Tightwads Discount Building SupplySuccess Story
Josh Hanson, managing partner of Tightwads Discount Building Supply in Prineville, Oregon, is kind of a rebel who doesn’t like being told what he can and cannot do. The success of his young business and partnership with Paladin Data Corporation and True Value proves it.
Just over two years ago, Josh and two partners purchased a company in the heart of Prineville that packaged restacked molding and sold it to discount lumber yards. The partners had experience in milling, mill sales, wholesale distribution and retail, so their vision was to turn their investment in a decrepit warehouse and elm-infested storage yard into a discount building supply store. For about a year, the business operated four days a week and was successful, but Josh had bigger plans.
To start its second year of operation, after researching many different hardware suppliers – some of which turned him down – he teamed up with True Value and Paladin to open a full-service hardware, lumber and building materials store. Since then, sales increased by 114%, the store has more than doubled in size – going from 3,200 square feet to 6,800 – and Josh says they are looking to expand even more. With Paladin and True Value, Tightwads went from working with hand-written quotes and receipts to a modern retail business using state-of-the-art technology.
“I did a lot of online research to find a system,” Josh says, adding that he chose Paladin even though the supplier recommended other systems. He recalls how Paladin representatives patiently worked to show him how seamlessly the platform, its features and integrations works with True Value programs. “Long story, short, boy, how you guys have grown with True Value!”
Oh, how Tightwads has grown, too. The business features more than 10,000 SKUs today and Josh says they regularly add about 500 new SKUs each month. The business was also honored as a member of the 2019 Class of Stihl Hardware All-Stars. Josh says Paladin’s 40 years of experience in developing innovative software with lumber and building materials industry-specific products are one of the reasons he chose the company as its technology partner.
Tightwads uses many of Paladin’s lumber-specific tools including thousand board-foot conversion, which easily converts mill unit pricing to retail pricing, to stay on top of its inventory and provide a quality customer experience.
“Lumber is a different entity. What other industry do you buy something one way and sell it another? Take paint, for instance. You buy five gallons of paint, one gallon of paint, a quart of paint and you sell it that way. Lumber, it’s all by footage and you buy it in different lengths than you sell it in. Paladin’s lumber tools were what attracted me. We use them extensively.”
Josh also leverages Paladin’s Market Driven Inventory Management™ for both lumber and hardware products. Tightwads realizes 34.5% gross margin return on investment (GMROI), while the industry standard is 20%. That’s big to Tightwads because, even though there are two competitors in town and it’s 30 minutes to the nearest big-box hardware store, it still competes against their prices. Josh says Tightwads beats big-box pricing on 95% of his inventory.
Tightwads has 2,000 square feet of off-site storage and plans to add another building for plywood storage and sales. The business uses Paladin’s Mobile2 technology to connect lumberyard associates and drivers with the point of sale system to record sales and deliveries.
Overall, sales are up, employee productivity is climbing, and business is booming. Josh says he also appreciates Paladin’s 100% USA-based customer service and hands-on approach. In fact, Tightwads is just a short drive from Paladin’s corporate headquarters in Bend, Oregon where Josh got his first look at the innovative retail platform.
“I have pretty lofty goals. Pretty bold,” he explains. “We started with three terminals; we’ve already added a fourth because we’re doing so much (business). That’s the biggest thing. We know what we’re doing and where we’re going.”