Becoming the Hub Within the LBM Supply Chain

As a lumber dealer, you are the hub and the middle of the supply chain. You work directly with vendors through purchasing and supply, you serve the contractor for their jobs, projects and demand, and by way of the contractor, you serve the end consumer with their projects and, of course, the DIY phenomenon.

Sitting in the middle of these roles within the supply chain is a large responsibility, and the number one goal of the dealer is customer experience and loyalty. In order to serve both sides of this chain, it’s imperative that you have the right tools and resources in place.

Create Stickiness with your Builder and Contractor Customers

Having orders connected this way through a digital channel allow for more accurate inventory, more efficient purchasing and costing for a particular job, and fast quotes and invoices for the contractor to send to their client. It also can improve the takeoff process for the dealer, presents quotes and recurring orders and invoices and statements, and in some cases can store the warranties the manufacturers warranties for the end-user all in one system that is owned by the dealer. This sets the dealer up for the unique customer experience that will ensure contractors will come back repeatedly for convenience and reassurance. So, all parties win with dealers as the key player in the middle: the Hub.

Efficiency is Key

The idea of a (buzzword alert!) digital transformation is the key to an efficient connection between both sides of the supply chain. At ECI, we recognize that our most successful customers have implemented technology and software to bridge the disparate sides of the supply chain into one centralized and integrated process.

In many cases, the final spoke that LBM dealers are implementing is ecommerce. However, many assume that e-commerce equates to simply a storefront for DIY shoppers to find one off supplies. But we recognize and most see that in fact, e-commerce allows dealers to serve their B2B business with a bi-directional, automated connection between their suppliers through to the end consumer. This sets you up as the true hub in the middle, serving your customers with a one-stop-shop experience that saves them time and energy.

What do you mean, “bi-directional spoke”?

Customers ask us, “Doesn’t ecommerce only sit between the dealer and the contractor?” They’re thinking of simple “online shopping.”

We know that LBM dealers sometimes lean toward identifying as distributors, and sometimes as retailers. However, they are both in most cases. Which is why its a different supply chain than your typical distributor-to-retailer chain. Dealers being the hub allows the industry to shift with the volatile nature of the LBM market. The way that ecommerce built within an ERP model is different than your typical online storefront such as Shopify, is that ecommerce and ERP offers inventory management tools, job costing features, and quote creation all connected to the online orders placed by the contractor or the consumer.