America's largest pro-oriented construction supply companies recorded in 2010 their first collective revenue increase since 2006, but some firms continued to stumble and further progress for the entire group could be tough, the latest ProSales 100 released today reveals.
The annual report, produced by ProSales and published each May, found that ProSales 100 companies sold a total of $24.08 billion worth of goods in 2010, up 6.2% from their sales total in 2009. Sixty-four of the 100 companies posted an increase in sales, a sharp contrast with the 10 that had done that in 2009 from 2008. Another 32 suffered declines in sales from the previous year; in 2009, 90 did. The other four companies on this year's poll said revenues were unchanged.
The ProSales 100 is the premier report on construction supply companies that garner more than half their revenues from professional builders. Large operations that cater primarily to retail customers, such as The Home Depot, Lowe's and Menards, are excluded, thus making it possible to examine more accurately the pro-oriented side of the lumber and building material industry.
On the top 100 list, ABC Supply's acquisition last June of former No. 4 Bradco Supply enabled the Beloit, Wis.-based specialty dealer to vault into the No. 1 spot with a 51.7% rise in overall sales to $4.07 billion. Denver-based ProBuild, which had been No. 1 since 2005, dropped to No. 2 on the list at $3.5 billion in sales, a 9.4% gain. It remains the nation's biggest full-service lumberyard.
Beacon Roofing of Peabody, Mass., takes third place with $1.65 billion in sales (down 5%), followed by Allied Building Products, East Rutherford, N.J., in fourth at $1.64 billion (up 0.4%); and 84 Lumber, Eighty Four, Pa., in fifth at $1.45 billion (up 7.4%).
Ranking sixth through 10th are L&W Supply, Chicago, with $1.06 billion in retail sales (down 17.7%); Stock Buiilding Supply, Raleigh, N.C., $861 million (down 39.7%); Roofing Supply Group, Dallas, $781 million (down 0.5%); Builders FirstSource, Dallas, $700 million (up 3.2%); and BMC, Boise, Idaho, $600 million (down 14.3%).
The actual rankings are based sales made to professional builders. In the case of the top 10, the rankings hold true whether one uses all sales or sales made solely to professional builders. Further down the list, the percentage of pro sales can make a difference in a company's ranking.
"Two years ago, only two ProSales 100 members experienced jumps of greater than 20%," noted Brendan Rimetz, ProSales' assistant editor, who collected the data and reported on it in May's issue. "This year, nine did. And two years ago, 31 companies posted declines of at least 20%, while just four did in 2010. For the rest, the gains and losses tended to be modest-61 were no more than 10% up or down."
Leading the way was US LBM, the Green Bay, Wis.-based holding company founded in 2009 and comprised mainly of several former Stock Building Supply companies. It grew more than 11 times to $275 million in sales in 2010, pushing it to 14th on this year's list. Meanwhile, its former corporate parent, Stock, saw its revenues drop 39.7% to $861 million, the biggest percentage decline on this year's list. Raleigh, N.C.-based Stock incurred that decline despite acquiring two former Top 30 companies: Bison Building Materials of Houston (No. 16 in 2009) and National Home Centers of Springdale, Ark. (No. 26.)
"Even though the majority of dealers reported improving conditions, nobody's feeling giddy," ProSales editor Craig Webb said. "Indeed, 10 companies said one of their greatest achievements in 2010 was the fact they survived. And dealers face huge uncertainties going forward. Housing starts are down 75% from their peak in 2005, and most economists believe it will take several years before we see robust homebuilding again."
ProSales 100 members manage 3,282 facilities nationwide and employ more than 62,000 people.
"Dealers remain cautious about investing in information technology, but they are looking forward to increasing the services they offer online," ProSales publisher Mark Taussig said. "This year, 43% of the respondents said they plan to spend between a quarter and a half percent of revenues on technology. They're making plans to enable customers to place and track orders online as well as pay invoices."
The ProSales 100 is featured in May's issue of the magazine. On the cover is Jane Fesler of Lampert Yards. Lamperts is No. 28 on the ProSales 100 list, with sales of $123 million, up 4.2% from 2009.
Learn more about markets featured in this article: Boise City, ID.