Priced Right

For most businesses, much of the last 18 months saw a sharp decline on the demand side, as locked-down consumers simply stopped consuming many goods and services. For people in the building supply industry, however, the big challenge was on the supply side, as steady demand for building materials ran up against reduced manufacturing capacity and weak supply chains.

That put businesses like West Central Building Supply of Langley, British Columbia right in the eye of the storm. “We have done quite well actually, all things considered,” says owner Casey Leyenhorst.

“We have good, long-standing relationships with our vendors and they made sure we had everything we needed. And that’s vital, because our customers count on us to keep them in business.” West Central supplies its 95-percent contractor customer base with a wide variety of construction products, including framing lumber and engineered wood, siding, decking, roofing materials, soffit and facia. The company serves customers throughout BC’s Lower Mainland from its three-acre lumberyard that includes several warehouses as well as some retail and office space. But while getting product wasn’t a problem for Casey, prices certainly were.

“Prices went through the roof, and it was a real challenge to not overextend on anything, because what goes up can come down fast,” he explains.

“We actually stopped buying OSB because the price just got out of hand, so we got our contractor customers to switch to plywood. At one point, OSB was $90 a sheet; it was back down to $16 a sheet a little while ago. If you get stuck with a truckload of 2100 sheets of OSB at $90 per sheet, you can go broke in a hurry.”

In business since 1984, West Central was a Sexton member when Casey purchased the company 19 years ago. He says he maintained that relationship in large part due to the rebate system that Sexton negotiates with the vendors. He also credits Sexton Group with helping West Central navigate the volatile pricing environment in the building supply market over the last year or so.

“It’s a highly competitive market on the Lower Mainland, so we have to be efficient with our inventory and priced right; there’s not much margin for error,” he says. Don Humphrey stays right on top of the market for all our product categories and puts out a weekly commodity report that we use to help us make our buying decisions. “But there is never any requirement that you have to purchase a certain amount of anything; that can handcuff you a lot more. We are really independent minded and they leave us alone unless we need them; I like that.”