Having the power to predict catastrophic events such as economic downturns or product shortages would be the dream of any LBM dealer, but it’s far from a modern desire. For example, in ancient China in 132 AD, an astronomer, mathematician, engineer, and inventor called Zhang Heng constructed a device to predict earthquakes—possibly the most catastrophic event known to man.
Zhang’s creation was a giant bronze vessel almost 6 feet in diameter. Eight dragons, each marking a primary compass direction, wound down along the outside of the vessel, and each one held in its mouth a small bronze ball. Directly beneath the dragons sat eight bronze toads, with their broad mouths gaping to receive the balls. The sound of the ball striking one of the eight toads would alert observers to an earthquake and would give a rough indication of its direction of origin.
We’re not that different from Zhang. Although we still cannot accurately predict earthquakes, we have come a long way in creating technology that can gather data which can be used to predict business upheavals and better plan for future action. And while detecting earthquakes may not be high on the list of problems LBM dealers daily face, having the ability to identify areas of potential growth and better provide a seamless transaction for customers is what technology platforms for the LBM industry are poised to provide.
Access to data
In the world of LBM technology, nothing stays the same for very long, and emerging tech trends point to increasing the availability and accessibility of the data the various tech platforms are amassing.
“One constant that we have identified is not technology-based per se, but rather the need for real-time access to enterprise-wide data,” says John Carrico, vice president of product management for Epicor. “Data that’s managed by functional areas within businesses that may be hosted in various disparate systems. The need and speed to this information facilitates decision-making, helps identify areas for improvement and growth, and helps gain an overall view of the company’s health.”
Carrico goes on to explain how LBM dealers are looking for technology solutions that store critical business information, aggregates data, and presents the information in an intuitive, user-friendly format that is accessible to all areas of the business. “Capabilities such as dashboards and reports are necessary to deliver a clear picture of all business operations that enable day-to-day and strategic decision-making. The overarching mantra is translating data to insights to meaningful action.” The critical factor, he says, is to democratize data. “Democratizing data doesn’t just make data available to everyone. It helps build that culture where data is valued and used effectively. It helps train employees to understand and use data and provide them with the necessary tools and support. This can lead to a more informed and engaged workforce that can drive organizational innovation and improvement.”
Jason Niemi, vice president of product strategy for DMSi Software, also sees the importance of accessibility as a growing technology trend. “The theme is accessibility; giving businesses easier ways to access and use their own data,” he says. “Accessibility can come from leveraging the web to a greater extent. Web-based software can revolutionize service levels. Instead of being tied to office computers, employees can log in wherever and whenever they need—from the yard, the showroom, the field … any location on any device with a browser.”
Better experience, less work Rather than shoehorning existing tech tools into the LBM world, tech creators are busy developing custom applications built specifically for LBM dealers.
“The modern customer has unique shopping and purchasing process needs—especially in today’s evolving online buying space, and there’s a gap between what customers expect from websites and what’s available,” John Maiuri, division president of LBMH at ECI Software Solutions, points out. “Spruce eCommerce supports the idea of an ‘endless aisle,’ helping SMBs [small-and medium-size businesses] extend their customers’ in-person shopping experience without having to do more work.”
He also mentions how better flexibility is another benefit. “Typically, LBM dealers are stuck in their stores after hours getting caught up on those things that have to be finished before the next day. But if their system is in the cloud, they can access it from anywhere that has an internet connection. This creates so much more flexibility.”
That flexibility can enable LBM dealers to quickly pivot, says Epicor’s Carrico, to adopt new technologies and business models, adapt to supply chain dynamics, and optimize their work environments and practices.
“Both Epicor BisTrack and LumberTrack are purpose-built solutions specifically for the building supply and lumber manufacturing industries,” he explains. “Our deep industry expertise and customer partnership is reflected in the development of each solution that integrates capabilities from all business functions into a single platform. Capabilities that support sales, inventory management, shipping and logistics, invoicing, financials, purchasing, and production management.” Jason Niemi points to DMSi Software’s new ERP, Frameworks, that’s completely web-based so that it can provide flexibility through what he describes as “anytime, anywhere, any device” accessibility. Instead of being tied to office desktops, he says employees can do their jobs from any place inside or outside the building. For instance, if a customer is out in the yard and has a question about a product, any nearby employee can check availability, locations, or alternative items on the spot. All they need is a smart phone (and user permissions).
Similarly, he describes DMSi’s Agility Commerce Cloud as a fully integrated self-service/ecommerce solution. “It’s a turnkey, out of the box solution that lets our customers quickly get up to speed on online service without needing to hire a web team. We also offer a full suite of APIs, so customers who want to build their own integrated sites can do so using their existing database; they don’t have to maintain inventory records in two places.”
AI on the rise
It’s all the buzz right now: artificial intelligence (AI) and machine learning (ML). Rightly so, these technologies bring concerns to many, but they also hold benefits for the LBM industry. “AI is becoming part of the technology conversation and starting to make its way into cloud solutions,” says ECI’s Maiuri. “For example, at ECI Software Solutions, we already have advanced analytics incorporated into our ERP software, which is probably the first place we’ll see this kind of technology impact the LBM industry. Additionally, we’re leveraging AI in our ecommerce offering today with a feature that uses ChatGPT to develop blog posts for customer marketing needs. It’s all about streamlining processes and strengthening data for SMBs.”
Epicor’s Carrico also sees potential benefits for LBM dealers. “We believe that the use of both AI and ML is rising across all industries,” he says. “We’re beginning to see benefits from both in LBM to streamline operations by automating routine tasks and improving sales performance by analyzing sales trends and identifying cross and upsell opportunities. AI can also extend to the supply chain by helping to forecast demand, manage inventory levels, and automate purchasing.
Applying AI and ML to the supply chain can result in a stronger customer experience—imagine providing customers with product recommendations based on past purchases and preferences. Being an early adopter of AI and ML also enables LBM dealers to stand out in a highly competitive market.”
Some industry experts also see AI as a potentially providing help with labor shortages. As Niemi explains, he sees DMSI’s customers using AI to streamline time-consuming tasks, especially tasks that require experience or background knowledge.
“Tight labor markets mean contractors are working longer hours than ever before; expectations for online access and self-service tools will keep going up,” says Niemi. “Customers want to request a quote, check an order, and pay invoices from their phone while sitting in their car over their lunch break, because that’s the only 15 minutes of free time they have. Dealers who can provide that level of service will be seen as better partners.”
In short, cloud and AI have the potential of removing the burden of having to manage business processes onsite, and an integrated ERP and ecommerce software solution brings the best of both worlds. “For consumers and tradespeople, this means unlocking the ability to shop online for delivery or in-store pickup, browse products, create accounts, build self-service quotes, pay invoices and more,” ECI’s Maiuri points out. “For LBM and hardlines businesses, this means help in avoiding over-stocking since inventory counts, transactions, pricing, invoices and other information are directly connected between systems.”
Don’t succumb to fear
If there’s one issue that prevents LBM dealers from embracing new technology, industry experts all point to fear, both of the cost and of the potential upheaval that a technology change can bring to a business.
Many people associate change with fear. As an emotion, fear exists to let us know that danger is near. Unfortunately, fear can also bring about paralysis, a state of being that can be deadly. Our fears can keep us safe, but they can also prevent us from evolving, and if you don’t evolve, you run the risk of becoming extinct.
As Epicor’s Carrico explains, the key to making a technology switch is for LBM dealers to remove the fear barrier by defining their needs, identifying their goals, researching technology providers, and identifying the one provider and solution that meets their needs today and in the future.
“Recognizing that LBM is a highly competitive market with tight margins, it’s understandable that some dealers may be reluctant to switch technologies,” he says. “Nevertheless, taking a sensible approach when evaluating technologies is the first step. For example, LBM dealers should define what their needs are and identify the gaps with their current technology. Next, map this to their present and future goals to quantify success—if one objective is to increase profitability by XX% over the next five years, does their current technology offer the ability for the dealer to offer both retail and online experiences? Finally, based on current sales forecasts and future projections, the dealers need to identify the investment amount that they’re comfortable with and research to ensure that this is a realistic amount.”
Once an LBM dealer’s technology requirements have been identified and their objectives have been defined, the next step Carrico recommends is to research providers offering technology solutions.
“Once the list has been narrowed down, interview the technology providers as you would a job candidate,” he says. “Provide them with your requirements, have them sell to you, and don’t be afraid to ask questions. You’ll know soon enough if they understand the LBM industry, the challenges you face on a daily basis, and the goals you’re trying to achieve. When you do reach the point to discuss costs, be realistic about your expectations, and be flexible differentiating between the ‘need to have’ and the ‘nice to have’.”
Making the decision to upgrade technology may not be as expensive as an LBM dealer might think, and the upgrade can bring a wealth of benefits, says ECI’s Maiuri. “With technology in their corner, dealers can turn lost time managing data in multiple systems into a singular, streamlined online order process,” he points out. “By modernizing old static offers with dynamic promotions, loyalty programs, item merchandising, and in-house marketing and design services, dealers and retailers can leverage their technology to expand sales.
He goes on to say that it’s a common misconception that moving to the cloud is expensive, but for small to medium size businesses, it’s actually bad business to stay on premise. “Considering all the costs of maintaining IT personnel, getting hacked, dealing with ransomware and the risk of natural disasters, the cost of moving to the cloud is less expensive in a lot of cases. In fact, by our estimate, a completely integrated technology can save more than $3,797 per month or $45,564 per year.”
Thank goodness we’re not tasked with predicting earthquakes (although if you have the desire, by all means have at it). Still LBM dealers are tasked with the challenge of doing more with fewer boots on the ground. Technology packages specifically designed to deliver data no matter where they’re working while also creating a more seamless experience for the customer can go a long way towards preventing business upheavals, say industry experts. And while it can be easy to fall into the trap of avoiding new technologies on the basis of “that’s not how we did it in my day,” technology is here to stay, and the successful LBM dealer will seek out its benefits.
As DMSi’s Jason Niemi puts it, “Technology is present in almost every area of our lives. It’s something younger generations expect and embrace. Dealers who want to attract and retain good employees entering the workforce need to provide the tools this generation considers essential.”
BlueTape | BlueTape is a payment and trade credit company serving LBM dealers, distributors, and manufacturers. It allows LBM dealers to automate their AR systems and offer their customers a wide range of payment options, including extended terms. BlueTape customers can leverage its easy-to-use solution to get paid fast, reduce their risk, and lower their DSO to one day. In the past year, the company introduced BlueTape lines of credit to enhance the customer financing experience. In the upcoming months, it plans to introduce several new initiatives, a new feature enabling BlueTape suppliers to offer consumer financing, special project financing for solar, commercial and public projects. bluetape.com
Builderwire | As the LBM industry’s oldest supplier of ecommerce and digital integration solutions, Builderwire is engineered to integrate with virtually all of the major ERP providers. According to the company, Builderwire is unique in providing key vertical industry segments with an integrated business-to-business ecommerce system that aims to increase productivity, improve operational efficiencies and reduce cost. Since its inception in 2000, Builderwire, Inc. has been focused exclusively on providing business-to-business ecommerce solutions integrated with its clients ERP back- office systems, allowing companies to market and sell more effectively through direct customer relationship channels. In addition, it offers complete digital marketing services for its customers that provides one-on-one consultations coupled with metrics, goal setting and performance analyzation. builderwire.com
Buildxact | Technology is making it easier to manage accounts, which is critical at a time when good, reliable labor is hard to find. As a leading technology provider, Buildxact is launching a convenient, easy solution for dealers to deliver services to pros who are not managed by an existing sales team. Those unmanaged accounts represent a large opportunity and include custom builders and remodelers who have to create a new project scope and associated bill of materials with quantities for each project. Buildxact’s solution comes at no cost to the dealer and does not require any organizational change management, plus it allows the dealer to compete with other dealers that are investing heavily to develop proprietary solutions. Here’s how it works: A pro can go to a dealer’s ecommerce site to shop for product. There they will see a link to a free tool from Buildxact they can use to do takeoffs and calculate quantities for a project. There is no cost and no sign in required to use the tool. After entering the project’s specifics in the tool, the pro will receive an email with all the quantities that they can then use to complete an order on the dealer’s site. buildxact.com
BuyMetrics | According to BuyMetrics, its new Advanced Analytics module gives users the learning resources to stay in front of change by automatically scrutinizing your purchase and market data, developing reliable, fact-based insights; instantly responding to complex, multi-dimensional user-defined queries; generating time-sensitive business intelligence (BI) and your most important measures (KPIs) in an easy-to-comprehend, visual format. Valerie Hansen, BuyMetrics’ Founder and Chairperson, notes: “BuyMetrics’ data is clean and ready for use in advanced AI/ML models. Anyone would be hard-pressed to find data this comprehensive to make predictions, to measure and manage purchase performance, to shape procurement strategy.” buymetrics.com
CAI Software | By connecting Shopify’s all-in-one ecommerce platform to the Ponderosa ERP solution from CAI Software, LBM and millwork customers have a powerful combination to help ensure their order information aligns with their billing. This enables companies to make more informed and timely business decisions in an ever-changing business environment. Shopify’s built-in Application Programming Interface (API) allows the Ponderosa system to query, update, and import specific data for orders placed. Ponderosa users can quickly and easily synchronize cost, price, and available stock between the Ponderosa ERP and their Shopify Storefront. Additionally, companies can automatically import orders placed in the Shopify Store into the Ponderosa ERP system, helping to ensure clear communication across departments. caisoft.com
Handle | Specifically designed for material suppliers like LBM dealers, Handle manages online payments and lien management for construction. According to the company, its electronic parcel map ensures accurate owner verification, even when precise addresses for certain projects are not available. In addition, Handle provides individual state- specific documents, offers mail tracking and delivery verification, and can integrate with an LBM dealer’s current accounting system. “LBM dealers face many challenges within every aspect of their businesses,” says Chris Woodard, CMO at Handle.com. “Companies like Handle are working closely with these dealers to leverage technology and develop the most efficient process improvements possible (and in Handle’s case, specifically within the finance and credit departments).” handle.com
Run Payments | Run Payments creates custom payment workflows that are designed to work for you and your customers. The company develops a customized payments architecture for its clients that spans in-store, in-app, ecommerce and anywhere else your potential customers might be. runpayments.io
Paladin Data Corporation | Paladin Data Corporation provides LBM dealers with a framework for retail success and best practices through its easy-to-use point-of-sale and business intelligence software. Paladin is described as a complete business management solution, which provides a suite of lumber-specific smart features, and offers over 150 integration add-ons. In the coming year, Paladin customers can anticipate a major expansion to the PaladinNsight offerings, as well as enhancements to the CloudDocument storage, mobile applications, B2B customer portal, RF gun functionality and its integration with electronic shelf tags. Plus, the ability for independent retailers to implement their own NPS [Net Promoter Score] system to better understand and manage the dynamics that contribute to their customer success. paladinpointofsale.com
O2 Web | O2 Web is a digital agency that specializes in developing integrated, flexible and innovative ecommerce solutions for manufacturers, distributors, major retailers and large businesses. O2 Web has worked with numerous players in the building materials sector, as well as B2B businesses in similar sectors, such as automotive and electrical components. O2 Web has created an eBook for the Building Materials industry to share best practices on thriving in the digital age. o2web.ca
TOOLBX | TOOLBX is an ecommerce platform designed specifically for the lumber and building supply industry. Integrating seamlessly with major ERP systems, the company make it easy for independent building suppliers to sell online, manage quotes, accept payments, and communicate with their contractors—all in one platform. According to TOOLBX, it’s ERP agnostic and integrates with all popular ERP systems used in building supply, allowing dealers to connect their existing ERP to their storefront enabling automated synchronization of pricing, inventory, quotes, and orders between your online store and ERP system. It recently introduced Quote-to-Order. Now dealers can allow customers to accept, convert, and complete payment for quotes online, speeding up the purchasing process and reducing tedious back-and-forth communications. toolbx.com
Levelset | The product suite from Levelset offers construction financial professionals payment solutions along with risk management and financing tools. Levelset Lien Rights Management software helps contractors and suppliers solve payment challenges by simplifying the notice process, reducing risk, and managing compliance in a cloud-based platform, while Levelset Materials Financing enables contractors to purchase materials for projects and pay for them without affecting their cash flow. According to Levelset, materials financing is beneficial for both suppliers and contractors. It removes the additional risk for suppliers by providing cash for materials right away. Contractors can start the project, keep cash in the bank, and have more time to pay off balances. Both parties can use the added cash they have available for other projects or to expand their business. levelset.com
Yesler | Marketplace from Yesler is designed to speed and organize communication between buyers and sellers of lumber and building materials. According to Yesler, Marketplace creates instant communication and negotiations with multiple trading partners simultaneously, organizing all quotes and market information, while capturing the history of quotes, negotiations, and trades. Recently-launched new profiles for sellers (shown here) enables them to take their offering online to enhance their reputation, build trust, and grow their business using Yesler as their digital channel to market. “Yesler is built for LBM users, so it has specific tools to help buyers and sellers that other platforms do not,” says Matt Meyers, founder and CEO of Yesler. “We’ve recently expanded features to help sellers digitally merchandise products directly to their buyers and amplify their professional profile and reputation online. Yesler Marketplace empowers LBM sellers to bring their trusted relationships into the future and increase speed and efficiency.” goyesler.com
Boise Cascade | Boise Cascade offers LBM customers a suite of integrated estimating, design, workflow management, and automated material processing tools designed to help improve productivity. BC FloorValue, part of BC Framer 3D design software, helps identify and fix potential floor performance problems before they get built. Web-based BC Connect workflow management software combines project, file management, inventory, and material cut optimization to give dealers a single platform that starts with the initial project request and ends with pre-cut and labeled job packs ready to ship to the jobsite via the company’s SawTek automated processing saws. Optimized, pre-cut job packs from SawTek systems give LBM dealers a premium offering to their customers that help set them apart. Job packs not only help reduce waste, but with optional pre-cut holes for mechanical, electrical, and plumbing chases, they also help reduce the builder’s cycle time. According to Chris Brandt, director of EWP value added solutions for Boise Cascade, the company recently invested in a new role, the Customer Advocate, whose primary focus is to listen, observe, and collect feedback on all current and potential features across our software suite. Seeing the software and workflows through the eyes of the customer helps guide the company’s efforts to create or enhance features that make a difference. bc.com
Weyerhaeuser | Weyerhaeuser offers a suite of software that helps dealers and their customers implement high-quality structural framing solutions and optimize material use while reducing construction cycle time, cost, and waste. For example, the company’s Javelin software models an entire structural frame, allowing dealers to optimize combinations of residential engineered wood products and dimensional lumber in layouts for floor, wall, and roof systems—all in a single file. To further add value for the builder, dealers can use Weyerhaeuser’s NextPhase Site Solutions to integrate the design data from Javelin with saw technology to create pre-cut and pre-labeled JobPack framing bundles. “Having access to data helps inform decision-making,” says Matthew Smith, Weyerhaeuser’s software development manager, about the importance of technology tools. “For example, Weyerhaeuser’s Stellar software gives dealers information to make decisions about when and what to order as well as make the best material and labor optimization decisions. From creating an optimized shipping list with jobsite cutting instructions to automated cutting equipment producing precision-cut framing packages as part of the NextPhase Site Solutions program, Stellar software easily scales to the needs of each business.” weyerhaeuser.com
Simpson Strong-Tie | Simpson Strong-Tie’s Pipeline LBM is a cloud-based material management and estimating system that is designed to pull data from multiple applications into a single information set for driving all processes. According to the company, Pipeline LBM solution from Simpson Strong-Tie bridges the gap between design and estimation for real-time, automated takeoffs by simplifying estimates with bills of materials for each plan while managing options-driven changes and updating construction documents and back-office data. Says Sam Hensen, vice president of building technology and digital product development for Simpson Strong-Tie, “We’ve focused more resources than ever before on partnership with our LBM pro dealer customers and understanding their specific needs as residential construction supply chain experts as they transition to an ever-increasing digital way of doing business.” Also available from Simpson Strong-Tie, its Outdoor Living Solutions platform suite includes three free software applications—Fence Planner Software, Deck Planner Software, and Pergola Planner Software—that gives DIYers and other retail customers the ability to quickly design outdoor living structures. “For builders and contractors, the software offers a way to expand value-added services, increase customer satisfaction, and line up more projects,” explains Michael Heisler, director of outdoor living solutions for Simpson Strong-Tie. “Lumberyards, pro dealers and retailers can additionally participate in a licensing program offering three tiers of co-branded or fully branded visibility within each app, increasing their own brand awareness and driving product sales.” strongtie.com