Builders and contractors have an obligation to do more than build houses or commercial facilities. They have an obligation to do so with the best materials possible while keeping costs within budget. Since lumber is often the largest expense builders will encounter, it demands that they find the best sources possible for the purchase of their lumber materials.
When the search for lumber ensures, a builder/contractor has three basic options: deal directly with a lumber mill, go to a wholesale lumber supplier, or make purchases from a retail lumber yard or hardware store. The last option is by far the most expensive option, one that is generally used by do-it-yourselfers. It's not really a viable option for large cost-cautious builders/contractors.
The first option, dealing directly with a lumber mill, creates logistical issues. Since most construction projects require the use of different types of lumber, it creates a situation where the builder/contractor might have to deal with multiple lumber mills (manufacturers) at the same time. That's not always convenient. Again, not a good option for busy builders/contractors.
That brings us to the middle option, dealing with wholesale lumber suppliers. Of the three options listed, this is the one that seems to make the most sense for larger builders and contractors. With that in mind, here is a list of the benefits associated with working with wholesale lumber suppliers.
What is a Wholesale Lumber Supplier?
Before getting into the benefits, it seems prudent to make clear exactly what would qualify as a wholesale lumber supplier.
The typical business model of wholesale lumber suppliers starts with the buying in bulk of manufactured lumber materials directly from manufacturers (mills). By buying in bulk, wholesalers can secure huge discounts. That affords them the opportunity to pass some of those reduced costs on to customers. Who are their customers?
First, retailers typically make their purchases from contracted wholesalers. However, they then tack on huge profit margins before selling lumber to the end-users, be it builders/contractors or do-it-yourselfers.
Astute builders/contractors with an eye on cost control will often go directly to the "middle man," the wholesaler. By doing so, they can often secure a price per board foot that is close to what retailers pay to wholesalers. Of course, larger purchases will result in better prices even at the builder level.
Now for the benefits of dealing directly with a wholesale lumber supplier.
Extensive Delivery Network
Lumber wholesalers are already required to create delivery networks for the delivery of lumber to retail locations, many times covering large regions. Since these delivery networks are already in place, it requires little extra work to provide deliveries directly to builders/contractors or the locations of their development projects.
This is by far a better option than making purchases from retail locations. That ultimately requires builders to send trucks to retail locations to make purchases and deal with the actual full scope of the delivery process. That takes extra time, effort, and money for the hiring of the delivery personnel.
Access to a Wide Selection of Lumber
The biggest and best lumber wholesalers all have something important in common. They each maintain large warehousing facilities where they can store large volumes of lumber. That also includes having the ability to store large supplies of all types of lumber.
By being able to get all the different types of lumber they need from one supplier in one delivery, builders and contractors can save time, effort, and money. It would be like an individual consumer going to a COSTCO to buy groceries and household supplies. Instead, builders/contractors can meet all their lumber material needs from one source.
Manned By knowledgeable Lumber Experts
In retail locations, the sales clerks have knowledge about all things but no expertise in a single area. That can be a problem for a builder/contractor who is seeking special advice about the quality and uses of certain materials.
Conversely, wholesale lumber suppliers tend to hire people who have knowledge and expertise about lumber. They know how it's manufactured, details about the quality and makeup of each type of lumber, and for what uses each type might be suitable. When purchasing agents can speak with someone with knowledge about the materials being sold, it instills in them a higher level of confidence about making purchasing decisions.
In the building industry, profits are driven mostly by being able to control costs. That is especially true in a building environment where home/commercial building prices will go stagnant for a long period of time.
Wholesale lumber suppliers can offer bigger discounts because they buy in bulk and get large discounts themselves. That leaves them highly motivated to pass some of their savings on to who or what they would consider to be large volume buyers. Can builders/contractors get the same kinds of discounts that are offered to retailers? Quite possibly. Larger lumber purchases almost always equate to larger discounts for customers.
Financing Options Might Be Available
Sometimes, a builder or contractor might find themselves dealing with cash flow issues. Since lumber mills/manufacturers and retailers are "cash and carry" suppliers, it makes these options are unavailable when cash flow issues arise. That is why some builders and contractors have to put projects on hold.
Larger wholesalers tend to have more flexibility when it comes to selling on credit. If a builder or contractor is able to establish a solid relationship with their favorite wholesale lumber suppliers, they can usually secure credit terms that will allow them to continue developing their projects without having to incur lumber supply issues.
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