Home improvements chain retailer Lowe’s Cos. Inc. is investing $1.7 billion over the next five years to modernize its supply chain with digital technology.
Lowe’s is overhauling its ecommerce platform and adding in some new B2B ecommerce tools for procurement managers.
Late last month, Lowe’s, which generates annual ecommerce sales of about $4 billion, including B2B and retail sales, began integrating its ecommerce system with Yardi Systems Inc., a large software applications-development company for asset and property management.
Lowes and its B2B ecommerce site, LowesForPros.com, is now a registered vendor on Yardi’s property and asset management software.
New exposure for LowesForPros.com
That means that property managers across a wide variety of commercial real estate markets linked to the Yardi software management platform can select LowesForPros.com as a vendor, make a digital purchase directly from their company’s procurement system and later pick up the item at any of the more than 1,700 Lowe’s stores.
Lowe’s and Yardi are vague on the details about the new arrangement, including how many Yardi software users there are, how specifically property managers can utilize LowesForPros.com and if Yardi or Lowe’s is offering any discounts or other incentives to property managers.
But the technology relationship with Yardi is part of a new series of B2B initiatives underway at Lowe’s. The chain retailer also is offering professional contractors and other B2B customers new ways to use e-procurement to purchase products and services on LowesForPros.com.
For example, customers can now go online to create custom catalogs for recurring purchases, access purchase history reports, and set up and manage tax exemptions online in their Lowe’s business account.
Customer-specific online pricing
Other new e-procurement features let B2B buyers get customer-specific online pricing and digital purchase approvals.
“Yardi demonstrates our continued progress in making it easier for [professional contractors] to grow their businesses with us,” says Lowe’s senior vice president for Pro sales and service Fred Stokes. “Over the past year, we have focused on meeting the basic needs of our [professionals,] and now we are investing in new partnerships and improved experiences to better serve this important customer.”
Lowe’s is looking to update its overall ecommerce program, technology and supply chain to overcome a variety of lingering performance issues and serve residential and commercial customers in new formats, CEO Marvin Ellison told Wall Street analysts on the company’s third-quarter earnings call in November.
Opening new distribution centers
Lowe’s will spend $1.7 billion to update its supply chain and open new distribution centers, Ellison told analysts. “We’re investing to transform our supply chain over the next five years and part of this transformation can be reflected in our opening of two new bulk distribution centers and three cross-dock terminals this year,” he said. “This infrastructure improvement will be key to Lowe’s transitioning from a store base home delivery model to a market-based model.”
Lowe’s also in the process of updating its ecommerce platform to Google Cloud but didn’t provide much detail. “Our ecommerce business is under repair and we are addressing legacy issues with the platform, and our first step in improving our online business is creating stability,” Ellison told analysts. “To that end, we are working diligently to improve the foundation of Lowes.com by re-platforming the entire site to Google Cloud from a decade-old platform.”
Performance problems have slowed online sales, but Lowe’s also expects web sales to pick up in the last six months of this year, but didn’t provide detail. “With a modernized, stable architecture in place, we have the ability to provide our customers with basic online functionality and address legacy ecommerce capability gaps,” he said.
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