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Residential Trade

Residential Trade is part of our Blended Branches business unit and serves the residential RMI and new construction sectors with a large proportion of sales through the branch counters.

Key Highlights 2018/19:

  • Continued to increase proportion of own brand sales
  • Rebranded and expanded the number of locations offering our one-hour “Pro pick-up” service
  • Acquisition of Blackman Plumbing Supply in the Northeast

 

Key products and services:

  • Plumbing supplies
  • Pipes, valves and fittings
  • Bathroom fixtures
  • Water heaters
  • Plumbing counters
  • Pro pick-up

Sales are typically made to plumbing contractors across both RMI and new construction. RMI contractors usually operate with a small number of vehicles and employees, working on small projects and day-to-day residential repair work. In these instances, their work is awarded based on their availability, price and severity of plumbing problem. The business is characterised by high order volumes though average order size for RMI customers tends to be small. New construction contractors work on a range of projects from single homes to mid-sized housing developments and are typically contracted by construction firms. This type of work is usually awarded through a tender process in advance of the project.

During the year we successfully rebranded our one-hour pick-up service for customers as “Pro pick-up” and expanded this to an additional 430 locations across the USA, bringing the total number of locations for this service to 617. This service is available to customers through every order channel.

During the year we acquired Blackman Plumbing Supply, one of the Northeast’s largest distributors of plumbing supplies and a leading supplier of HVAC and Waterworks products and solutions. The acquisition of Blackman significantly improves our presence in New York and New Jersey and we now have 103 locations across the region.

Own brand continues to be a key part of our strategy and we have made good progress in this area over the year. These products offer higher gross margins than branded equivalents and provide additional customer choice. We continue to increase own brand sales as a proportion of the overall product mix.

We continue to diversify our product offering through multiple brands to attract and retain a larger base of customers whilst aligning prices based on our cost to serve. We also continue to work on our digital presence providing mobile apps and inventory management for our customers.

Ferguson is the number two in residential trade in the USA with an estimated market share of 17 per cent. The estimated combined market share of the top three companies is 54 per cent with much of the market fragmented between mid‑size regional distributors and small, local distributors.

To read more around how our associates live our values in the residential trade business click here