|Traded as||NYSE: IBI|
|Headquarters||Jacksonville, Florida, USA|
|Key people||Michael J. Grebe, Chairman & CEO
John Ebner, CFO
Kenneth D. Sweder, President & COO
|Products||plumbing, electrical, security hardware, HVAC, janitorial & sanitary products|
|Revenue||$1.24 billion (2007)|
Interline Brands, Inc. (NYSE: IBI), headquartered in Jacksonville, Florida, is one of the United States' largest wholesale distributors and direct marketers of maintenance, repair and operations (MRO) products for non-industrial businesses.
Wilmar Industries was a Camden, New Jersey hardware store in 1978 with big aspirations. To grow the business, they began selling MRO products to area apartment complexes, then expanded geographically, becoming a distributor targeting multi-family housing businesses. Wilmar went public in 1996 and purchased 14 regional competing businesses before acquiring the Sexauer Group, a well-known and established distributor, in 1999. A leveraged buyout in May, 2000 took the company private in preparation for the next stage of growth. Wilmar approached Barnett, Inc. about merging because the two businesses were very similar, but each targeted a different customer base. Wilmar's customers performed facility maintenance, while Barnett sold to locksmiths, retail hardware and contractors. The two joined in September 2000 and named the umbrella company, Interline Brands. Their guiding principle was to "change as little as possible about the way our customers currently do business with us". Each of the businesses (including Sexauer) retained their identity from the customer's point of view, including salesmen, telephone numbers, products, etc. They realized the value of each company's brand, and preserved sales/marketing relationships built over the years. What did change was behind the scenes in accounting, distribution and administration, realizing economies of scale. In 2000, Interline had a total of 76 distribution centers, which they were able to shrink to 56 in 2004. A 319,000 sq ft (29,600 m2) national distribution center in Nashville, Tennessee was opened in 2001, reducing the inventory required at the local distribution centers and improving delivery times.
They did not market to industrial business or new construction where the profit margin was much smaller. Over the first four years, the company's performance was excellent, and Interline went public in late 2004.
Products and organization
The company staffs 30 showrooms throughout North America with 70 strategically placed distribution centers stocking over 30,000 products under eleven brand labels such as Hardware Express, Maintenance USA, Wilmar, U.S. Lock and Sexauer. Its customer base includes:
- Facilities maintenance businesses servicing multi-family housing facilities, educational institutions, lodging and healthcare facilities, government properties and building service contractors
- Professional contractors who repair, remodel and build residential and non-industrial facilities
- Specialty distributors, including plumbing and hardware retailers.
The Interline companies offer plumbing, electrical, HVAC, security hardware and janitorial products, but nearly half of Interline's sales are plumbing products. Their goal is to provide premium products at competitive prices with same or next-day delivery. "Get It Right. Get It Now." is the company slogan. Products are sold using multiple channels: direct sales by national account representatives or field representatives, telephone sales, customer service representatives, direct marketing through flyers & catalogs, "pro centers", vendor managed inventory, and Internet-based service. Most Interline Distribution Centers include a customer center for over-the-counter sales which Barnett customers prefer. In markets with a sizeable customer base but no distribution center, Interline would look for an existing single-location supply house that could be purchased and turned into a "pro center"--a small contractor showroom and pickup facility that stocks high turnover items.
When the recession began in 2008, the company implemented a plan to improve cash flow and cut costs. One action was to reduce the number of distribution centers from 70 to 59, while increasing the capacity at certain locations for better efficiency. The distribution center in Jacksonville was scheduled to move from a 100,000 sq ft (9,300 m2) space to one with 275,000 sq ft (25,500 m2). The company was also able to pay off $98 million in long-term debt which strengthened the company, even though sales were down. On Nov 4, 2010, Interline Brands, Inc. sold $300 million of senior subordinated notes in the 144a private placement market.
- Funk, Dale: "Interline Brands Files for IPO" Electrical Wholesaling, July 1, 2004
- "Interline Brands, Inc." Hoovers Business Intelligence, Company overview
- Olsztynski, Jim: "Interline Brands’ Unique Vision" Supply House Times, May 4, 2004
- "History" Interline Brands, About Us
- "Interline Brands Inc. (IBI)" Yahoo Finance
- Basch, Mark: “Interline Brands moving to larger distribution center, adding workers” Florida Times-Union, May 6, 2010
- Irina Waqar: “Interline Brands Inc (IBI) sold $300 mln in senior subordinated notes” CEOWORLD Magazine