Where Building Materials Growth Is Actually Happening with Craig Webb, President of Webb Analytics

The big box giants are buying everything. But independent dealers? They can still win. In this episode, Stefanie Couch sits down with Craig Webb of Webb Analytics, the most trusted data voice in the building materials industry, to break down what the 2025 M&A numbers actually mean for independent dealers. Craig shares where the real growth is hiding, why installed sales is no longer optional, and how AI and e-commerce are separating the dealers who thrive from the ones who stall. If you run a lumberyard, a hardware store, or a building materials operation and you want to know how to stay competitive against consolidated dealers, this episode is your roadmap. Covering independent dealer growth, construction supply consolidation, installed sales strategy, and AI for building materials, this conversation is packed with the data and the direction you need right now.

What you'll take away today:

- The three market segments where independent dealers can out-compete Home Depot and big-box consolidators: custom builds, single-specialty, and installed sales
- Why installed sales is no longer optional as products like oversized doors and windows get more technical and builders need warranty protection built in
- Where the real growth is happening in 2025 and beyond, including hot geographic markets, specialty product niches, and e-commerce for dealers
- How AI tools built specifically for the building industry are already saving dealers money, improving contract terms, streamlining inventory, and freeing up staff hours
- The two things that separate dealers who will thrive from those who won't: genuine passion for the business and a relentless drive to operate smarter
Ready to turn visibility into growth? Head to gritblueprint.com to learn more and book a call to talk about your growth strategy.

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👉 About Stefanie Couch & Grit Blueprint

I'm Stefanie Couch, the founder of Grit Blueprint. I grew up in a third-generation building supply business. I've worked inside dealers, distributors, and manufacturers. I built Grit Blueprint to solve problems I saw in our industry.

Grit Blueprint is a visibility, media, and growth partner for manufacturers, distributors, dealers, service providers, and leaders in the building industry.
We help you get seen, build trust, and become unmistakable.

Transcript

Can Independents Still Compete?

Stefanie Couch 0:00

Can independents still grow and really be a big part of the industry when these big giants are buying so much? Can they still win as an independent dealer?

Craig Webb 0:08

Well yeah, I think they can. There is a sort of sweet middle that these dealers can get themselves involved in, and that's largely the custom market, the single specialty market as well as the installed sales market. You put those three together and you've got opportunities that the Home Depot really doesn't want to get involved in, and the purely retail people aren't really very good at.

Stefanie Couch 0:29

The turnkey market is something I keep hearing like you have to have installed sales, and I believe that truly, especially as the products get more technical, you have to have someone who knows what they're doing to install those to feel comfortable selling them.

Craig Webb 0:41

If you think about it, if you're a home builder, where are the warranty problems gonna come from? They're probably gonna come from the doors and the windows. It's so much better for a dealer to walk in and say, I'll sell you the 40 windows and I'll install them for you at the same time. That takes care of your warranty problem. Thank you for the money.

Live From The Denver Market

Stefanie Couch 0:57

It's a good deal for everybody all around. Welcome to the Grit Blueprint Podcast. I'm your host, Stefanie Couch. This is a spot where leaders talk about the stories, strategies, and systems that win in the building industry. We unpack how leaders and brands build their reputations and become unmistakable. Welcome to the Grit Blueprint Podcast. I'm your host, Stefanie Couch, coming to you live from the Do it Best True Value market, on the floor in Denver, Colorado, with my friend Craig Webb, Webb Analytics. Thank you for joining me again.

Craig Webb 1:35

It's a pleasure.

Stefanie Couch 1:36

We did this, I don't know, a few a year and a half ago, maybe. Something like that. And uh we now we're in the glass cube and we've we're in the middle of the action.

Craig Webb 1:46

It's no surprise to see you in the middle of the action.

Stefanie Couch 1:50

I do like to live there. Well, I want to do an intro. Uh, there's a lot going on in our industry right now. You are on the cutting edge of all the data and you keep up with everything. Uh, you have a great background in reporting, and so I want to just read a quick intro and then we're gonna dive into what's going on. If you've been paying attention in our industry, you've seen a lot of stuff happen. 2025 was the year of the giants. QXO bought Beacon, Home Depot, uh, snatched up SRS and then GMS, and then Lowe's got foundation building materials and artisan design group, three buyers, four big deals. 85% of every facility that changed hands last year was in those four deals, which I didn't realize until I got your report. That's crazy. Uh, 85%, that's a lot. So the question on everyone's mind, especially here, we're with a bunch of independent dealers, where does that leave them? Which we're gonna talk about. Is there really still room to actually build something, to grow it, to compete in the industry? And your answer to that question is absolutely yes, I think, and you've got the data to prove it. You are the president of Webb Analytics, one of the most respected voices in our industry, a lifelong journalist who's worked on Wall Street, led Pro Sales magazine for 12 years, visited dealers in 49 states. We got to get that 50th state, Craig.

Craig Webb 3:15

Alaska.

Stefanie Couch 3:16

Alaska, we're working on it. We gotta go to Alaska. And today you produced two of the most influential and important reports in our industry. So welcome to the show, and I'm excited to get started.

Craig Webb 3:25

Let's get going.

Stefanie Couch 3:27

First question is that when we talked last year, you told me that the year coming on was gonna be about execution. No head, no tailwinds were gonna be pushing the industry forward, and the only way forward was to row your own boat and do the paddling yourself. So you've got the data. Were you right on that prediction?

Craig Webb 3:46

Yeah. Uh the the industry did not really advance forward uh collectively. I'm uh collecting the information now for the uh 2026 version of the construction supply 150. Out of the first 50 or so dealers who have ridden in, um, the average is a 4% decline in revenue. A lot of that is lumber related.

Stefanie Couch 4:11

Yeah.

Craig Webb 4:11

But uh very few people were going forward. If they were going forward, it was because they bought another dealer and consolidated.

Stefanie Couch 4:18

Okay. You have been a journalist for a long time. So five decades, covered the White House, the World Cup, and you interviewed Colonel Sanders, which I we probably need to come back to that in another interview. Uh, somewhere along the way, you decided to go all in on building materials and lumber. When was the time that you realized, like, I'm all in on building materials and why? What was it about this group of people or the stories? What made you come to this industry?

Craig Webb 4:46

Well, first it was a desire to get into real journalism. I had been working for a trade association at the time and was deeply unhappy. I I actually it was I was extremely lucky to get involved with pro sales because if you ever saw me with a hammer, uh you you'd it'd be a danger. Uh, but my Wall Street Journal experience and and working for UP and I and other places was just what appealed to the people at Pro Sales magazine. And it it only took like three months for me to figure out that this is a really great profession and wonderful, absolutely wonderful people to deal with uh who need information.

Stefanie Couch 5:22

Yeah.

Craig Webb 5:23

And and they're so concentrated on what's happening in their own county that they have no time to know whether there's any incoming missiles about to blow up their world. So if I provide that 30,000 foot view, I really feel as if I'm providing value.

2025 Mega Deals In Context

Why Deal Activity Slows Down

Stefanie Couch 5:37

Yeah, I love what you do, and I think it is very important, like you said, being a person who runs my own business, you do get pretty caught up in what's happening in your own four walls, especially in retail, because you got people coming at you all day. So I I love that you're giving that bigger perspective to the industry. I want to talk about the 2025 deals report, which just came out. The numbers were pretty staggering. So 1,813 facilities acquired the four mega deals by those three buyers. And the part that doesn't get talked about a lot is the actual number of deals really dropped uh to 120, so down 50 since the last year before, and only 75 companies were out there buying, the fewest we've seen in four years. So, what's the real story? What do people need to take away from this data? Because it's a lot of numbers, and some people just what's the outcome that we need to be paying attention to? And what is something that's underneath maybe those headlines?

Craig Webb 6:32

I would say there actually are three trends going on. The first is obvious, lending rates were not very good. Yeah, the Fed was keeping uh things tight, and so it was hard to get money. The second was frankly confusion. When President Trump came in, we started having a whole bunch of different stuff happening all at once.

Stefanie Couch 6:52

Yeah.

Craig Webb 6:52

And it left people having trouble figuring out how to value a company, how things are going forward. The third one, and I think this is an interesting trend that's going on too, is that it involves the number of daughters who are taking over construction supply companies. And I don't think it gets noticed enough that perhaps some of these stores that might have been sold because Sonny Boy didn't want to take them over are now being taken over by women. And that's going to be a natural slowdown, too, in the action.

The Sweet Spot For Independents

Stefanie Couch 7:24

Wow. I haven't really thought about that. Being a daughter of someone who had a lumber yard, it's very interesting to me. But I do see a lot more women. And uh actually spoke this morning in my session. Two women came up from Alamo that are two daughters that are uh running out Alamo and uh talked to them. They have 16 stores about to open their 17th, and they want to grow. So I love it. You know, I'm all in on that. But it's an interesting thing that maybe people weren't thinking about. What is, you know, the trend here is asking, can independence still grow and and really be a big part of the industry when these big giants are buying so much and putting so much capital into the market of technology and infrastructure. What's your opinion on that? I mean, can they still win as an independent dealer?

Craig Webb 8:09

Oh, yeah, I think they can. Uh there is uh a sort of sweet middle that uh these dealers can get themselves involved in. And that's largely the custom market, sort of the single specialty market as well as the installed sales market. You put those three together and you've got opportunities that the Home Depot really doesn't want to get involved in, and and and the purely retail people aren't really very good at.

Stefanie Couch 8:36

The turnkey market is something I keep hearing, like you have to have installed sales, you have to have installed sales, and I believe that truly, especially as the products get more technical. You know, you were at the international builder show uh last two weeks ago, I was there too. The doors, like I'm a door girl, obviously, they just keep getting bigger. They're 20 feet tall, they're 12, 15, 17, 18 feet wide. It's insane. You have to have someone who knows what they're doing to install those to feel comfortable selling them. So having that in-house is a really big deal.

Craig Webb 9:09

Absolutely. The if you think about it, if you're a home builder, where are the warranty problems going to come from? They're probably gonna come from the doors and the windows. Yeah. So it's so much better for a dealer to walk in and say, I'll sell you the 4D windows and I'll install them for you at the same time. That takes care of your warranty problem. Thank you for the money.

Greenfield Openings And Local Service

Stefanie Couch 9:28

Yeah, it's a a good deal for everybody all around. Well, I want the Do it Best market members to hear this, some of these data. So 201 new locations actually still opened in 2025. Um, you've got a few people that you name in your report, but in a year that dominated that, like what are some of those things that those small people are seeing in certain markets that they're like, hey, we're gonna go greenfield or open something?

Craig Webb 9:52

Well, I think they're sometimes seeing opportunities. An example of this is in Reading, California, uh, a Meeks yard close, and some Meeks people got together and created Shasta Building Supply. There was uh in in Arizona, there's a company called Rise Lumber and Trust that just opened up uh in the last year. They've got three locations already, frequently providing local services that um Foxworth Gallbraith used to supply, but um USLBM has not been able to do as well at. And so consequently, that local knowledge uh about how to deal in Arizona is is is serving them well.

Stefanie Couch 10:31

Yeah, I think that there's a lot to be said for uh there's so many things with this consolidation that you gain, you know, all these big tickers on the, hey, we've got people, we've got infrastructure, we've got CRMs, we've got all these things, but there are things you lose when you consolidate and you centralize. You gain something, you lose something. And I think unfortunately for some of these bigger people, some of the things you lose might be some of the most important things to builders on the ground, especially in custom building. It's gonna be hard for them to play in that game.

Craig Webb 11:02

Right. Uh I have a person who has just been writing to me recently saying, you know, most people who are sellers don't realize that SPF grown on the east is different than SPF grown on the west. Yeah. And and and so all the tiny little nuances that come from years and years of experience sometimes get washed away when bigger companies come in.

Where Growth Actually Shows Up

Stefanie Couch 11:23

It's easy to look at the the numbers in the bottom line and think there's not as much nuance, but there is a lot of nuance in this business. This episode of the Grit Blueprint Podcast was sponsored by Do It Best Group. Do It Best Group is the largest co-op in the world, and they help independent hardware and lumber yards all over North America win. Do It Best offers services, products, and people that can help you win long term. They are the champion of independence. Well, you have another big report, uh, the construction supply 150. It ranks the biggest building materials suppliers in the country. Over half of them showed that decline in sales. They're trying to figure out where to invest their money, where do you put capital, where do you put time? What does the data tell you about where the growth actually is and where it's going in the future?

Craig Webb 12:13

Well, frankly, some of the best companies, I just happen to be in hot markets. The Carolinas, Florida, Texas, California, that sort of thing. Uh, the second area that's coming are the people who are, I'm seeing, getting involved in installed sales and and and doing work like that. The third are the people who are getting into specialty dealers. Um, I believe you know BB Lumber in Wichita, Kansas, which has this nice little side business selling uh disaster rooms.

Stefanie Couch 12:43

Yeah.

Craig Webb 12:44

Uh and and so they got into that and they're doing very, very well. The fourth group that are doing it are the people who are finally getting deep and getting better at e-commerce. And they're finding themselves selling products that to people that they had not sold before.

Stefanie Couch 12:58

Right. The people that you see, like one or two people that have done really well with the e-commerce, is it through a co-op or are they independent dealers that are doing it on their own or through another technology source? Anything that's like a game changer that you've seen?

Craig Webb 13:30

The people who are, I think, doing well or started started small and then worked their way up and learned along the way. Um, first by starting with billing presentment and collection, then getting e-commerce going. Now they're starting to understand uh how AI can help them do suggestive selling and and and analyze their data a little bit better. So those people who actually have hired somebody to worry about IT tend to be the ones who win. And when you're talking earlier about, you know, what is the future of the dealer? A consolidated dealer gives you the finances to be able to afford an IT person.

Technology That Frees Up Staff

Stefanie Couch 14:09

Yeah, that's very true. And at the end of the day, there's so many options out there. Like you talk, you mentioned AI, and I was speaking about AI today and and several times this weekend with people. Um, I've spoken to some dealers that are doing some pretty cool stuff. Are there any people or processes that have really struck you like wow, this is a big competitive advantage already for people?

Craig Webb 14:31

I think the people who have figured out how to use technology to uh free their staff so they can do other things. Uh and uh an example of that from a few years ago that was developed by Nation's Best Holdings, uh owned uh partly owned by Do at Best was something called Tracula, yeah, which is software that basically tells the dealer which parts of the store you really should check for inventory. And if if it saves a third or half of a staffer an extra, you know, an ex several hours more per week, you've got that. Um, I'm seeing a lot of interest right now in digital shelf labels, not just because Walmart's getting involved in it, but uh because they're discovering that they can know so much more and they have so much freedom and they get so much more information than they were getting before.

Stefanie Couch 15:21

Well, and Walmart's probably done a lot of research. So if they're getting into it, I have to believe that there's probably something to it. They've done the research.

Craig Webb 15:28

Well, and it if you've ever been to Europe and gone to um hardware stores and lumberyards over there, as I have, uh you you see them, they've they've had them for years. And in fact, one of the leading uh companies in uh uh digital shelf labels is French. And um they so they came over here, where did they start their business? Montreal. And then you know they're now they're conquering the English-speaking world in the United States. Right.

Stefanie Couch 15:54

You mentioned that um that you have visited 49 states still working on Alaska. So you've studied thousands of people. Can you really distill it down to like one or two things that separate the dealers who are gonna thrive and survive in the future from those who maybe won't?

Craig Webb 16:12

Well, I think the first thing, and this may sound really strange, but you've got to really want to be in this business.

Stefanie Couch 16:17

Yeah.

Craig Webb 16:18

You gotta wanna you have to enjoy putting in the hours. You have to enjoy the notion that you're making homes better in your community. A great example of that is um HPM Building Supply in Hawaii, which thinks of themselves basically as the stewards of Hawaii's housing. Yeah. And when they were having problems on the hina or whatever, they said, What can we do? And they started getting into modular, they started doing other things. But it it was that ohana feeling that they had about family that that really got them going. The other people who are getting ahead are the people who truly understand that you can't make a living with a 3% net profit. You've gotta you've got to figure out how to do things a little better and a little smarter. And technology is finally reaching the industry after being tested and and and people on the bleeding edge have provided education that now we're able to have technology that that that really does improve things.

Stefanie Couch 17:14

Yeah, and I finally feel like uh just from the the people that I speak with, they are wildly curious about AI and how it can help them, and they're willing to try some things. I feel like not everyone, but the majority of people I speak with, they know that they don't have 15 years to figure this out like they did with the internet or maybe with an ERP provider. They know they need to know now how to use this. And maybe they're not gonna go all in 100% on every tool, but they they want to be curious enough how can they use it today to make their business better in a way that they don't have to hire 10 people. Even if they could find the people and and pay them, they can't find the right people a lot of times for those roles where AI might be able to do it. You know, if they're in a small market, they may not be able to find a world-class marketer, but AI can help them be a world-class marketer.

Craig Webb 18:03

Yeah, there are several things that are going on, but two of them that are important is that one, the technology is getting simpler and easier to use. You know, you can ask AI to help you for things. The the challenges that uh that people are facing are are sort of getting easier to overcome.

Stefanie Couch 18:19

Yeah.

Craig Webb 18:20

And and that's that's been a that's been a big change.

Stefanie Couch 18:22

That is my favorite thing about AI, the AI will tell you how to use AI.

Craig Webb 18:26

Well, I the funny thing, I I still have cynicism about AI. Um, I have read a lot of really bad stories in LBM that were written with AI. Sure. You know, no sourcing, no real knowledge of the industry. But the funny thing, too, that's happening is that we are now seeing companies come on that are customizing AI to our needs. Uh, one of my favorite is like a company that will review your contracts that you're having with builders, find language in the contract where the builder is screwing you, red line the contract, and suggest alternative language.

Stefanie Couch 19:04

What is this called?

Craig Webb 19:04

Fair build. F-A-I-R-B-U-I-L-D. Fairbuild.ai. I heard of that one. And it's written, it was put together by some lawyers who basically have represented dealers and people who have been in the trust and and components business for years. So they knew how in the past the builders were ripping them off. Right. And so they were able to write it in and teach people. And those those sorts of programs, customized things, uh, are really coming along.

Lightning Round And Key Metrics

Stefanie Couch 19:30

Yeah, they start to change really what could be millions of dollars very quickly. Well, I want to go to the lightning round questions. So are you ready for the lightning round?

Craig Webb 19:40

I I will grab my seat here.

Stefanie Couch 19:43

All right. What's the worst advice that you've ever gotten or heard about the lumber industry?

Craig Webb 19:49

I think the worst belief I've ever heard is that all you need is a merch uh master's of business administration degree to run a lumber yard.

Stefanie Couch 19:57

Oh, yeah, the school of hard knocks, maybe, but not the MBA. Yeah, it could help some places, not in others. All right. What is one data point or metric that every dealer should be tracking, but most of them aren't?

Craig Webb 20:10

Well, it it's it's the old reliable on-time info. Uh it's it's the easiest and best way to sort of have conversations in your store about whether you're frankly meeting the number one expectation of your customers, products on time, and it with everything you said you were going to deliver.

Stefanie Couch 20:28

Okay. What's something that people would be surprised to know about you, Craig?

Craig Webb 20:33

Oh, aside from the Colonel Sanders interview, uh I would say that uh probably the most surprising thing that people might not know is that my first job out of college was in Italy, where I worked for a paper in Rome. Uh uh, that at one point, before I was there, had been owned by the CIA.

Stefanie Couch 20:52

Wow, that is really interesting.

Craig Webb 20:54

It was called the Rome Daily American. And uh and so there I was able to produce the very the only extra, extra edition that uh I was ever able to produce as a journalist. Uh what was it about? Jimmy Carter's election, which shows you how far back I go.

Stefanie Couch 21:12

I love it. Okay, last question. Um, last time you were on the show, you told me the country is full of needs, full of people who need a lumberyard in their county. You said as long as you can provide a service that other people aren't giving their opportunities after everything that's happened. Do you still believe that to be true?

Craig Webb 21:30

Oh, I believe that definitely to be true. Uh sell what sells. Uh, I was in Iceland recently. My wife and I love to go to Iceland, and there is a store there that popped up largely because the the local people in town moved out. And so they felt the need and they've stayed in business now several years. But there, it's not just a place where you go to buy lumber or you go to buy fasteners, you go a few feet down and they've got a knitting section with yarn in it.

Stefanie Couch 22:01

Yeah.

Craig Webb 22:02

Because people in Iceland love to knit. And so they provide they provide the yarn because that's what customers want.

Stefanie Couch 22:08

Yeah, and you see a lot of stuff when you walk this floor at do it best True Value market. I mean, there are some things that I never saw in my dad's hardware store 20 years ago. But you see it and they're selling it. They're some of them are really doing well. You know, Gina uh Schaefer is a mutual friend of ours. She told me one time that the number one selling item in her store was the soda stream refill capsules for the sparkling water machines. I was blown away by that. I don't know if it's still true, but she lives in a city. People don't want to have to tote water jugs to their house when they come from the grocery store because it's walkable. Right. So it makes sense if you think about it. Sell the people what they want. I love that advice.

Craig Webb 22:48

Yeah, I mean, it you know, yeah. Have you ever been to a store where they had buffalo steaks or I have not. Or Boy Scout uniforms, you know, that sort of thing. And I've seen them both.

Report Drop Dates And Closing CTA

Stefanie Couch 22:56

So wow, it's really cool. Well, thank you for joining me on the show, Craig. And I am looking forward to your next report, the dealer report. When does that come out?

Craig Webb 23:04

May 1st.

Stefanie Couch 23:04

May 1st. So check out Craig Webb at Webb Analytics. He will be releasing it on LinkedIn and also in his email. And if you're not subscribed, subscribe to Webb Analytics newsletter. Lots of trending reports coming out all the time. So thank you for joining us on the Grip Blueprint Podcast, and we will see you on the next episode. Thank you for listening to the Grit Blueprint Podcast. If this episode helped you think a little differently about how to show up, share it with someone in your building world who needs it. If you're ready to turn visibility into growth, then head to gritblueprint.com to learn more and book a call to talk to us about your growth strategy. Until next time, stay unmistakable.