When a lightning strike fried the server at Lebanon, Tenn.'s Fakes & Hooker Lumber a few years back, owner Howdy Roberson started rethinking his data management options.

"It was a nightmare," he recalls. "We were trying to remember prices. We're supposed to be selling 2x4s, not fixing computers.

"We had our servers upstairs in a closet. We backed it up on what looked like a huge cassette tape. Then you went and took it home with you," Roberson says. "You kept a week's worth, then retaped. We knew how to back up the system–according to the manual. We didn't have an IT guy.

We had system failures over the years. It was just a lot of little pains. We did inventory every year on the Friday after Thanksgiving. If you had a problem, you couldn't get anybody. You'd have to leave a message if you had a problem and they said someone would get back to you in 48 hours."

Then Roberson's brother Jason, who works in the computer industry, suggested he do something that was quite rare five years ago: Move his company's operations software and data out of the store and into "The Cloud." Now Fakes & Hooker runs Progressive Solutions' bisTrack software via an Internet-based connection to a server farm located far from the dealer's metro Nashville base.

"This was the smartest thing we ever did," Roberson declares.

Fakes & Hooker was an early convert to what has become one of information technology's biggest trends–and it's a trend whose popularity is accelerating. Last month, software provider Epicor (formerly Activant) moved to the cloud with its LBM unit products and Spruce Computer Systems of Latham, N.Y., is heading there in the fall. There they join fellow LBM solutions providers DMSi of Omaha, Neb., and Canada's Vancouver-based Progressive Solutions, along with Rader Solutions of Lafayette, La.

In simplest terms, cloud computing means a company's data is managed off-site–aka "in the cloud"–and handled at large data server farms, which may be hundreds or even thousands of miles away. Software updates and regular data backups are handled internally by the company providing the off-site hosting.

With many industry consultants calling 2011 the year cloud computing comes of age, it behooves LBM dealers and distributors–a group known for its frugality toward technology–to look at cloud-based data management systems and see whether it makes sense for their operations. ProSales found more than a few dealers who have already jumped to the cloud.

Born in Dire Straits

For a couple, like Roberson, it was a natural catastrophe–or the threat of one–that got them there. For others, it was the lack of an IT staff with the knowledge to handle sophisticated programs. Still another cited scalability, an attractive option in a constantly shifting economic climate.

Rader Solutions CEO Chris Rader, whose company offers both cloud-based and locally hosted data management services, believes off-site hosting is the better option for many LBM dealers because lumber yards "don't have the environment to place a server–this is a big, hot, sweaty business–nor do they employ or manage the staff to deal with it."

"I think a lot of people are confused about what the cloud is," says Len Williams, president of Progressive Solutions, whose business software company started offering secureHosting, a cloud-based management service, just two years ago after careful study. "Some customers wouldn't do anything else but go in the cloud. Others want to pull out a flamethrower and threaten to barbecue you if you mention it."

Roberson knows full well the kind of resistance Williams is talking about.

"In our industry we don't like change. You've got to stick those keys in the outlet a few times before the light bulb goes off," he says with a drawl and a chuckle. As he explains it, "Hamburger is good until you have T-bone. But the first one you have, you throw that hamburger out in the yard."

"Typically, LBM clients look at investing in equipment rather than systems, and usually they would put in a simple Unix system," says Dave Woodhouse, vice president of managed services at Progressive.

"There is a comfort in having the black box with the flashing lights even if those lights don't mean anything," adds John Matterson, vice president of Progressive's bisTrack software unit.

"When we first broke this [service] to our customers," says Woodhouse, "the silence was fairly deafening, and in talking to customers the reaction was fairly lukewarm."