Switch to Spruce LBM Software Brings Major Gains on Multiple Levels
If you really want to know why using Spruce® software from ECi Software Solutions to manage a lumber yard makes so much sense, just spend a few minutes with Kyle Kincaid, chief financial officer at Carl's Building Supply in Port Hadlock, Washington.
Carl’s made the switch to Spruce in 2013 and, says Kyle, it has brought major benefits on multiple fronts.
“We had been using the Advantage system for many years and it had basically gotten to the point where it was too old and we needed something better,” he recalls.
“Advantage is a very cumbersome system. We had to go through many different menus to get a report and we were getting multiple errors in the database.”
As Kyle went looking for new software options, it became clear very quickly that Spruce was the only logical choice.
Spruce is lumber yard management software that costs half as much
“We visited another lumber yard in the region that was already using Spruce and we really liked what we saw,” he says. “The cost and monthly maintenance fees were very reasonable—probably about one-third to one-half of what we might pay with other systems. Spruce came loaded with features and functionality that we just didn’t have with Advantage and its ease of use was very impressive.”
Three years after Carl’s went live with Spruce, Kyle runs down some of the key changes at the company.
Sales are up 84%, though he says that’s due more to an improving market than to new software. Having said that, though, Kyle says Spruce is doing a great job of helping the company make the most of that sales gain.
For example, even though sales have nearly doubled over the past three years, the increase in headcount has been far less—from 23 to just 28 employees currently.
On the inventory management front, Spruce has added somewhere between a half and a full turn on inventory at Carl’s and raised margins by about two hundred basis points— from 26.8% to 28.16%, Kyle reports.
Profitability has increased by about 4% of sales and, says Kyle, at least one-third to one-half of that increase can be attributed to the impact of Spruce on the business.
That’s a remarkable performance by any measure. What’s almost as impressive is that it takes Kyle literally less than a minute to get all those numbers out of the Spruce system!
And that’s just for starters!
Automated special pricing means improved margins
“Spruce has transformed our special order department and that’s had a huge impact on margins,” says Kyle.
“It used to be that if you went to five different people to order a window, you’d get five different prices,” Kyle says, and he’s not joking!
With Spruce, Carl’s has been able to automate special order pricing in a way that has brought significant margin gains, by adding over 40 additional S/O product category templates and setting automatic pricing by target margins on each category. This allows management to control special order pricing rather than leaving it up to salespeople.
“Everybody now gets the same price on that window no matter who they ask and we get the margin we want every time,” he reports with satisfaction.
The result: Over the past three years, the average margin on Carl’s special order business has grown by 3%, and with that side of the business accounting for about one-third of total revenues, that’s a nice change to see!
Productivity up as the time to process daily tasks goes down
Overall productivity has also seen a huge boost at the business, thanks to Spruce. For example, Spruce’s powerful document management system means it literally takes one-fifth the time to put an order together with Spruce than it did with the previous system.
And once that order is placed, tracking it through all the various stages to a final invoice is so much easier now.
“The Spruce system links the customer’s order to the vendor purchase order to the customer’s invoice and to the invoice from the vendor,” Kyle explains. “All those steps are linked and it’s easy to drill down and look at any document in the process if you need to. We could never do something like that with Advantage.”
On the receivables side of things, the improvement Spruce has brought has also been dramatic, Kyle reports.
“With our old system, we would send out statements once a month, either with no invoices or with invoices that had to be manually pulled from a file and matched because they had a signature on them,” he recalls. “With Spruce, we capture the signature at the point of sale, the invoices are automatically collated with the statements and they’re either mailed, e-mailed or both with all the supporting documents. Spruce has taken a process that used to require a full day under our old system and reduced it down to just two hours!”
Spruce’s credit card tokenization functionality has also generated significant improvements at the point of sale.
“With Spruce, we’ve been able to upload several hundred credit card numbers into the cloud on a secure website,” Kyle explains. “The only piece of data we have in the onsite customer record is the fact that there’s a bank card on file. That not only makes us 100% PCI-compliant, it also means that our checkout crew doesn’t have to spend time looking up a number and keying it in when they’re ringing up a charge sale. Spruce has made our credit card business totally secure and speeded up the time at the point of sale by a huge factor.”
Spruce makes it easier to make a sale
“Spruce was developed by lumber dealers from the point of view of the salesperson on the counter, in my opinion, rather than primarily for the back office,” says Kyle. “It has made it so much easier for us to make a sale, price it correctly, receive it correctly and get the invoices and statements in the hands of our customers quickly, accurately and efficiently.”
“If you’re stuck with one of the old legacy character-based systems and paying more and more for maintenance, Spruce is really the only logical alternative,” he says. “There are other software programs out there but Spruce is the one with the biggest user base, a proven track record of performance and an affordable price,” he says. “I’ve been in this business for over 40 years and at this point in time, Spruce is the only software program for most lumber yards that I’m comfortable recommending.”