in higher than Lowe’s (negative 1.7 percent) in the rst quarter of 2025.
Manufacturers & Services Directory
Hancock Lumber scores in Massachusetts
Hancock Lumber has a message for Johnson Lumber, a single-location lumberyard operating out of Salisbury, Massachusetts: “Welcome to Team Hancock.”
The acquisition expands Hancock’s lumberyard footprint to 12, and it marks its rst location in Massachusetts. Kevin Hancock, the sixth-generation manager-owner of Maine-based Hancock Lumber, described the acquisition and integration of Johnson Lumber as an “amazing” experience.
“Johnson Lumber has been a quintessential family business since the early 1960s –doing things the right way for over 60 years,” Hancock said. “The Johnson family, their employees and their customers represent the essence of what local and independently-owned lumber companies bring to their communities. So, for Hancock Lumber it’s a big blessing and responsibility to be given the opportunity to continue to expand and build on that legacy.”
Located just two miles from the coast and minutes from I-95 and I-495, Johnson Lumber is situated on a 12-acre site featuring covered storage and contractor-focused inventory. Johnson Lumber is a delivery-driven operation, with over 80% of its sales delivered to job sites.
Hancock Lumber says it intends to add resources and invest in the Johnson business. The two companies, he said, combine similar cultures that value employees and service.
The two companies also mark a good geographic t. Hancock also says the acquisition is a natural extension of the company’s markets, enhancing the reach between its existing Kennebunk, Maine, and Wolfeboro, N.H., locations—just 40 and 70 minutes away, respectively.
This additional lumberyard will help grow key product lines including Hancock-made wall panels, trusses and pine, along with Marvin windows and Tiny Homes, while creating additional capacity and delivery ef ciency across the region.
Twenty Johnson Lumber employees will join Hancock Lumber, including three second-generation owners, two of whom will stay on short-term to assist with the transition and one as a full-time employee.
“Our family has been focused on nding the right partner to move our family business into the next generation of ownership,” second-generation owner and president, Trish Johnson, commented. “Ultimately, choosing to partner with Hancock Lumber came down to nding a company that will honor our values and take care of our people—both employees and customers—for the long run.”
Product Knowledge
Product: ScotchBlue PROSharp Painter’s Tape with Edge-Lock+ Technology
Manufacturer: 3M of St. Paul, Minn.
MSRP: Sells for roughly $19-25 for a three-roll pack.
Knowledge: 3M says its new advanced Edge-Lock+ Technology delivers a 2x better hold, sealing out paint to leave consistently sharp lines. That handy bit of technology reduces the need for touch-ups and repaints.
According to 3M, ScotchBlue PROSharp Painter’s Tape offers enhanced resistance to tearing and slivering, promotes even adhesion to prevent paint seepage, performs across a variety of paint types and is ideal for both indoor and outdoor surfaces.
Fun fact: Scotch Tape gets its name thanks to a disgruntled Minnesota auto painter. After scoffing at an early prototype of masking tape that only had adhesive along its outer edges, he rudely proclaimed: “Take this tape back to those Scotch bosses of yours, and tell them to put more adhesive on it!” The name stuck.
Weber decision generates heat
In the aftermath of Weber’s early May decision to make an exclusive distribution deal in the convenience hardware channel, retailers that have been cut off have expressed shock and disappointment.
Case in point: Joe Taylor, the president and CEO of Virginia-based Taylor’s Do it Center and Pleasants Hardware wrote an open letter objecting to the Weber deal. Taylor is also chairman of the board of Fort Wayne, Indiana-based Do it Best. Weber, one of the world’s largest grill manufacturers, struck an exclusive deal with Oak Brook, Illinois-based Ace Hardware Corp. and its Emery Jensen Distribution division. The distribution arrangement will kick in Dec. 31, 2025.
Taylor says he’s not buying it.
“Years back, Weber presented us with a replica of George Stephen’s original kettle in recognition of our many years of strong support. What changed?”
He added that his business has enjoyed double-digit growth this year with Weber, the retailer’s only gas grill line in its stores.
“It will most certainly hurt to lose
them,” Taylor wrote about Weber under its new policy. “But we will not buy their products through our competitors. How can this be a reasonable solution for independents?”
In the home center warehouse (big box) channel, Weber grills and ancillary products will continue to be sold at The Home Depot and Lowe’s.
Palatine, Illinois-based Weber has been unresponsive to HBSDealer’s requests for comment.
Clay Jackson, COO and EVP of purchasing for the Memphis-based distributor Orgill, expressed disappointment in Weber’s decision.
Jackson shared in a letter to customers: “It’s worth noting that fewer than 8 percent of Orgill customers purchased more than $1,000 in Weber products over the past years. Orgill already offers one of the most extensive assortments of grills and grilling-related products in the industry—including over 60 trusted brands—and we’re actively expanding our offering even further.”
Weber claims a spot in grilling history as the innovator of the original kettle charcoal grill more than 70 years ago.
At Ace Hardware, the Weber brand plays a major role in the co-op’s Elevate3 Ace experiential store concept, which intends to elevate major brands — Weber, Traeger, Big Green Egg, Craftsman, DeWalt, Milwaukee, EGO, and STIHL— in a brand-immersive shopping environment.
“Over the next ve years, Ace Hardware will invest over $1 billion in opening new stores and remodeling existing stores to better serve our neighbors,” said CEO John Venhuizen in a press release last year promoting the store concept. “The Elevate3 Ace store model will be at the heart of this investment.”
Openings, closings and acquisitions
Regularly updated, the News Map draws from press releases, external media coverage and original reporting to provide the latest industry insights.
Lowe’s recently opened in Fort Worth, Texas. In Pennsylvania, Rural King opened its fth location, the latest in Altoona. In Florida, Sunshine Ace Hardware opened a store in Babcock Ranch, just outside Fort Myers. And in North Carolina, Kodiak Building Partners acquired New River Building Supply & Lumber Co. in Boone, and Banner Elk. Explore the interactive News Map at HBSDealer.com/map
An immersive Weber aisle displayed by Ace Hardware as part of its Elevate3 store concept.
Project Master offers do-it-yourself hardware kits designed for both beginners and the seasoned craftsmen. Our all-in-one, carefully curated kits come with high-quality products needed for all your home projects, repairs and more.
TECHNOLOGY BLENDS WITH TRADITION AT SPAHN & ROSE
By Robby Brumberg
When you think of the U.S. Heartland, Dubuque, Iowa, is just about smack-dab in the middle of it. This quaint town of 60,000 on the banks of the Mississippi River is where Spahn & Rose emerged in 1904. Over the years the company has evolved and expanded, especially in the last decade or so, growing to 25 retail lumberyards throughout the Midwest and Southeast. With geographic expansion has come increased product variety and o erings. The company now supplies everything from steel buildings to countertops to insulation and windows, to complement its bread-and-butter lumber and hardware items.
Tom Ford, the company’s director of IT and supply chain, is one of the architects orchestrating Spahn & Rose’s continued strategic growth. Ford brings a deep well of experience, shaped by two decades of consulting and sharpened through years of supply chain leadership.
to lean more heavily into AI and analytics.
“We’re asking: ‘How can AI help us get more e cient? How can it support our goals across the board, from internal operations to customer experience?’ ”
“With customers, we have to understand what pain points they have and how our tech might make their lives and jobs easier. You have to demonstrate value.”
Ford notes that while other industries have fully embraced online retail and contactless service, the building materials sector is still in the early phases of digital transformation. And that’s OK.
Tom Ford, Director of IT and Supply Chain, Spahn & Rose
After earning a degree in supply chain and business from Iowa State University, Ford began his career in the consumer packaged goods space, focusing on inventory planning and manufacturing. From there, he went into consulting, spending 20 years assessing the health and e ciency of supply chains, helping companies implement new capabilities across people, processes and technology.
Two and a half years ago, Spahn & Rose created a new role tailored for Ford’s unique expertise. It’s a move that speaks volumes about the company’s growing ambitions.
Much of his job, according to Ford, boils down to implementing tech and tactics that reduce friction for colleagues, customers (largely prodealers) and their customers’ customers. “How can it support the things we want to do across the board? How do we engage more with our customers? How do they journey with us?”
As for current tech priorities, security (both in terms of data and infrastructure) tops the list.
“Security is always top of mind. Phishing is always a real concern, so we’ve built in regular training and testing to keep employees alert. We’re constantly evaluating our fi rewalls and access points,” Ford says.
As the company undergoes shifts in its technology team, including the retirement of a tech leader and the hiring of a new senior director of technology, Spahn & Rose is looking
“We’re trying to get a handle on where the industry might go in terms of tech. Online retail and hands-o delivery have not yet really taken o in our industry; it’s still very relational. But it’s happened quickly in other industries, so we want to let our customers lead the way.”
Ford approaches technology as a problem-solving tool, rather than a mandate. “Forcing tech adoption rarely works. People fi rst need to understand the value, and then go at the pace they’re comfortable.”
As for right now, Spahn & Rose remains focused on foundational improvements like perfecting the “blocking and tackling details of smoothly handling transactions.”
Spahn & Rose’s long-term vision includes building an end-to-end digital experience for contractors and consumers alike.
“Imagine a homeowner comes in with a set of plans. We want to use technology to visualize those plans, do takeo s, price out materials in real-time, and share that with their contractor.”
Ford also sees AI tools playing a big role in supply chain strategy—especially in terms of demand planning and inventory replenishment tech that grows and “learns” over time to anticipate the company’s unique needs.
Founded in 1904, Iowa-based Spahn & Rose now has 25 retail lumberyards in the Midwest and Southeast.
How would you rate the hardware & building supply industry’s tech adoption compared to other retail sectors?
2025 AND BEYOND: SMARTER PRICING, DEMAND FORECASTING, AND E-COMMERCE
Looking ahead, the company is keen to invest in demand forecasting software, as well as focusing on pricing optimization. “How do we have the most competitive prices in the market? We want to make sure we’re appropriately priced in larger markets and in micro-markets,” according to Ford.
That’s no easy task with the aforementioned tari s still swirling about and unsettled. The economic anxiety is palpable, with many folks delaying or postponing projects to see how things play out. The recent trade announcements with China, as well as with Mexico and Canada, have helped, says Ford, but many are still in a “wait and see” mode. That puts pressure on pricing, he says.
So, Spahn & Rose are keeping a close watch on competitors’ pricing (as well as monitoring big guys like Lowe’s, Home Depot and Menards) and getting feedback from customers when they miss out on a bid.
As for e-commerce, the company is working on it. But it’s not something to rush.
“We want to produce something people will actually use and fi nd useful. If you rush into e-commerce, you can create terrible customer experiences.” No one likes clicking on something that’s out of stock, for instance. “We want to do it in a structured way that delivers without creating a bad experience.”
To that point, Ford o ers a nugget of wisdom that could apply to any business: “Things often fail if you try to lead with technology,” rather than leading with listening.
He further explains his approach toward tech:
“What will drive value and solve problems? How can technology help us in that regard? How can tech make your life better? People have to see the results or potential results before buying in.”
For companies struggling with digital adoption, whether internally or with customers, Ford suggests getting key users involved and decision makers who can test and validate it.
“With customers, we have to understand what pain points they have and how our tech might make their lives and jobs easier. You have to demonstrate value.”
This empathetic, listen-fi rst ethos has served the company well in its expansion e orts, too. Spahn & Rose’s recent acquisition in Huntsville, for example, was notably seamless.
“They closed as an independent on a Friday and reopened as Spahn & Rose by Monday. We took our time, did it right, and helped them thrive in their local market.”
Moving forward, Spahn & Rose is poised for more expansion. But it’s not doing so willy-nilly. Just as it’s doing with technology, the company aims to invest in the right things, at the right pace, and for the right reasons.
RECOGNITION FOR INDUSTRY CIOS
CYBERSECURITY, ESLS AND HIGH-TECH COMMUNICATION ON THE MENU
Chad Finnigan, VP of IT for Kodiak Building Partners, is chairman of the board of the Colorado Chapter of SIMNext, an organization designed to help IT professionals connect and grow their careers.
That mission translates well to that of the 2025 ProDealer Industry Summit, which is using the tag “We Got Next” to promote insights pertaining to the next generations of leaders, systems and products. Finnigan will join industry leaders on a technology panel at the summit. (Visit Prodealer.com for more.)
Among his day-to-day responsibilities at Kodiak— along with building cost optimization and operational ef ciencies—is cybersecurity. And, no surprise, in cyber space, hackers are harnessing the power of arti cial intelligence.
“We’ve got to be able to ght bad AI with good AI,” Finnigan said. “Because the human just can’t react as quickly as arti cial intelligence can.”
Fiinnigan is also a nalist for the Colorado ORBY CIO award. He’ll be joined on the tech panel by at least one other award-winning CIO. Adam Gunnett , director of IT and business intelligence for Pennsylvania-based Busy Beaver Building Centers, and recipient of the 2025 Pittsburgh CIO of the Year award.
In addition to electronic shelf labels and autonomous inventory scanning robots, Busy Beaver has been leading the charge for a frontline employee communication system, called Zipline. “It’s basically the single source of truth for our organization,” Gunnett said.
The IT leader described communication as a challenge for all organizations throughout the decades. “It’s always evolving, and it’s always changing. “And we’re just looking to put more tools into our people’s tool belts.”
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GOING AROUND THE WORLD FOR AI INSIGHTS
As famed quote machine John C. Maxwell once shared:
“Change is inevitable. Growth is optional.”
Those words ring true regarding the seemingly inevitable rise of AI tools, which no doubt o er tantalizing possibilities for retailers of all stripes. However, all the buzz about what AI can do, or maybe will be able to do sometime in the future, makes it daunting to know where to start—or to settle on specifi c ways it might be useful in your business.
HBSDealer reached out to cutting-edge tech experts from around the world to share guidance on how hardware and building supply dealers might be able to harness some of these emerging technologies to grow their business.
PRACTICAL WAYS HARDWARE STORES CAN IMPLEMENT AI TECH
Trevor Hough, senior director of product marketing at Crescendo.ai, is a big believer in using new tech to bolster customer care and support.
“Retailers, whether online or brickand-mortar, can benefit from using AI-powered customer support tools to manage common queries. These include product recommendations, feature inquiries, returns, repairs, refunds, shipping updates, discounts, installation issues, and warranty questions, which typically make up 80–90% of all support tickets,” Hough explains.
By automating these repetitive tasks, retailers can signifi cantly lighten the load on in-store sta and online
support teams, allowing them to focus on more complex issues that require human judgment, he says.
AI can also help with fi nancial analysis, according to Leury Pichardo from Digital Ceuticals. He suggests:
“Upload monthly profit and expenses, and see where there is potential to make savings or profits. It can help a small business analyze a ton of data and give you some quick win opportunities that you might not have found on your own or had to pay a big amount for a specialist to do it for you.”
Pichardo says AI can be your “small business fi nancial advisor,” but “the key is to give it the proper samples and prompts.” As with all AI tools, however, always double-check the results. Some programs have been known to, er, embellish.
AI can help bolster your business. But how, exactly?
“I’ve seen how hardware stores can use AI without losing their neighborhood charm. AI isn’t just about chatbots or predictive inventory—it’s also about understanding local customers better,” says Singaporebased Eugene Leow, an international SEO consultant. “For example, a hardware store can use AI to track sales trends of specifi c product categories, like gardening tools during the rainy season, and adjust promotions accordingly.”
“I’ve seen how hardware stores can use AI without losing their neighborhood charm. AI isn’t just about chatbots or predictive inventory—it’s also about understanding local customers better.”
Eugene Leow, International SEO consultant
For operations, Leow says, AI can simplify sta scheduling based on foot tra c patterns and help forecast demand for seasonal products. “It’s not about replacing your team, but giving them better data so they can serve customers more personally—whether that’s recommending the right paint for a tropical climate or the best tools for a condo balcony garden,” he says.
Rachel McNab of Virtual Rani touts AI’s adaptability in terms of learning new tricks and tasks, which can be of service to employees and customers alike.
“A custom AI can be trained on a retail store’s products and then can answer any questions a sta member has. This means that a newer sta member does not need to track down a more experienced sta member to answer a customer’s question—they just need to ask the AI and get the answer instantly. The AI can also recommend upsells/cross-sells for the sta member to recommend.”
David Hunt, COO of Versys Media, a South Africa-based design and marketing fi rm, says AI can help surface deeper insights about customers you might not have previously considered.
“AI’s capability to analyze data can help hardware stores better understand customer behavior and preferences. For instance, incorporating AI-driven recommendations on e-commerce platforms can boost sales. By analyzing past customer purchases, AI
THE FANTASTIC FOUR
1. SALES DATA ANALYSIS AND FORECASTING
AI models can analyze sales data to identify patterns and trends that might be overlooked. This includes recognizing seasonal demand uctuations, forecasting demand at the SKU level, monitoring new product adoption rates and determining optimal reorder points.
2. PERSONALIZED MARKETING AND CUSTOMER ENGAGEMENT
AI can segment customers based on their purchasing behavior and preferences, allowing for targeted marketing campaigns. By analyzing customer data, AI tools can recommend products, send personalized promotions, and predict future buying behaviors.
3. INVENTORY OPTIMIZATION
AI systems can monitor inventory levels in real-time, predict future stock requirements, and automate reordering processes. This ensures that popular items are always available, reduces excess inventory and minimizes storage costs.
4. ENHANCED IN-STORE EXPERIENCE
Smart shelves can detect when items are low in stock and alert staff, while digital price tags can automatically update prices, ensuring accuracy and saving time.
—Greg
Trinidad, marketing director for SEAMGEN, a San Diego-based custom software development company
can suggest complementary products. One of our clients, a building supply retailer, saw a 30% increase in their online sales after implementing an AI recommendation engine that tailored o erings directly to customer preferences.”
Another critical area where AI adds value is in inventory management and operational e ciency, said Hunt. Predictive analytics can forecast demand for specifi c products, enabling stores to maintain optimal stock levels and minimize overstock or stockouts.
A case in point: a hardware client that integrated predictive AI tools reported a 20% reduction in their operational costs due to better demand forecasting and stock management practices.
He also says AI-driven insights can streamline operational processes by identifying trends and ine ciencies, such as pinpointing products that have the highest returns and why. This sort of data can be used to adjust product o erings and refi ne sales approaches to decrease return rates.
LMC: A legacy of strength
Lumbermens Merchandising Corp. enters its 90th year
Everything begins with the members.
That’s how LMC leaders in Wayne, Pennsylvania, describe the culture of the $7 billion strong lumber industry co-operative.
“We work very hard to instill in our dealers the feeling that they come first,” said John Keeley, vice president of building materials. “We have the cream of the crop of independent lumber dealers. And it’s important for us to provide them with the service that they expect.”
One part of that formula is pooled buying power. Another is the synergies fostered by collaboration — site visits, educational events, roundtables and other growth-inducing networking opportunities.
To borrow from Rudyard Kipling: The strength of the co-op is the members. And the strength of the members is the co-op.
Over the decades, LMC has evolved with technology, programs, expansion and expertise. And at the heart of it all is the concept of buying power and efficiency.
“LMC members are looking for this organization — this corporate office here in Wayne, Pennsylvania—to provide that
down-the-hall-office concept in overall purchasing,” said Vern Dando, vice president of panels, special wood products and logistics. “That remains the key to making our dealers the most successful they can be.”
It’s an approach that’s produced industry-leading success for nearly a century.
“The strength of the wolf is the pack. And the strength of the pack is the wolf.”
— Rudyard Kipling
Ring's End Lumber (top) of Conneticut and J.C. Snavely of Pennsylvania have grown through the decades with LMC. Below: LMC dealers develop leadership skills at Northwestern University’s Kellogg School of Management.
Major moments and milestones
From a simple idea, nine decades of growth and success
During the depth of the Great Depression, a lumber dealer pitched the idea of group buying to his colleagues in the industry. That dealer’s name was Jim Buckley. And on Oct. 1, 1935, a collection of visionary lumber dealers formed Lumbermens Merchandising Corp. Today, LMC is a leading forest products and building materials buying group representing nearly 450 dealers with over 1,900 locations in all 50 states
Over the years, LMC has cultivated enduring partnerships with top-tier lumber mills and renowned manufacturer brands in America. The cooperative purchasing model introduced by Jim Buckley during its early years revolutionized the lumber industry, reshaping how business was conducted.
Here’s a look back at key events in a 90-year journey of growth and innovation.
• In the beginning: 35 lumberyards joined forces with Buckley’s model and founded LMC. Buckley was appointed as the first general manager, operating with a staff of two other paid employees.
• Year one: LMC held its First Annual Meeting for Stockholders in January of 1936 in Philadelphia. Dividend checks were returned to each stockholder and ranged from a few hundred dollars to well over $1,000, which generated growth in interest within the industry. Another 35 new stockholders joined from New York and New England, bringing the total membership to 70. After one year of operations, purchases reached $536,000.
• World War II period: In a crucial moment during the war, LMC played an important role by becoming the distribution arm for Georgia Hardwood (the forerunner of Georgia Pacific) helping to fulfill the urgent need for lumber in the war effort. This move not only contributed to LMC's growth but also sustained local businesses and communities.
• Post-war growth
LMC continued to expand in the 1950s, moving southbound into Florida and West to Mississippi,
Decision point: Sole affiliation
LMC leadership introduced the concept of sole af liation in 2001. And it was adopted across the full members in 2003.
The bold policy that would prevent LMC members from belonging to a competing co-op wasn’t universally embraced initially.
But ultimately, the decision led to growth, success and ef ciency, embracing what a co-op is all about: maximizing the purchase volume of the collective membership.
“Sole af liation really got everybody in the organization rowing in the same direction,” Ryan said. “It really helped us differentiate ourselves from other co-operatives, and made a big difference with our supplier community.”
Vice President of Building Materials John Keeley expands on the bene t of sole af liation. “It really set us apart from our competition,” Keeley said. “It put us in a position where we were able to build up a lot of goodwill with our supplier community. Because we took that stance where LMC dealers could belong to one buying group, it has bene ted us over the years, leading to unique programs and offerings that suppliers are willing to provide for LMC and our stockholders.”
Bellevue Stratford Hotel, Philadelphia, Pa.
expanding to 56 LMC dealers. LMC celebrated its 25th Anniversary at the Shoreham Hotel in Washington, D.C. on Nov. 9, 1960, and purchases reached $70 million.
• The '70s
LMC turned 40 with 120 stockholders across the East Coast and as far west as Mississippi with purchases crossing the $100 million mark for the first time.
• Crossing the Mississippi
In the 1970s and 1980s, further expansion drove LMC into the Southeast and Midwest, and parts of Texas and Minnesota – shifting the buying group’s service area across the Mississippi.
• The rst $1 billion
The 1980s and 1990s saw LMC move into its current headquarters in Wayne, Pennsylvania. By 1988, LMC had reached $1 billion in purchases with 262 stockholder companies. And nine years later, LMC opened up the Rockies as a new Western Region and surpassed 300 stockholders.
• Into the digital age
In 1998, LMC entered the modern communications era by launching its website: lmc.net. Before the turn of the century in 1999, LMC achieved another milestone by surpassing $2 billion in purchases for the first time with 328 stockholder companies.
• Sole af liation
At its 2000 fall market, LMC announced a bold plan: “Sole Affiliation.” Members were asked to
An industry veteran’s viewpoint
Vern Dando, VP panels, special wood products and logistics, is a de facto senior statesman of LMC. He has seen a lot of changes at LMC during his long career. He joined in 1979, and remembers back to the old trucking depot that was remodeled for of ce work back in the seventies.
Behind the scenes, the systems and technology have also advanced signi cantly.
“When I started in 1979, we didn't have quite the handle that we have today on our dealers’ purchasing needs,” Dando ticked off some of the game changing communication tools that he has seen:
drop affiliations with other co-ops and to purchase through LMC exclusively. The plan was in place in 2003. The move led to record-breaking purchases, pushing LMC across the $3 billion milestone.
• Coast to coast, and beyond
In 2006, LMC expanded internationally with a member in the Bahamas. In 2013, LMC had successfully planted its flag in Hawaii and Alaska, bringing the co-op to all 50 states.
• The $7 billion milestone
In 2021, LMC crossed another milestone: $7 billion in purchasing power.
the fax machine, computers, e-mail, text. “And yes, all that technology has helped move us along. But success is really about our dealer support and their focus of purchases here at LMC.”
Added value for membership, he says, takes a number of different forms, and as supply chain and logistics head, Dando points to the basics.
“Along with that purchasing element comes service,” he said. “We have to get product to our members on time. It's got to arrive correctly. We have to make sure our dealers are positioned well to supply their customers.”
Beyond logistics, there are ancillary services that maximize performance of dealers.
Dando explains: “Can we help them with their technology by putting together and amalgamating opportunities in e-commerce? Can we help them if they're thinking about adding something to their business? Are they adding a door shop, or building a truss plant? Can we provide knowledge through networking?”
By managing and directing these kinds of cooperative services, LMC provides a value and bene t to its members that is both tangible and intangible.
“But you know, our concept of being a purchasing organization, we can't vary from that a whole lot. We have to be as ef cient as possible and take advantage of all the opportunities that help us with that ef ciency.”
The LMC CEO Q&A
Paul Ryan is in it for the membership
As the LBM industry increases in complexity and as LMC approaches its 90th anniversary, CEO Paul Ryan embraces a time-honored and crystal-clear message.
“We start with the dealers,” he told HBSDealer. “Our goal is to try to level the playing field or even tilt it in their favor so that they can continue to be leaders in their markets.”
Ryan joined LMC as senior vice president of finance and technology in 2016, and took over as CEO in 2021. In the following Q&A , the CEO expanded on the Wayne, Pennsylvania-based co-op’s strengths, its goals and its milestone anniversary.
HBSDealer: How do you describe the strengths of LMC?
,Ryan: I think our strengths really begin with our dealers. But it’s not just the quality of our dealers, it's how they work collaboratively with our team. And then also being able to work with best-in-class suppliers across the whole product spectrum that we represent. That’s how it all comes together so that our members are incredibly successful — and even better than they would be on their own.
HBSD: When you look across your membership, what do you see as common traits of the members?
Ryan: What makes the LMC members special, to me, is their position in their local markets. They focus incredibly hard on customer service, and they have the same expectations of us here at LMC. They're also not willing to just sit by idly as business evolves. They continue to innovate, grow their business, look for new opportunities and we're here to help them.
HBSD: An evolving industry often brings uncertainties, and that’s certainly the case in the LBM industry. How does LMC guide its members in these times?
Ryan: We have a great team here at LMC, and we’re here to provide our views and thoughts on the short term and long term about what’s happening in the markets, and what’s going to happen next. Also, we use the cooperation of our membership. For instance, if a member is looking to evolve from a local warehousing solution to a distribution center model, we have members who are more than willing to help each other and help make those decisions to innovate and improve their companies.
HBSD: What’s your approach to your 90th anniversary?
Ryan: There aren't a whole lot of companies that make it close to 100 years in the United States today. So for us to make 90 years, it is a really large landmark for us. And primarily, we’ll use it to celebrate the quality and the longevity of our members.
HBSD: Since the beginning, what were the big turning points and
major decisions that shaped LMC?
Ryan: I think there were a couple of moments that were really important to us as an organization. First, when we decided to service the entire country, and not just the Eastern U.S. Now we're in all 50 states, and that opportunity to service dealers across the country has also helped us dramatically with our supplier relationships. Another major event we feel is when we became sole affiliated. About 25 years ago, we asked all of our members to belong to just LMC and not belong to any of the other competing cooperatives. That got everybody in the organization rowing in the same direction. It made a big difference with our supplier community. It helped dramatically in how we manage the business and it really helped us differentiate ourselves from other co-operatives.
HBSD: Looking ahead, what are your thoughts about the next 90 years?
Ryan: We’re really excited about the future. We have really strong members, and we’re looking to help them sustain and grow their business. From adoption of technologies that are likely to change the future of the industry, to succession planning and moving from one generation to another; or essentially help them compete in a world that is getting much more consolidated and competitive.
Success by Committee
LMC’s foundational structure ensures dealer-centric success
LMC’s unique governance model, driven entirely by its membership, ensures that the company's decisions align closely with the interests of its members. This member-centric approach is embodied in its committees.
“It starts with our board, which is made up of all members. We have no outside directors,” said Paul Ryan, CEO. “Our members are guiding the management of the company to make sure we’re making the right decisions for other members. We learned a long time ago that if the members don't think it’s a good idea, it’s not a good idea to pursue.”
Supporting this governance framework, LMC has established committees to guide various aspects of the business. These committees are integral to LMC's operations, providing valuable insights and direction.
“We have an array of different committees to guide us on specific aspects of our business,” Ryan said. “And it touches really everything we do, whether it be around our development and education programs or each of our divisions, a committee is there to guide them."
“We use them very much as a sounding board,” Ryan said. “And we’ve even just adopted a new technology committee to help us with helping the members adopt technology. What technology is worthwhile to adopt and what may not really hit the mark for them. We try to provide guidance to make sure that our members are investing in technology that will help their businesses.”
Sean Tighe, senior vice president of purchasing and business development, emphasized the committees’ role in providing a forum for strategic discussions and feedback.
“Our committees are really part of our governance,”
Tighe said. “The easiest way to kind of describe what that means is that we are only going to do things for our dealers that they want us to do. The committees are able to provide a forum where we can talk about everything from strategy to current market conditions to different factors that are affecting their businesses positively or negatively. And it gives us that forum to be able to ask, ‘What should we do next?’ Or say: ‘These are some ideas that we have going forward. How do you think that represents the overall dealer base?’ And we get quite a bit of feedback from them.”
LMC’s committees are designed to be geographically and demographically diverse, ensuring comprehensive representation and input. “So we might have some that are $20 million a year, retail or less in a room and mixed in a committee that may have somebody that’s $300 million or more. All of them have an equal voice, and they really give us a lot of good feedback.”
Initiatives to watch
Far from resting on its laurels, LMC is playing offense when it comes to investing in its business and its members' success.
• Created a new Modular Building Division to support the manufactured housing channel. An alliance with MHBG, the Manufactured Housing Buyers Group, ampli es purchasing power for both groups.
• Created a team to focus on Components. “LMC has put time and resources into ensuring that our cooperative members, whether a component manufacturer or LBM yard, have access to programs that will support the growth of this important, innovative, prefabricated product,” said Rachel Hoops, manager of the Components Department. “This department's sales continue to multiply each year and we’re nowhere near capacity.”
• Emphasis on category expansion. For instance: gypsum. Vice President of Building Materials John Keeley said there is opportunity for attractive margins for many members. “We’ve worked hard to take a stance in the gypsum category to nd ways for dealers to expand that business,” Keeley said. “We’re not saying that they become one-step drywall yards. But we see the category as one where they can make some money.”
Building Business Together
At the ninety-year milestone, success breeds success
If you had to describe LMC in three words, you won’t do better than the official slogan: “Building Business Together.”
The combination of quality dealers, multi-billion-dollar buying power, and high-level collaboration between members is the time-honored path to LMC’s growth.
Senior Vice President of Purchasing Sean Tighe emphasizes the idea that success starts with the members. “Every dealer that joins LMC is already successful,” he said. “It’s not as if somebody's coming here because they're under some type of business strife. They're market leaders.”
“We're not here to tell them how to run their business,” Tighe continued. “They've proven they can do that. So our goal here is to find programs and find strategies and find all of those things that can bring value to an already successful business. And I think we do that really well.”
Chris Ford is LMC’s Vice President of Lumber, and he leads the co-op’s lumber trading floor, consisting of nearly 40 staffers
Vision for the next 90 years
LMC is guided by a rousing vision statement: To be the essential business relationship in the Lumber & Building Materials Industry. “Enabling best-in-class dealers to be more successful in their local markets. We accomplish this by working collaboratively at scale with leading suppliers, our industry insight, and our commitment to service and innovation.”
working on the dealers' behalf. “We’re extremely proud of our trading floor,” he said. “It’s the premier trading floor in the industry.”
But the greatest strength of the co-op is the concept of collaboration that permeates the organization, he said.
“We have almost 450 members now,” Ford said. “They’re already successful companies. But to help them be more successful and more competitive in their local markets, and compete against the largest national companies—that’s our job.”
FIND OUT MORE
LMC brings leaders in the lumber and building materials industry together to increase the purchasing power, pro tability, and competitiveness of our members. To learn more, visit LMC.net
UFP’s Holly Kutcher dives into the details
Holly Kutcher didn’t seek out the building-materials industry.
“In fact, I was headed to Law School, when I took a turn, attended James Madison University for my master’s degree, and was fueled by how business works, what it takes to be successful in business, and how to develop business plans that drive success,” she said.
As it turns out, those business skills have helped guide Kutcher through a 25-year career in the industry, developing products as well as business plans that drive success. Today, she is vice president of retail for Deckorators, a UFP Industries company.
“What I was looking for was a career that would challenge me and enable me to develop and grow,” she said. “I found that in lumber and building materials. The work in this industry is both challenging and rewarding, but it’s the people who work in this industry that really make it a special place to establish your career.”
Instilled with a strong work ethic from her parents, Kutcher says her experience in category management has played a key role in her professional growth. “It’s about diving deep into the business, understanding what is working and what is not, and pivoting when necessary,” she said. “To really be successful in strategic business development,
you need to get into the details. It’s that journey that allows you to nd the wins and losses and act on it.”
There are no guarantees in business, but projects that begin with data analysis and market research are keys to understanding the end user of products and services in the development pipeline.
“It’s true that business is both science and art,” she says. “But the data is the starting point, and from there, the art of selling and developing programs takes shape.”
Like many Top Women in Hardware & Building Supply (Kutcher was part of the 2021 and 2024 classes), she pointed to the powerful impact of mentors on her career. Among them, UFP colleagues J.F. Granger and Donald James.
“J.F. encouraged me to be fearless,” she said, referring to her rst boss at UFP. “He encouraged me to stand tall in a room and know that I deserved to be there.”
And one of the memorable lessons from Don James, executive VP of national retail sales and marketing, brought the valuable lesson of how to read a room, and how to command a room.
“Knowing what is—and also what is not—being said in a room is important,” Kutcher says. “How you react and pivot is equally important. Commanding a room is about being fully prepared, and presenting your ideas and thoughts in a concise, commanding and actionable way.”
Lessons learned from industry leaders and her own 25 years of building materials and category management experience infuse her advice to others who are entering or growing their career.
“Commanding a room is about being fully prepared, and presenting your ideas and thoughts in a concise, commanding and actionable way.”
—Holly Kutcher
Her advice begins with the tried and true: “work hard and earn it.” She continues: “There are standards for promotions and advancing your career. Learn them and achieve them. Work harder than anyone else in the room, and beat the standard. Don’t expect the standard to be lowered to help you achieve it because that degrades the accomplishment. Rise to the standard, and then set a new standard.”
ODESSA JENKINS
Successful
Successful
Don’t
Don’t miss Odessa’s
Summer Selling Season: It’s here
What better time to encourage customers to step outside, get some fresh air and tackle a project or two?
For this month’s product roundup, let’s get a closer look at some new items from the world of outdoor living.
Bring concrete back to life (and make it safer)
The last thing anyone needs is a slip-and-fall lawsuit from a litigious neighbor.
Here to help avoid that fate is Daich Coatings’ new TracSafe Anti-Slip Color Coat, which comes in a choice of ve colors, plus one gallon of clear TracSafe Anti-Slip Sealer and two application rollers. Ideal for enhancing walkways, pool decks, patios, garage and basement oors along with other drab surfaces, TracSafe can help make slippery spaces safer and more attractive. Each kit contains enough product to cover up to 200 square feet
Take the edge off those summertime splinters
Festool has released a Cordless Random Orbit Sander with integrated LED lights, the ETCS 2 125/150.
“The Cordless Random Orbit Sander solves two common jobsite challenges – poor visibility and limited mobility – without compromising on power or quality,” says Rick Bush, Senior Product Marketing Manager at Festool. The lighting element on this product solves another problem: providing an excuse to step outside for some nighttime sanding when you need a break from it all.
Damage-free mounting
FrogTape now offers damage-free mounting solutions with the launch of FrogTape reMOVEables. This new line is designed to help organize and decorate any space, offered in a variety of sizes, colors, nishes and product types to t any décor.
All FrogTape reMOVEables mounting solutions feature CleanGrip Technology to hold strong to a variety of smooth, rm surfaces while removing cleanly without a trace when it’s time to move on or redecorate. And with no tools required, the installation process is quick, easy and damage-free.
Power up for storm season
Ampace has unveiled its industrial-grade Ampace Andes 1500 Extra Battery, which it says drastically expands the capabilities of its agship Ampace Andes 1500 Portable Power Station. Designed to provide uninterrupted power during emergencies, outdoor adventures and extended outages, Ampace’s battery extension is equipped with RESS (Residential Energy Storage System)-grade battery cells with a capacity of 1,462Wh.
The system supports connection of up to seven extended batteries, achieving a total capacity of 11,696Wh—enough to power an average household for up to a full week.
Light up the neighborhood
A product that will surely rile up fuddy-duddy HOAs across the U.S., Govee’s lamp post features 60 high-ef ciency white LEDs and 2,000 lumens of brightness.
It also includes a 6-zone color lighting effect, a patented wedge prism structure and 54 RGBIC lamp beads designed to eliminate dark spots and produce rich, uniform gradients with a distinct petal-shaped glow. The lamp post offers over 100 preset lighting effects and three customizable motion detection zones.
Pergolas, made easy
Simpson Strong-Tie’s Sage System DIY pergola connectors enable DIYers or pros to build outdoor shade structures in a single afternoon. The Sage System features open-top connectors that simplify installation, adapt to various build methods and handle minor lumber variances.
The connectors, available for both 4x and 6x lumber, install quickly and easily with color-matched Outdoor Accents connector screws (included). Sage System includes corner connectors for post-to-beam connections and middle-T connectors for midspan support, which also enable multi-bay structures.
Patio furniture, but make it weatherproof
POLYWOOD has launched POLYWOOD Select, the brand’s latest iteration of composite lumber. It features two proprietary advancements:
Microcell Technology provides enhanced resistance to moisture over Heritage, its predecessor composite.
GenuineGrain Finish offers a highly detailed texture enhanced with TrueTone hues and rich striations for a uniquely elevated aesthetic.
Select is available in three colorways—Natural, Kona, and Driftwood—and debuts across POLYWOOD collections, including Modern Adirondack, EDGE, Vineyard, Nautical, and the PW Designer Series.
Grill and chill, in style
Built with stainless-steel construction and engineered for durability, Monument Grills’ Eminence 605 comes with a 10-year warranty.
With IPX8 waterproof protection and 4000V anti-lightning resistance, the rebox is ready for all-weather grilling. It features 89,000 BTUs across six full-blaze burners, a side infrared burner, and a rear rotisserie. The Eminence 605 gives grillers the ability to cook a whole chicken in an hour, sear beef ribs in ve minutes or handle 30 burgers at once. Enhanced with app connectivity, users can control temperature, set timers and get noti cations when food is ready.
Distributor vs. Tariffs
IT TAKES A TEAM TO NAVIGATE MARKET UNCERTAINTIES
Pricing and the related elds of tariffs, supply chain and sourcing promise to play an increasingly important role in the working lives of independent retailers into the foreseeable future. Retailers have questions. And Orgill executives have supplied guidance in the form of a Q&A designed to help independents navigate the troubled waters of tariffs. Below are highlights from an educational initiative presenting insights from David Mobley, executive vice president of sales; John Dillon, senior vice president of pricing; and Clay Jackson, executive vice president and chief operating of cer.
Q: What would you say is the smartest guidance retailers should consider right now with all the news about tariffs and their potential impact on sales and operations?
Mobley: First off, I’d say don’t panic – but be prepared. Tariffs may or may not hit in a big way, but either way, retailers need to have a robust process for both staying on top of how the market is shifting and then handling price changes in a timely and effective way. That’s absolutely critical. The days of slowly updating tags around the store are over. You’ve got to respond fast and accurately to protect margins.
Q: So how does a retailer best stay on top of the market with it shifting as rapidly as it is?
Mobley: Well, for most retailers, I would suggest making sure you stay in regular contact with your distributor’s sales representatives and merchandising team as
Orgill execs say they are developing a strategy beyond a “buy-now-before-thetariffs-hit” approach. “We’re not trying to create a run on the bank,” said Jackson. “Our philosophy is to consult, not panic.”
well as any vendors you might deal with directly. These are all resources for you, and they offer you another set of eyes and ears that may be one step closer to recognizing and identifying market shifts.
For example, if a product like an air compressor from China suddenly has a 145% tariff, our team can advise you as to whether you should stick with it or look at alternatives from countries like Vietnam. This is one example of how our team helps retailers nd those alternatives quickly.
Q: From your perspective, what’s the most important thing retailers should be doing right now?
Dillon: I would have to support what David mentioned: The biggest thing is having a disciplined process in place for implementing price changes. Tariffs create a resource strain, and you can’t rely on one person doing manual updates. Retailers need to have a scalable system to manage those changes rapidly and consistently.
Q: How does Orgill approach supplier cost increases caused by tariffs?
Dillon: We treat tariff-related increases the same as any cost change—whether it’s due to labor, materials or transportation. We vet the increases and do our research to ensure we’re not putting our customers at a competitive disadvantage with either the price we charge them for the product or the prices we are
From left: Mobley, Dillon and Jackson
PUSHING BOUNDARIES
ORGILL WINS BUSINESS IN SOUTH AMERICA
Sodimac, one of Latin America’s largest home improvement retailers with more than 260 locations across Argentina, Brazil, Chile, Colombia, Mexico, Peru and Uruguay, has chosen Orgill as its exclusive U.S.-based distribution partner for hardline products.
Founded in 1952, the Chile-based Sodimac has grown to become a dominant provider of home improvement products in South and Central America.
“Because of the diversity of our customer base, we have become very agile in our ability to serve customers of all types and sizes, and we have set up systems that are scalable to meet a wide variety of customer needs,” said Boyden Moore, Orgill’s president and CEO. “We are very pleased to be able to leverage this agility and our core distribution competencies to partner with Sodimac as they continue to grow.”
“We were looking for a reliable partner that could not only supply us with the
suggesting they charge the customers in their trading area. But this isn’t really any different than how we normally manage our pricing.
For pricing, we start at retail and look at what competitors are doing, and then we use that information to establish pricing suggestions for our customers. Then, we work backward from that to arrive at our overall pricing. Making sure they can be competitive and pro table is at the heart of the entire process.
Q: What are you doing internally to prepare for and potentially mitigate any tariff-related impacts?
Jackson: We’re approaching it from two angles: how we are managing our Exclusively Orgill (private-label) brands, and how we are managing the relationships we have with independently branded vendors.
For the private-label side, we’ve already made signi cant shifts. About 50% of that product is no longer sourced from China,
products we need and the American brands that our customers are looking for, but also one partner who would take the time to understand our business, work with us to modernize and strengthen our supply chain, drive ef ciencies and support our growth,” said Francisco Torres, Commercial and Marketing Corporate Vice President at Sodimac.
The distribution agreement between Sodimac and Orgill was signed on May 7, 2025 in Santiago, Chile. The teams from both companies are currently managing the transition from Sodimac’s previous supply partner. Sodimac expects the transition to be fully complete by September 2025.
“Orgill offers a wide range of scalable solutions that we are eager to continue exploring, including the ongoing cross-border, e-commerce, and American brands initiative we have in Colombia,” said Torres. “This initiative has already proven successful, and together we are
looking to replicate that model across the region. Combined with access to some of the most recognized brands in the industry, we believe this collaboration will strengthen our ability to serve customers, streamline our operations, and enhance long-term pro tability.”
“Even through our rapid cycle of growth, we have never slowed the pace of investments we make to improve our systems, facilities and teams,” Moore said. “By improving our operation internally and with the support of our key vendor partners, we are con dent we can help all of our customers grow. We are now proud to count Sodimac among these customers and look forward to working with them for years to come.”
and we’re planning to get that down to 25% by year-end. We’re also exploring alternative sourcing opportunities across multiple countries and working closely with our factories and sourcing agents to identify ef ciencies and share the scal responsibility—rather than pushing all the costs onto the retailer or eating them ourselves.
When it comes to how we are working to mitigate the impact of tariffs with our independently branded vendor partners, we are leaning into our relationship with them. It’s all about collaboration. When vendors bring cost increases, we ask them to walk our category management team through the speci c SKUs, materials, and country-of-origin details. That gives us a transparent look at what’s changing and why. Then we can work with them on sourcing alternatives, operational synergies, or—when necessary—re-assort the line altogether.
Q: What about some categories or product lines that are primarily sourced from areas like China, where opportunities to move production may be more challenging?
Jackson: Great question. Holiday is a perfect example – 80 to 90% of these products still come from China. You can’t just move that production overnight if at all. For those critical programs, the programs that are prebooked well in advance, we’ll of course honor our commitments to customers on prices. If a customer booked at a spring market price, we’ll eat the incremental cost if necessary. That’s part of being a reliable partner.
For more from Orgill on pricing, visit HBSDealer.com
Orgill’s Francisco Feraud (right) seals the deal with Sodimac’s Francisco Torres.
First glimpse at a new giant
By HBSDealer Staff
Investors and distribution industry leaders received the best look yet into the new QXO. That glimpse came during a presentation by founder Brad Jacobs at the Wolfe Research Annual Conference in New York.
During the May 20 event, Jacobs added color to QXO’s plans to be the tech-enabled leader in the $800 billion building products distribution industry. And since acquiring Beacon Roo ng Supply in late April, QXO can point to several achievements, including:
On day one, rebranding to QXO took place, including the company e-commerce site and the the company mobile app;
Instituted a sales “Win room” for lead generation;
Initiated a rapid inventory rebalancing effort to enhance in-stocks on key SKUs by branch; and
Completed rst phase of talent assessment.
Beacon Roo ng Supply served as an ideal springboard and a “smart rst move,” Jacobs said. “Roo ng is a steady, predictable vertical, bolstered by strong long-term trends. Everyone has a roof—and roofs require upkeep.”
Beacon represents the rst step toward a goal to achieve $50 billion in annual revenue within the next decade through a combination of accretive acquisitions and organic growth.
The company’s acquisition strategy includes looking at regional targets in roo ng, waterproo ng and complementary categories. It’s also seeking transformational deals in adjacent verticals.
“Our business plan is to do disciplined M&A, signi cantly improve the pro tability of the acquired operations, then rinse, wash, repeat,” Jacobs said.
Jacobs painted a picture of a business with major tailwinds. “The U.S. housing market is currently undersupplied by approximately 4 million units. At today’s pace, it would take about 15 years of homebuilding to close that gap. Meanwhile, the average single-family home is over 40 years old and in need of repair and remodeling.”
Additionally, QXO estimates that there’s more than $2 trillion in projected infrastructure spending across North America over the next 20 years.
Jacobs also pointed to the “deep expertise” of the team assembled to lead QXO, with strengths in disciplined M&A, seamless integration, pro t improvement, capital markets, culture building, logistics, and more.
INTEGRATION NATION
Getting the QXO brand to appear on the Beacon website on day one of the acquisition was no easy feat, according to Joe Checkler, QXO spokesman. And it wasn’t just the website. There was the mobile app, social media, email migration and the e-commerce site.
“The integration was something that required a lot of people working really hard together, working really long hours and getting to know each other to be able to pull that off,” Checkler said.
The goal of the tech integration was to avoid any kind of customer disruption. For instance, customers weren’t required to download a new app. But more than that, domain changes were implemented without forcing any password resets. That means Beacon customers maintained a seamless, logged-in status on their new-look QXO mobile app.
One of the big digital challenges was in the form of redirects from the old Beacon website. More than 500 such redirects were mapped out and tested before the launch of the QXO site.
QXO entered the industry with a plan to lead in the technology arena. Asked where those advances might come, Checkler pointed to inventory management, product assortment and pricing optimization, supply chain improvements and e-commerce.
“Some companies are involved in great tech programs, but it’s still an industry that’s in the early innings on using tech to help improve processes like these,” Checkler said.
Brad Jacobs, CEO of QXO.
Faster lumber grading in Oregon? Maybe.
Abill working its way through the Oregon legislature might change the way the lumber is graded. And not everyone agrees with the idea.
The state senate and house have both passed Senate Bill 1061, the “Oregon Forests to Homes Act,” led by Senator Todd Nash (R-Enterprise). The bill establishes a lumber grading training pilot program through Oregon State University’s Extension Service, in partnership with the state’s Department of Consumer and Business Services. The program will enable individuals who complete a oneday training course to become certi ed to grade lumber. As a result, certi ed small sawmill operators will be able to sell lumber directly to homeowners or their agents for use in single-family homes or duplexes.
“This bill opens the door for small sawmill operators to participate in local housing solutions,” said Sen. Nash. “Forty years ago, Eastern Oregon had 69 mills— today, only seven remain. This is a practical step to support rural economies and increase housing options using locally sourced materials.” With both the state and house voting in favor of the bill, it appears the nal hurdle will be Governor Tina Kotek’s signature.
Issues with the bill
While Oregon’s legislation aims to streamline the procurement and production of building materials, not all in the industry are enthusiastic about the implications should such a rule take hold. Eric Fritch, president of Fritch Forest Products and founder of Seattle-area Chinook Lumber, raises concerns about the bill’s effect on quality control, safety and accountability.
“It’s well intended, but it doesn’t comply with well-established product standards,” he says. Aside from minimizing the importance of rigorous, objective expertise in the grading process, Fritch
says the proposed law in Oregon presents serious traceability issues: “Every piece of graded lumber I sell can be traced back to my company. This legislation doesn’t account for that fact,” which he explains can cause downstream dif culty if a piece of lumber fails.
Fritch also notes that grading lumber requires much more knowledge and training than can be dispensed in a one-day course, explaining that different species require niche expertise. Allowing homeowners to use un-graded or poorly-graded lumber opens another potential can of worms for sellers down the road, he says, adding that grading larger, more load-bearing pieces, such as scaffolding plank, is a “life-or-death” issue.
In an open letter to Oregon Senator Kathleen Taylor, David E. Kretschmann, president of the American Lumber Standard Committee (ALSC), echoes many of the concerns shared by Fritch. Kretschmann writes:
“At the outset, ALSC continues to submit that this legislation is unnecessary. Oregon has adopted a building code that requires the use of graded lumber for the vast majority of wooden structures built in the state that refers to and relies on the American Lumber Standard (ALS)
system. This system is a comprehensive national system of quality control and uality assurance that ensures that lumber purchased with an accredited agency grade stamp has been subjected to individual inspection by quali ed graders and has undergone a continuous inspection and review process that maintains the competency of the grading process. The legislation you are proposing suggests that anyone can develop the skills to grade lumber by passing a short course or having obtained a degree in forest and wood products or has experience equivalent to the degree program somewhere in their life. This is not the case. Grading is a skill that requires many months of training and continual review.”
He also points out that “Developing the skills to become pro cient at grading lumber ... is a lengthy process that needs to be taught by someone who is already an expert at grading.” The letter adds:
“The process proposed in the bill omits the very heart of the ALS system, which is a consensus-based, structured system of continuous checks and balances and quali cations that are essential to the proper application of the grading rules for the labeling of lumber and establishing design values.”
Oregon’s bill could enable certi ed sawmill operators to sell directly to homeowners.
Marketing
Arrow sharpens its identity
Arrow Fastener, a big name in tools since 1929, adopted a new name: Arrow Tool Group. The change re ects the company’s continued growth and expanded portfolio of iconic American tool brands designed for trade professionals, DIYers, and ceiling installation contractors, according to the Saddle Brook, N.J.-based company.
“For nearly a century, Arrow has stood for American ingenuity, hands-on reliability, and practical solutions that professionals and DIYers depend on,” said Roberto Izaguirre, chief executive of cer of Arrow Tool Group. “As Arrow Tool Group, we’re honoring that legacy while embracing a broader future — one rooted in innovation, reliability, and a deeper commitment to our customers across every segment of the trades and DIY market.”
The new name re ects Arrow’s expanded brand lineup, which includes Arrow, Goldblatt, Pony Jorgensen, SK Professional Tools, and Arrow RevealCut— a collection of respected names in the tool business.
“Doing business as Arrow Tool Group enables us to better serve our customers by providing access to a wider portfolio of trusted American brands,” said Justin Sumner, vice president of sales. “Our customers will bene t from expanded product categories, streamlined service, and the same quality they’ve come to expect — all under one uni ed sales platform.”
Sumner continued, “This name change will not affect how we do business with our customers. While our branding, logo, and website will be updated to re ect the new identity, all customer contracts, banking details, and customer relationships remain unchanged.”
Arrow Tool Group will continue to operate from its Saddle Brook, N.J., headquarters and serve as the U.S. sales, marketing, and distribution hub for its parent company, Hangzhou GreatStar Industrial Company, a global leader in tools, robotics, and industrial equipment.
The Arrow T50 Staple Gun is a tool box classic.
The Home Depot has named Angie Brown, a 27-year company veteran, as executive vice president and chief information of cer. As CIO, she will be responsible for all aspects of the company’s technology strategy, infrastructure, cybersecurity and software development. Brown, who was most recently senior vice president of information technology, replaces Fahim Siddiqui, who is leaving The Home Depot.
Fort Wayne, Indiana-based Do it Best Group appointed Marianne Thompson as its executive vice president of transformation and integration, a new position created to lead the integration of True Value and United Hardware into the Do it Best organization. Thompson brings more than 35 years of industry experience, including a veyear tenure at Home Hardware Stores Limited, one of Canada’s largest independent home improvement retailers.
Koppers Holdings Inc., a global provider of treated wood products, appointed James A. Sullivan as president and chief transformation of cer. Sullivan will lead a companywide transformation process named “Catalyst,” and will oversee the evaluation, scoping, quanti cation, planning and execution of opportunities.
Minnesota-based Weekes Forest Products has promoted John Lesher to chief operating of cer. Lesher previously served as the company’s executive vice president, focused on strategic planning, operational excellence and organizational growth. Lesher will lead the day-to-day operations with a focus on customer service excellence and sustainable growth, said President Scott Gardner.
Deckorators named Michelle Hendricks as its new director of marketing. Hendricks joined UFP Industries nearly six years ago as a category marketing specialist and, by 2021, had moved into the role of category marketing manager. Now, she takes the reins of marketing leadership for the company’s composite decking brand.
Central States Inc., a distributor of metal building components, roo ng and building packages, hired Doug Watts has as manufacturing president. Watts comes to his new post with more than two decades of manufacturing and leadership experience, most recently with Oldcastle BuildingEnvelope. He will oversee operations, sales, logistics and customer service for Central States Manufacturing.
Brown
Thompson Sullivan
Lesher
Hendricks Watts
Residential Construction/Sales
Monthly Retail Sales, not adjusted
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