IN DEPTH: Technology Tools
It’s hard to find an area of life where technology doesn’t have an influence and a presence, and the lumberyard is no exception. Tech tools from software to hardware to apps are helping dealers be more efficient, save money, and better serve customers. And with each passing year, options grow and become more user friendly.
“Dealers are under increasing demands from their customers and the markets they serve,” says Mike Limas, executive VP for DMSi Software. “One of the key ways that successful dealers thrive in this demanding environment is by providing a superior level of service. …Technology helps dealers by shortening the communication cycle time so they have better information about stock levels, capacity, and costs so they can make good decisions about which commitments to make upfront. Sophisticated systems like [DMSi Software’s] Agility ERP allow dealers to satisfy their customers and tailor the appropriate level of service to each customer.”
Though the construction industry is notoriously slow to change, particularly with regards to technology, dealers themselves have been a little more receptive than their customers. Enterprise Resource Planning (ERP) systems, for example, have been a go-to tool for years. “What makes LBM a unique industry is that its business management technology has to serve everything from point of sale to traditional order entry to distribution to manufacturing,” says Graham Rigby, director of sales for lumber and building materials for Epicor, provider of the BisTrack ERP solution. “A customer could walk out with three 2x4s or a whole house project or an order of custom-made doors. BisTrack is meant to handle the full gamut of what the pro dealer requires. Everything needed to run the business is all built in.”
Like the rest of technology, ERP systems have evolved. In the beginning, platforms were designed for automating back-office accounting and record- keeping, Rigby says. The newest tools are also about getting data out of the system to make decisions about customer habits. “It’s really taking data that once was used just for accounting and turning it into data you can utilize to make real business decisions.”
That type of value is key to getting more yards on board. “Dealers are not early adopters of technology. In many cases they look at technology as a necessary evil,” says Dennis Sullivan, senior account manager for Computer Associates, whose Ponderosa ERP software integrates every aspect of a dealer’s business. “What we’re trying to do is work with our customers to get them to understand the value that technology can bring to their business. We’re always looking for areas where we can better improve customer service to better allow our clients to connect with what their customers actually need.”
And while they do require investment, back-end systems can save real dollars down the road in improved efficiencies, accuracy, and staff time. When the downturn occurred, Rigby notes, dealers used technology such as document imaging and online payments to tighten processes and do more with less. When the market rebounded, the software allowed dealers to grow, doubling purchases without necessarily having to re-double accounting staff.
“One thing that helped us from a software standpoint was the recession, because it forced dealers to get lean,” says Sullivan. “Now business is ramping back up, and they’re starting to realize that they don’t necessarily have to throw bodies at a problem. You can utilize technology and minimize having to bring in new hires.”
The data and efficiencies brought by automation and customer relationship management are also helping salespeople get back to what they do best—sell. “…A lot of the lumber salespeople are spending a significant amount of time estimating instead of selling. That may not be the best use of their time,” says Brian McCormick, director of residential supply chain for MiTek. “They’re often the most knowledgeable people in the organization—they understand how a house is built, pricing, logistics. Dealers want them building relationships rather than counting sticks.”
“Salespeople are more valuable out there closing sales,” says Doug Syme, president of Saberis. “They shouldn’t be doing clerical work.”