Dave Rush on digital tools
At the 2024 International Builders’ Show in Las Vegas, the Builders FirstSource booth had a clear focus on digital tools. One could even say that the crowded booth would have felt right at home at a technology event or consumer electronics show.
And that’s just the way Builders FirstSource CEO Dave Rush likes it.
The company’s emphasis—and optimism—on its collection of digital tools continued in the company’s most recent quarterly earnings call with investors and analysts.
On the call, he said he was very pleased with the reaction to the program’s launch in Las Vegas in February, calling it an “exciting milestone” for the Dallas-based LBM giant. "Our customers told us the new tools address an unmet need, and they were excited to use them in their businesses.” He said.
Rush elaborated: “At a high level, our digital tools do three things: one, solve customer pain points; two, make it even easier to partner with us and our suppliers; and three, help us gain incremental business from new and existing customers.”
He described how one of the digital tools, “Build Optimize” — a 3D modelling system — identifies problems before they show up at the customers’ job sites. For one large customer, the tool has been used in three markets and 13 communities across 34 plans. On average, the tool identified 150 conflicts per plan. “Resolving those conflicts before construction leads to job site time and cost savings,” he said.
Three other large builders have shown interest in the 3D modeling tool, as well, he said.
“With our Digital Tools, we are providing our customers with a more efficient and cost-effective way to manage the construction of their homes that will increase existing customer stickiness, win new business, and improve our operational efficiency,” he said.
A key to the company’s digital approach was its 2021 acquisition of Paradigm, a software solutions and services provider built specifically for the building products industry. Builders FirstSource promotes its Digital Tools as “powered by Paradigm.”
Rush describes Builders FirstSource as the “only provider of an end-to-end digital platform in our space.” Combined with proprietary estimating and configuration tools, he said Builders FirstSource customers will have more control over the entire building process.
The company has seen orders on the digital platform go from nearly 0 to more than $60 million.
Additionally, the company realized more than $10 million in incremental sales, in the first quarter, but that’s just the beginning, he said. The company has set its focus on $200 million of incremental digital revenue by the end of 2024, and $1 billion by the end of 2026.
“It's a win-win, and we're excited about how everything is going so far after the launch,” Rush said. “We're focused on operational excellence and innovation and using playbooks of proven best practices to increase our safety, efficiency and wallet share with customers.”
