When choosing software for your lumber and building materials (LBM) business, consider more than just the features and functionality. The stability, vision, and long-term reliability of the company behind the software are equally crucial to your success.
In the ERP software market, you may see some vendors that frequently change ownership. They often focus on acquiring several older ERP systems specifically marketed to lumber and building materials industry. This approach introduces risks that could impact your business for years to come.
Why frequent ownership changes should concern Lumber and Building Materials Businesses
Some software providers have been bought and sold multiple times, often by private equity firms or larger tech companies. These frequent transitions typically prioritize short-term financial returns over long-term innovation and customer success.
With each ownership change, your business could face:
- Unpredictable shifts in product strategies that no longer align with your needs
- Cost-cutting measures affecting product development and the quality of support
- Changes to licensing and pricing structures leading to higher long-term costs
A finance director who recently worked with us said, "We couldn't risk a long project that might fail We came in on time and on budget, so we made the right choice." This highlights the importance of stability when implementing business-critical software.
How ownership changes impact your product experience
When a software provider undergoes frequent ownership transitions, you as a customer face several risks:
- Product development driven by financial priorities rather than specific lumber and building materials industry needs
- Slowed innovation or shifted focus, creating uncertainty about future improvements
- Solutions potentially being discontinued or merged, forcing migration to new systems
- Diminished support quality or increased reliance on less experienced support teams
One of our clients in the building materials industry said, "We have always used software to gain an edge in the market. Our old system didn't offer the flexibility and control we have now and need for our future." This sentiment resonates with many businesses stuck with software from providers whose priorities have shifted after acquisition.
The hidden risks of software built through acquisitions
Many vendors in the LBM space have expanded by acquiring multiple software systems. While this approach might appear to offer more features, it introduces significant risks:
- Uncertainty about long-term investment in your specific solution
- Potential forced migrations if older platforms are phased out
- Integration challenges because of disconnected technologies
- Changing pricing models leading to higher costs over time
A company manager who recently upgraded to our software said, "We know our new software uses the latest technologies. It gives us the tools to innovate and stay ahead of our competitors as we look to the future. We were also impressed by how the system let us make many changes ourselves. This gave us full control over our own system."
When companies buy other software to improve their LBM product
We have talked about the risks of frequent ownership changes. There is another strategy some ERP vendors use. They acquire complementary solutions to improve their main product. This can initially seem attractive, as it promises to fill functional gaps without waiting for in-house development.
When an ERP software provider acquires complementary solutions, it can potentially:
- Add specialized industry capabilities missing from their core platform
- Accelerate time-to-market for features that customers are demanding
- Bring in additional expertise that enhances their overall offering
However, these complementary acquisitions come with some considerations worth noting:
- Integration complexity: Different technologies and architectures may require additional configuration to work together smoothly, potentially extending implementation timelines.
- Resource balancing: Vendors must share development resources between their original platform and new solutions. This can impact schedules.
- Support coordination:When using many connected systems, you need support teams that understand the entire system, not just parts.
- User experience consistency: Modules often keep parts of their original design. This may require users to adjust to different interfaces when switching between system components.
- Evolving roadmaps:As vendors integrate acquired technologies, their development priorities naturally evolve, sometimes adjusting the timeline for previously planned enhancements.
When evaluating lumber and building materials industry software, ask vendors about their product growth strategy. Are they committed to cohesive, organic development, or do they rely primarily on acquisitions to address functional gaps?
The best long-term partners usually have a balanced approach. They have a clear vision for how to integrate new software and skills. This means not just connecting them but also creating a consistent and unified experience.
Our team of industry experts uses a structured approach when building complex business systems. We carefully plan and connect all the different components, so they work together seamlessly. We thoroughly test everything before launch to ensure it all functions correctly.
Long-term cost considerations for lumber and building materials suppliers
Software vendors owned by private equity firms often prioritize short-term profitability, which could result in:
- Higher subscription or support fees after an acquisition
- Essential features being bundled into more expensive packages
- Reduced investment in customer support
If your LBM business picks a provider that often changes ownership, you might see unexpected cost increases. This can affect your ROI and long-term budget planning.
The risk of another sale or forced migration
Given the history of frequent sales among some providers, there's always a possibility of another ownership change. This brings additional concerns:
- Continued cycles of restructuring and cost-cutting
- Products potentially being phased out
- Unexpected changes in licensing models and pricing structures
One of our merchant clients said, "It was important for us to easily connect with other systems. We needed to invest in a system that could easily work with any current or future technologies. This will help us keep a strong, central hub to run the business. Essentially, it's about looking to the future and covering the unknowns."
Why choosing a stable, LBM-focused provider matters
Many providers offer solutions for LBM businesses. However, those with frequent ownership changes and aggressive acquisitions can be concerning. These issues may affect stability, long-term product investment, and cost predictability.
Before committing to a solution, ask yourself:
- How confident are we that this provider will continue investing in the solution we need?
- What's the risk of being forced to migrate if they stop supporting older products?
- Will our long-term costs remain stable?
- What happens if the provider is sold again in the next few years?
For LBM businesses that prioritize stability, transparency, and long-term software investment, selecting a provider with a consistent history and dedicated focus on the LBM market offers significant advantages.
When you choose a provider with stable ownership, you gain a partner. This partner focuses on your industry and understands your business well. You avoid the risks of unstable ownership, changing priorities, or sudden price increases.
Our history and partnerships show that we are dedicated to helping our customers succeed over the long term. We created solutions like GenetiQ tailored for the US lumber and building materials supply industry.
Partner stability: a critical factor in your decision
When making a significant investment in business management software, you're seeking a long-term partner. Since 1992, we've dedicated ourselves to developing business management and ERP softwarespecifically for the lumber and building materials industry. Our commitment to excellence and innovation remains unwavering.
As an independent, family-driven company, we've built our growth through continuous in-house innovation rather than through frequent acquisitions. This approach ensures our solutions remain cohesive, well-integrated, and true to our vision.
In 2024, we formed strategic investment partnerships
to speed up our growth and invest more in innovation. This includes expanding into the US market with our GenetiQ solution. Our CEO recently said: "This is a pivotal moment for us and a real testament to our incredible team's hard work and dedication, as well as the trust and belief that our partners place in our vision. As we move forward, we remain committed to our mission of delivering exceptional value and service to our customers."
One of our financial partners commented, "We are delighted to have made this investment. They are a true market leader with a great future ahead of them. We look forward to partnering with the team to support their next phase of growth." This funding demonstrates a commitment to our progressive trajectory and ability to serve customers for the long term.
Our customers consistently express confidence in our solutions, appreciating the reliability and long-term value we provide. They choose our software not only for today’s needs but also for the future. They trust it will adapt and grow with their business.
Choosing an ERP partner that will stand the test of time
Look beyond features when selecting software for your lumber business. Consider the company behind it - are they stable? Do they understand your industry? Will they be around long-term?
The best partners focus on businesses like yours, keep prices fair, and continuously improve their products. By thinking ahead, you can avoid forced system changes, price hikes, and poor support that often follow when software companies get bought and sold.
Choose a partner who will grow with your business for years to come.