The chair and CEO of the Wolf Organization, the York, Pa.-based distribution company, said Monday the recent decision to stop distributing AZEK products and start selling private-label as well as branded products reflects a move toward becoming a sourcing company rather than a distributor.
"The problem with the distribution model is that the products you sell may not meet the needs of your customers," Tom Wolf said in an interview with ProSales. "You can get trapped between the policies of the vendors and the needs of the customers. We want to modify that two-step model to say that we'll sell a combo of branded and private-label products, but we want to focus unambiguously on the needs of the customer. If there are gaps, we have an obligation to go out and try to fill that void."
As part of that new focus, Wolf officially ended as of last Friday its relationship with AZEK, one of the leading manufacturers of PVC decking and exterior moulding products. At the same time, Wolf has become the exclusive supplier of another PVC decking product--CEVN--and will introduce its own proprietary PVC decking and railing products. (Story)
The move has shaken up the construction supply world in Mid-Atlantic and some Southern states. It also represents another effort by Wolf, once one of the biggest owners of lumberyards in the Mid-Atlantic, to change itself.
In late October, Wolf announced it will establish a new distribution center in Massachusetts or Connecticut for the New England market, will move its Allentown, Pa., operation to a larger facility in York, Pa., and will create a cross-dock and customer service center in Pennsylvania's Lehigh Valley to serve customers in New Jersey and New York. Earlier this year, Wolf opened distribution facilities in High Point, N.C., and Florence, S.C., and it opened a major distribution center in the Atlanta suburb of Lawrenceville, Ga., in 2009.
Those changes appeared to cause friction with AZEK.
'When we're tied to a specific vendor, our opportunities for geographic growth are limited," Tom Wolf said. "We wanted to move to places where [AZEK] already had distribution.
"The second thing is that we think we've developed a product with manufacturers that is equal to or better, that'll be priced more competitively, and that we can again respond more unambiguously to the needs of the pro dealer."
In the next several months, Wolf-branded products in trim, moulding and decking will be unveiled, he said. They come in addition to a private-label line of kitchen cabinet hardware and cultured marble countertops that the company has produced since the 1990s.
There has been talk that Wolf will expand into the Midwest. Tom Wolf said that's his goal, but added: "We don't have anything on the drawing boards."
"Things are tight, but ... the first thing is, this is the best possible time to take a look at what you do and your business model and reinvent yourself," he said. "The second thing is, our plans are predicated on no help from the economy. We want to be stronger supporters of the dealer channel. Everybody in Wolf is energized and excited about where we're going."