December 2021 | vol. iv, #12
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Natural disasters impact supply chain
There is no winning for the west coast of Canada right now. The pandemic has caused a global supply chain crisis, and now British Columbia is dealing with a string of natural disasters.
The Port of Vancouver faced a fire this summer and the rest of the province faced challenges with flooding. All of these events led to supply chain issues across the country.
The excess rain led to a mudslide across one of B.C.’s most used transportation routes, Highway 99. This caused a disconnect between the Lower Mainland and the Interior, as well as Canadian National and Canadian Pacific railways. Without a direct highway or railway, getting product to store shelves has been a challenge.
“We try to strive for just-in-time inventory,” said Alex Yakovyshenko, general manager of Haney Builders Supplies in Maple Ridge, B.C. “We order it when we need it or when we anticipate it will sell out. Now we're looking at having a little bit more with a vital supply.”
The logistics challenge has led dealers and other businesses to take a step back and reassess their stocking methods. Stockpiling isn’t always a good option for business. It can be costly, explains Steve Armstrong, an instructor with emergency and recovery management at Mount Royal University in Calgary.
“We operate society on an adjustment-type model, and we have for 50 years, and people just don't have the resources to stockpile large amounts of inventory,” said Armstrong. “Highway closures exacerbate that, as does COVID’s impact on the supply chain.”
There was also a limit on gas in the province due to the threat of supply, with a maximum of 30 litres of gas per purchase. Between the gas limits and physical barriers, it was tough for staff to come to work.
“Depending on where they live, we had at least three staff members that didn't come to work for about two and a half weeks,” said Yakovyshenko. “We had one staff member that was evacuated from their home.”
Natural disasters have an impact on the supply chain and community, but they also require a lot of resources to rebuild the damage.
“For example, in British Columbia, it looks like they'd build around 20,000 single-family homes and then there are apartments and condos. The homes damaged by the floods is somewhere around the three to 5,000 range, many of them completely destroyed,” said Armstrong.
He estimates that an additional 50 percent of the supply in B.C. will be going to rebuilding these homes. “But where's the stuff coming from? And how are we going to get to them in time so that they can rebuild their homes and businesses?”
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Delivery service works with local dealers to deliver to job sites
Toolbx, a building materials purchasing platform for contractors, has expanded into the Vancouver market. The company got its start serving the Greater Toronto Area and later moved into Ottawa. Toolbx offers a single platform from which builders can source materials from any local supplier, to be delivered to the job site within the same day or even within two hours.
At the Vancouver location, RONA and Lowe’s are the only suppliers on the actual platform, but nationally Toolbx offers a mix of major national retailers and local dealers.
“We are not trying to replace construction suppliers,” says company founder Erik Bornstein. “We want to improve the longstanding relationships that exist between a supplier and their customers by reducing the friction that occurs during the procurement process; from ordering right down to delivery. Ultimately, we give suppliers the tools they need to compete in the current climate.”
He says the company has the ability to make a dealer’s inventory available digitally, “bringing their entire catalogue online and making it accessible for their entire customer base.”
Bornstein founded Toolbx in Toronto in 2018, after spending 15 years as a homebuilder. The platform lets contractors and builders connect, either by mobile or computer, to place orders remotely.
(Dealers interested in becoming a supplier to Toolbx can click here for more details.)
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Home Depot stays close to its pro customers with online and referral services
The contractor customer is evolving, and Home Depot Canada is adapting its offerings to keep up, including the use of online platforms to keep its contractor customers engaged.
“Data has become king. We have always said the customer is king, and they certainly are, but what a difference it has made to really understand what data can do for you!” says Jamal Hamad, who heads up Home Depot Canada’s contractor services and pro rentals division.
Had he been told 15 years ago that pros would be choosing to make certain purchases online, Hamad says he wouldn’t have believed it.
“Cultivating our relationships is still a big deal,” he stresses, citing the importance of Home Depot Canada’s inside and outside sales teams in catering to pros. “We’re investing to meet the changing delivery needs of our DIY and pro customers.”
Those investments included the opening of two new direct fulfilment centres in 2020; advances in low-cost, same-day delivery; and a loyalty program dedicated to pro customers. Expanded product offerings, including rentals for a new generation of space-crunched contractors, are also part of the effort.
Critical to Home Depot Canada’s contractor strategy is its Local Pros platform, which Hamad calls “a game-changer.” It connects homeowners with participating Home Depot pro customers who can complete their desired projects. The business generated for that pro customer is an added value that is free to Home Depot’s contractor customers. “We want to ensure that we reward our pros and thank them every single day for shopping at Home Depot.”
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