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LBM White Paper on Material Sales Experience and Quote Comparisons

Updated: Jun 27, 2019

Blog Version 3 of 6

Accurate and Transparent Pricing Leads to Happy Customers!

Crawl Space

Each of the material dealers submitted an estimate for the crawl space portion of the project. Everything required to ready the foundation for the floor system was included in the crawl space bid and varied based on interpretations of scope of work for that phase of the project and items that material dealer offers for purchase. The plans show a post and beam configuration to support the floor system above and three of the five dealers (Dealers 2, 3, & 5) estimated the support structure that way. The other two (Dealers 1 & 4) took it upon themselves to provide material for a pony wall to support the floor system, one with 2x4 material and the other with 2x6. All of the dealers provided a treated mud sill and sill sealer while only three included anchor bolts of any kind. Beyond that, there wasn’t a real consensus in materials used between dealers.

Of the dealers who provided the specified post and beam solution, two included pricing for a 5-1/8”x12” beam (Dealers 2 & 4) and the other one provided pricing for a 3-1/8”x 12” beam. None of which provided any kind of a calculation sheet showing the beams had been sized for the specific structure or anything other than the estimator’s (or salesperson’s) preference was used to price the beam in the quote.

One dealer (Dealer 4) included 150 sticks of rebar, 8 foundation vents, 16 gallons of foundation coating, 2 roller frames and 2 roller covers. While this material will likely be needed on the jobsite, it was uncharacteristic of other material stages and certainly not common among the other dealers, standing out as an outlier in the comparisons.

Floor System

Every material dealer submitted pricing information for the floor system. Materials included in this phase included I Joists, Rim Board, Adhesive and Floor Decking. The Floor System was one of the few packages to get a direct comparison based on materials used. While quantity discrepancies occurred among every dealer, most were relatively close on the amount of material they provided. There was an 11% discrepancy between the highest lineal footage of I Joists compared to the lowest. Similarly, there was a 14% discrepancy in floor sheathing. All dealers estimated 11-7/8” I Joists with corresponding Rim Board and ¾” tongue and groove OSB decking. One dealer (Dealer 1) included four I Joist hangers for a crawl space access that was shown on the plans.

Variations in Framing Lead to Delays on Job Sites

Wall Framing

As expected, every material dealer submitted a lumber package for wall framing. Four of the five dealers correctly read the plans and included 8’ studs while one (Dealer 1) included 9’ studs. Two dealers included 10’ studs for the garage (Dealer 1 & 4) and the others simply used the 8’ studs throughout. Coincidentally, those two dealers provided a treated bottom plate for the garage walls that sit directly on concrete. Overall, the plate material varied significantly by length, some choosing to include only 16’ length stock and others breaking it up between 8’, 12’ and 16’ stock. A simple explanation for this difference is dealers applying differing margins among different lengths of boards, trying to gain margin on more popular lengths while encouraging customers to purchase less desirable lengths through their pricing strategies. It is also unlikely that a dealer who specifies only 16’ stock would only ship 16’ stock and not work to balance their inventory among other lengths.

A great deal of variety was estimated for header stock. A range of 2x10, 2x12 and glue lam beams were estimated in a variety of lengths for which no correlation could be drawn between any two dealers. Again, none of the dealers provided any sort of a calc sheet to support their reasoning behind the chosen header stock and the recipient is left to infer that a two ply 2x10 header will perform as well as a 2x12 header with zero concern if one is undersized or the other over built.

All dealers estimated 7/16” OSB for wall sheathing with a wide array in quantity and unit pricing. Four of the dealers were within a range of 4 sheets plus or minus, but a pricing difference of nearly double from the low to the high. This shows the difference in the buying power among a large national dealer versus a small single location dealer. It is also likely the large dealer was operating off current market conditions while the small dealer had old stock and hasn’t updated their pricing to reflect the downward market trend of OSB during Q4 2018.

OSB's Downward Trend Throughout 2018

Another significant discrepancy occurred in the dollars estimated for house wrap. While each dealer varied in roll size and quantity, assuming each estimated enough to cover the walls, a range of $360 on the low side to $810 on the high side, suggests either some dealers are not purchasing the way they should or view house wrap as a blind item to capture more margin they give up on other items.

It should be noted, that one dealer (Dealer 3) did not break out its wall sheathing from its roof sheathing, nor its sub fascia, barge rafter or truss bracing from its wall framing. Its pricing numbers will be overstated in the wall framing section and understated in the roof framing section. In a final analysis, an assumption will be made, and these quantities will be broken up based on a percentage of material placed in each phase by other dealers.

This LBM blog post is one of a series of posts outlining the findings from a study conducted on 5 various building material suppliers. To download the entire White Paper visit: https://www.lbmsupply.com/lbm-white-paper or visit https://www.lbmsupply.com/shop for purchase options of unredacted versions with pricing included.