Choosing Vendors Wisely

Tom Wolf published this article on November 19, 2012 in Build your Business,. Total Comments: 4 | Comment

The October National Remodelers’ (NARI) Show in Baltimore was packed with vendors displaying all sorts of great products.  Anyone who visited the Baltimore Convention Center surely came away from the event with a renewed appreciation for the vast array of options available to contractors, consumers, and dealers.  There were lots of products, lots of vendors, and lots of deals.  All of which raised the common question, “How do dealers accommodate the broad needs of their customers without accommodating an equally broad list of vendors?”  WOLF has a great suggestion.

WOLF’s great suggestion is to expect more from fewer vendors.  Dealers should intensify their search for a few good vendors from whom they can get competitive access to the broad array of products their customers increasingly demand.  In choosing these vendors, dealers should look for three things: 1) vendors who can provide a broad array of products consistently and competitively; 2) vendors who do a good job fulfilling the actual level of demand; and 3) vendors who don’t insist that the dealer stuff their facilities with too much inventory.  WOLF’s goal is to be this kind of vendor.

WOLF’s decking product offering is an example of the first point.  Unlike most manufacturers specializing in one product or one price point, WOLF’s engineered decking offering ranges from low cost composite products all the way up to PVC cap stock in a number of tropical colors.  Thus WOLF customers have access to the broadest array of decking and railing products on a day-in day-out basis.  The same is true of WOLF’s kitchen cabinet and PVC trim offerings.

Second, WOLF puts a lot of time and energy into improving fill rates for its customers.  It takes full advantage of the massive computing power of its SAP system to respond consistently and completely to the product needs of its customers.  Clearly it is not perfect in this regard – its fill rate is not 100% all the time – but it has the systems and the will to continually improve its capacity to meet the product needs of its customers.  In other words, WOLF keeps trying to hit the 100% fill rate target.

Finally, WOLF does not force its customers to stock up on loads of inventory even in most of its early buy programs.  Where dealers want to take a large stocking position, WOLF is happy to accommodate them, but more often than not WOLF tries to give great prices without loading up its customers with lots of slow moving inventory.  It does this with its mixed truck program.  The idea is to have the dealers do what they do best: sell building products, and have WOLF do what it does best: stock the product in its own warehouses.

WOLF’s business model is especially relevant as the independent LBM community enters the winter buying season for outdoor building products.  As dealers think through their seasonal product assortment needs in anticipation of 2013, they should think of WOLF as a prime source for these goods.  WOLF’s financial success hinges on the financial success of its dealer customers.  As a result, its product and service offerings are designed to assure that success.  Its goal is to give its dealers easy access to the right mix of products in the right quantities and at the right prices.  This is what dealers need to attract customers; this is what they need to succeed; this is what they should look for in a vendor; and this is the kind of vendor WOLF tries hard to be.  In sum, we try to make it easy to choose wisely when looking for a vendor.

About Tom Wolf

Tom is a sixth generation owner and pioneer. With degrees from Dartmouth, MIT and the University of London, plus more than 30 years in the building materials business, you’ll find Tom’s insightful, eclectic viewpoints to be both stimulating and entertaining.

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