REH moat, page-162

"Perhaps more of a threat to the Reece empire may be the poaching of management staff from their branches. I have long considered that key management at a branch level will strive to address poor performance, including stocking, hours, customer service etc etc. Where else would you go to find key staff but the market leaders. Combined with strong executive management change, this may preclude the need to close many of the underperforming stores and help them build acceptable return levels. Quite often it only takes a few senior staff to change teams, they then know the right managers to tap on the shoulder."

@gold1650,

You make it sound so easy.

It begs the question why neither Crane Group nor Fletcher Building did what you are suggesting, while they owned Tradelink.

The problem for Tradelink is that the problems can't simply be solved at the localised branch level. It is far bigger challenge than that.

The issues for Tradelink relate to poor store configuration, insufficient supply chain infrastructure, lack of inventory control, outdated billing systems and management information systems.

Given the chronic under-investment in Tradelink's operations, addressing those issues to the point where the business would be anywhere close to operating at industry best practice would cost the better part of $100m, I suspect, and would take the better part of three years to fully commission.