SEPTEMBER 2021 Vol. 47 No. 9
BUILDING ON OUR COMMITMENT TO
SERVICE
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Rome, NY
Rome, NY
Post Falls, ID
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Inwood, WV Hurricane, UT
Sikeston, MO Tifton, GA Kilgore, TX
Orgill Distribution Centers 2021
Picked-to-order
HBSDEALER HARDWARE + BUILDING SUPPLY
INDEPENDENT PROFILE 18 Oregon’s Bandon Supply
has inventory covered
PRODUCTS & CATEGORIES 28 Demand for decking
continues to build
31 Railing news from around
the industry
32 Kitchen and bath products
are cooking
MARKET INSIGHTS 27 From the NLBMDA, a rallying
cry to banish new taxes
34 Top Women: Stanley Black
18
Game Changer
24
Top 200 ProDealer Scoreboard
and Decker’s Maria Ford
The combination of Builders FirstSource and BMC has far-reaching implications for the home building industry.
The annual list of leaders in the consolidating, yet still fragmented, LBM industry.
28
FROM THE EDITOR
NEWS & ANALYSIS
IN EVERY ISSUE
8
10 Stat of the Month: Comps
10 Stat of the Month 12 Product Knowledge 14 News Map 36 People in the News 38 Quikrete Industry Dashboard
These women mean business: The Top Women in Hardware & Building Supply crusade.
return to earth at Home Depot and Lowe’s
10 Southeast LBM Interests
enters the fray
12 Lack of inventory adds
18
to the pressures of the housing industry
14 Thanks to an ESOP, The Cool
Hardware Company is born
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 in the United States: $110 one year; $200 two year; $14 single issue copy; Canada and Mexico: $130 one year; $235 two year; $16 single issue copy; Foreign: $150 one year; $285 two year; $16 single issue copy; in all other countries (air mail only). Digital Subscription: $75 one year; $140 two year. Periodical postage paid at Chicago, IL., and additional mailing offices. POSTMASTER: Please send address changes to HBSD, Circulation Fulfillment Director, 8550 W. Bryn Mawr Ave., Suite 200, Chicago, IL 60631. Copyright © 2021 by EnsembleIQ. All rights reserved.
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SEPTEMBER 2021 HARDWARE + BUILDING SUPPLY DEALER
HBSDealer.com
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HERE’S WHAT’S ONLINE
See more and share more when you follow us on Facebook.
The continually growing Webcast library Visit HBSDealer.com/ Webinars for access to a variety of repeat performances, including:
Succession planning
The store of the future
Data driven in 2021
Naming names The HBSDealer Daily Newsletter, the industry’s leading news source, now has another new companion: The HBSDealer “People Edition.” Every other week, we’re broadcasting executive news, promotions, awards, interviews and profiles of the people who move this industry forward.
The polls are open. Your voice is wanted. HBSDealer publishes weekly poll questions on pressing industry matters, and other topics. For instance:
42%
58%
Yes
No
Q
Has your business been negatively affected by extreme weather in 2021?
Follow us @HBSDealer
Poll questions and results appear every week at HBSDealer.com. Source: HBSDealer poll results, 5/28/2021. n=150
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SEPTEMBER 2021 HARDWARE + BUILDING SUPPLY DEALER
HBSDealer.com
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FROM THE EDITOR
HBSDEALER HARDWARE + BUILDING SUPPLY
These women mean business
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
HBSDealer is fired up over its Top Women in Hardware & Building Supply awards
SENIOR VICE PRESIDENT (HBSDealer, Drug Store News, Chain Store Age) John Kenlon, jkenlon@ensembleiq.com, 212-756-5238
Ken Clark Editor in Chief
EDITOR IN CHIEF Ken Clark kclark@ensembleiq.com, 212-756-5139 LBM EDITOR Andy Carlo acarlo@ensembleiq.com, 845-891-5108
HBSDealer created two categories of awards for our Top Women in Hardware & Building Supply Awards program. The “Rising Stars” award recognizes a talented professional with the potential to make a significant positive difference within her company and within the industry for years to come.
The Business Excellence award recognizes a leader who has demonstrated achievement, growth and success in the hardware and home improvement industry; embraced education and community service, and inspired others to follow a similar path. These inspirational descriptions describe Top Women in theory. But for next-level inspiration, check out these actual descriptions taken from the nomination forms of some of our real-world Top Women from the class of 2021. Gina Cashner of Beacon Building Products is described on her nomination form as a pro who has “excelled at all levels, positions and responsibilities. She’s a tested veteran who executes well, builds a high-performing team, creates customer loyalty and continues to mentor and coach new talent coming into our industry.”
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Leigh Hudspeth of BlueLinx “understands the need for diversity within our industry and is committed to changing how the LBM business is viewed and looks.” Heather Young of Shelly’s Supply “has created a culture of shared accountability and process discipline in a fun and motivational manner. This has fostered an improved experience for the customer, the employees and anyone interacting with the business.” Here’s a passage from the nomination form of Stanley Black & Decker’s Maria Ford: “She had the courage to lead in an uncertain period with honesty and transparency, and created a new standard for empathetic leadership that drove employee engagement and a sense of belonging, just as critically as business results.” You can read more about Maria Ford in our Top Women profile series on page 34. “Our class of 2021 Top Women includes some fantastic leaders and role models,” said HBSDealer’s Amy Grant, who is spearheading the program. “We were thrilled with the quantity and high quality of nominations for the awards ceremony, as well as the enthusiasm that the industry is bringing to this year-round project.” The Top Women in Hardware & Building Supply program will culminate in the firstever, live, Top Women in Hardware & Building Supply awards and networking event in Chicago, Nov. 10-11. Find out more at HBSDtopwomen.com. And tell us what you think at news@hbsdealer.com. HBSD
SEPTEMBER 2021 HARDWARE + BUILDING SUPPLY DEALER
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 AUDIENCE
LIST RENTAL MeritDirect Marie Briganti 914-309-3378 SUBSCRIBER SERVICES/CUSTOMER CARE TOLL-FREE: 1-877-687-7321 FAX: 1-888-520-3608 contact@hbsdealer.com PRODUCTION/ART
SENIOR VICE PRESIDENT, OPERATIONS Derek Estey destey@ensembleiq.com, 877-687-7321 DIRECTOR OF PRODUCTION 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 MARCH 29-APRIL 2, 2022, WASHINGTON, D.C. WWW.PRODEALER.COM IN PARTNERSHIP WITH THE NLBMDA, WWW.DEALER.ORG CONTACT: AMY PLATTER GRANT agrant@ensembleiq.com, PDIS DIRECTOR OF SPONSORSHIPS PERMISSIONS: NO PART OF THIS PUBLICATION MAY BE REPRODUCED OR TRANSMITTED IN ANY FORM OR BY ANY MEANS, ELECTRONIC OR MECHANICAL, INCLUDING PHOTOCOPY, RECORDING, OR INFORMATION STORAGE AND RETRIEVAL SYSTEM, WITHOUT PERMISSION IN WRITING FROM THE PUBLISHER. FOR REPRINTS, PERMISSIONS AND LICENSING, PLEASE CONTACT WRIGHT’S MEDIA AT ENSEMBLEIQ@WRIGHTSMEDIA.COM OR (877) 652-5295.
CORPORATE OFFICERS CHIEF EXECUTIVE OFFICER Jennifer Litterick CHIEF FINANCIAL OFFICER Jane Volland CHIEF INNOVATION OFFICER Tanner Van Dusen CHIEF HUMAN RESOURCES OFFICER Ann Jadown EXECUTIVE VICE PRESIDENT, EVENTS & CONFERENCES Ed Several SENIOR VICE PRESIDENT, CONTENT Joe Territo
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THE FIRST STAIN
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YellaWood® brand pressure treated products are treated with preservatives (the “Preservatives”) and preservative methods, and technologies of unrelated third parties. For details regarding the Preservatives, methods, and technologies used by Great Southern Wood Preserving, Incorporated, see www.yellawood.com/preservative or write us at P.O. Box 610, Abbeville, AL 36310. Ask dealer for warranty details. For warranty or for important handling and other information concerning our products including the appropriate Safety Data Sheet (SDS), please visit us at www.yellawood.com/warranties or write us at P.O. Box 610, Abbeville, AL 36310. YellaWood and the yellow tag are federally registered trademarks of Great Southern Wood Preserving, Incorporated. All other marks are trademarks of their respective owners and are used with their permission.
NEWS + ANALYSIS
Southeast LBM Interests enters the fray A new consolidator has made its first move, but it’s not the first rodeo for the executives behind Southeast LBM Interests. Backed by Building Industry Partners, Southeast LBM made an inaugural investment this summer, acquiring Warner Robins Building Supply, headquartered in Warner Robins, Ga. Founded in 1947, Warner Robins Supply is a longstanding independent, eightlocation pro dealer. in Warner Robins, Ga. and across seven rural markets throughout Georgia, North Carolina, and South Carolina — its banners include Henson Building Materials and Mountain Building Supply. The 70-year-old business generates over $80 million in annual sales and employs over 190 people, BIP said. “We’re excited to kick off our new
STAT OF THE MONTH
Bassed in Warner Robins, Ga., Warner Robins Supply is the first acquisition of Southeast LBM Interests.
regional LBM platform with these businesses as our foundation,” said Matt Ogden, founder and managing partner of BIP. “The Southeast has strong housing construction fundamentals and it’s a region we have deep affinity for, close strategic relationships in, and we’ve wanted to
invest here for many years. Industry veteran Roger Farmer will lead the new venture and also take on the role of president of Warner Robins Supply. Former president Mark Bayer will stay on as an advisor to Southeast LBM and chairman of Warner Robins. BIP has been a force behind forming and building some of the largest pro dealers and building material organizations in the last 10 years, including US LBM Holdings and Kodiak Building Partners. Ogden added: “Southeast LBM is BIP’s first new platform under our people-first purpose — we’ll be implementing broad-based employee ownership programs, with supporting programs designed to set in motion the virtuous cycle of investing in people.”
Home Depot vs. Lowe’s Comparable store sales metrics return to earth
What goes up, must come down, especially after four consecutive quarters of 20% or higher comp-storesales gains. The second quarter produced some dramatic numbers for both Home Depot and Lowe’s, including record sales and earnings — but also a not-unexpected dive in comps. For more analysis, visit HBSDealer.com
40.0
30.0
HD LOW
20.0
10.0 3.4% 0.0
-10.0 19Q3 19Q4 20Q1 20Q2 20Q3 20Q4 20Q4 21Q1 Source: Company Reports
10
-2.2%
SEPTEMBER 2021 HARDWARE + BUILDING SUPPLY DEALER
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NEWS + ANALYSIS
Inventory among the ‘biggest’ housing industry issues It’s difficult to write a headline about the volume of data and trends in the 2021 “The State of the Nation’s Housing Report,” said Danial McCue, senior research associate at the Joint Center for Housing Studies at Harvard University. But McCue came up with five biggest issues.
Product Knowledge Product: Feeney “Era” and “Icon” Awnings Manufacturer: Oakland, Calif.based Feeney, Inc. Knowledge: The powder-coated aluminum frame and polycarbonate UV2 panels provide high levels of protection from the elements, including hail. Engineered to withstand snow and wind loads of up to 35.5 psf. Plus, a builtin gutter whisks away rain. An easy-to-install base kit measures 59 inches, and the extension kit essentially doubles the width. The “Era” model has a vintage look, while “Icon” is distinctly modern. Fun fact: Feeney’s recurring photo contests deliver grand prizes of $500 for user photos of its railings, awnings and other products. Feeney’s Era Awning
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In no particular order: Inventory of homes for sale at historical lows Home prices are rising rapidly Rents are down sharply for high-end apartments in high-cost markets Renters and people of color fared the worst during the pandemic Unsheltered homelessness is growing Regarding the first topic, JCHS reported that in December of 2020, there were just 1.03 million homes for sale. Measured by months of supply (how long it would take for homes on the market to be sold at the current sales rate), the inventory of homes
The JCHS report shows inventory of homes for sale at a record low.
for sale was just 1.9 months, which puts it below 2.0 for the first time since recordkeeping began in the 1980s. As of April 2021, there were still just 2.4 months of supply, or 1.16 million homes for sale nationwide. Historically, a balanced market has been defined as 6 months of available inventory, which has not occurred in the US since 2011.
Katerra closes shop The June issue of HBSDealer reported on the bankruptcy filing of Katerra, the high-tech, high-profile Silicon Valley entrant into the homeconstruction disruption and innovation race. The latest news: Katerra has sold off its factories and facilities. Mercer International received approval from bankruptcy court to acquire Katerra’s 270,000-squarefoot, state-of-the-art cross-laminated timber (CLT) factory in Spokane, Wash., for $50 million. The facility opened in 2019 and was presented to the industry as the most cutting-edge manufacturing center of its kind. Additionally, Philadelphia-based Volumetric Building Companies (VBC) is purchasing Katerra’s 577,000-square-foot plant in Tracy, Calif. The facility also opened in 2019 and produced building
SEPTEMBER 2021 HARDWARE + BUILDING SUPPLY DEALER
Sold: Katerra’s factories.
components including wall panels, floor systems, and windows. Financial terms were not disclosed. Vaughan Buckley, CEO of VBC stated: “Katerra’s Tracy location provides an exceptional opportunity to bring our hands-on construction and manufacturing expertise to a state-of-the-art facility and build our presence on the West Coast.”
HBSDealer.com
SAVE THE DATE
PRODEALER INDUSTRY SUMMIT
MARCH 29-APRIL 2, 2022 HYATT REGENCY WASHINGTON ON CAPITOL HILL IN WASHINGTON, DC
www.prodealer.com
PRESENTED BY
NEWS + ANALYSIS
Through an ESOP, D.C. chain becomes The Cool Hardware Company A Few Cool Hardware Stores, the 13-location locally focused chain of Ace stores in and around the nation’s capital, has a long history of given people second chances, The store was featured in an “Ace Heartware Stories” video that focused on the company’s successful practice of hiring returning citizens from drug rehabilitation and other programs. The chain is now giving its employees something else: shares in the ownership. AFCHS is selling ownership of the company throgh an Employee Stock Ownership Plan, or ESOP. AFCHS owners Gina Schaefer and Marc Friedman will transfer ownership of the organization over the next several years through the ESOP’s trust under the name “The Cool Hardware Company.”
Marc Friedman and Gina Schaefer of A Few Cool Hardware Stores in Washington, D.C.
An upfront transfer of 30% of the company’s ownership happened in August. “The ESOP model allows us to give back to the employees who have done so much for our company, while still aligning with the culture we’re proud to have built over the last 20
years of business.” said Schaefer. With 14 million employee owners across 7,000 companies nationally, ESOPs offer employees stake in a company through a stock allocation that accrues value over time, much like a 401(K) plan. The amount of stock distributed is determined by the number of employees receiving shares and each employee’s individual salaries- all at no cost to the employee. The benefits of this transition from privately-owned to employee-owned include increased staff engagement in decision making processes, personal wealth building, and an active investment in the success and health of the business. Founded in 2003, AFCHS has grown to more than 250 employees. Its stores include 101-year old Frager’s Hardware on Capitol Hill.
News Map: Openings, Closings & Acquisitions Illustration of retailers and dealers in various stages of coming and going. For more retail news, visit HBSDealer.com. colorado
Golden
OPENING
CLOSING
EXPANDING
Meyer Hardware, a 76-year staple of the community, plans to close its doors at the end of September. Owner Steve Schaefer told the Golden Transcript newspaper that the time came to move on and “spend more time with my family and my nine grandchildren.”
pennsylvania
Mechanicsburg
PaulB Hardware, known as the “Heavy Duty Hardware” store, is celebrating the opening of its 25,000 sq.-ft. Mechanicsburg store throughout the month of September. The company also operates stores in Lititz and Belleville, Pa.
florida
Largo
Tibbetts Lumber Co. is acquiring Florida Forest Products LLC, based in Largo, Fla. With the deal, St. Petersburg-based Tibbetts expands to seven locations throughout Florida. (A sister company, Cox Lumber, operates two locations in the Cayman Islands)
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SEPTEMBER 2021 HARDWARE + BUILDING SUPPLY DEALER
north carolina
Statesville
84 Lumber’s 2021 expansion plans have included the opening of a dedicated truss plant in Statesville, N.C. The 34,000-square-foot component plant primarily manufactures roof trusses and floor trusses.
HBSDealer.com
INDEPENDENT PROFILE
Oregon’s Bandon Supply has inventory covered The seaside hardware and building supplies dealer offers a diverse selection of products. By Andy Carlo ocated in the coastal community of Bandon by the Sea, Bandon Supply carries much more than hardware and building supply needs. The Oregon dealer is centered within a town of 4,500 and is a half-hour drive or less for five additional surrounding communities. Along with hardware and lumber, Bandon carries appliances, plumbing, electrical supplies, paint, heating and cooling needs, flooring, kitchen bath products, and lumber. “We try to have good inventory levels at all times,” says owner and founder Tom Stadelman who opened the business with his wife, Sarah, more than 20 years ago. “We look to buy at the best prices so we can pass on good value to the customers.” On-site, Bandon also operates a separate Outdoor Living and Rental department. There you can find lawn and garden supplies, pet and equine products, tools, outdoor power equipment, rentals, and a service department for repairs. Given the diverse set of offerings at Bandon, Stadelman says that the sales staff works with customers and makes an extra effort to satisfy their needs. “We let our customers feel welcome and appreciated no matter what point of view they may have as to what we offer,” he says. Bandon Supply has a staff of 15 employees that offer advice on a wide range of subjects, including building materials, electrical supplies, plumbing, roofing or hardscapes. Customers make up about a 50/50 split between professional builders and DIYers. Bandon’s location on 1120 Filmore Avenue was a veneer mill when Stadelman purchased the property. Prior to that, it was a box plant and even had a life as a brick mill in the 1930s. “When I took over the property, it was an eyesore compared to today,” Stadelman recounts. Bandon Supply began as a lumberyard in 1998 after the facility received much-needed repairs and a fresh look. Over the past 23 years in operation, four more buildings and two more acres have been added to the business, including the outdoor
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Bandon Supply in Bandon, Ore. carries a wide variety of hardware and building supply products, including building materials, outdoor power equipment, electrical supplies, and lawn and garden goods.
“We let our customers feel welcome and appreciated no matter what point of view they may have as to what we offer.” —Tom Stadelman, Owner and Founder, Bandon Supply
SEPTEMBER 2021 HARDWARE + BUILDING SUPPLY DEALER
living department and rental center. “I added the businesses to complement the original building supplies and hardware business,” Stadelman says. “The two businesses (outdoor living and rental) operate on the original mill site.” Stadelman got his start at his father’s building supply business in 1978. Prior, he assisted his father in building homes. “I enjoyed working in the yard putting things away and delivering materials as I got older,” he says. “He sold the yard in 1988, then I went back to building with him.” But Stadeleman was disappointed that the company was sold and decided to start a new business. When the mill site went to auction in 1996 and 30,000 square feet of buildings were sold, Stadelman knew it would be a perfect place to start his yard “I went to the mill owners and asked to buy the property,” he recalled. “They said ‘no’ at first, but I didn’t give up. I was very lucky to be able to buy the property and the buildings.” Regarding advice for other building supply and hardware dealers, Stadelman says, “Don’t get stuck in a routine. Changing things around is good.” He added: “What seems to be fine sometimes needs to be improved.” .
HBSDealer.com
TECHNOLOGY
At Home Depot, a high-tech partnership for pros Buildertrend, the construction management software provider, partnered with The Home Depot’s Pro Xtra contractor loyalty program. Under terms of the national partnership, Home Depot Pro Xtra customers can receive discounted access to Buildertrend’s technology to help them manage and grow their businesses, along with a fully integrated purchasing experience and exclusive discounts. The new integration enables pros to complete more projects while reducing delays, eliminating communication errors, and increasing customer satisfaction, according to Buildertrend. The Omaha, Neb.-based tech company said the new agreement
HBSDealer.com
Buildertrend’s digital tools help builders and pros manage their businesses and projects.
is a one-of-a-kind platform. which combines the benefits of The Home Depot’s free Pro Xtra loyalty program with Buildertrend’s software to support the pro customer. Buildertrend provides
construction management software for home builders, contractors, and remodelers. During a live webcast, Home Depot General Manager for Outside Sales and Service said his team was “blown away” by Buildertrend’s technology and called it “the right fit” for the Pro Xtra program. Additionally, Pro Xtra customers will be able to use Buildertrend’s software and receive 25 months of purchase history along with a “favorites list” that is directly imported into a materials cost catalog. The companies said the new partnership is part of The Home Depot’s focus on professional contractors, and investment in innovation to advance its customers’ businesses.
HARDWARE + BUILDING SUPPLY DEALER SEPTEMBER 2021
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C O V E R F E AT U R E
GAME CHANGER The combination of Builders FirstSource and BMC has far-reaching implications for the building material industry. By Ken Clark
B
uilders FirstSource (BFS) and BMC officially tied the knot on their merger in January, propelling the combined company into uncharted territory. The terms “megamerger” and “blockbuster deal” had already been used to describe earlier BFS and BMC deals that brought ProBuild Holdings and Stock Building Supply into the consolidated picture. So what do you call the creation of a $12 billion player in the building supply business? Two words come to mind: “Game changer.” “I think that’s a proper name for it,” President and CEO Dave Flitman told HBSDealer. “Back when we announced the deal, I began using the word ‘transformative.’ What we’ve brought together here with the number one and number two industry players — it’s never been done before.” More impressive than the size of the merger is the speed with which the two companies have effectively joined forces. The company says it is a year ahead of schedule in achieving its synergies. During its recent second quarter earnings call, BFS reported $36 million in cost savings, so far. The company also raised the goal posts — and is now looking to achieve between $140 million and $160 million in total synergies by the end of 2022. Executives in Dallas point to a number of reasons for the integration’s success to date. Chief among them: management teams that have been there before, specifically in 2015 when BMC and Stock, and BFS and ProBuild went through mega mergers. (See sidebar). The repercussions of the merger are playing out in several ways, both internally and externally throughout the (still) fragmented building supply sector. Here are some of the big transformative themes of the merger.
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SEPTEMBER 2021 HARDWARE + BUILDING SUPPLY DEALER
HBSDealer.com
Momentous occasions APRIL 2015 Builders FirstSource plans to acquire ProBuild Holdings The move was billed as the creation of a $6 billion pro dealer with enhanced scale and an improved geographic footprint. DECEMBER 2015 BMC and Stock Holdings complete merger With $2.6 billion in combined revenues, the new company announced plans to capitalize on expansion opportunities. JANUARY, 2021 Builders FirstSource officially combines with BMC The move created a company with combined sales of $11.7 billion. Said BFS President and CEO Dave Flitman: “This merger represents a transformational milestone for our customers and an exceptional platform to accelerate the growth of our value-added solutions.”
SYNERGIES
“We have the geographic coverage, but also the product depth that’s really unmatched in the industry,” said Flitman, speaking for the company’s combined company’s 550-plus locations in 84 of the nation’s top 100 metro areas. “But the real power in this over the long haul, in my view, is the transformative nature of bringing together more than 26,000 team members.” The combination of two like-minded cultures focused on innovation is a foundation for solving customer problems deep into the future. “That’s what I get excited about,” Flitman added. “And that’s really going to be the ultimate game-changer of this merger when we look back in 10 years.”
“We have the credibility with our customers that comes from being innovative and helping to solve their problems. And whatever that innovation evolves into over time, we’re going to be right in the center of helping our customers figure it out.” — Dave Flitman, President and CEO
HBSDealer.com
Above and left: Manufactured product accounts for 22% of BFS’ business. More than 60% of the business comes from non-commodity sales.
On the operations said, Mike Farmer, president of commercial operations, said teams on the ground have been able to quickly respond to synergized manufacturing. Take truss plants for instance. “When we’re in a market where, let’s say, Builders FirstSource had two truss plants and BMC had one, we were able to take those three plants and look at their workload and move things around to be able to optimize the process,” Farmer said. “If we were at 100 board feet (BFT) per labor hour before the merger, we combined up to 120 BFT. So we were able to help builders very quickly from that perspective. And we have seen a lot of outpaced growth in our truss business.”
CULTURE
Culture eats strategy for lunch, according to the modern leadership gurus. And that’s an idea that flourishes at BFS. “At the heart of our culture is our people,” Flitman told HBSDealer. “And at the heart of our people is
HARDWARE + BUILDING SUPPLY DEALER SEPTEMBER 2021
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C O V E R F E AT U R E
The S.P.I.C.E. of Business at BFS When the new Builders FirstSource sat down too examine their core values, they discovered an acronym that covered the basics pretty well. CEO Dave Flitman explained the letters of S.P.I.C.E. to HBSDealer.
S
AFETY “Fundamentally, if you can’t keep your people safe at work, then all the things we’re doing to drive growth, just don’t matter.”
P
EOPLE “Attracting the right talent is critical, but we also have to make sure people can envision a clear career path in front of them at BFS.”
I
NTEGRITY “Integrity has to be at the heart of our company.”
C
USTOMERS “Exceptional service results comes from solving customer problems and putting them at the center of our decision-making.”
By end market, Builders FirstSource’s sales mix is largely single-family homes — 77%. An enduring demand for housing fuels optimism for the company’s executives.
how they think about the customer.” The human resources team at BFS is immersed in helping to build a successful culture, but according to Amy Plasha, senior vice president of human resources, the task falls on everyone. “I’m a firm believer that we all own the culture,” she said. The companies have been lucky, executives say, that the BMC and BFS cultures were a good match from the beginning. But Plasha has also been busy applying best practices — even through a pandemic. “We need to make sure that our people feel engaged, that they stay with us and that they feel like they have a voice,” she said. “And that effort carries through into the effort to build an open and diverse work force. That’s an important initiative for us, and it’s not just a corporate-driven, top-down program. It’s important everywhere. “One goal is getting folks to understand that this isn’t about statistics It is about inclusion, and ensuring that all different groups have a voice and are part of the conversation. I’m passionate about it, and we have a lot of team members who are passionate about it, too.”
PRODUCT OFFERING
When asked about the term “lumberyard” and how it applies to Builders FirstSource, CEO Dave Flitman had a quick response: “We’re not a lumberyard,” he said. “We are the largest building materials, supplier and manufacturer in the country. That’s the way I think about it. With those capabilities, what we do is we solve problems. And we do that in a number of ways.”
E
XCELLENCE “We keep the pressure on continuous improvement here.” Adding to the topic of business excellence, Flitman said: “The day you think you’ve arrived, it’s game over. No matter how good you are, no matter how happy your customers are and how well you’re performing, there’s always something you can be improving on. That’s how you keep the competiton from leapfrogging you.”
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“We have more people, we have more voices, and we have more promotion opportunities all across the country now. And we can bring new capabilities to our team members that they didn’t have before.” —Amy Plasha, senior VP human resources
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CFO Peter Jackson added that BFS has locations that do a great job selling sticks, and the company does so much more. “We’ve got tools and approaches to building homes that can really make it easier, faster and better.” Jackson adds: “I think that our broad product portfolio is the most compelling factor, when you talk to a builder customer and ask, ‘How can we help today?’” One of the more highly visible products along those lines is ReadyFrame, the precision, pre-cut framing package delivered to the job site ready to assemble. The process has shown results that significantly reduce framing “I think a real game time and improve the changer is going to cycle time for the builder. come from a technology Before the merger, Builders FirstSource had a similar perspective: how do we solution called Better improve the life cycle Framing Systems that was of the building process available in a few markets. and create more The two products have merged into what President transparency around of Commercial Operations what’s happening and Mike Farmer calls “a new when it’s happening.” and improved Builders FirstSource Ready-Frame.” — Mike Farmer, president, “We’re making adjustments commercial operations to our go-to-market strategy, and how we’re pricing it, how we’re selling it and some of the internal processes around how we bundle and ship out the product,” he added.
Digital opportunities The construction industry is good at many things, but digital transformation has not been one of them. “Given the scale of our platform, we feel we are well-positioned to help shape important outcomes for our industry, including improved efficiencies and productivity through digital technologies,” said CEO Dave Flitman. There’s plenty of room for the industry to grow in this area—a fact that’s hammered home by a color-coded infograph that BFS shares with investors. The chart (based on McKinsey data) rates 22 sectors with a digitization index
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across 10 business areas. Construction, bathed in red, is rated higher than only one other sector: agriculture and hunting. And as new generations of builders and contractors enter the industry, they’re bringing with them new ideas about how to do business with their suppliers. Builders First Source sees this shift as a big opportunity. How big? In addition to reducing inefficiencies and strengthening partnerships, “We believe we can capture more than $1 billion
A high priority: Solutions and systems to build more efficiently and address labor constraints.
Being the largest player also comes with advantages. Farmer explained that during the pandemic’s early stages, both BFS and BMC stocked up on materials even as prices were surging. “Not everybody did that,” he said. He pointed to OSB as a particular success story earlier this year, as BFS maintained its flow of product while it was under allocation in many places. Maintaining relationships with vendors is also a high priority, he said. “I think there are some manufacturers who are still wondering how this merger is going to work out,” he said. “Because we are a pretty big piece of their business today. But I think
of incremental sales over the next five years by utilizing our digital assets to accelerate the adoption and capture rates of value-added products,” said Flitman.
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C O V E R F E AT U R E
Right: A Ready-Frame order staged for delivery. Below: Associates are solving customer problems under a new slogan—“Outperform today. Transform tomorrow.”
the way we’ve gone to market with them and will continue to work to be strategic partners will help them grow. There’s a lot of runway It’s still a very fragmented industry. And one that we think we’re well-positioned to help in a lot of different ways.”
INNOVATION
Many have tried and some have failed to solve the construction industry’s challenges related to labor and efficiency. One wellpublicized failure was that of Katerra, the Silicon Valley off-site construction start up that filed for bankruptcy this summer. Builders FirstSource recognizes that the industry will evolve, but it will evolve around the needs of the customer. “We have the credibility that comes from being innovative and
“When you’ve got the best people, the best product portfolio, and the best location coverage, that sounds like fun to me. I like winning that way.” —Peter Jackson, CFO
solving their problems,” Flitman said. “Whatever the building industry evolves into over the course of time, we’re going to be in the center. We’re going to be right in the middle of helping to figure out what that needs to look like.” He added: “We’re not trying to fundamentally change the way homes are built,” he said. “What we’re trying to do is provide a platform to allow our customers to get more efficient with their building process—to produce what’s possible off-site to save labor hours, to do it safer at the job site, to eliminate waste and to be more productive overall.” Technology and digitization have a large and growing role to play, according to Farmer. “The last 12 to 18 months has taught us to think a little bit differently,” Farmer said. “And I think one of the clear areas is that communication of the home building process life cycle is at an absolute premium. There is a real opportunity to bring more technology and to be able to connect that technology to improve everybody’s experience and reduce build cycle times.”
GROWTH
Speaking to analysts and speaking to HBSDealer, BFS executives are well versed at pointing to the growth potential of the home construction business. The numbers shared with investors are worth repeating, and point to a long runway of growth, according to Flitman: 20% of adults are considering buying
a home next year; 82 million millennials are coming into
the housing market; Average inventory of 1.1 million units is way
down: 20% below the five-year average and well below the 3.5 million units in 2007;
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On top of organic growth, BFS’s cash-flow generation and strong balance sheet positions it to pursue accretive tuck-in acquisitions. The goal is simple: be the number one or number two player in all of its markets. Even post merger, BFS enjoys a market share that’s somewhere in the mid teens. That highly fragmented environment allows BFS to operate as a “disciplined consolidator in this industry for a
long time to come,” Flitman said. After taking stock of strengths and opportunities, the brain trust at Builders FirstSource hit on a forward-looking slogan: “Outperform today. Transform tomorrow.” “I think that’s perfect for the company,” said Farmer. “We’re using innovation to move the industry forward.”
Builders FirstSource pushes tech toward builder efficiency By Andy Carlo
from one another’s best practices while choosing the best solutions to continue improving its offerings. “We’ll continue to drive best practices and common processes where it makes sense for the business, but beyond that we will bring focus to the third digital domain and create real value for our customers,” Page said. “We feel that our company is very well-positioned to play a significant role in the digital transformation of the industry given our team members’ knowledge in construction and design, the ability to reach customers at scale, and trusted relationships both with builders and supply partners.” In mid-August, Builders FirstSource completed its acquisition of WTS Paradigm LLC, a Wisconsin-based provider of software solutions and services to the building products industry. Page said the acquisition of Paradigm provides the company with a starting point for enhancing its digital capabilities. “Ultimately, we see a market in need of a digital platform that provides workflow and the required integrations to improve the design process and remove waste in
When it comes to the progress of technology in the LBM world, there’s often the connotation that it’s an industry still run by handshake deals for orders of truckloads of sticks. But the industry continues to make technological advancements in hopes of driving better efficiency and improved customer service to assist home builders and remodelers drive their own businesses forward. Prior to the mega-merger between Builders FirstSource and BMC, the two companies each had digital initiatives underway. According to Builders FirstSource Executive Vice President of Digital Solutions Tim Page, the companies deployed technology within two digital domains: improving internal operations and interacting with customers. The company will now focus on a third digital domain: using technology to help its customers operate more efficiently. “Prior to the merger, both companies were focused on the first and second domains and achieved “Scalable productivity gains from the configuration and deployment of technology tools such as delivery management, visualization millwork configuration, and technology will automated material take-offs,” enable productivity, Page explained. “We were also improve improving interaction with our customers through purchase construction and order automation, lead generation transform our tools, and sharing information industry.” over customer portals” Since the January merger —Tim Page, was completed, it allowed the Senior VP of strategy and development new, larger company to learn
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residential construction,” he said. A home builder’s work can be overwhelming and often extends beyond the normal workday. Building a home is a complex project. It is difficult work to manage material suppliers, align with various trade contractors and deal with ancillary service providers while also trying your best to meet the homebuyers’ expectations. The right tools will lead to reduced cost, shorter cycle times and a better experience for the home buyer. “Builders don’t currently have the tools they need to do their jobs most efficiently. We’re committed to developing tools that reduce planning time, effectively integrate the design into the build process and ensure alignment across all stakeholders,” Page said. “Such tools improve communication and transparency to better meet the needs of our customer’s business, their homebuyer or homeowner customers and other project stakeholders.” Page said Paradigm has a history of helping industry participants boost sales and become more efficient through a simplified process for configuring, quoting and manufacturing complex products. “We will continue to invest in the core Paradigm Omni configuration technology. That technology also powers a new product, Paradigm Omni for Homebuilders, a software solution that creates a 360° virtual home design experience,” Page explained. “It allows homebuyers to customize their dream home, see how selections affect pricing and building allowances and visualize their choices — all before building begins. We believe scalable configuration and visualization technology will enable productivity, improve construction and transform our industry.”
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SPECIAL REPORT
By HBSDealer Staff Consolidations, mergers and acquisitions went to work on the latest edition of the annual HBSDealer Pro Dealer Industry Scoreboard, ranking the Top 200 home building supply dealers by annual sales. The changes are dramatic, even when not counting the biggest of all — the Builders FirstSource and BMC merger that occurred in early 2021. (An exclusive profile of the combined super company begins on page 18.) The Scoreboard reflects highly unusual circumstances that shaped the pro dealer business in 2020. The inter-related factors of pandemic prevention, supply chain disruption and intense spending on the home — whether that’s new construction or renovation. Single family home construction, the bread and butter of the pro dealer industry increased 11.6% to 990,500 in 2020, pushing up against the one million milestone not crossed since 2007. Meanwhile, the U.S. Census Bureau’s statistics show sales of building materials and supplies dealers (NAICS 4441) up 13.6% to $371,027,000,000. The price of lumber itself bears significantly in the NAICS 4441 chart, and the industry as a whole, and the operative word since mid 2020 has been “volatility.” Lumber prices per thousand board feet rose to just under $1,000 last year, before returning to earth. An even more volatile lumber-price situation has played out in 2021, as lumber prices crossed $1,500 in late May and have since fallen below $400. The Top 200 pro dealers are turning increasingly to
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PRO DEALERS Annual single-family housing starts (Thousands) 1000
750
500
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Annual NAICS 4441 sales (Millions $USD) 400,000 350,000 300,000 250,000 200,000 150,000 150,000
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Sources: U.S. Census Bureau.
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technology to build efficiencies in their business and stand out to customers. “Contractors are recognizing the value produced by utilizing the full range of our digital solutions, which includes online ordering and estimating tools,” said Beacon Building Products President and CEO Julian Francis. (Builders FirstSource revealed highlights of its high-priority technology initiatives on page 23.) On the following pages, we document and estimate the revenues of the first 100 leading LBM dealers, based on data from their most recently completed fiscal years. For the full Top 200, visit HBSDealer.com/report.
Rank
Company Location
ABOUT THE LIST
The 2021 Top 200 Pro Dealer Industry Scoreboard tracks companies that sell lumber and building materials to homebuilders and contractors. To be included on this scoreboard, the majority of a company’s sales must be to the pro customer, as opposed to the homeowner or DIY customer. Information is gathered from several sources: corporate statements, published reports and interviews. HBSDealer also relies heavily on estimates, which are noted in the listings. The data reflects activity from 2020, or the most recently completed fiscal year. The editors of HBSDealer encourage your feedback. Share it with us at news@hbsdealer.com.
2020 Dollar Sales
2020 Locations
Rank
12,000,000,000
860
23
Company Location
2020 Dollar Sales
2020 Locations
National Lumber Co. Mansfield, Mass.
373,000,000
14
1
ABC Supply* Beloit, Wisc.
2
Builders FirstSource Dallas, Texas
8,558,874,000
550
24
Mead Lumber Columbus, Neb.
368,000,000
44
3
Beacon Building Products Herndon, Va.
6,943,900,000
858
25
Shelter Products Portland, Ore.
365,900,000
8
4
Ferguson* Newport News, Va.
6,540,000,000
1,452
26
Alpine Lumber Westminster, Colo.
351,000,000
19
5
84 Lumber Eighty Four, Pa.
4,700,000,000
255
27
R.P. Lumber* Edwardsville, Ill.
307,500,000
73
6
US. LBM Holdings Buffalo Grove, Ill.
4,265,100,000
280
28
E.C. Barton* Jonesboro, Ark.
305,000,000
111
7
BMC Atlanta, Ga.
4,207,300,000
174
29
Hammond Lumber Belgrade, Maine
302,000,000
21
8
SRS Distribution* McKinney, Texas
3,570,000,000
395
30
Idaho Pacific Lumber Boise, Idaho
286,100,000
10
9
GMS Tucker, Ga.
3,137,000,000
233
31
Sunpro Corp. Saint George, Utah
278,000,000
14
10
Kodiak Building Partners Denver, Colo.
1,766,600,000
103
32
Drexel Building Supply Campellsport, Wis.
258,000,000
9
11
Carter Lumber* Kent, Ohio
1,750,000,000
166
33
Curtis Lumber Ballston Spa, N.Y.
243,025,910
23
12
Foundation Building Materials* Tustin, Calif.
1,385,800,000
154
34
Franklin Building Supply Boise, Idaho
236,500,000
16
13
McCoy's Building Supply San Marcos, Texas
1,055,563,000
89
35
Mill Creek Lumber & Supply Tulsa, Okla.
232,600,000
24
14
Lansing Building Products* Richmond, Va.
995,000,000
112
36
Erie Materials Syracuse, N.Y.
217,700,000
10
15
Contractor's Warehouse* Rosevillle, Calif.
768,000,000
14
37
Ring’s End* Darien, Conn.
217,000,000
9
16
American Construction Source Springfield, Mo.
703,200,000
73
38
Hancock Lumber Co. Casco, Maine
215,500,000
10
17
Parr Lumber Hillsboro, Ore.
642,500,000
36
39
LaValley/Middleton Building Supply Newport, N.H.
187,925,000
14
18
Foxworth-Galbraith Lumber* Dallas, Texas
588,500,000
35
40
Kuiken Brothers* Fair Lawn, N.J.
180,000,000
11
19
Ganahl Lumber Co. * Anaheim, Calif.
502,300,000
11
41
M.G. Building Materials* San Antonio, Texas
180,000,000
12
20
Professional Builders Supply Morrisville, N.C.
426,900,000
14
42
Guy C. Lee Building Materials* Smithfield, N.C.
172,900,000
8
21
Matheus Lumber Woodinville, Wash.
416,000,000
8
43
Reliable Wholesale Lumber* Huntington Beach, Calif.
170,500,000
2
22
Riverhead Building Supply Calverton, N.Y.
400,000,000
18
44
Scherer Brothers* Brooklyn Park, Minn.
170,000,000
5
* Estimated Data
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SPECIAL REPORT
Rank
Company Location
PRO DEALERS 2020 Dollar Sales
2020 Locations
Rank
Company Location
2020 Dollar Sales
2020 Locations
45
Capitol Building Supply* Manassas, Va.
164,000,000
19
73
TAL Holdings Vancouver, Wash.
99,800,000
10
46
Lezzer Lumber* Curwensville, Pa.
162,000,000
13
74
Viking Lumber Belfast, Maine
99,000,000
9
47
U.S. Fence Solutions* Littleton, Colo.
161,200,000
16
75
Florence Building Materials* Huntington, N.Y.
97,000,000
3
48
Keim Lumber* Charm, Ohio
159,200,000
2
76
Russell Do it Centers* Alexander City, Ala.
95,500,000
9
49
Spahn & Rose Dubuque, Iowa
157,000,000
23
77
Builders Supply Co.* Omaha, Neb.
95,000,000
1
50
Honsador Lumber* Kapolei, Hawaii
154,200,000
11
78
Mans Lumber & Millwork* Trenton, Mich.
94,700,000
4
51
Burton Lumber* Salt Lake City, Utah
150,000,000
10
79
Timberland Lumber* Brazil, Ind.
94,000,000
3
52
Koopman Lumber* Whitinsville, Mass.
150,000,000
9
80
Harbin Lumber* Lavonia, Georgia
91,300,000
7
53
HPM Building Supply Keaau, Hawaii
147,000,000
13
81
Zuern Building Products * Allenton, Wis.
89,000,000
7
54
Star Lumber* Wichita, Kan.
141,200,000
7
82
Buccheit* Perryville, Mo.
86,500,000
10
55
Hayward Lumber* Monteray, Calif.
140,000,000
8
83
Simonson Lumber* St. Cloud, Minn.
83,000,000
8
56
Alexander Lumber Aurora, Ill.
140,000,000
12
84
Garris Evans Lumber* Greenville, N.C.
82,300,000
5
57
The Building Center* Pineville, N.C.
139,200,000
6
85
Robert Bowden* Marietta, Ga.
82,000,000
3
58
Western Building Center * Kalispell, Mont.
137,000,000
13
86
Doug Ashy Building Materials* Lafayette, La.
82,000,000
8
59
McCray Lumber & Millwork Overland Park, Kan.
134,400,000
7
87
Dunn Lumber Seattle, Wash.
82,000,000
9
60
Belletetes* Jaffrey, N.H.
133,600,000
9
88
Wilson Lumber * Huntsville, Ala.
81,100,000
4
61
Tibbetts Lumber* St. Petersburg, Fla.
133,000,000
8
89
Millard Lumber * Omaha, Neb.
81,000,000
3
62
Big C Lumber* Granger, Ind.
132,700,000
18
90
Innovative Construction Group* Jacksonville, Fla.
80,000,000
2
63
Erickson Companies* Chandler, Ariz.
130,800,000
4
91
Ashby Lumber* Berkeley, Calif.
80,000,000
2
64
Bloedorn Lumber* Torrington, Wyo.
126,000,000
25
92
Cassity Jones Lumber* Longview, Texas
79,500,000
9
65
Gilcrest-Jewett* Waukee, Iowa
125,000,000
5
93
O.C. Cluss Lumber* Uniontown, Pa.
79,000,000
4
66
Builders Warehouse Kearney, Neb.
114,000,000
3
94
Chelsea Lumber Company* Chelsea, Mich.
78,000,000
3
67
T.H. Rogers Lumber* Edmond, Okla.
113,900,000
40
95
Graves Lumber* Copley, Ohio
77,900,000
1
68
Central Valley Builders Supply* Napa, Calif.
111,000,000
7
96
Williams Lumber & Home Centers* Rhinebeck, N.Y.
77,000,000
6
69
Jackson Lumber & Millwork * Lawrence, Mass.
110,900,000
5
97
Randall Brothers* Marietta, Ga.
76,400,000
4
70
Coastal Construction* Jacksonville, Fla.
109,100,000
15
98
Oldham Lumber* Dallas, Texas
76,000,000
1
71
Your Building Centers Altoona, Pa.
107,000,000
17
99
NorCal Lumber* Marysville, Calif.
75,600,000
1
72
Woodhaven Lumber & Millwork Lakewood, N.J.
105,000,000
4
100
Wheelwright Lumber Company Ogden, Utah
74,460,794
1
* Estimated Data
There’s more! See the full list of TOP 200 companies at HBSDealer.com.
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NLBMDA UPDATE
A rallying cry to banish new taxes The NLBMDA weighs in on a $3.5 trillion debate Over the coming weeks, congressional committees will draft legislation around a $3.5 trillion budget resolution. At the same time, the NLBMDA says it will be working directly with those committees to protect LBM dealers. NLBMDA has been lobbying Capitol Hill for several months urging them to reject any tax proposals that will negatively impact LBM dealers. The Washington, D.C.base association says it has made “significant inroads” in the Senate. At presstime (late August), the House of Representatives has approved a 2022 budget resolution on a party-line vote of 220-212. Approval of the budget resolution is the first step in the budget reconciliation process which directs legislative committees in the House and Senate to begin drafting a bill that could spend up to $3.5 trillion on legislative initiatives supported by President Biden and congressional Democrats. Approval of the budget resolution is the first step in the budget reconciliation process which directs legislative committees in the House and Senate to begin drafting a bill that could spend up to $3.5 trillion on legislative initiatives supported by President Biden and congressional Democrats. The budget resolution sets the topline spending levels for each committee and includes a series of legislative recommendations for the committees to consider as they draft the bill. Both House and Senate leaders are requesting that the committees examine provisions relating to climate change, housing, education, immigration, child care, health care, paid leave and other social programs.
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To offset the cost of the legislation, Democrats have instructed the taxwriting committees to examine tax increases on individuals making over $400,000 per year and corporations. The NLBMDA notes that these are just recommendations and it’s currently unclear which provisions will have enough support to be included in the final reconciliation bill. The actual bill is also expected to be more narrow in scope than the $3.5 trillion approved level. The NLBMDA is strongly opposed to any tax proposals that will negatively impact LBM dealers, however. In a letter to the House Ways and Means Committee and Senate Finance Committee, the NLBMDA highlighted its positions on several tax proposals that impact lumber and building material dealers, including:
“Enacting tax policy that incentivizes job creation is particularly crucial as the U.S. economy continues to recover from the COVID-19 pandemic.” —Jonathan Paine, CEO, NLBMDA
Oppose the repeal or reduction of the existing 20% pass-through deduction; Oppose increases to personal income tax rates; Oppose increases to the corporate income tax rate; Oppose changes to the existing estate tax exemption and “step up in basis” provision; Oppose tax increases on capital gains; and Restore the state and local income tax (SALT) deduction.
The letter, signed by NLBMDA CEO Jonathan Paine, incudes the passage: “Small businesses are the backbone of the U.S. economy as they employ nearly half of all American workers and account for two-thirds of the net job creation over the past decade. NLBMDA believes any changes to our tax code should sustain the competitiveness of America’s small businesses and ensure they can remain viable in the long-term. “ Paine added: “Enacting tax policy that incentivizes job creation is particularly crucial as the U.S. economy continues to recover from the COVID-19 pandemic.”
HARDWARE + BUILDING SUPPLY DEALER SEPTEMBER 2021
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PRODUCTS
Decking demand builds in 2021 and beyond By Andy Carlo While Americans are returning slowly to offices and cubicles, many others continue to work from home. And while home, their spending more time outdoors, and more money on outdoor living spaces. The decking sector remains hot — especially from a remodeling standpoint. “Homeowners are staying in their homes longer and investing in their homes. Remodeling professionals are booked well into 2022,” says Jase DeBoer, senior marketing manager at Deckorators. Demand for low-maintenance, high-quality decking and railing products exploded in 2020 and that demand has remained strong in 2021 heading into 2022. “Where demand in 2020 was heavily DIY, many homeowners are re-engaging with restaurants and vacations,” DeBoer notes. “And that steady DIY demand is shifting towards building professionals going into 2022.” Decking, railing, and accessory manufacturers have been making investments to increase production as well. Trex CEO Bryan Fairbanks recently noted that the completion of a $200 million capacity expansion program in May enabled the Trex Residential division to convert significant customer demand into a 43% increase in sales. Meanwhile, new products continue to lift the category. Here’s what’s new in decking, railing, and accessories in 2021:
Deckorators has added two new vertical-grain color options to the popular line of Vista wood composite decking (WPC), which offers the appearance of exotic hardwoods without the maintenance. Silverwood (light gray) and Dunewood (medium brown) join Driftwood (gray) and Ironwood (brown) to give builders and their clients more color pairing possibilities. All four Vista colors are available in 5½-inch width and 12-, 16-, and 20-foot solid- and grooved-edge options.Vista is backed by a 25-year structural, 25-year stain-and-fade, and 25-year removal-and-replacement limited warranty. Deckorators.com
FastenMaster has partnered with leading deck manufacturers to offer Cortex Decking Plugs in collated strips. The collated strips of Cortex Decking Plugs come in a wide range of deck colors from AZEK, Trex, and Wolf. The wood ‘grain’ on the collated plugs comes pre-aligned allowing the installer to save valuable time on the jobsite. The hidden fastening system was developed by FastenMaster and designed for use with composite, capstock, and PVC decking boards, as well as PVC trim. Collated Cortex Plugs are packaged in three sizes to accommodate 100 lineal feet of decking, as well as 100- and 300-square foot decks. Each package includes Cortex Screws, Cortex Plugs, and Setting Tools, and assumes two fasteners per board installed 16-inches on center. Cortex Plugs are made from the same material as the deck and come with a warranty for the life of the project. FastenMaster.com
Fortress Building Products has extended its line of railing solutions to commercial building professionals with the Al¹³ PLUS aluminum railing system. Formerly known as Al¹³, the system features code-driven enhancements and an innovative bracket system that addresses common challenges on large-scale commercial projects. Al¹³ PLUS joins Fortress Building Products’ current residential aluminum railing offering, Al¹³ HOME, and is available across its North American dealer network. Featuring an additional IBC code-compliant railing post, Al¹³ PLUS accommodates 8-foot spans and fascia mount installations. The system’s prewelded assembly reduces installation time and provides superior performance in strength and safety, while its premium powder coating supports corrosion resistance to ensure lasting style and minimal maintenance. Fortessbp.com
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SEPTEMBER 2021 HARDWARE + BUILDING SUPPLY DEALER
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Beautifully Finished Projects Installed 50% Faster Since its introduction, the Cortex® Hidden Fastening System has led the industry in improving installation quality and delivering the homeowner a premium finished look. Innovative collated plug strips for decking and trim applications are engineered to reduce installation time by 50% compared to loose plugs. Available for the leading board manufacturers, there's a perfect Cortex plug for every project. Visit FastenMaster.com to watch installation videos and view technical guides.
Cortex Decking and Trim packaging available in various lengths, sizes and brands
FastenMaster.com
800·518·3569
FastenMaster® and Cortex® are registered trademarks of OMG Inc. Copyright © 2021 OMG, Inc. All rights reserved.
SECTION HEAD
Envision Building Products now offers the Pro Plug Hidden Fastening System for use with all fullprofile deck boards and colors. Made by Starborn, Pro Plug allows installers to face-fasten deck boards while eliminating visible screw heads and holes. When used in combination with Envision’s EverClip Hidden Fastener, the Pro Plug System is an ideal solution for achieving a fully hidden and securely fastened deck. The Pro Plug System consists of three components: epoxy-coated carbon steel screws or stainless steel screws; a patented PVC/Composite tool that attaches to a standard drill/driver to drive screws to the correct depth without overdriving or stripping the screw; and plugs made with Envision’s decking material for a perfect match to the deck boards. Drive the screw in a straight and stable fashion with a standard drill until the Auto-Stop mechanism fully engages, then insert the plug into the hole above the fastener and tap into place with a smooth face hammer. The result is a seamless surface for a smooth appearance and feel. Envisiondecking.com
Westbury VertiCable Aluminum Railing from DSI makes any deck or porch beautiful, and it comes with a lifetime limited warranty. Featuring thin vertical stainlesssteel cables rather than larger bulky infills, VertiCable railing is stylishly designed to provide unobstructed clear views from any deck or porch making it ideal for residential and multi-family installations. Westbury VertiCable railing comes in pre-assembled sections for fast installation. Available in an industry-leading 12 standard colors and textures, VertiCable railing is powder coated with DSI’s 10-step powder coating process to provide low maintenance and long-term durability. The components are lightweight and engineered for easy installation. VertiCable railing can be installed in up to 60% less time than horizontal cable railing systems. Westbury VertiCable railing offers major installation advantages over competitive horizontal cable railing systems. Diggerspecialties.com
Fiberon has launched Promenade premium PVC decking. Featuring enhanced streaking, premium embossing and a next-generation surface coating designed for superior weather resistance, Promenade PVC decking is now available to order. Promenade PVC decking is covered by a lifetime limited performance warranty and a 50-year stain and fade warranty. It offers an on-trend aesthetic with the benefits of premium PVC, including enhanced durability. Promenade deck boards are lightweight and easy to handle, with a slip-resistant texture that makes them ideal for waterside applications. Both grooved- and square-edge options feature four-sided capping with streaking on the unembossed underside. Fiberondecking.com
Trex has expanded its reach with the launch of a new professionally focused website. Trex.com/Professionals provides new digital content dedicated to satisfying the information and material needs of the AEC (architect, engineer, contractor) community. The new site targets landscape and building architects, along with designers, engineers and commercial contractors and offers a dedicated digital resource hub where they can access pertinent information about Trex’s product offerings, which include decking, railing, cladding, fascia, outdoor lighting, pergola, deck drainage, outdoor kitchen components, fire & water features, outdoor furniture and related accessories. The site also features content that educates, engages, and empowers professionals with the product confidence needed to specify Trex products for their project portfolios. Trex.com/Professionals
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SEPTEMBER 2021 HARDWARE + BUILDING SUPPLY DEALER
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RAILING NEWS
DSI expands in Pennsylvania Bremen, Ind.-based Digger Specialites Inc. (DSI) is building a new manufacturing facility in Williamsport, Pa. The new facility is currently under construction with targeted production scheduled to begin during the first half of 2022. Initially, the new facility will employ 150 employees. DSI said that it is aggressively expanding its production capacity to meet the growing demand for its outdoor living products which includes Westbury Aluminum Railing, PolyRail Railing, along with CourtYard Regis Aluminum Fencing. In April 2021, a third powder coating line was added at DSI’s original manufacturing plant in Bremen. DSI also operates a production facility in Carthage, Mo., which became operational in 2019. The new Pennsylvania plant will begin operations manufacturing aluminum and vinyl fencing as well
as vinyl railing. During the second half of 2022 Westbury Aluminum Railing will be added to the manufacturing mix at this facility. DSI composite and fiberglass columns will be stocked at the new facility to serve the needs of DSI customers. “The new DSI manufacturing and distribution plant in Eastern Pennsylvania will quickly service and reach our Northeastern customers for railing, fencing and columns,” said Larry Boyts, DSI’s VP of sales and marketing. “We are planning for significant growth by capturing market share with an expansive and superior group of building products to help grow our customers base of business.” The Bremen, Ind.-based company’s product offerings include aluminum and vinyl railing, aluminum and vinyl fencing; composite, fiberglass, and aluminum architectural columns; gates; and deck and fence lighting.
Key-Link offers visualizer Key-Link Fencing & Railing added to a growing list of deckand-railing industry visualization tools with its new American and Outlook Series Railing Visualizer. The visualizer is the result of a partnership with web-tools provider Chameleon Power of Novi, Mich., which specializes in the design space. With the visualizer tool, home owners can call up a variety of scenes — beach, forest, lake, meadow, mountains — that most resembles their outdoor living space. After picking one of the 14 settings, it then becomes a matter of trying out various railing features, including color and infill options. Key-Link says it plans to add its Chesapeake product line to its Railing Visualizer in 2022.
BlueLinx partners with Regal Ideas BlueLinx Holdings announced that it has joined forces with Regal ideas Railing (Regal ideas) to distribute their premium aluminum railing from
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its distribution centers in Omaha, Neb.; Kansas City, Mo.; and Minneapolis, Minn. Regal ideas offers a variety of railing systems that are known in the industry to be easy to install and maintain. Their systems, which include pickets, glass and LED, are engineered to withstand the most severe weather and temperature conditions and are backed by a 20year limited warranty. “BlueLinx is committed to growing our Outdoor Living offering,” said Mike Wilson, senior vice president, BlueLinx. HARDWARE + BUILDING SUPPLY DEALER SEPTEMBER 2021
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KITCHEN & BATH
NKBA reports backlogs and challenges, but also growth The kitchen and bath market continues to deliver growth, according to the quarterly National Kitchen & Bath Association/John Burns Kitchen & Bath Market Index report. The research and estimates from the NKBA and John Burns Real Estate Consulting show an 11% increase in sales for the second quarter of 2021 compared to the first quarter of the year. And despite ongoing material shortages and rising labor costs, full-year sales are now expected to
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exceed 2020 by 14.5%, an upward revision from the 13.4% consensus forecast last quarter. “We’re encouraged by the findings from our report on the Kitchen & Bath industry, which reaffirms the longer outlook of the field as one of growth and strong earnings,” said Bill Darcy, NKBA CEO. “While we are seeing the continued delay of materials and increase in labor costs causing problems and concerns within the sector, it also shows that the sky-rocketing demand for remodeling projects has continued.”
SEPTEMBER 2021 HARDWARE + BUILDING SUPPLY DEALER
According to Darcy, the industry is also experiencing an increased interest in higher-end products as consumers are spending more time than ever in their homes due to the ongoing pandemic and are prioritizing comfort and luxury, particularly when it comes to kitchen and bath improvements. But the COVID-19 pandemic has continued to have a significant impact on the supply chain and material development industries, causing widespread challenges to all sectors of the economy, the NKBA said. The NKBA said that the industry has seen “double-digit” price increases across common kitchen & bath products, while labor rates have increased an additional 10-19% in an effort to retain talent within the industry. All of these factors have put a strain on the consumer budget.
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Despite these hurdles, there is a clear demand for remodeling services as 60% of designers have reported a backlog of at least three months. Additionally, in Q2 2021, 55% of the building and construction industry reported zero projects canceled, a stark contrast from the previous quarter. And despite an increase in material costs, nearly half of retailers (46%) have begun to see a shift in typical price points demanded by customers with 89% saying their customers are shifting toward the pricier, higher-end finishes. Among the report’s key findings: Labor Challenges Persist: As the qualified labor pool continues to shrink with early retirement and career changes, building and construction
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The KBMI score hit an all-time high in the second quarter, reflecting strong kitchen-and-bath spending.
companies scramble to incentivize their current workforce. 80% of companies report increasing labor rates to retain employees — with nearly two-thirds report rising rates of as much as 19%. This continues to increase the overall price of the project and delay the timeframes of planned remodels. However, clients continue to move forward with projects and are willing to pay for products and finishes in demand. COVID-19’s Impact Lessens: While industry experts and professionals keep
a watchful eye on the progression of the Delta variant of the coronavirus, members reported a significant drop in the pandemic’s impact on business, giving it a score of 4.9 out of 10, where 0 is no impact at all and 10 is a significant impact — down significantly from around 6 the previous three quarters. More Record Indices: An 82.3 overall KBMI score topped the previous all-time record 79.8 from Q1. Current conditions of 85.7 shattered last quarter’s record 78, and is miles ahead of the 59.8 from Q4 2020. Future conditions are flashing warning signals though, as price hikes and lead times are beginning to take a toll. Many members are becoming creative, ordering months in advance to circumvent lead times and lessen the sting of price hikes.
HARDWARE + BUILDING SUPPLY DEALER SEPTEMBER 2021
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HBSDealer’s Top Women in Hardware & Building Supply networking event is slated for Nov. 10-11 in Chicago. Visit HBSDTopWomen.com to join us.
Stanley Black & Decker’s Maria Ford By Ken Clark
Maria Ford, the president of Stanley Black & Decker’s commercial and industrial division, began her career in the male-dominated tool industry when, on the advice of a Loyola College of Maryland lacrosse teammate, she took on a role as an intern at the company. On the lacrosse field Ford played an attack position. But at the tool company, she was seen as a keeper. Twenty-three years later, she’s described by one colleague as “an incredible leader,” whose “passion for the industry is evident in every interaction she has with her team and her customers.” In her current role, Ford manages a $1.4 billion division and leads a team of more than 500 employees. During an interview with HBSDealer, Ford shared some of that passion on the topic of diversity, mentorship and the role of women in the industry. Here’s the edited version of the conversation: Tell us about Stanley’s diversity mission. The company has changed dramatically in 23 years. And the past five years or so, Stanley Black & Decker has really put some intense effort behind its diversity mission. It’s something that we are very passionate about. And it’s absolutely a core piece of our metrics as we move forward. We are currently working to increase uour female leadership by 40%. How is diversity changing overall? I feel like there’s been big improvement
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Maria Ford rose through the ranks at Stanley Black & Decker. Her advice: “Be real.”
in the industry, and at Stanley Black & Decker. And it was pretty cool for me to see Tara Tansky from our team recognized as a Top Woman, as well. She plays a critical role for us, and she’s our first -ever female, regional vice president. I think we’re making strides. As a female, I think we benefit from seeing other women in these positions — we see that it’s attainable, we say to ourselves, OK, I can do it, too. It’s like the saying: “See her, be her.” You described Black & Decker’s Pete Morris as a mentor. What was it like working with him?
SEPTEMBER 2021 HARDWARE + BUILDING SUPPLY DEALER
Pete was an executive back during a really interesting, critical time. It was a time when it wasn’t common for women to be in leadership or management positions. But Pete was unique — he had two of us (my boss and myself). He embraced it. And on top of that, he was a phenomenal leader. Without his guidance and his help — even though I’m a strong-willed person — I probably would have left the industry. You have experience with the Industrial Supply Association Women in Industry Initiative and also the Stanley Global Women’s Network. What do these groups, and others like them, need to do to advance the cause? I think the biggest thing is this: there’s got to be action. When we participate in these meetings, my best advice is to make sure that there’s good action coming out of them. Let’s make sure that there’s some type of education or training. The idea is for women to leave with core foundational business practices. Another key is the networking, the ability to bounce ideas off of each other. That is also extremely important. What is your company doing? How is your company handling certain issues? What are they doing differently? These are important questions that can help advance the whole industry, right? If the industry rises, we all rise. It shouldn’t be a solo effort. Advice to succeed in the hardware and building supply industry? “Be real. Don’t try to be something you are not. Do the little things. And as for succeeding in a male-dominated space: Again, be who you are.”
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JOIN US LIVE AT FAIRMONT CHICAGO NOVEMBER 10 -11, 2021
Get Ready to Shine
Join us for two days of celebrating top women, networking with industry peers and hearing from star panelists that include:
Susan Kasko 84 Lumber
Evionne Silver Builders FirstSource
Sarah Dodd Lowe’s
Alison Dowell Emery Jensen
Wendy Whiteash US LBM Holdings, LLC
Jean Fahy Do It Best
Lita Abele U.S. Lumber Inc.
Jean Niemi True Value
PRESENTED BY
PEOPLE IN THE NEWS Cornerstone Building Brands announced that James Metcalf will retire as CEO. The move is effective Sept. 6 with Metcalf being succeeded Lee by Rose Lee as president and CEO. Metcalf will continue his role as executive chairman of the board, with Lee also joining the board of directors. Lee joined DuPont in 2015 as global business director, DuPont Kevlar and Aramid Intermediates. In 2016, she assumed the role of President, DuPont Protection Solutions and was named President, Safety & Construction in 2017. Prior to joining DuPont, Rose held senior leadership positions at Saint-Gobain in several general management
positions serving the construction, transportation, energy, and defense sectors, as strategy director and CIO of the North America region.
Doyle
Philemon
Masonite, the interior and exterior door manufacturer, has appointed Clare Doyle as senior vice president, chief sustainability officer, and Vicky Philemon as senior vice president, general manager, Europe, both effective immediately Doyle joined Masonite as senior vice president, components in 2016 and has served as senior vice president, general manager, Europe since 2018. She
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SEPTEMBER 2021 HARDWARE + BUILDING SUPPLY DEALER
previously held marketing leadership positions in the chemicals industry with Elementis plc and Rohm and Haas Company. Philemon was most recently managing director for Morphy Richards, a supplier of small appliances in the UK. She also previously served in senior sales and marketing roles at Stanley Black & Decker. Doyle and Philemon will report to Heckes. Specialty Building Products (SBP) announced that Chris Gerhard has joined the company’s executive leadership team. In the newly created role of executive vice Gerhard president, Gerhard will work with the existing management team to enhance the company’s customer and supplier relationships and to further accelerate the growth of the business. SBP’s operating brands include U.S. Lumber, Alexandria Moulding, and Midwest Lumber. Over the last decade, he has served as vice president of sales for Trex Company where he maintained various responsibilities, including management of product launches, strategic customer negotiations, distribution strategy, and the Trex sales team. Fortress Building Products has added industry veteran Jim Plank to its sales team. As Director, Channel Sales, Plank will employ Plank market strategies to identify and secure product specifications in the architecture, engineering, and construction (AEC) sector. Plank began his professional career over two decades ago with Stanley Black & Decker, Inc. Since then, he has held
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various sales and business development roles of increasing responsibility across the retail and wholesale channels with American Standard Brands, Moen Incorporated, and Uponor. The Lumbermen’s Association of Texas (LAT) has elected Harley “Bubba” Finnell, owner of Oldham Lumber Company in Dallas, Texas, as president othe Finnell Board of Directors. Additionally, the LAT reported that Kate Woodson Borroni, director of human resources, operations at Woodson Lumber Company has joined LAT’s Executive Committee as second vice president. The board also elected four new directors: Corby Biddle, president and general manager at Higginbotham Brothers; Jammy Pate, president at Pate’s Hardware Inc.; John Sewall, CEO at The Detering Company; and Isaac Smith, vice president of purchasing, hardlines at Matt’s Building Materials. McCoy’s Building Supply has named two new managers for locations in New Mexico and Texas. Albert Garza has been appointed store manager of McCoy’s Garza Roswell, N.M. Garza began his career as a yard crew member nearly four years ago at McCoy’s Odessa, Texas store before enrolling in the company’s Management Webb Development Program. McCoy’s has also appointed Clay Webb as store manager of its Brownwood, Texas. Webb, a native of Houston and joined McCoy’s three
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years ago. He worked in the yard and in a commercial sales support role before enrolling in the company’s Management Development Program. Weyerhaeuser has appointed Travis Keatley as senior vice president of Timberlands, effective Sept. 13. Keatley has served as vice president of Keatley Western Timberlands for the company since January 2020, and his appointment follows
the planned retirement of Adrian Blocker, who will stay on through mid-October to serve as a senior advisor and aid in the transition. Keatley joined Weyerhaeuser in 2000 in the company’s Western Timberlands organization. He has since held a variety of operations and leadership positions, including serving as vice president of Southern Timberlands prior to his current role leading Western Timberlands, and among other key projects, he led the successful integration of our Longview Timber acquisition in 2013.
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HARDWARE + BUILDING SUPPLY DEALER SEPTEMBER 2021
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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) July: 1,534,000
NAICS 44413
(sales in $ billions)
50
1800
4
1700
46.9 40
1600 1500
45.4 42.1
42.4
3.50 41.5
39.4
3
3.27
3.15
3.35
3.23
2.84
30
1400
(sales in $ billions)
2
1300
20
1200 1100
1
10
1000
0
900
MAY
J A S O N D J F M A M J J
2020
SOURCE: COMMERCE DEPARTMENT
Single-family starts
JUNE
0
JULY
2021
APRIL 2020
MAY
JUNE
2021
SOURCE: MONTHLY RETAIL TRADE REPORT FROM THE U.S. CENSUS BUREAU
(in thousands, SAAR) July: 1,111,000 1400
HBSDealer Stock Roundup
1300
the percent-change performance of stocks based on Aug 26 prices
1200 1100
100
1000 900 800
DE
80
BLDR
600
ANNUAL CHANGE
700
J A S O N D J F M A M J J SOURCE: COMMERCE DEPARTMENT
Existing-home sales (in millions, SAAR) July: 5,990,000 7 6.5
60
BECN
40
SHW
20 SWK
6
TSCO
DJI
LOW WY
HD
5.5
0
5
-5
0
5
10
15
20
4.5
MONTHLY CHANGE
4 3.5
BECN (BEACON); BLDR (BUILDERS FIRSTSOURCE); BMCH (BMC STOCK HOLDINGS); DE (DEERE & CO.);
J A S O N D J F M A M J J
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)
8.0
10.0
4.0
80
38
Current Prior month
120
Prior year
16.0
5.4%
18.0
July 0.0
$3.00 $2.50
14.0
6.0
2.0
100
12.0
20.0
60
129.1
$3.15
July
Aug 26
140
SEPTEMBER 2021 HARDWARE + BUILDING SUPPLY DEALER
$2.00
$3.50
SOURCES: LABOR DEPARTMENT, THE CONFERENCE BOARD, AAA
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