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LBM Advantage and a 'State of the Union'

Dealers gather in Boston for the LBM buying group’s Fall Planning Conference.
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LBM Advantage Tim Johnson
LBM Advantage Vice President of Forest Products, Tim Johnson, delivers a "State of the Union" presentation to dealer members.

The LBM Advantage Forest Product Division is “poised and prepared for continued growth.”

That was the message that Tim Johnson, LBM Advantage vice president of forest products, delivered to a ballroom of dealer members at the lumber and building material cooperative’s opening session. LBM Advantage opened its Fall Planning Conference here last night with a reception held at Encore Boston Harbor hotel and resort.

Johnson delivered a Forest Products Division State of the Union to kick off today’s events, including dealer-member visits with 60 vendor and mills partners who are exhibiting at the conference.

According to Johnson, the member-owned buying group is increasing its leverage along with the ability to buy larger volumes of products while securing better deals. And growth is being driven by new members, new territories, and increased support from members.

Based in New Windsor, New York with regional offices in Michigan, North Carolina, and Texas, LBM Advantage’s membership includes 522 member companies operating nearly 1,400 locations in 46 states.

LBM Advantage Fall Planning 2023
LBM Advantage CEO Steve Sallah said the conference has solid attendance with every region of the buying group represented.

Challenges, including the wild swings in lumber prices are in the rearview mirror, Johnson said.  

Additionally, product shortages and devaluation risks are obstacles that have also been overcome.  “The volatility is behind us,” Johnson added. “We own inventory, we have inventory on the ground in several reloads.” 

A new challenge is how much and how quickly LBM Advantage can grow — including its forest products division — and making sure the buying group has the right programs in place to take on additional growth.

Looking at current sales trends at LBM Advantage, framing lumber sales are up 4%, panels are down 2% partly due to product limitations in the marketplace, but treated lumber is “the shining star” and up 30%, Johnson noted.

Additional good news is the lumber market is correcting itself with prices landing more in line, minus extreme fluctuation. “We are heading in the right direction,” Johnson explained while pointing out that prices for framing lumber will be back in line from where it was a year ago within the next 30 to 60 days.

Looking ahead, LBM Advantage said housing “remains underbuilt” and the organization has a positive outlook as it heads in 2024 and 2025.

Regarding the conference and expectations, LBM Advantage CEO Steve Sallah was pleased with the conference’s attendance and the outlook ahead.

“We have every region of the country represented,” Sallah told HBSDealer. “Dealers are positive, business has remained strong, and consistently better than expected. They are looking forward to closing out the year strong.”

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LBM Advantage Dealer Members and Vendors
LBM Advantage dealer members, vendors, and mill reps get down to business at the Fall Planning Conference.

Mark Lockwood, vice president of King Lumber in Goldens Bridge, New York, said “business is great” in the Westchester County region his company serves. 

The single-unit dealer is preparing to get a new showroom underway, providing more options and ideas for its residential remodeler and home builder customers, along with homeowners.

When discussing King Lumber’s membership in LBM Advantage, Lockwood said he likes “the buying aspects and how it can save time and money and the convenience of having a group that buys for you.”

While the prodealer has been making conservative decisions toward 2024, Lockwood said his company has a “lot of ideas for improvement” in the next year.

Located about 200 miles northwest of King Lumber in the state’s southern tier is Home Central in Owego, New York. The three-unit dealer serves remodelers, builders, and homeowners through home centers and yards.

Given the dealer’s location, and the economics of the region, Home Central doesn’t face the up-and-down cycles other dealers might meet in various U.S. regions.

“Business is solid and steady,” said Ryan Rennells, general manager at Home Central. “We are having a solid year and look forward to 2024.”

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