LBM Journal’s Dealer of the Year awards, sponsored by Epicor, recognize LBM companies of different sizes that epitomize the entrepreneurial spirit. By our definition, a Dealer of the Year describes a company in which leadership excels at identifying underserved—or emerging—markets, satisfying customers, and is constantly working to grow and improve business. While these companies represent vastly different operations, the common thread is their fierce commitment to finding ever better ways to serve their customers and their communities.
PHOTOS BY OLIVIA ADAM, NHPA
You’d be hard pressed to hear a boastful word from the ownership team at Walker Lumber & Supply in Nashville, Tennessee—unless it’s about their staff. While Ray Hayles and Scott McMillan have increased the company’s annual revenues from $22 million when they bought it in 2016 to $77 million in 2022, they’ll only thank their team for getting them there.
Ray and Scott are just the third owners of the 73-year-old company. Prior to purchasing Walker Lumber in 2016, Scott served 17 years as in-house counsel at Goldman Sachs in the real estate division, and Ray owned a manufacturer’s rep and distribution business serving the construction equipment and oil and gas industries. When the brothers-in-law purchased the company in 2016, Walker Lumber had 32 employees. In the time since, it has grown to over 70 team members. The company has continued to focus on pro builders and contractors, which make up around 95% of their business.
Walker Lumber is one of the few remaining independent dealers located within Nashville city limits. The single location just a few minutes south of downtown strategically serves not only pro contractors, but also do-it-yourselfers and homeowners from surrounding neighborhoods.
“Having five acres in the middle of the city, we have an advantage,” Scott says. “Our competition can only grow along the periphery.”
Since Walker Lumber’s core customers are high-end custom homebuilders and remodelers, the company is probably one of the only lumber dealers that isn’t able to showcase, or reference in detail, many of its customers’ building projects. With Nashville’s legendary music scene, professional sports teams, and health care industry corporate headquarters, many of the clients require non-disclosure agreements to protect their privacy.
“Our economy isn’t focused around just one thing, and Nashville is in the top three cities in the U.S.,” Ray says. “We have a lot of high-end, high paying jobs here.” As such, the group isn’t experiencing the same recession fears that dealers in other cities face. “We haven’t slowed down at all,” he says. Since buying the business in 2016, the partners have experienced double-digit percentage revenue growth every year. In their seven years of ownership, revenue has increased over 300%.
“We have seen first-hand the number of businesses and people moving here over the last several years, particularly since the onset of Covid and the ability of people to work remotely from anywhere. The high-end custom home build/remodel market has continued to stay extremely strong even as the production/tract builders have started to slow down,” Ray says.
“We attribute this first and foremost to having great employees and a very strong management team at Walker Lumber, all of whom are fully aligned with our company’s mission statement, which is ‘To Serve Others with Excellence,’” says Scott.
Customer — and employee — care
Ray and Scott have maintained the business’s success by taking care of their customers, but they know that begins with taking care of their staff. In the seven years since they purchased Walker Lumber, payroll has increased more than 400%. Some of this increase is the result of headcount growth, but consistent with the company’s mission statement, the owners strive to serve their team members by paying them well. As a result, a large part of the payroll increase has been increased compensation for all team members.
“One of the new initiatives we have is the alignment of our compensation structure with the company’s mission statement. Our goal is to fully align our team members with our mission statement and reward them for fulfilling it each and every day,” Scott says.
Unlike many companies, the ownership team at Walker Lumber doesn’t manage the business based on an annual budget or have countless meetings to make decisions, Ray says. “We make informed decisions based on what is best for the business and our customers in the long term. If decisions need to be made, we can typically make them within 30 minutes, even decisions such as capex purchases. We show up every day and keep our fingers on the pulse of the business daily, keep our heads up looking to the future while, at the same time, focusing on the things we can improve each day.” Agile decision-making affords Walker Lumber innovative value-adds to serve customers such as the company’s proprietary logistics and dispatch software. When a customer places an order, the order isn’t picked by just one forklift driver. The lumberyard is divided into five sections and pickers in each of those sections pull the items from their area for each order. All the items are pulled, staged and ready for the customer to pick up in one convenient location. “By leveraging technology and implementing systems to optimize workflows, we have made order pickups and deliveries more efficient, allowing us to put most of our customers’ orders in their hands within 24 hours,” Ray says. “The process has also provided extra data points we can use to improve overall operations.”
Unlike many lumberyards, more than half of Walker Lumber’s employees work in the yard or drive delivery trucks. This allows customers to load materials in minutes without getting out of their vehicles, or, if they prefer to have their order delivered, to get delivery within 24-36 hours after placing their order. “When we purchased the business seven years ago, the company was completing, on average, 20 deliveries per day. Since that time, deliveries have grown to 70 to 80 per day,” Scott says.
Service with style
If customers do need to wait while their orders are picked, they have a luxury setting in which to do so. Walker Lumber’s 2021 purchase of an adjoining lot and subsequent building expansion allowed the company to move from a 6,000 square foot store to a new 30,000 state-of-the-art facility housing both retail and office space. In planning the expansion, each of the company’s department heads was asked for input on how to best utilize the new space, from office, to retail, to yard.
“Our management team came through in spades, providing ideas that have made Walker Lumber a destination to shop for building materials and supplies,” Rays says. “In fact, just this week one of our customers commented ‘This place is like a toy store for contractors!’”
The facility now features 100-year-old reclaimed barn wood accents and forward-thinking design. “We wanted a new, updated facility but also desired that the facility be warm and welcoming and feel like a hardware store and lumberyard,” Scott says.
Since the neighborhood behind Walker Lumber is residential, trees were planted along the boundary with the neighborhood to not only provide a buffer between Walker Lumber and the homes, but also to provide some natural beauty for the community. One very intentional aspect of the new build was to make the restrooms and lunchroom up to the standards of a five-star hotel, Scott says.
“When we moved into the new facility, most of the old store was converted to warehouse space; however, a section of the building was converted into a locker room for the yard employees and drivers. The locker room was modeled after locker rooms of sports teams and has been very well received by the yard employees and drivers,” he says.
Scott says the primary goal of Walker Lumber has never been to just get bigger. Rather, the goal has been to get better, every day. And that philosophy has served them well as Walker Lumber has grown substantially. In growing, the company has continued to give back to the community.
“Taking a humble approach to philanthropy, we are highly involved with community and nonprofit organizations behind the scenes, donating money and time,” Ray says.
Giving back to the community also comes in the form of hiring from non-traditional groups. Nearly 10% of the workforce at Walker Lumber are people who needed a second chance in life, Ray says. “We believe that everyone deserves a second chance, and we are willing to give them an opportunity for a fresh start.”
Each of these employees is matched up with a mentor to guide and encourage them, not only in the workplace but also in their life outside of work, and to show them they have a long-term career path at Walker Lumber.
“There is a common saying heard at Walker Lumber: ‘We are in the relationship business; we just happen to sell lumber and building materials.’ We really feel this way. We know that if we focus on nurturing our team and our customers, success and growth will follow. We have and always will look for opportunities to take calculated risks in our business to help us become better at serving our customers and each other. In fact, if the anticipated recession arrives, we view this as an opportunity to add more quality people to the Walker Lumber team. We have and always will continue to build for the future,” Scott says.