The 2020 Mid-Year Economic Update_long

2014 Trends Snapshot: Building Materials/Construction Distribution

This article is part of MDM's 2014 Distribution Trends Report. It provides a quick look at key trends affecting the building materials/construction distribution sector.

The annual report was researched and written by MDM editors based on interviews with dozens of wholesaler-distributors, as well as industry experts and manufacturers. MDM also conducted a survey of its readers to uncover the trends outlined in this report.

The full report is available to download in PDF format to MDM Premium subscribers. Subscribe below for full access. Or log-in if you are already a subscriber.

Trends outlined in the 2014 report include:

  • Leaving Economic Uncertainty Behind
  • Connecting the Dots Online and Offline
  • Need for Access Whenever, Wherever, However Drives Mobile Adoption
  • Avoiding Information Overload Essential with Analytics
  • Making the Case for Millennials in Distribution
  • Training, Technology Take Front Seat in Employee Retention Strategies
  • Better Inventory Management Through Data, Collaboration
  • Distributors Seek More Complete Strategy for Vending
  • Private Equity Consolidating Markets
  • A More Practical Approach to Product Expansion
  • Other Trends
  • Trend Snapshots for 13 Sectors

The report also includes the following case studies and interviews:

  • 2014 MDM Market Movers
    • Engman-Taylors Cost-Saving Teams
    • Capitol Coffees Proactive Problem-Solving
    • Redwood Plastics Online Success Story
  • MDM Market Leader Profiles
    • DGI Supply: Building on the Core
    • F.W. Webb Takes Diverse View of Market

This is a part of the 2014 Distribution Trends Report. The annual report was researched and written by MDM editors based on interviews with dozens of wholesaler-distributors, as well as industry experts and manufacturers. MDM also conducted a survey of its readers to uncover the trends outlined in this report.

2014 Distribution Trends Report

Distributors are recovering from the adverse weather of the first quarter. Harsh winter conditions in the first couple months of the year shut down a lot of distribution centers and brought transportation channels to a halt. "We were impacted in the first quarter by the weather because we basically operate from Pennsylvania down to Georgia on the east coast,"says Don Schalk, president and COO of specialty building materials distributor C.H. Briggs Company, Reading, PA. "We lost 25 percent of our delivery days in February."

Economic conditions are improving across the sector. According to the Institute of Trend Research, 2015 should see a significant improvement in the construction market, with the market strengthening even more from 2015-2018.

"We continued to perform very well in the commercial markets, we’ve got a lot of projects in our pipeline," Schalk says. "We have seen a nice rebound in residential remodel and our customers that deal primarily with the retail trade have said that their activity is the best it’s been since the crash in 2008."

Customers are looking for faster information. With the rise of e-commerce and the bleed of B2C expectations into the B2B world, customers are expecting information faster than ever before. "We’re working very hard in continuing to implement technology to respond to our customers quicker, provide them information faster," Schalk says.

HR continues to be an issue. "We have some open positions where I think, quite frankly, we’re struggling to find qualified candidates with the skill set that we require. And that’s happening particularly because, as technology changes the way you go to market, some of the people that may have some of the traditional skills that we’re looking for, they’re lacking some of the skills to use some of the technology we have," Schalk says.

Apart from internal hiring concerns, distributors who have fleets are also struggling to find qualified CDL drivers, he says.

Technology is becoming a bigger influence in the industry. "I think that you’re going to continue to see technology be rapidly introduced in our industry," Schalk says. "Probably a lot faster than we even think and that I think because of companies like AmazonSupply and some of the things that Grainger and others are doing, we really have to look at our business model and make sure that that business model is one that allows us to compete and compete profitably."

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