MERCHANT FOCUS: APP WHOLESALE THERE’SAN APPFOR THAT
Boilers, but so much more: Anjali Sooknanan meets a heating distributor and merchant with ambitious plans, and the backing to make them happen.
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PP Wholesale has so much potential. That’s according to Michael Brockman, managing director of the plumbing and heating distributor, part of Lords Group Trading Plc. The company has spent the last two years investing in its people, property, and processes as it looks to define itself as ‘more than just a boiler distributor’. Started in 1990 as Ultimate Discount Heating with one small shop in Billericay in Essex by Allan Pierce; his aim was to offer direct to the homeowner a simple but affordable central heating pack offering. The success of that heating pack concept during the 90’s saw that retail business grow quickly. Brockman says: “I joined in 2006 initially to help Allan set up finance functions, systems, and processes. From 2008 the following decade saw massive growth for the business via its distribution division, driving boiler volumes into the independent merchant network. During this time, Pierce built an external sales team and a senior leadership team which included his son Matthew, David Fulton, Stuart Snell, and Brockman. By 2019 the business that started as a retail only operation had grown into a massive market player both on retail through its Mr Central Heating stores and now, distribution via its APP Plumbing & Heating division. The business had nine trade counters and a significant independent merchant customer portfolio.
On December 6th 2019, Pierce sold the business to Lords Group Trading plc. Lords Group have been on a five year journey of growth by acquisition and APP were the next business to join the Lords family. “The Lords team, particularly Group CEO Shanker Patel and Group CFO Chris Day will have viewed us fundamentally as a good business but a bit of a rough diamond. We’ve spent the last two years trying to polish that up in certain areas, and that improvement has been driven by the investment they’ve allowed us to make,” Brockman says. Three months into the acquisition, the COVID-19 pandemic struck, something which,
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as it turned out, proved the resilience of the team and the strength of the branches. “Although we cut back on hours, we stayed open throughout for both our retail and merchant customers, and we didn’t make anyone redundant during the period. The 100 employees we furloughed had all returned to work by August, and we were back up to full speed. Six months following the acquisition, Allan began to take a step back from the day to day running of the business, and I was given the opportunity to step into the managing director role,” he says.
Processes
Post-pandemic, investment in APP ramped up, Brockman explains. “First of all, we invested in the ERP. We nailed down the basic system processes like sale order processing, purchase order processing, receiving and shipping of stock and inter branch stock transfers. Prior to 2021 we had no accurate or reliable view of stock, so with the basic processes working the next step was to introduce perpetual inventory with daily PI counts. That was the platform for driving further improvements,” says Brockman.
“In the second half of 2021 we started a warehouse management system project, which is nearing completion. The WMS project was headlined ‘Go Paperless’ as with the introduction of more tech we are trying to make basic operational processes quicker and slicker and remove paper from those processes, this involved the introduction of hand-held devices, locating stock and barcoding locations in the warehouse. The project has improved accuracy on stock, picking accuracy, loading and delivery processes and ultimately improved the whole customer proposition.
“As part of the ‘Go Paperless’ project, we’re also in the process of implementing a product called PODFather. This piece of tech allows us to improve our route planning, vehicle utilisation, track our vehicle fleet, send customer delivery notifications and collect electronic proof of deliveries both on the retail and distribution sides of the business. We’re
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trying to drive all the manual processes out of the business.”
With a branch network including Portsmouth, Dagenham, Erith, Billericay, Croydon, Park Royal, Tamworth, Glasgow and Bristol, APP saw an opportunity to invest in its properties. “We have moved seven of the nine branches we currently have to bigger better premises in the course of the last decade, including most recently in Q2 2021 our Croydon and Bristol branches and with a move for our Glasgow branch underway. The Mr Central Heating brand is very strong, but we have a national brand with only a localised store presence. The Mr Central Heating brand strength began to accelerate with the birth of the website 12 years ago which now generates revenues of around £15m per year alongside £35m generated in store. In September this year, we opened our first new branch since 2012. We saw an opportunity to open a retail-only branch in West Bromwich under the Mr Central Heating brand. The site in West Bromwich is the first step in its our expansion plans and we’re continuing to plan what a future branch network expansion might look like.”
People
Investment in its senior team has been pivotal to APP’s growth strategy. Prior to the Lords Group Trading acquisition, David Hayward joined APP as financial controller and has progressed in the business to finance director. In April 2021, APP recruited Craig Stanford as operations director
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