"Apex Supply proves on a daily basis that no one in the PHCP industry is as good at distributing products for manufacturers -- with all the services that entails -- as a good wholesaler."
With all the fear and loathing of Home Depot that we've reported on over the years, it turns out that a good wholesaler can teach Home Depot a thing or two about selling to contractors. That, of course, is why Home Depot has purchased Apex. The retailer wants more contractor customers.
Home Depot's latest move should not surprise anyone. The professional contractor represents an important growth market for Home Depot and other big-box home centers. More than 80% of the $120 billion being spent on home remodeling is spent on jobs being done by professionals.
Home Depot's purchase of a good wholesaler is the next logical step in its quest to reach more contractors. As wholesalers know, home centers already have expanded inventories of name-brand products, lengthened store hours, dedicated sales counters to contractors and advertised in trade magazines.
Now Home Depot hopes that Apex Supply will show it how to penetrate the PHCP market even further. We obviously believe that Apex is a smart, well-run company. Chances are that Home Depot will learn a lot from Apex about selling to contractors.
As Home Depot applies these lessons to its stores around the country, we'll all get an opportunity to see just how much the retailer learns. But a bigger question may be how much will wholesalers pick up from Home Depot. Say what you will about the company, Home Depot is no slouch when it comes to marketing, customer service and using technology to lower its costs.
Wholesalers that lag in any of these areas may well be forced to catch up. And while we suspect that most wholesalers still can teach a retailer a thing or two about selling to trade customers, we also believe that Home Depot's purchase of Apex Supply sends a new message to the industry.
The message is that an already strong competitor from outside the traditional distribution channel wants to know what you already know about selling to contractors.
Wholesalers should make sure that they stay in a position to translate their knowledge into sales.