ProBuild restructures its organization
ProBuild Holdings, the nation’s largest pro dealer, has announced a restructuring that will eliminate several high-level management positions, lay off a number of people and institute a hiring freeze at its Denver headquarters.
In an internal memo obtained by Home Channel News, ProBuild’s CEO Rob Marchbank outlined the new leadership and reporting structure of the Denver-based company. The executive VP operations layer of management will be eliminated, and all senior VPs operations will report directly to Marchbank.
Frank Garcia is leaving the company. Garcia was president of ProBuild’s South Central region before being named head of the metropolitan group.
The corporate development function will be eliminated, and as a result, Michael Mahre, senior VP corporate development, is leaving the company. The real estate function will report to Mark Butterman, and construction services will report into manufacturing, which is headed by senior VP Lonnie Bernardoni.
Bryan Reckrodt, a senior VP, is also leaving ProBuild.
Ed Waite, former president of Spenard Builders Supply and later the company’s Northwest region, is moving back to Alaska to assume the role of senior VP operations there. Waite also served as executive VP local operations.
All the company’s senior VPs will join the Executive Leadership team, according to the memo, to allow better insight into market issues and closer connection with customers. “Working with the SVPs, we will develop a plan for that organization in the coming weeks,” Marchbank said in his memo.
A spokesperson for ProBuild said the company would have no comment on the memo.
ProBuild also has a number of changes in store for what it calls its “support structure.” This restructuring follows nine months of strategic analysis by Rick Goulding, managing director at Devonshire Investors, who will return to Devonshire’s Boston headquarters in early May.
• Pricing: Now led by David Koth, pricing is getting another overseer — Don Riley, executive VP supply chain and development. Koth, who now reports to Riley, will focus on “developing processes and tools to help the locations better manage and analyze their product pricing,” according to the memo.
• National accounts and sales force effectiveness: Wendy Minichiello will lead this function and report directly to the CEO’s office.
• Marketing: ProBuild is eliminating the position of VP marketing. Instead, marketing now reports to Paul Dodge, senior VP supply chain.
• Transformation Management Office (TMO): ProBuild wants a more focused and tactical project management team. Mark Garboski, currently VP of TMO, will stay with ProBuild for several weeks to ensure a smooth transition of TMO resources and project accountabilities, and then he will leave the organization. The team will report to Don Riley.
• Human resources: Felicity O’Herron, senior VP human resources, is leaving ProBuild for personal reasons. Paul White of Devonshire Investors is serving on an interim basis while the company searches for a replacement.
ProBuild has found it necessary to prioritize and reduce the number of business initiatives for 2012, according to the memo.
The reorganization follows an ongoing downsizing at ProBuild, which continues to shed executives as its parent company, private equity firm Fidelity Capital, pours money into the LBM chain with diminishing returns. Last summer saw the departure of CEO Bill Myrick and executive VP operations Jim Cavanaugh. Joe Todd, executive VP specialty distribution and pricing and the company’s rainmaker with big builders, left in October 2011.
“I realize there have been a number of changes in leadership and direction over the past 24 months,” wrote Marchbank, who took over as CEO in January 2012. “We need to focus on developing the tools and capabilities that will differentiate our company in the future. I am committed to opening and maintaining a dialogue with you as we move forward, and I encourage you to ask questions and provide you feedback.”
ProBuild is the nation’s largest network of lumberyards and component plants, ranking No. 1 on the HCN Pro Dealer Scoreboard. It operates more than 430 LBM outlets that serve 45 U.S. states, and is owned by Fidelity Capital, a private equity firm based in Boston. Devonshire Investors is one of Fidelity’s portfolios.
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The wrong stripping agents can kill
An investigation into the death of a Michigan bathtub refinisher in 2010 has uncovered more than a dozen other fatalities that may be related to the same chemical compound. In the Feb. 24 issue of Morbidity and Mortality Weekly Report, a publication of the Centers for Disease Control and Prevention, researchers looked at the effect of methylene chloride, a paint-stripping product marketed for use in aircraft maintenance.
The agencies identified 13 bathtub refinisher fatalities associated with methylene chloride stripping agents that had been investigated in nine states during 2000 to 2011. Each death occurred in a residential bathroom with inadequate ventilation.
Protective equipment, including a respirator, either was not used or was inadequate to protect against methylene chloride vapor, which has been recognized as potentially fatal to furniture strippers and factory workers but has not been reported previously as a cause of death among bathtub refinishers.
Ten different products were associated with the 13 deaths. Six of the products were marketed for use in the aircraft industry, the rest for use on wood, metal, glass and masonry. None of the product labels mentioned bathtub refinishing. The percentage of methylene chloride in the products ranged from 60% to 100%.
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Stock prevails in subcontractor lawsuit
A North Carolina Business Court Judge has ruled in favor of Stock Building Supply in a long-running case involving one of its window and door installers. Thompson Installation filed suit against Stock in April 2011, claiming breach of contract and unfair restraint of trade because Stock allegedly refused to let Thompson do work for any of Stock’s competitors. According to the lawsuit, the contract between the two companies was supposed to be “non-exclusive.”
But that’s not how it worked out, the plaintiff said. Stock used “threats and coercive tactics” to make Thompson refuse work from Stock’s competitors. At the time, the Raleigh, N.C., pro dealer was providing Thompson with more than 200 installation jobs per week. Stock’s competitors were offering less than 20, according to the court brief.
The issue at stake — whether Stock possibly committed unfair trade practices or unlawful restraint of trade — was designated as a “mandatory complex business case” by the Chief Justice of the North Carolina Supreme Court and assigned to a Business Court. In Judge John Jolly’s ruling, there were no “substantial aggravating circumstances” in the dispute that would constitute unfair trade practice. He also noted that Stock had a 60% market share of window and door installation in the Raleigh-Durham-Chapel Hill area, hardly a monopoly that would hurt consumers through an unfair constraint of trade.
Jolly did not rule on the breach of contract motion.