Distributors in the home center and hardware store industry act as liaisons between the consumers and manufacturers. Companies purchase products in bulk from many different manufacturers, and then retail them in smaller quantities to consumers. In this way, consumers can purchase different items from different manufacturers. Products bought in bulk may consist of cables, connectors, bolts, networking materials, screws, or wiring devices.
There are an assortment of factors that drive demand and profits for this industry: home remodeling and repair, construction, hardware retailing, new home building, and telecommunications all require products retailed in this industry. Overall revenue depends on efficient management of a company’s inventory, as well as use of effective advertising strategies. Large companies have an advantage in that their distribution networks are expansive, and as such they can provide consumers with a wide selection of products and services. Smaller businesses prioritize providing specialty items, stocking products they know their consumers need, and providing excellent customer service. Individual operators rely on obtaining quality products at a lower cost, strategic merchandising, and competitive prices.