and Home Centers
The retail lumber and home center industry is made up of approximately 10,000 privately owned businesses and fewer than 50 publicly owned corporations. Many analysts feel that there is likely to be a substantial reduction in the number of privately held smaller independent units as a result of a decline in new home construction during the next decade and the expansion and continued growth of home center warehouses (a.k.a. “big boxes”), such as Home Depot, Lowes, Menards, and others. Because of the growth of these home center warehouses in the 1980s and 1990s, some would liken this basic segment of our economy to the retail grocery business of fifty years ago when the chain supermarkets started to displace the corner family-owned grocery store and meat market.
This chapter addresses only closely held, privately owned businesses with annual sales generally in excess of $2 million but less than $50 million, as this range comprises the limits of our brokering and valuation work.
The more than 10,000 privately owned businesses can be generally categorized into two groups: a contractor type lumberyard or a con-
* Devon O. Howe, MBA, coauthored the original chapter in 1992.