Business Operations

LBM Dealers Move Quickly to E-Commerce

Prior to the pandemic, there were a limited number of LBM companies with e-commerce sites, as most felt a basic web presence was sufficient.

Prior to the pandemic, there were a limited number of LBM companies with e-commerce sites, as most felt a basic web presence was sufficient. Over the last 15 months, the pandemic has dramatically shifted the LBM industry’s focus to seek out technology solutions in order to provide online access to both their account holding customers (B2B), and a true e-commerce experience for the local consumers (B2C) looking to purchase materials online and schedule a delivery.

There are many examples of e-commerce growth in the LBM industry, but none show it more than the pure number of inquiries BuilderWire has seen recently. In the first quarter of 2021, we signed on almost 30 new LBM clients. The companies range from multi-location distribution companies to smaller one-location lumberyards or hardware stores. The new desire to allow their customers secure, online access to view AR balances, make online payments, check inventory via an e-catalog, and even place an order for customer pickup or delivery has never been more apparent.

Dealers are also now looking to add credit card payment options to capture new local business with delivery. Dealers were caught off guard when the pandemic hit. Consumers were demanding online ordering and the dealers quickly pivoted to find ways to make online e-commerce work for their business and this new demand.

2000-2010

BuilderWire was founded in the early 2000s. At the time, our industry was extremely resistant towards technological change, especially building a web presence that showed pricing online. Early on, a major issue for LBM dealers trying to implement e-commerce was the nonexistent access to the data contained in the dealer’s ERP software. Most major ERP companies hadn’t thought about giving external access to data using web services or APIs to pull the data.

Once we finally had reliable access to data, the few LBM companies that started using e-commerce had strict rules of who could or could not access the online portal. Most early adopters of e-commerce only allowed their top and loyal customers access to their web portal. Companies were not interested in promoting their brands online, social media was still in its infant stages, and mobile friendly sites didn’t even exist yet.

2010-2015

LBM dealers were once again caught off guard with the rapid adoption of web-enabled mobile phones. Any prior investment made into their web presence was now completely outdated. Today, about 65% of traffic on a dealer’s website comes from a mobile device. It was crucial that websites became responsive to any device the end user was using. This caused most dealers to rebuild their websites to allow functionality on a mobile phone.

The rebuilds allowed dealers to incorporate more e-commerce into their websites, and we saw an increase of clients wanting online product catalogs. Our platform directly connects to our clients’ “back-office computer” to pull product information from the ERPs. This feed allows the dealer to build a fully integrated product catalog that is maintained completely within their ERP. Any changes made in the back-office computer would push to the website, giving dealers a dynamic data driven web store (1:1 ratio with the website). The adoption of e-commerce was still limited, but access to ERP data was improving. Social media was around at this point, but not prominent in the LBM industry by any stretch of the word.

2015-2020

Customers started to see the benefits of channelizing their e-commerce efforts. Mobile sites were very important by this time. If your website couldn’t be viewed on a phone, it was a problem. Customers began to open up to the idea of B2B e-commerce, mainly selling to the loyal customers that are in their stores every day, rather than opening up the catalog to everyone. Over the course of these years, many companies opened e-commerce stores and websites started accepting payments over the internet.

Social media platforms such as Facebook and Instagram had taken off. They are used both as a point of contact, as well as a source for general information or information about the products that they sell.

2020-2021

The pandemic has altered the way virtually all LBM businesses are able to operate. Dealers are really pushing to adopt a more powerful, user friendly, and well merchandised online store. This listing is all of the functionally requested to be developed since the pandemic started:

1. ACH – Bank-to-bank bill payments for account holders to pay statement balances or select invoices.

2. Developed curbside pickup functionality in which dealers meet clients curbside with the order placed online.

3. Builder Dash functionality, which allows for a select product group to be delivered within two hours of ordering.

4. Locker integration for touchless pick up with bar code sent the mobile phone and scanned at the locker.

5. Online training portal – A large U.S. wholesaler is using the platform to train and educate their LBM customers on selling specific products.

6. GEO targeting so we can offer localized delivery to clients using credit cards and shipped on company trucks.

7. Curri Integration – Curri is an on-demand delivery service for lumberyards. Think UBER Eats for lumber deliveries. It offers a two-hour delivery.

8. We are currently developing a web-based product configuration system to allow configuration of interior/exterior doors on our client’s website.

9. We offer countless shipping options and we are integrated with UPS, FedEx, USPS and multiple common carrier shipping companies that allow our clients to ship across the country.

10. Online scheduling for kitchen designers allowing the client to view the available time slots open and set up an appointment with the kitchen design team.

11. Multi language support – Some of our clients are near a significant population of Spanish speaking customers. The system allows the user to toggle between languages.

12. Video/Media Library – Dealers can upload training/products videos.

13. Split Shopping Cart – This allows dealers to offer for sale both in stock items and special-order items in the same shopping cart. If an end-user orders a few items that are in stock and a few items that are special order, the shopping cart gets split into two shopping carts and two orders submitted.

14. Search Engine Optimization & Reputation Management – LBM dealers now understand the importance of driving traffic to their website. There is no added value from a website that does not gain any new traffic/business. SEO is used to drive organic traffic to the website. Using various SEO techniques with on-page optimization helps dealer’s sites get the highest possible raking on Google, Bing and other search engines.

Another important realization is off page reputation management work is required. One bad Yelp, Google or Facebook post can tarnish the brand and image of the dealer. LBM dealers are more focused on gaining good reviews and comments on the off-page sites.

15. Social Media Feeds – There are many benefits to having your website linked to social media pages. Whether there is a promotion on a product or a new educational blog post, having the website directly connected to a company’s socials is a tactic used to increase traffic. It provides more “entryways” to a website, meaning the website will show up in search results more often.

The global pandemic unexpectedly created a boom for dealers selling lumber. It also showed how unprepared dealers were in allowing e-commerce access for clients. This recognition came at a perfect time in the evolution of e-commerce capabilities for dealers.

The younger generation has influenced their company leaders to apply technological change and e-commerce capabilities. API’s and web services have become robust in being able to access dealers’ data. And, e-commerce software has become less expensive, more functional, and easier to deploy. The thinking is: you can buy anything online, why not building materials?

The global pandemic was the catalyst that changed the thinking from “we want this in the future” to “we absolutely need this now.”

Ted McNamara

Ted McNamara is business development manager for BuilderWire, Inc. (www.builderwire.com).

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