Summary
• Jewson’s annual conference took place on February 1-2.
• Around 1,500 people attended.
• The suppliers’ exhibition featured more than 110 stands.
• The event was the first opportunity for Build Center employees to be involved.
Anyone doubting the size and scale of Jewson should take a look at the hotel registers in Harrogate between February 1-2. Those were the dates of the company’s annual Internal Build Exhibition and Suppliers’ conference at the Harrogate International Centre and it quite literally really went to town.
Around 1,500 senior management, branch managers and sales executives, along with suppliers attended the conference, with 1,300 sitting down to a celebratory dinner and awards ceremony on the first evening.
The event is an opportunity for two-way communication, said Peter Hindle, managing director of Jewson and chief executive of Saint-Gobain Building Distribution (SGBD). “On the first morning of the conference we are able to update our suppliers in terms of our plans and in the afternoon they have the chance to talk about their new products and promotions. On the second day we communicate our strategy to the Jewson team and then have an interactive session where they can ask me questions.”
This year’s event was the first opportunity to welcome the newly acquired Build Center business to the mix. It ran its own “mini-conference” for branch managers and key sales executives alongside the main event and attended the dinner and awards ceremony – which included some Build Center-specific awards – but its employees were not allowed to visit the suppliers’ exhibition due to “commercial sensitivities until we get clearance from the Office of Fair Trading (OFT)”, said Mr Hindle.
Build Center integration
Mr Hindle briefed Build Center and Jewson employees on the amalgamation of the two businesses and, at the time of the conference, the suggested timeline after an OFT decision was the start of integration in April and its conclusion in September. Jewson has now offered to sell a branch in each of 22 areas identified by the OFT as areas of substantial competition concerns.
Most of the Build Center branches will be rebranded as Jewson, although some will become Gibbs & Dandy. “We’ll then have 664 sites and be one of the two biggest builders merchants in the UK,” said Mr Hindle, adding that he has “huge respect” for his main competitor, Travis Perkins.
The Build Center acquisition will mark the end of the “big swallows” in the sector, he added. “There will be some one-off acquisitions for sure but I think, in terms of generalists, the UK consolidation is pretty well complete. We started the consolidation process with the acquisition of Harcros in 1997 and finished 2011 with Build Center, which was number four in the UK. During that time we’ve spent £1.1bn on acquisitions.”
Survival of the fittest
He’s obviously confident that Jewson has the scale to survive the ongoing economic downturn and is phlegmatic about current activity in the building sector. “I wouldn’t get depressed about it – it’s just what we’ve got,” he said. “And I have to say that if it wasn’t tough at the moment we wouldn’t have been able to buy Build Center. It’s a good test of how good your strategy is, how good your people are and how good your balance sheet is. The strongest survive.”
Jewson’s core customer base, the small- to medium-sized builders still seem to be quite busy and there are home improvements to be done, although people are waiting before they invest in the bigger ticket items such as kitchens and bathrooms, said Mr Hindle.
“A lot of our trade customers have extended their skill sets,” he said, adding that around a thousand customers had undergone training at Jewson’s Greenworks Academy and were now, for example, accredited solar panel and/or ground source heat pump fitters.
As far as new build goes, he agrees that financial constraints will still dominate in housebuilding and first-time buyer mortgages, which will make it difficult to get the sector – and the economy – moving again.
“However, the fact is that that’s not sustainable. We have to build houses [in the UK] and at some point that will happen, so we take our opportunities and get ourselves set for growth.”
Green Deal
He’s also hopeful that growth will come from Jewson’s ability to capitalise on government initiatives to reduce CO2 emissions, such as the Green Deal. “The government has woken up to the fact that the best way to reduce the carbon footprint is through the existing housing stock, rather than new build,” he said.
“As long as the scheme is understandable and engages with the trade and the finances are made straightforward, then I think it will work.”
Without the sovereign debt crisis he believes carbon footprint reduction would be further along the track: “But it will come – absolutely it will. And timber will play a massive part in that because it’s sustainable and it’s back in fashion. It’s where it belongs now.”
