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Bluelinx Holdings Inc. Message Board

  • forestxpress87 forestxpress87 Aug 1, 2013 7:47 AM Flag

    Cyclical Changes!

    It is interesting how this business has gone over the last 20 or so years. In the mid 1990's they condensed all the distribution centers to two centralized locations (Atlanta/Denver), now they are moving to focus more on the local area. It is sad when the management continues to think they can "cut their way to profitability" and/or close "under performing DCs". Maybe they should invest in these underperforming areas! For example, they sold the Seattle DC. They are basically saying that they can not make money in the whole state of Washington??? I have seen this before, those in Denver, they will eventually close the sales center and run everything out of Atlanta. The west is a different market than the east. The east is more condensed and you can deliver to many more customers in a short time, in the west the travel time is greater, thus the cost is significantly higher. They need to invest and add more smaller distribution centers in the west, not close them down! Then they need to higher the top sales people from the competitors and buy back the business that have lost. Unfortunately, they have already upset these markets in the west so it will be hard to get these customers back. They cannot continue to try to run the west like the do the east. Maybe they should separate the two areas into two companies...Ohhh, and another thing, wall street does not care about your specialty versus commodity mix, they only care about profit dollars, they don't care if you make your $s on outdoor lighting or on plywood! I remember when this company just "sold all the products", they used the plywood and lumber to sell the specialty programs, they did not have "business units" and individual product groups, every product manager in the branch/area sold all the products, not just his/her items. I am sure there are good people that still work there, but they have high turnover, some people leave, most get laid off. Be sure to protect yourself, this "company" has no loyalty to you.

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    • Good comments. GP ate the Mckinsey bowl of #$%$, then went back for seconds. No other competitors followed suit. Couldn't execute then and can't execute now. Their market share has been cut in half if not more. Power retailers, one steppers, buying groups and cooperatives have all cut into the distribution model - much less is required now as many operate their own DCs. Plus many manufacturers are willing to sell LTL direct. Local, agile & nimble distributors with strong sales reps are thriving in this housing recovery (most of which are ex GP/BLX reps). Bloated companies with high overhead are doomed - as witnessed by the latest quarterly results. At least they didn't blame the weather as an excuse this time. kind of strange that it's been two months since the CEO was terminated and still no replacement. makes me think one won't be necessary.

      • 1 Reply to celebrate_d_varsity
      • Their managing philosophy is flawed. They manage to their sales, so when their sales go down they cut salespeople or close distribution centers (but do not add when sales go up). When they split the lumber manufacturing and the distribution division, it was a major flaw in their business model. When Cerberus bought them they stopped selling gypsum for fear it was the next asbestos and they would be hit with lawsuits, guess that thought was "almost" correct! (sarcastic!) I remember when they could move a market just by their purchases, thousands of carloads of plywood, etc. They could be aggressive and play the commodity markets. Now they are barely a force in commodities. I think you are right, it looks as if they are starting to cut up the company and sell it off in pieces. They just call it a "reorganization", and they have one almost every October. This next quarter will be interesting as it is usually always their "best" quarter. We will see.....

 
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