Lead image courtesy of Ferguson.

In continuing MDM’s Case Study series, we focused on key Ferguson growth initiatives that have led to the company’s $7.9 billion dollar business in its 2024 fiscal year.

That case study is now available here — complimentary for Premium subscribers (which includes NAW members upon Premium activation here) and available to purchase in the MDM Store.

That case study packages our three-part Premium series and infuses additional insights and context.

• Part 1:How Ferguson Worked Wonders with “Channel Drifting” Expansion (Aug. 19)
• Part 2: Inside Ferguson’s Private Brand Strategy (Aug. 27)
• Part 3: A Deep Dive into Ferguson’s Digital Strategy (Sept. 9)

Here, let’s highlight a few key takeaways that we covered in depth in the extensive three-part series.

Ferguson has grown significantly driven by strategic acquisitions and a focus on its customers. As a distributor, there are basically four ways to grow:

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

Ferguson has driven growth using that simple approach. Let’s start with acquisitions. Ferguson has completed more than 50 acquisitions in the last five years. That pace — roughly an acquisition every 36 days for the past 5 years — is almost hard to comprehend as a distribution leader. This acquisition growth has been heavily focused on driving more business from new customers, expanding its product sets and entering new markets.

Ferguson acquisitions have primarily been in HVACR, home remodel, PVF and other key areas it traditionally did not serve as a plumbing-only distributor.

They have also focused considerable efforts on selling more to their existing customers with their focus on adding products and offerings across North America to serve the growing dual trade contractors.

Our series took a deep dive into four key areas that are driving Ferguson’s growth:

1. Ferguson Adjusts its Model to Serve a Changing Residential Market.

Ferguson estimates that $30 billion of the $100 billion addressable residential trade plumbing and HVAC market is being served by dual-trade plumbing and HVAC professionals. The growing number of dual-trade contractors will likely continue as contractors are fighting for limited talent and have acquisition trends that mirror distribution. Ferguson has a laser focus on being that one-stop-shop for these dual-trade contractors.  It aims to fill an entire HVACR or plumbing order with a single order to a single distributor (aka the customer’s local Ferguson location.)

2. Ferguson Evolves its End-Customer Support and Fulfillment Offering.

Ferguson publicly stated it leads the industry with its omnichannel offerings, which includes an ordering platform (actually, two web platforms for different buyer types build.com and ferguson.com), order tracking and improved delivery services.

3. Ferguson Deploys its Private Label Brand Strategy.

Private label, which Ferguson refers to as its “exclusive brands,” can be a key market accelerator. Our series dove into Ferguson’s “industry-leading” private label approach.

4. Ferguson Invests in its Digital and Rewards Program Approach.

Ferguson’s digital programs (ferguson.com and build.com) are clear business differentiators for their business and help drive growth. The digital properties combined with Ferguson’s ProPlus Customer Reward program is winning one-two punch in my book.

The Final Word

The questions of “What tools do our customers need today?”; “What tools will our customers need tomorrow?”; and “How can we develop better tools and support to take share from the competition?” are all likely part of the Ferguson mantra.

I imagine those words, or some similar version of those statements, are probably written on a strategy whiteboard at Ferguson’s headquarters in Newport News, VA.

I hope you will take a deep dive 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 just the latest MDM Case Study we’ve rolled out. See our previous features below, and stay tuned for more in the coming months.

• MDM Case Study: Wesco International (in Premium Dashboard here, in MDM Store here)
• MDM Case Study: Fastenal (in Premium Dashboard here, in MDM Store here)
• And the first of our three-part Watsco Case Study series is here, with Parts 2 and 3 coming shortly