Editor's Note: This ran as a sidebar to the Sales Rep 2.0 feature in the ProSales August-September issue.
With the rise of services like Amazon, e-commerce sales have nearly tripled in volume since 2008, rising to $123.7 billion in the first quarter of this year, the Census Bureau estimates. That's 9.3% of all sales. Projections suggest e-commerce will account for at least 12.4% of all retail sales by 2020. The growth of e-commerce in LBM is even more pronounced.
In the Census Bureau category “Lumber & Other Construction Materials,” e-commerce had grown from less than 2% of total sales in 1999 to 13.4% of all sales by 2016. Notably, e-commerce as a percentage of total sales in this sector has doubled since 2011. E-commerce accounted for $2.36 billion in retail sales for “Lumber & Other Construction Materials” when data were last collected, in 2016.
The figures include consumer purchases, so you have to look elsewhere to find pros’ involvement.
A survey by the Home Improvement Research Institute found only 11% of builders, GCs, and specialty contractors said they never use the internet to buy products. Of those who did, the majority of builders and contractors bought online from warehouse home centers like Home Depot or Lowe’s instead of traditional LBM dealers. The big box stores account for more than 50% of sales to generalists, while only 8% of purchases from this sector were made from LBM dealers.
