‘Difficult’ decisions in rear view mirror, Orgill prepares for strength in home improvement.
Armed with research on consumer trends and some aggressively positive 2021 sales projections, Orgill President and CEO Boyden Moore delivered a state of the distributor address during day three of the company's virtual buying event.
Moore’s presentation looked back at 2020, but most of his address looked ahead at the business and the industry. The first is expected to be bolstered by the onboarding of a new Rome, N.Y. distribution center. And the second is expected to remain lifted by consumer demand from DIYers and – to an even greater extent – Pro customers.
While congratulating dealers on surviving the challenges of 2020, Moore pointed to Orgill's annual sales increase of 21%, and total sales that crossed the $3 billion mark for the first time ever.
He also pointed to difficult decisions made in the year of the pandemic. Chief among them was the suspension of orders to non-primary customers in certain distribution centers, and limiting the number of lines in some areas. “It took us a while, but we worked our way out of all of those restrictions,” Moore said.
The Orgill CEO’s wide-ranging presentation included the following highlights:
• New vision for technology.
Orgill nation recently hosted more than 330 independent dealers for an eCommerce symposium. That event is merely one facet of Orgill's new and reorganized vision for technology, Moore said. Experts across distribution centers, retail stores, and Orgill’s Tyndale Advisors division are now joined under Chief Information and Technology Officer Mark Hamer. “We are preparing the company to ensure that we can double in size over the next few years with the right technology to do so,” Moore said.
• New DC on the way.
Orgill accelerated the construction timeline of its soon-to-be-open Rome, N.Y. distribution center by a full year. Construction began in April and finished in November. Currently, racks are being installed and some 200 new DC employees are being hired. Shipping is expected to commence in the middle of the year. “Adding this 800,000 sq. foot warehouse will greatly improve our entire distribution network,” Moore said.
• Home improvement projects.
Moore shared statistics from Cleveland Research Group showing that expectations for home improvement spending continue to be high. About 35% of homeowners expect to do "many more" home improvement projects in 2021 than in 2020. Only 16% of respondents expect to do fewer home projects in 2021.
• Pro business growth.
The housing industry is benefiting from strong economic trends, and Moore believes those trends will continue into 2021 and beyond. “In 2020 the DIY customer led the increase in the industry," Moore said. "We’re expecting the pro business to outperform the industry in 2021."
• Sales projections.
As more non-home-improvement related businesses open and compete with home improvement outlets for share of wallet, some forecasts for industry sales in 2021 are in the low, negative, single digits. However, Orgill’s forecast is for positive 7% growth.
"We believe many of our customers have picked up market share and they’ll be able to keep it going forward,” Moore said. “We are expecting another strong year of growth and success for our customers and the industry in general, and we’re investing and preparing to be ready for it.”
• Staying safe.
Safety protocols were put in place immediately with the pandemic outbreak. Of the 500 plus Orgill employees who tested positive, all have recovered or are currently recovering, Moore said.
Orgill's 2021 virtual buying event will continue through Feb. 19.