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Industry Giants Look to Streamline in New Year

Several companies have taken a strong look at their bottom lines for 2008, with layoffs occurring at the top, bottom and in between at major home improvement companies including Stock Building Supply, Ferguson, Home Depot, 84 Lumber and BlueLinx. Skus and facilities also have been on the chopping block.

Wolseley

Wolseley said in late November it would eliminate 1,300 more positions at Stock Building Supply and plumbing supply company Ferguson, following a round of 1,500 layoffs in the prior fiscal quarter.

Wolseley noted it already had made a 3,500 headcount reduction over the last year in its United States operations. Wolseley’s U.S. results have been affected by the decline in the U.S. housing market, as well as falling consumer confidence and a weakening U.S. dollar, the company said.

At its headquarters, Wolseley said it is eliminating the positions of chief development officer, held by Adrian Barden, and chief operations officer, held by Larry Stoddard, in an attempt to “streamline central management.” The goal of the streamlining effort is to help “focus attention on specific opportunities within each continent and to accelerate decision-making in response to local market conditions,” the company said.

Headcount reductions at the company’s two U.S. divisions have accounted for approximately one-third of Stock’s work force and 10 percent of Ferguson’s.

Home Depot

Home Depot said on Dec. 4 it will close call centers in Chicago, Dallas and Tampa, a move that will affect 950 employees.

According to Stephen Holmes, a spokesman for Home Depot, the cuts are to the retailer’s Home Services installation business, which deals with building and closing job quotes, specifically for flooring, millwork and decor.

“This change moves these responsibilities to approximately 550 stores,” he told HCN.

The call centers will close on Jan. 28. The move affects 750 employees in Tampa, 100 in Chicago and 100 in Dallas. The positions will be phased out.

“As the company continues improving the customer experience, we felt it was a priority to restore the customer-associate relationship in the store by giving customers a local point of contact for their installation purchases,” Holmes told HCN. “The way it has worked through the call centers (for the 550 stores) is that a customer would deal with a call center for the installation process for flooring, millwork and decor, meaning that the measures, quotes and other follow-up would be handled outside of the store by these call centers.”

The decision is consistent with the process Home Depot currently follows at most of its U.S. stores, he said.

84 Lumber

84 Lumber said early this month it has cut about 40 positions at its Eighty Four, Pa.-based headquarters due to the slumping housing market.

The company has seen the number of employees at its corporate headquarters fall in the past year to approximately 650 from about 800 employees.

According to 84 Lumber spokesman Jeff Nobers, the approximately 40 positions affect 25 people, as some employees have been offered alternate positions.

A week after announcing layoffs at its headquarters, 84 Lumber has closed 12 units in nine states. The company has pulled out of Redding, Calif., and Manchester, Tenn., due to slow housing starts, and shuttered fives stores in metropolitan areas where the company has other locations: Loveland, Ohio; Palatine, Ill.; Granite City, Ill.; Ellicott City, Md.; and Amsterdam, N.Y.

Four other lumberyards—Greensboro, N.C.; Pineville, N.C.; Columbia, S.C.; and Slidell, La.—were described as relocations in areas where bigger stores had been built nearby. A store in Merced, Calif. is being converted into a components plant.

BlueLinx Holdings

BlueLinx Holdings announced plans on Dec. 5 to eliminate underperforming skus from its assortment as part of a cost-cutting effort.

Russ Zukowski, head of corporate development and investor relations at BlueLinx, told HCN that a cross-functional team went through the company’s assortment branch by branch to cull individual skus. “We’re not exiting any product lines,” he said.

BlueLinx will also consolidate its Atlanta headquarters and sales center into one building, with the goal of saving $1 million to $1.5 million in operating expenses next year. Both buildings are leased facilities, and cuts already made to the employee base there have produced excess capacity.

The company has reduced headcount by 500 people over the last 12 months.

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