MDM’s Ferguson case study is now available

Main photo courtesy of Ferguson.

Continuing our series of MDM case studies, we focused on key Ferguson growth initiatives that led to the company reaching $7.9 billion in fiscal year 2024.

This case study is now available here — free for Premium subscribers (which includes NAW members after activating Premium here) and available at the MDM store.

This case study follows our three-part Premium series and provides additional insights and context.

Here, let’s highlight some key takeaways that we’ve covered in detail in this extensive three-part series.

Ferguson has grown significantly through strategic acquisitions and a focus on its customers. As a distributor, you can develop in four ways:

1. Acquisition
2. Sell ​​more to your current customers
3. Find new customers
4. Expand your product sets or enter new markets

Ferguson fueled growth with this simple approach. Let’s start with acquisitions. Ferguson has made more than 50 acquisitions over the past five years. This pace – roughly an acquisition every 36 days for the last 5 years – is almost difficult for a distribution leader to understand. This increase in acquisitions has been largely focused on acquiring more business from new customers, expanding product lines and entering new markets.

Ferguson’s acquisitions were primarily in the HVACR, home remodeling, PVF and other key areas where the company had traditionally not been a purely plumbing distributor.

They have also focused significant efforts on increasing sales to their existing customers, focusing on adding products and offerings in North America to serve their growing dual trade counterparties.

In our series, we detailed four key areas that are driving Ferguson’s growth:

1. Ferguson is adapting its model to support the changing housing market.

Ferguson estimates that $30 billion of the $100 billion residential plumbing and HVAC market is served by dual-discipline plumbing and HVAC professionals. The growing number of dual industry contractors is likely to continue as contractors compete for scarce talent and acquisition trends reflect distribution. Ferguson is focused on being a one-stop shop for dual trade contractors. Its purpose is to fulfill an entire HVACR or plumbing order in one order to one distributor (i.e. the customer’s local Ferguson location).

2. Ferguson is developing an offer of support and order fulfillment for end customers.

Ferguson has publicly stated that it leads the industry with an omnichannel offering that includes an ordering platform (actually two online platforms for different types of buyers build.com and ferguson.com), order tracking and enhanced delivery services.

3. Ferguson implements its own brand strategy.

Private label, which Ferguson calls his “exclusive brands,” could be a key market accelerator. Our range follows Ferguson’s “industry-leading” private label approach.

4. Ferguson is investing in its approach to its digital and rewards program.

Ferguson’s digital programs (ferguson.com and build.com) clearly differentiate their business and help drive growth. Digital features coupled with Ferguson’s ProPlus customer rewards program is a double win for me.

The last word

Questions: “What tools do our customers need today?”; “What tools will our customers need tomorrow?”; and “How can we develop better tools and support to gain a competitive advantage?” are probably part of Ferguson’s mantra.

I imagine these words, or a similar version of these statements, were probably written on the strategy board at Ferguson’s headquarters in Newport News, Virginia.

I hope you will dig deeper into our Ferguson case study series featured on MDM Premium and read about Ferguson’s approach in much more detail.

More MDM case studies

This is the latest MDM case study we have published. See our previous features below and stay tuned for more in the coming months.