However, some dealers are becoming adept at making use of their customers’software to their own advantage. Littleton, Colo.–based Home Lumber, which with Strober is a subsidiary of Pro-Build Holdings, wedges itself into the picture with its customers through Buzzsaw, an online project management repository where builders can develop and store house plans. Home uses that platform to assist builders in designing their homes, with an emphasis on value engineering, says Jerry Ellefson, the dealer’s director of marketing and special projects. Home has even taught some contractors how to apply Buzzsaw to their businesses. Beyond that, Home has partnered with several builders to process purchase orders seamlessly and without the double-entry headaches other dealers encounter.
Dealers that can’t find some way to establish stronger ties with customers run the risk of becoming less relevant as suppliers, says Luis Solis, president of Broomfield, Colo.–based supply chain management consultant Symbius Corp. He thinks builders resist these connections because “they don’t believe [dealers] are competent to provide what they need.” He also thinks dealers should be proactive in providing builders with information about consumption, “down to the SKU.”
Peter Lotto, a consultant with Alpharetta, Ga.–based Infor Global Solutions, which has provided enterprise resource planning systems to dealers and distributors such as Bradco Supply and Stock Building Supply, advises clients to implement technology for demand planning, supply chain management, and warehouse inventory management. He doesn’t buy dealers’ arguments that demand planning isn’t feasible because there are too many SKUs, too many special items, and demand is unpredictable. “I tell them all of these things are trackable and forecastable.”
Scaled to Size In general, most dealers and distributors say technological solutions become more necessary as their companies grow. “We need to be able to see information across regions and geographies because we’re serving [builders] that operate in several markets,” says Strober’s Klyman. And based on recent initiatives by some of the industry’s leaders, technology is touching all aspects of their operations:
On Track Dealers can be vague when asked how they choose one provider’s system or software over another. In many cases, what they are using today is a variation or upgrade of what was already in place. And price continues to play a critical determining role in dealers’ purchases.
Skip McDonald, chief information officer for Dallas-based Builders FirstSource (BFS), says his company favors providers that have good track records for delivering what they promise on time and on budget. BFS also leans toward products that “can produce a measurable return on our investment” within 12 months of their installation.
When BFS introduces new software or systems, it conducts on-site training at least a month before the product goes live, says McDonald. BFS also maintains a help desk with 6 a.m. to 6 p.m. coverage as well as after-hours call-in numbers.
Lucchesi of BMHC agrees that training is a key to success for any application of technology. “We do pilots all the time; we don’t just go out and buy software.” His department has crews of trainers who stay on a site anywhere from two to four weeks. The company also offers retraining that includes Web-based instruction.
Activant, a leading ERP provider, has devoted a team of trainers to National Home Centers as the dealer switches from Activant’s CSD distribution management system to Activant Falcon. Frame says his company is making this move because the older system can no longer accommodate the inventory and manufacturing diversity within National’s operations.
Technology has become a critical component in National’s ability to expand. About three years ago, it started storing documents electronically, “and I don’t know how we lived without it,” says Frame. “If you buy something and we invoice it, that goes into the system, and a pick ticket is scanned in along with the barcoding.” Over the next several months, National will work on tying together its order and delivery tracking. The goal, says Frame, is to be able to follow an order from the transaction to where the product is located in a yard to when and where it’s delivered. Every pick ticket, once created, would be assigned a delivery truck and employee. Ideally, Frame also wants each delivery to trigger an e-mail alert to the customer and jobsite where the merchandise would be dropped.
