Online uptick: the construction supply industry is hardly a burgeoning hub of e-commerce, but dealers and pros are starting to connect electronically

Like many custom home builders, Peter Reich in Shelter Island, N.Y., works long, hard hours. By the time he's done at the jobsite, managing his six-man crew and following up with customers, it's usually well past the end of the business day--which is why he likes being able to go online at night to write orders with his lumber supplier, Riverhead Building Supply of Riverhead, N.Y.

"I'm usually doing paperwork at 10 or 11 o'clock at night, when there's not going to be anybody at the other end of the phone line" says Reich, a partner at Reich/Ecklund Construction, which builds approximately three $1 million-plus homes a year. "So, if I'm doing a deck and I want some ACQ framing, stainless steel nails, and 1,000 feet of five-quarter ipe decking, I'll just do it online. Then, magically, it shows up the next day. It's great."

Of course, Riverhead's magic--and the fact that Reich is willing to use it--is still the exception, not the rule, in the construction supply business. While nearly 48 percent of respondents to the 2005 ProSales 100 Annual Survey of Leading Construction Suppliers plan to offer click-and-buy capabilities to their customers, only 14 percent do so now.

But breakouts like Riverhead continue to emerge. In April, $36.5 billion Lowe's Cos. of Mooresville, N.C., issued a press release touting its point-and-click online purchasing option for dimensional lumber. The firm declined to comment for this story on the uptake of that program, citing its "quiet period" before releasing quarterly earnings to Wall Street, but confirmed that delivery fees for lumber "vary from $45 to $150, depending on the market," according to Lowe's public relations spokesperson Jennifer Smith.

Shipping costs have been a sticking point for e-commerce in the construction supply business, especially among pros who are used to free delivery to the jobsite. Fort Wayne, Ind.--based Do it Best Corp. has tackled the issue with its Ship-to-Store program, which routes online orders, free of charge, to the closest member store where customers can pick them up. At 37-unit Do it Best member Lampert Yards, a $245 million operation based in St. Paul, Minn., pros can have those orders added to their daily truck. "If it is a pro contractor, we would call and ask them if they wanted it shipped to the jobsite. Then we'd add it to their next delivery," says Pam Leier, vice president of marketing at Lampert. The program has boosted Lampert's online orders, both pro and consumer, by 25 percent in the past year, according to Leier. "That's pretty typical in terms of volume increase among our members" says Debbie Wagner, e-commerce member services coordinator for Do it Best. "Members that participate in Ship-to-Store love it because it has generated more traffic to their sites."

Still, dealers who are using online purchase orders with pros admit it's only a small part of their business. At Riverhead, for instance, marketing director Mike Kochanasz says the $194 million, 10-unit firm is only tracking about 10 online orders a month. "It's still pretty miniscule," Kochanasz says. But order generation isn't necessarily why the company made the online leap. "It was really more to give customers information they were looking for after hours. They can prepare an estimate, put together an order, or access their account to check their balance without involving our personnel" Kochanasz says.

That is exactly what hardworking customers like Reich are looking for. "If I'm working on an estimate at night and I need a couple of numbers to finish it, it's right there," he says. "That's nice, because if you had to wait to get somebody on the phone in the morning, you'd be on the road and it wouldn't get done"