Builders' and plumbers' merchanting: an attribute study of organization, functions and performance

This thesis examines a number of problems in the distribution of building materials and components by 'builders' and plumbers' merchants' to the various material users. The objective is to review developments in builders' and plumbers' merchanting since the mid-1960's, and to assess factors influencing successful merchanting operations. Within this objective, merchanting organization, functions, and performance are studied, principally by relating specific policies and practices to a number of distinct merchant classifications. The data for the study was collected in the field, chiefly by means of structured interviews with staff employed in a total of 25 British merchanting companies located in several regions. The main analytical work involved the application of three non-parametric statistical tests to data arranged in the form of 2 X 2 contingency tables. The relevant merchanting policies and practices were expressed in the form of attributes. Respondents were classified according to company size, degree of organizational decentralization, type of materials distributed, urban situation, and regional location. Statistically significant correlations between attributes and merchant classifications were then obtained using the three tests, A number of topics wore examined using the case study method, and in certain instances, the results of previous research were used to supplement primary data, The main subject areas studied were: (a) the organization of building materials distribution; (b) merchant marketing practices; (c) problems in the stocking function; (d) the impact of vehicular traffic on merchant facilities; (e) problems in the provision of premises and facilities; (f) aspects of merchant financial performance; (g) aspects of merchanting management and administration. The study showed that fluctuations in construction activity, together with heavy competition from other suppliers and distributors, tended to erode the position of the builders' and plumbers' merchant as the traditional supplier to the building trades. There was also a tendency for merchants to diversify their interests into commercial areas other than building materials, although these other areas were usually concerned with markets related to building, e.g. improvements to existing dwellings. The general increase in personal car ownership, and in the road transport of materials by heavy goods vehicle, resulted in heavy pressures being placed on many merchants' premises and facilities, particularly during peak service periods. These pressures, together with strong competition, profit losses due to bad debts and pilferage of stocks, and staff deficiencies, forced a number of smaller merchants into mergers. Although these mergers were aimed at achieving economies, considerable difficulties in the rationalization of diverse company policies and organizations were experienced by many of the participants. The study also showed that there was a need for improved management information system in merchanting, together with general improvement in the training of merchanting staff at all levels.