The Prodealers channel is thought to be an increasingly important outlet for wood products. In previous research, homebuilders were found to rely heavily on this segment for wood products supplies and, ever more, structural components. Yet, very little research has been devoted to the characterization of this segment, where significant changes do occur.
Among these changes, prodealers are adapting quickly to the consolidation of their own client base by the way of consolidating themselves. They are also adding framing solutions and installation services to their product portfolio. According to Abernathy et al. (2004), Prodealers’ revenues come mostly from homebuilders that build 25 homes per year. Another 20% of revenues can be attributed to larger firms building 500 (or more) homes per year. Increasingly, these builders are thought to use their leverage to push down prices via purchasing agreements that are covering a broadening spectrum of products. This is forcing prodealers to readjust their strategies in accordance to customers’ needs. Componentization and more emphasis on installed sales are two key elements that prodealers are turning to (Abernathy et al., 2004). This study offers an important complement to “Attributes Demanded in the N.A. Structural Components Industry” in understanding changing demands for primary wood products by the North American structural components industry.
Up to now consolidation had remained a marginal trend in the prodealer segment, in contrast with the do-it-yourself (DIY) and retail segments. However, further consolidation can be expected and the prodealer segment is bound to gain importance for the wood products industry. Another change that might be occurring lies within the wood products portfolio carried by prodealers and homecenters. Over the last decade, there has been a sharp increase in U.S. imports of overseas lumber, most notably from Europe. While much of this substitution is thought to be happening in prodealers and homecenters yards, little is known on the impetus for substitution.