84 Lumber revealed today that total sales for 2008 dropped by $1 billion from the previous year to $2.1 billion. The Eighty Four, Pa.-based dealer had sales of $3.1 billion in 2007 and $3.92 billion in 2006.
"The reality of it all is that 95% of our business is derived from new-home construction," Jeff Nobers, vice president of marketing and public relations, told ProSales. "As that business goes, our business goes."
Total housing starts in 2008 fell 30% compared to 2007, according to the U.S. Census Bureau and the Department of Housing and Urban Development. Sales of new single-family homes fell 14.7% in December 2008, compared to November figures, and nearly 45% compared to December 2007 totals.
Two years ago, 84 Lumber operated 450 locations and employed 9,500 people. But the company has made drastic cuts in the past year, pulling out of numerous markets. Today, the dealer operates 319 yards and six component plants in 150 markets with about 4,900 employees.
"While it's certainly not a situation any of us in the industry want to be in, our competitors, vendors, and our customers are all going into the same type of financial situation right now," Nobers said.