I really do. I love change. It makes my writing job so easy. Getting words structured into proper sentences and spelling words right is not much of a challenge when you have spell checker along with talented and educated editors fixing everything you mess up (thanks, y’all).
really do. I love change. It makes my writing job so easy. Getting words
structured into proper sentences and spelling words right is not much of a
challenge when you have spell checker along with talented and educated editors
fixing everything you mess up (thanks, y’all). It is the creative part of the
writing process that gives me headaches. But observing and writing in the
roofing industry comes easy because very little remains the same.
change. People who work in the industry come and go all the time. New systems
appear routinely to great fanfare. A good percentage of those systems die and
go away, usually with very little notoriety. To quote the great philosopher,
Roseanne Roseannadanna, “I tell ya, it’s always something!”
this week we bore witness to a couple of major events in the supply-chain
sector of the roofing industry. Beacon Roofing Supply, the first consolidator
of roofing distributors to go public, was called out by NASDAQ (where their
stock - symbol BECN - is traded) and recognized in a bell-ringing ceremony on May
10. This was a very big deal in the world of public markets, especially for a
firm whose IPO was a scant five and a half years ago. But it did not create the
buzz inside the roofing industry that a couple of Beacon’s rival roofing
distributors made when word broke out the same day that ABC Supply Company was
acquiring Bradco Supply Corp.
to news releases, this is the largest acquisition since ABC Supply hit the road
on the way to becoming the nation’s first national roofing distribution outlet
back in 1982. I think it is fair to say this was the largest acquisition of any
roofing distributor by another roofing distributor ever, at least in this
country. The companies went on to announce that the deal should close by the
end of June pending regulatory and other approvals. There is no reason to doubt
that this deal will go through.
what? What does this mean to roofing contractors? Will it mean less choice? Will
it mean less competition in some markets? I doubt it. For the 35 years I have
been in this business roofing-oriented distributors have worked very hard to
hone their craft. They perform more services with less people and equipment
than they did when I entered the sector in 1985 as a branch manager for JGA
Corp. Just like the roof-contracting trade, roofing distributors have used
technology and experience to get better at what we do.
“super consolidation” is a natural next step in the maturation of the roofing
distribution industry. The outfit I took over back in 1985 was a lumberyard
turned roofing distributor: a family-owned enterprise consisting of exactly one
yard. ABC Supply, by the way, continues to be a family-owned enterprise.
Anyway, back to my story … in 1985 the industry was going through a round of
consolidation that included ABC Supply and other regional distributors buying
out the “one-off” family-owned local distributors.
the decades that followed the regional distributors continued to grow and ABC
Supply moved into “national” status. The next step had larger regional
distributors consolidating with Bradco Supply and Allied Building Products
Corp. growing exponentially followed later by GulfEagle, SPEC, Beacon Roofing
Supply, and others. Beacon went public in 2004 and has continued to grow
organically and by acquisition.
in what will seem from the outside a very small amount of time (and from the
inside may seem like an eternity), ABC Supply will assume the assets and
operations of Bradco Supply and life will seem quite normal as Bradco fades
into our memories.
the folks who faithfully patronize and work for Bradco Supply, this change may
not seem all that good. Change, even when all goes well, is hard. Regardless
how you view this (good or not-so-good), it will work out. Bradco Supply did
have a significant place in the world of roofing and they held it for a very
long time. Now some of the good things they brought to the table by way of
their people and processes will continue to influence the industry by way of
their new persona as part of ABC.
for ABC Supply and their ability to execute this kind of acquisition, they are
uniquely qualified for this kind of work. I have an enormous amount of respect
for their leadership. They have done some good things for the industry. Not
always perfect but always moving forward in the style of founders Ken and Diane
Hendricks. So now they must execute. And with change always part of the
equation they should take nothing for granted.
for the people at Bradco Supply whose world is suddenly and unexpectedly being
turned upside down: I think the roofing industry continues to need seasoned
professionals. Change will come and in some cases it may not work out so great.
But I believe there are and will continue to be great opportunities in the
roofing industry for those who are wiling to work hard and accept new
challenges. It has always been the case… that is one thing that has not changed
so much. Easy for me to say … my world is not turned upside down. But my turn
is coming. Remember, change is my friend (usually) and I know it is always just
around the corner.
what about the rest of the distribution world? Is this the beginning of a new
chapter where more “super-consolidation” will take place? I do not know but
will not be as surprised when the next bombshell hits as I was when the news of
this acquisition hit.