While the acquisition marked another major change to traditional two-step distribution, it didn't come as a complete surprise.
"We'd heard rumors like this for years," said Inge Calderon, executive vice president of the American Supply Association. "It was always a different candidate for the day. We also understood that Home Depot was committed to entering the wholesale channel even to the point of developing its own facilities."
The acquisition certainly signals the home improvement retailer's intent to seriously court the professional contractor market.
"In general terms, about 30 percent of our business currently goes to professional contractors," Home Depot spokesman Jerry Shields told us. Considering 1999 company sales are sure to top $30 billion, that's around $10 billion worth of goods bought by the trade. "We're trying to integrate more pro sales into our business, and this acquisition will enable us to serve contractors that we couldn't serve that well before."
In a prepared statement Home Depot president and CEO Aurthur Blank added: "With the acquisition of Apex Supply, we will strengthen our ability to reach the professional trades, both residential and commercial. Apex will provide us with the resources to handle special orders for plumbing products more efficiently."
By all accounts, Home Depot picked a first-class wholesaler to acquire. Founded in Atlanta in 1949 by the Rodbell family, the company has twice been named "Wholesaler of the Year," by Supply House Times magazine in 1984 and again in 1998.
Apex will operate as a wholly-owned subsidiary of The Home Depot Inc., and its current management, including chairman and CEO Clyde Rodbell and COO Sidney Rodbell, will continue to operate the company.