Conference 2013: All merchants must work together, says Peter Hindle

Published:  24 June, 2013

Dr Peter Hindle MBE was the final merchant to take to the stage on the second day of the conference. CEO for the UK, Ireland and South Africa division of Saint-Gobain, Dr Hindle has been working in the builders' merchant industry for 43 years, and has spent time at both national and independent merchants.

Dr Peter Hindle MBE was the final merchant to take to the stage on the second day of the conference. CEO for the UK, Ireland and South Africa division of Saint-Gobain, Dr Hindle has been working in the builders' merchant industry for 43 years, and has spent time at both national and independent merchants.

National merchant Jewson is part of the Saint-Gobain Group, and Dr Hindle explained that while the Group is a global company operating in 64 companies, the business is run in regions.

While he acknowledged that the merchant industry faces challenges ahead, Dr Hindle said he believes that "there always will be a strong role for merchants".

He also urged the entire merchant community - national and independent - to work closer together. "I think that together we can be more powerful," he said, urging all merchant businesses to consider joining the Builders' Merchants Federation (BMF). "It will be a great day when we all join up with the BMF," he said.

"It's great news that Travis Perkins and Persimmon Homes are back in the FTSE100 index," he added. "It shows that the industry has some real momentum again."

Dr Hindle went on to extol the virtues of a strong workforce when times are tough. "It's easy to downsize when there's a downturn, but Saint-Gobain maintained our workforce wherever we could, so that we're ready to grow when things get better."

The company has also been able to continue making selective growth and acquisitions where appropriate, such as the company's purchase of Build Center, which Dr Hindle said was too good an opportunity to pass up.

Reflecting on the changing landscape of the builders' merchant industry, Dr Hindle pointed to rising energy and fuel costs as a serious challenge to any distributor. "The market's resistance to price increases makes dealing with this particularly tough," he said. "Fuel costs in particular increase logistical costs for the traditional builders' merchant, since the UK is burdened with the most expensive diesel in Europe."

He also questioned whether holding large real estate premises was the right idea for merchants going forward, pointing to Tesco as an example of a business that is now investing more in smaller stores than larger superstore sites.

Dr Hindle said there has been an increase in price transparency in the sector, as customers are less willing to negotiate and are increasingly beginning to pay for goods in cash. He also noted that online purchasing is attractive for customers of light goods that aren't needed immediately, with online businesses incurring lower costs than more traditional competitors, and that customers 'showrooming' - searching for goods in store to make purchasing decisions, then sourcing them online for the actual purchase itself - is becoming a "real challenge for B2B businesses".

Online retail sites such as Amazon also give suppliers the ability to bypass builders' merchants and go direct to their customers, something that Dr Hindle pointed out has already been seen in the construction industry in the United States.

Dr Hindle added that, while 2013 is definitely seeing some hope, with housebuilding starting again and the mortgage market increasingly liquid, businesses couldn't afford to be complacent, and needed to make sure they were ready to react to market forces.

Concluding, Dr Hindle quoted Charles Darwin, who famously said that it was not the strongest of the species that survives, but instead "it is the one most adaptable to change".

For a full report on this year's BMF All-Industry Conference, don't forget to read the July/August issue of Builders' Merchants News.

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