Hammond Lumber Grows in Maine

Belgrade, Maine-based Hammond Lumber is putting the finishing touches on its eighth location, which will open in Portland this March. The pro dealer and home center, with some $95 million in sales for 2007, is set to take on big-box competition in Home Depot and Lowe’s, as well as Maine-based Hancock Lumber in an area of Portland known as contractor row.

The company has a habit of growth through acquisition, but after losing a bid to purchase Wickes Lumber’s Portland location to Bradco Supply, Hammond began construction in early 2006.

Originally set to open some time in early- to mid-2007, the company experienced delays in paperwork and permit reception and is set to open the Portland store this month.

But in a market where many lumber retailers are cutting costs, cutting labor, and in some cases, closing their doors, how does Hammond manage an expansion?

Hammond Lumber has been able to expand through an effort to stay aggressive, progressive and service-oriented, according to Mike Hammond, vp of the family owned Maine business. With that approach to business, the company received the Maine Merchant Association 2006 retailer of the Year award.

“We honestly feel that there is adequate work out there—you just have to out work your competition and provide value and relationships to your customers,” Hammond said. “If you’re a progressive, aggressive company, then times aren’t too bad. It could be a lot worse out there.”

That’s the mentality instilled by Hammond’s grand father, Clifton “Skip” Hammond, who founded the company in 1953.

“We have three generations of owners who work right in the store,” he said. “I know very few businesses in the whole country in which three generations of owners, who work right there in the sales pit, and are not up in an office.” That includes Hammond’s grandmother, who comes in every work day at the age of 81.

While the housing market in Maine has been insulated from the highs and lows of other areas of the country, the market is still down 25 percent from last year, and staying afloat is a challenge. Earlier this month, Maine and New Hampshire lumber retailer Lavalley Lumber announced that it had laid off workers in three of its Maine locations and was planning to reduce store hours in reaction to the difficult housing market.

When it comes to direct competition with the big boxes (a Home Depot is a block away, and a Lowe’s is less than a mile down the road), Hammond said he’s survived big-box competition before and even out lived stores such as Home Quarters.

“We have big-box competition, we have one-step distribution competition, and we have other retail lumberyards. They all have their niches, and they’ve all been successful. However, we can only worry about ourselves and get customer service taken care of,” he said.

The new location is described as the only drive-through warehouse in Portland. In addition to providing undercover loading facilities, the new facility will create easy in and out loading by strategically locating heavier and bulkier items near the loading doors, and providing a gate ticket system, where customers can select their items at the drive-through area without setting foot in the front of the store.

The company opened its Bangor location in 2002, and with the new Portland store set to open at the beginning of the building season for Maine, Hammond will be set to take advantage of Maine’s two largest cities and a growing commercial building market.

While Hammond’s sales were flat in 2007, he said much of the competition in New England was down “anywhere from 10 percent to 20 percent.” He said he hopes the Portland store can bring sales to the $115 million to $120 million range.

“We’re just aggressive and progressive in whatever we do,” he said. “Treat your people well—that was taught from my grand father to my father—and they’ll treat you good in return.”