US LBM said when the deal was announced that, based on its collective 2008 sales, it would rank 15th on the 2009 ProSales 100. That suggests the 13-unit, 500-employee company has total sales of about $250 million.
Each state’s locations will operate as local autonomous businesses, BlackEagle said, under the names Bellevue Builders Supply in New York, East Haven Builders Supply in Connecticut, and Wisconsin Building Supply. Bellevue, like East Haven, used that name before being acquired by Stock about five years ago.
Rossano said he thinks the name change back to East Haven Builders Supply will help, given what he calls a fragmented Connecticut market full of smaller, regional firms.
“In this type of a market, being perceived as a small player is sort of an advantage,” says Rossano, who is serving as president of East Haven while overseeing more than 100 associates.
Corporate mandates, such as limiting the amount of hours that employees put in, is an example of one of the Stock agendas that hampered business, Rossano says. He plans to do just the opposite.
“I can’t look at the clock and wonder why a guy worked three hours overtime. I can’t worry about that,” he says. “It got overbearing and Stock was looking in the wrong places.”
Today, there are no corporate “radar screens,” Rossano says. “It’s only my view.”
Rossano says his locations in Newtown and East Haven can cover all of Connecticut and Westchester County in New York State. His service area pits him against a number of strong players, including Interstate + Lakeland Lumber and Ridgefield Supply.
The ability to focus on customers is one of the largest benefits of the change, according to Bill Imig, president of Wisconsin Building Supply. “We got so wrapped up in so many corporate initiatives that it impacted our ability to help customers,” he says.
Imig, a 30-year veteran of Stock, oversees seven yards along with a truss plant, panel plant, and door shop in his newer role as division president.
At Schenectady, N.Y.-based Bellevue, president Greg Gaskell is tweaking the product mix so it’s more in touch with the needs of the local market as opposed to a national program, which was the case with the yards when Stock owned them.
“I don’t think we are reinventing the wheel here,” say Gaskell, a 20-year industry veteran who worked at Wickes and Bradco before Stock. Bellevue remains a strong name in New York’s capital region. The business had been a family-owned one, with roots in the area tracing back to 1937 before it was sold to Stock five years ago. According to Gaskell, at one point, the Schenectady yard was the single largest yard in the country.
Back Home. The Johnson family, owner of Home Lumber in Bishop, Calif., in the Sierra Mountains, sold the three-unit company to Stock in 2006. Brent Johnson had a three-year agreement to continue working for the dealer, primarily at the former San Bernardino locations. But that yard closed in November 2008 and Johnson heard this spring that the former Bishop location was on the chopping block too.
After months of talks, the location remained open but once again it’s under the Home Lumber banner. Given its “green” locale (Bishop is located near Yosemite and several other parks), not to mention the green movement, Johnson redesigned the Home Lumber logo around Stock’s dark green logo.
The real challenge for Johnson, though, was getting reacquainted with day-to-day routines that were once taken care of at Stock headquarters in Raleigh, N.C. Centralized procedures from accounting to human resources that had been part of the routine were gone.
“I was able to get help from past employees,” Johnson says. “I had to restart everything from scratch.”
That meant taking the reins back in the accounts payables, accounts receivables, credit, and accounting departments. It also meant setting up a new computer system and software.
Thankfully, Johnson had the eight remaining employees also make the transition from Stock to Home Lumber. “The quality of the people is great. They know how to run their store,” Johnson says.
While Stock broke many of its leases with the former owners of its yards, that’s not the case with the Bishop location, which is owned by the Los Angeles Department of Water and Power. Although the dealers ProSales spoke with did not disclose the prices they paid for former Stock locations, Johnson says that once he heard Stock was about to close Bishop, he received “one heck of a deal. They just wanted to close it.”
The real challenge for Johnson is “having confidence the market will be strong again,” he says. “You have to think there is a bright light in the industry that people can start walking to.”
Opportunity Knocks. While Johnson saved his former business and the jobs of his former employees, dealers have pursued buying former Stock locations for a variety of reasons. In some cases, it just made solid business sense.
That was particularly the case for Stock locations in the Carolinas. Home Builders Supply of Greenville, N.C., picked up a yard in Wilson, one county over. Professional Builders Supply of Morrisville, N.C., bought a former Stock yard in Wilmington and set up its first branch. And Build A House LLC in Greenville, S.C., bought Stock’s commercial door operation in Greer, while Commonwealth Door & Hardware of Salem, Va., took Stock’s Charleston, S.C., commercial door operation.
Elsewhere, the deals were just as enticing. When Lavalley Lumber of Sanford, Maine, bought two former Stock locations and a kitchen design facility in Massachusetts, Lavalley CEO Don Collins said the acquisition was a “natural fit” that could not be passed up. “It was the quality of the people, the quality of the customer base,” Collins told ProSales.
Even ProBuild got into the action when it took over a Stock location in Kalispell, Mont., giving ProBuild its first facility in the far northwest region of that state.
“These were not only some of Stock’s best markets in the country but some of the best teams they had,” Gibson says of the operations in three states that US LBM now runs. “These guys were just too good to let go.”
Kitzmans’ Loves Park location replaces a yard that was practically falling apart yet would have cost $500,000 to raze and get the ground prepped to code. But there was another big reason for moving to Loves Park. “In the local region, this is one of the last facilities of its kind,” says Kitzman. “If I didn’t buy it, someone else would. How in the world could I sit by and let this go?”
Kitzman views the deal as worth the effort. But if you want to follow him, he has some advice: “Think about how hard this is going to be, and multiply it by a factor of two or three.”
