A new 500,000-square-foot Concept Center and 50-acre campus, a look back at 2022 and a peek ahead at 2023—plus an invitation to attend the 2023 NHPA Independents Conference—were among the topics discussed during a virtual Orgill Update.
“We had a very successful year at Orgill last year,” Moore said at the beginning of his address. “Our sales were $3.8 billion—9% higher than 2021. And amazingly, almost 50% higher than in 2019.”
Moore shared that Orgill delivered to more than 13,000 stores in 2022, which make up more than a one-third of the hardware stores, home centers and lumberyards in the U.S., and that Orgill now serves more than 50% of the top 100 pro dealers in the U.S.
“We have built capacity to serve your growth,” he told customers. “We have improved our service levels significantly but won’t rest until we return to our standards. We are investing in new technology to continue to lower your costs. We are investing in a one-of-a-kind facility to continue to drive industry-leading assortment customization. We are driving innovation in our technologies to make doing business with Orgill easier and more convenient.”
Modern Distribution Centers
Moore says that Orgill’s new Tifton, Georgia, distribution center, which is still under construction, will implement robots and a goods-to-person picking system that will drive new efficiency and cost reduction—savings that will be passed along to the customer.
“This critical growth and new technology in our distribution network puts the infrastructure in place to support growth for the next several years,” he says.
He also shared that in the past two years, Orgill added 1.3 million square feet of warehouse space when it opened its new Rome, New York, distribution center in 2021 and expanded its Hurricane, Utah, distribution center in 2022.
Orgill now operates eight distribution centers in North America with 6.7 million square feet of capacity and more than 75,000 SKUs in each distribution center.
A Reimagined Concept Center
Orgill is in the planning stages of the design and construction of a new, state-of-the-art Concept Center, according to Moore.
The Concept Center will be located adjacent to the company’s corporate offices in Collierville, Tennessee, on what will become a 50-acre Orgill campus.
“Our plans call for doubling the size of the current space to 500,000 square feet and turning it into a multifunctional facility where we can host customer events, vendor conferences and corporate or industry meetings,” he says. “We are planning a technologically advanced, highly flexible working space where we are able to feature the breadth of our assortments and capabilities year-round, weaving together our annual Dealer Market, our four online buying events and everything in between. A living market, if you will.”
Orgill’s current Concept Center is a 250,000-square-foot facility in Olive Branch, Mississippi.
High Performance in 2022 and Looking Ahead to 2023
Orgill measures how well it delivers to customers based on fill rate, accuracy and delivery speed, and it plans to do better in 2023, Moore says.
“Our performance on these metrics is industry-leading, but I realize that for the past few years that’s not saying much,” Moore says. “We are not content to just be better than the others. We improved our service level from 75% at the beginning of last year to over 85% by the end of the year. We will return to our historical standards of greater than 95% fill rate this year.”
Orgill is focused on the new challenges customers will face in 2023, with a looming recession, a slowdown in housing starts and sales, moderating consumer demand, higher interest rates and continued wage inflation, according to Moore.
Moore says that based on forecasts from Cleveland Research, the North American Hardware and Paint Association (NHPA) and the Home Improvement Research Institute (HIRI), the industry is projected to grow between 1% and 2% in 2023.
“At Orgill, we are projecting 6% growth in our sales for 2023,” he says. “We see an opportunity to recover more sales this year with the improvements in our supply chain. We see a huge opportunity to drive better seasonal business this spring as last year’s weather was some of the worst ever. We also see a lot of new business opportunities that we can pursue with a recovered supply chain. We are optimistic on the industry for 2023 and on our customers’ ability to outperform the industry. We look forward to tackling the challenges on the horizon with you as we find new ways ‘to help our customers be successful.’”
Moore suggested the following focus points for Orgill customers in 2023: A review of assortments, including Orgill Smart Start programs, Exclusively Orgill private label products and impulse assortments; a review of pricing using Orgill’s Market Specific Pricing program; and a return to promotions, with help from Orgill’s BrandBuilding team.
Supporting the 2023 NHPA Independents Conference
Orgill customers were invited at the end of Moore’s video message to join the company in attending and supporting the 2023 NHPA Independents Conference in Dallas on Aug. 2-3.
In addition to the two days of conference presentations, events and networking, Moore shared that Orgill will host complementary events the day before and during the conference at an adjacent hotel. The dates will align with the beginning of Orgill’s Fall Buying Event.
Moore also reminded Orgill customers they can use Orgill Market Travel funds, earned based on purchases made this June, to cover travel, hotel and registration fees for the event.
“We are very excited to be supporting and participating in this event,” Moore says. “The independent channel needs an annual gathering where dealers of all shapes, sizes and distribution affiliations can come together and learn from one another. We’re excited to participate and will be strongly supporting the NHPA event.”
Learn more about the 2023 NHPA Independents Conference at YourNHPA.org/conference.