Inventory Pressure
That trend encourages dealers to expand their inventory to handle demand. “We see dealers more apt to want to stock products today, especially in June and July, when products might be harder to get,” says Brent Gwatney, senior vice president of sales and marketing at MoistureShield. “As the economy turns, there is more demand and supply is reduced, so products can be harder to obtain quickly to send to the customer.” To encourage adding inventory, MoistureShield is offering cash rebates for dealers who stock more products. “That little bit helps us stay on top of demand during the season.”
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Obtaining products has become more challenging as options have expanded. “The whole industry has changed, in that distributors are facing more issues in having to deliver job lots of products rather than truckloads, partly due to the large number of SKUs dealers need to keep stocked,” says Mike Descoteaux, marketing manager at DuraLife. “Most companies add colors but don’t drop any, which puts more pressure on the dealer and distributor levels and adds shipping time when the right product isn’t stocked.”
That pressure extends through the channel, Descoteaux notes. “Consumers can be overwhelmed by the sheer number of color choices and features being offered. Retail sales people can be overwhelmed too. Imagine a customer coming in and wanting to see available deck options in ‘brown.’ It can create a difficult situation. Where would you even start?”
The irony is that so many options don’t add too many sales. “Distributors prefer to stock fewer colors, but we see that options are growing, especially with architects and homeowners taking advantage of the full range of options,” says Joel Cone, North American director of sales and marketing for NewTechWood. “They like seeing other colors, even if they ultimately don’t choose them. Many manufacturers offer 10 colors, but 80% of their sales are in four colors.”
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