ChanneLinx, which supports the LBM dealers it corralled in the late ’90s but now focuses its sales efforts on other industry supply channels, offers a similar link between dealers and vendors. “New technology is making it easier to implement back-office system integration and interfaces with other systems,” says Crockett, including hosted, Web-based solutions that add even more speed and integration to the process. “The big boxes started requiring electronic invoicing with their vendors, and it’s spilling over into the rest of the market.”
But not downstream with customers—at least not yet. A mere 3 percent of the top 100 pro dealers, according to PROSALES’ 2005 Annual Survey of Leading Construction Suppliers, currently offer online payment, while just 14 percent enable online invoicing and purchase orders.
Most dealers cite a lack of interest in direct online sales among builders and contractors. “We’ve had a total of 12 online orders since 2000,” says Bernard Perrault, sales associate/Webmaster for L.P. Adams, a single-location dealer in Dalton, Mass., that offers a materials order form, submitted via e-mail, for contractor accounts. “We thought it would be used quite a bit, but [contractors] don’t want anything to do with it.”
Customer Connections Clearly, most pros seem content to rely on paper instead of a PC to pay their lumber suppliers. But that fact doesn’t mitigate the need to connect with contractors online. In essence, the definition of “e-commerce” is expanding to include features and conveniences that spur and support sales regardless of how the money moves.
Lavalley Lumber, a three-location, $50 million operation based in Wells, Maine, for instance, provides pros with password-secured access to their account information via the dealer’s Web site, allowing them to view current and past invoices, check Lavalley’s inventory, and place (if not pay for) orders that are then estimated and processed by the dealer’s staff. “We have a few dozen customers signed up and using it,” says marketing manager Martin Sheehan, who initially developed an in-house system before switching to Spruce Computer’s software two years ago.
Sheehan plans to upgrade the service to provide customers with more detail about past orders and price packages, though stopping short of posting (and constantly updating) each customer’s negotiated materials prices. “We’re considering tools that make it more convenient and useful for our builders,” he says, noting that most of Lavalley’s accounts are small builders with minimal office support.
Similarly, LumberJack plans to add online account access to its Web site within the next year, if only to remain ahead of the acceptance curve among its contractor customers. “Builders don’t demand it because they don’t know to demand it,” says O’Connor, who headed an in-house effort to build the company’s Web site and its features. “But they will once they use it and see the benefits.”
Like a growing number of dealers, especially those with a healthy share of homeowners in their revenue mix, LumberJack also contracts with a consumer hardline supplier to provide an online shopping mall. “As a retailer, we need to branch out and get our products to customers any way we can,” says O’Connor.
Unlike its pro accounts, LumberJack’s DIY customers demanded the online shopping option. “If there wasn’t, we would not have invested in it,” O’Connor says. Still, he reports a minimal amount of revenue generated from that Web portal. “If you’re fixing a toilet, you’re not going to wait to get a part or tool delivered,” he says. So, the mall is mainly a catalog of products available at LumberJack locations—albeit one available around the clock instead of just during store hours.
Online Destinations Despite its place among the largest pro-oriented construction suppliers in the country, BMHC’s Web site leans toward the traditional: an electronic marketing tool for its various businesses, including BMC West, as well as for current and potential investors in the publicly held company. “For many of our BMC West customers, there’s no real reason to go to the Web site,” says Goebel. “If we’re doing our job, we’ve already contacted them.”
