Howard Grant: healthy figures, useful services.

Covering all bases

Published:  23 November, 2011

Unimer’s managing director, Howard Grant, talks to Lisa Arcangeli about how his organisation is powering ahead. With its best-ever turnover on its 75th anniversary, the industry’s clearing house is also working hard to ensure that its members can make the most of business by carefully sourcing services that will ensure merchants cover all bases for their markets.

It has been a splendid year for United Merchants. The UK’s largest invoice clearing house for the building products industry reported a 12-month turnover of £876m and posted 14% growth year-on-year. In a merchant market where growth in turnover is at a meagre 7%, this figure is very healthy indeed.

“This phenomenal result represents an all-time record for Unimer and this is being achieved in the year in which we also celebrate our 75th anniversary,” said managing director Howard Grant. “It’s a great way to record this wonderful milestone.

“We are currently trading at a level just slightly ahead of last year. We’re ahead of the budgets we have set. RMI appears to be holding up and the

Government’s cuts do not appear to be impacting too heavily upon the independent merchant sector.

“Part of the strength of the turnover we are processing is still driven by

fairly significant price hikes in respect to material costs. It’s a key issue,” Mr Grant admitted

“We are seeing most merchants

returning to a level of profitability – perhaps not where they want to be but certainly back in profit. There are one

or two that haven’t quite achieved that yet.”

One area which he says has caused most concern over the last few months is the failure of some suppliers, particularly the smaller, specialist kitchen and bathroom distributors.

“These are companies that are small in scale and operating off thin margins with a weak asset base. These are still the businesses that are most at risk. Unimer has gained share by growing the market for its invoice clearing house services and in particular by

focusing on four key factors, Mr Grant stated.

“We have increased market share with existing merchants and suppliers; we have recruited new merchant

members; we have increased the portfolio of suppliers and we have maintained the lowest cost operating base,” he said.

The organisation worked closely with its 1000 merchant members who trade from over 3000 outlets and with its 600-plus suppliers members to

explore and exploit business opportunities that benefit both parties.

Unimer recruited 47 new members in the last 12 months. It also continued this growth with new supplier agreements and 41 new suppliers were added to the organisation’s portfolio.

“Managing and monitoring our overhead expenditure and continuing to

ensure that all of our activities

create value for money is our chief aim,” Mr Grant said.

“In processing the record level of turnover and a record volume of 1.3

million incoming transactions, Unimer generated £18.5m of added value for its merchant members, a 14.9% year-on-year increase in what we have added to our members’ profits.”

As well as streamlining back office and supply chain operations for both merchants and suppliers, Unimer also positioned itself to try to help its merchant members to win business in

particular market sectors.

The four cornerstones of this

strategy include Procurement for

Housing. The responsive repairs supply contract was renewed for a further three years and turnover with Unimer members has grown by 43% over the last year.

Its links with BuildStore for the self-build and major renovations projects market has seen Unimer’s participating merchants grow to 264 branches with good product and geographical coverage.

Unimer’s partnership with trading portal eBuildingSupplies for the online procurement of building materials is generating an average of £50 000 of sales enquiries every day for its participating merchant members.

To enable merchants to target the renewables market and get a firm footing on the Green Deal, Unimer’s franchise opportunity is the Green Energy

Centre. The first franchise is currently fully operational and several others, said Mr Grant, are scheduled to follow.

“We want to continue building on our results,” he added. “We keep on being proactive and winning more business – mostly with existing members and suppliers.”

That is why for the first time, Unimer is holding a Supplier Conference on

6 October at BuildStore’s headquarters in Swindon. Representatives from over 200 suppliers are expected to attend.

“Our intention is to explain all the opportunities that are available through Unimer and how the suppliers should be making the best use of Unimer to

target market growth and also to

reduce their operating costs.”

The event will also explain Unimer’s trading approach, its policies and its marketing opportunities for suppliers. “In addition, it will make clear the back-office benefits that we drive through

The well-attended Meet the Merchant session at Unimer's Open Day at Celtic Manor.

for suppliers and will link into marketing opportunities in terms of where

suppliers can link into our other offers like eBuildingSupplies, the Green

Energy Centre and, of course, BuildStore,” Mr Grant related.

Unimer will also be attending the NMBS Conference in 2012 in Marbella, Spain on 21-24 June. “We have been

reassured that the merchants who have confirmed their attendance include one or two of the nationals and, as it is an

all-industry conference, we will also be present,” Mr Grant said.

The topics which the Conference will address next June will have to

feature issues that are up-to-the-minute concerns for the merchant sector.

Before June 2012, the Builders’

Merchants Federation will also be

addressing some of the thornier issues that are plagueing merchants at its Members’ Day on 20 September 2011 at the Forest of Arden Hotel in Meriden, Warwickshire.

One of the key issues to be reviewed will almost almost certainly be the Green Deal and its implications for the merchant sector.

“Our Green Energy Centre partnership is all about the Green Deal and

ensuring merchants are able to compete successfully. We identified the

importance of this a year ago,” Mr Grant said.

“We don’t see our role to lead

our members. It is our role to provide our members with services that they can opt in or out of as it suits their

businesses,” Mr Grant pointed out.

“We’re not run by committees.

We offer a range of services. And, we

always try to identify market sectors in which we can help merchants develop their business in. That’s where the marketing offers divisions have come from.

“When we see an opportunity we will

gladly grab a hold of it and try and help our merchants in that particular

specialist sector.

“By doing something centrally, Unimer can enable independent merchants regionally to do a better job,” he stated.

Internally, the board of Unimer also

recently approved a major investment in IT. The £250 000 project, will replace over 90% of all the major IT systems run within the organisation.

“We went through a fairly comprehensive selection process and came out with the choice of Access Dimensions

as a system to take the business forward.

“Our intention is to provide a fully-

integrated and fully flexible solution that will be suitable for our business for the next 10 years,” Mr Grant explained, pointing out that Unimer’s current core

system has been around for over 20 years.

“We are at the stage where the

system’s scoping exercise has been completed and the early stages of programming development are under-way. We plan to have the initial test system available by the end of this month

(September) and then we will go through a very rigorous and thorough user acceptance programme which hopefully will deliver a system that will be ready to go live at the start of the new calender year,” Mr Grant concluded.

This article first appeared in the September edition of Builders' Merchants News.

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