The Platform War for the Pro Has Begun
QXO , The Home Depot and Lowe's Companies, Inc. are building different versions of the same thing. For manufacturers, the risk isn’t just consolidation. It’s who owns the workflow, the data and the customer relationship.
A few months ago, I wrote that QXO’s 22,000 jobsite visits per day should be keeping building products manufacturers up at night.
At the time, I was focused on what that kind of access could mean.
QXO had spent nearly $30 billion assembling Beacon, Kodiak Building Partners and TopBuild. The scale was obvious. What was less obvious was what they planned to do with it.
We don’t have to speculate anymore.
QXO Told Us Exactly What 22,000 Jobsite Visits are Worth
QXO completed the TopBuild acquisition July 1. The combined company now represents approximately $18 billion in revenue, 1,150 locations and 28,000 employees. More importantly, QXO has started explaining how it intends to connect those assets.
Its July investor Q&A laid it out plainly. Those 22,000 daily jobsite visits give QXO real-time visibility into project progress, what products are needed and where adjacent products could be sold. QXO says that intelligence can improve demand forecasting, procurement, inventory placement and sales execution, and eventually support private-label growth and deeper customer relationships.
I called QXO the biggest channel shift I’d seen.
But, QXO isn’t the only company moving in this direction. Home Depot is doing it. So is Lowe’s. They’re starting from different places, but they appear to be heading toward the same destination: Own more of the Pro’s workflow.
Once you own the workflow you own the information that influences what gets bought. That’s something much more valuable than shelf space.
The Acquisitions Were Only Phase 1
For the past two years, most of the conversation has centered on consolidation. Who bought whom? How much did they pay? Which categories are next?
At first, I those questions mattered but they’re increasingly the wrong questions.
QXO assembled major positions across roofing, waterproofing, lumber and building materials, doors and windows, insulation and installation.
Home Depot bought SRS Distribution and then added GMS for $5.5 billion, expanding its reach far beyond retail into specialty building products distribution. Home Depot says the strategy is to serve the Pro across the entire project and increase share of wallet.
Lowe’s acquired Artisan Design Group, giving it design, distribution and installation capabilities in interior finishes, then acquired Foundation Building Materials, adding more than 370 distribution locations serving large Pros. Lowe’s described the combination as a platform to better serve the large Pro.
That’s more than consolidation. There’s a larger battle taking shape.
We’ve spent 2 years watching what they bought. Now we need to watch what they’re building. 3 starting points. Same customer.
QXO started with specialty distribution. Home Depot and Lowe’s started with retail. All 3 are moving closer to the jobsite and deeper into the way contractors actually run their businesses.
QXO is building what it calls a more capable operating system across its businesses with common data, CRM, ERP, warehouse management, pricing, procurement, point of sale and sales processes. The objective is to make cross-selling, pricing, inventory decisions and customer service more systematic.
Home Depot has been expanding its Pro digital workspace into project planning, delivery management, inventory visibility and complex order scheduling. This year, it introduced an AI-powered Material List Builder that can interpret a project, generate the materials needed and populate product recommendations that a Pro can order through Home Depot.
Lowe’s is moving in a remarkably similar direction. Its Pro tools now include real-time inventory, bulk quoting, direct-to-jobsite supplier delivery, job-level spend reporting and purchasing tools. In May, Lowe’s launched its own AI-powered Material Lists capability, converting notes, photos and spreadsheets into quote-ready orders.
These companies are moving upstream toward how the contractor plans the job, determines what is needed, selects products, gets a quote, schedules delivery and manages the project.
That changes the game. The platform that’s hardest for the contractor to leave may not be the one with the best price or widest selection. Let that sit for a minute.
The New Battleground is the Workflow
For decades, the manufacturer-distributor relationship was relatively easy to understand. The manufacturer made the product and the distributor provided availability, local inventory and relationships. Then the contractor bought it. Obviously, it was never quite that simple. But each party had a reasonably clear role.
Digital platforms are collapsing those boundaries.
If the same company helps a contractor estimate the project, build the material list, determine availability, quote the job, finance the purchase, schedule the delivery, manage the order and reorder materials later, it becomes more than a supplier. It becomes infrastructure. That’s really hard to leave.
Home Depot’s recent nationwide expansion of three-hour Express Delivery illustrates the point. More than 2,000 stores can now function as local fulfillment hubs delivering products directly to jobsites.
Convenience matters but the strategic value is even bigger.
Every additional workflow a Pro puts through the platform creates another data point. The distributor may soon know your customer better than you do. Again, let that sit for a minute. 🤯
Most manufacturers have a lot of transaction data that tells them what already happened. A platform embedded in the contractor’s workflow can potentially see something different. It sees the project forming before the purchase occurs.
What type of job is this?
What materials were requested?
What products were considered?
What was substituted?
What gets bought together?
What wasn’t available?
What gets reordered?
Where is the project in its lifecycle?
That’s a lot closer to demand intelligence than transaction reporting.
QXO has been unusually direct about this. It says jobsite access improves visibility into customer needs and strengthens forecasting, procurement, inventory placement and sales execution. It also says greater scale improves its negotiating position with suppliers.
This is where the implications for manufacturers get uncomfortable. Your distributor understands the end customer better than you do.
Private Label isn’t the Biggest Threat
Private label will get plenty of attention, particularly because QXO has identified it as one of its growth levers. I don’t think private label itself is the real threat. The intelligence that makes private label smarter is.
QXO says it intends to be selective, focusing private label on categories where products are sufficiently commoditized and customers prioritize value and availability. It also acknowledges that highly specified products are less attractive targets. (That’s a relief but private label isn’t the only threat. Have you thought about e-commerce? That’s another article.)
Brand is the Best Defense Against Channel Power
Giving the customer a reason to insist on your product is the best defense against channel power. Yes, I’m talking about building a strong brand.
If your product is interchangeable, lightly differentiated and bought primarily because it is available at an acceptable price, increasing channel intelligence creates risk. (And, then there's the up tick in e-commerce where a strong brand protects you from commoditization.) A pattern is emerging.
If your brand is specified, preferred, technically differentiated or creates measurable value for the contractor, dealer, builder or homeowner, the equation changes.
In other words, right to win matters more as the channel gets stronger.
You’re A Manufacturer. Now What?
This isn’t an argument to bypass distribution. For most building products manufacturers, that would be both unrealistic and strategically foolish. Distribution creates enormous value.
But… if your distributor owns the contractor's workflow, data, delivery, credit, installation relationship, and increasingly the product recommendation, exactly what part of the customer relationship do you still own?
That's not a rhetorical question. It's a strategic one.
Make a deliberate choice about which parts of the customer relationship you’re willing to surrender. Answer these questions:
Who understands your contractor?
Who owns the specification?
Who creates the preference?
Who provides the training?
Who influences the product decision?
Who sees demand changing first?
And who has the data to prove it?
If your answer to most of those questions is “our distributors,” you may have something other than a channel strategy. You may have a dependency strategy.
It’s important to start thinking about this now. The manufacturers who can answer these questions clearly will still have pricing power, shelf position, and brand relevance 5 years from now. If you can't answer them, you’re already losing ground.
The Better Bet: Stop watching consolidation only through the lens of who buys whom. Start identifying which parts of the customer relationship your channel partners are beginning to own and which ones are too strategically important for you to give away.
Consolidation was the First Chapter. Integration is the Second. Are you ready for the third?