Contractors, foremen and most construction workers know what happens when a crew comes up short of materials, tools or supplies on a jobsite. Suddenly, you have a bunch of high-skilled, high-wage people standing around with nothing to do.
That’s the problem Erik Bornstein, CEO of Toolbx, set out to solve four years ago. Bornstein spent 15 years in the construction industry building a successful company in the custom home and commercial building markets and saw the knock-on effects of supply and material interruptions first-hand. Additionally, he felt the normal process of securing supplies and materials seemed riddled with slow-downs, uncertainties and inefficiencies.
The new company he founded, Toolbx, is aimed squarely at solving these inefficiencies with an app that allows users to order almost any type of material or supplies and have them delivered, if need be, within two hours.
“I saw a huge lack of technology available specifically for procurement of construction materials,” says Bornstein. “And yet 50% of the budget for any project is for materials – whether it be a small remodel, a medium size home, or a large commercial building.”
Bornstein identified three basic problems in the construction materials acquisition process:
One: guys leaving the job site, to go pick up materials, multiple times a week.
Two: the lack of digitization around sourcing. A project manager, owner or a site super had to call or email a bunch of different suppliers, just to see what’s available, eating up more valuable jobsite time.
Three: the payment and approval process. “Most builders have 10 to 20 different supplier accounts,” says Bornstein. “It was an accounting nightmare for us.”
The vision for Toolbx was to take all three of these pain points and create a digital materials procurement platform that connects builders with their suppliers. “We do it in a transparent, digital way to give time back to the builder by making it fast and easy,” says Bornstein.
Supply chain visibility
The key was to provide visibility. “When you order from a traditional supplier you don’t know where the materials are, you don’t know when they’re going to show up and you often don’t get a confirmation when they ship,” says Bornstein. “If you’re a builder working on multiple jobsites, not having that visibility can cause a lot of friction.”
For a Toolbx user, all decisions get documented and streamlined within the app. You can add jobsites and add crew members with a few taps on a smartphone. Every order is GPS tracked. And you can place an order 24/7 from anywhere to get the materials to your jobsite anytime between 7 a.m. to 5 p.m. Payment is handled within the app and all your invoices are posted online for you, organized by jobsite.
Delivery within hours
The supplies and materials Toolbx sources run the gamut from hand and power tools to PVC pipe fittings and hardware to rebar, lumber, steel and concrete. “We have about 50,000 SKUs in our database today,” says Bornstein. “But as we go into new markets, we bring on more suppliers and continuously update those SKUs.”
Toolbx outsources its fleet of delivery vehicles and partners with Onfleet, a provider of last mile delivery management software to connect businesses, dispatchers, drivers and deliveries to end customers in real time.
Lumber, drywall, insulation, fencing, decking products and hardware are some of the most frequently ordered items on Toolbx. “The larger orders typically get scheduled well in advance,” says Bornstein.
For large orders, Toolbx will partner with different suppliers and connect the order to their system, so the builder knows they have this material coming from a specific supplier. Then it facilitates the direct delivery from the supplier, and it all gets tracked in the Toolbx app.
“In the markets that we operate in, we can do deliveries in two hours or less,” says Bornstein. “You can schedule your orders in one-hour time slots, but you also have the option to do four- hour or next-day time slots scheduled in advance. You can also place an order at 11 p.m. and have it show up at 8 a.m. the next day.”
marketplace for material suppliers
Toolbx doesn’t stock materials or products. It’s not a threat to retailers. Rather it partners with both big box stores and local specialty suppliers.
“The nice thing about it is that it is a symbiotic relationship,” says Bornstein. “We are driving revenue to them and helping those suppliers digitize as well. We’re not just building tools for the contractor, but we’re also building tools to help optimize suppliers, as well, because it works hand in hand. We’re trying to provide efficiency and productivity to both sides of the equation.”
The company does not charge users a platform fee, but rather adds a markup on items purchased through the app. There is also a delivery fee depending on distance and weight.
Contractors can also get a $99 monthly subscription that offers unlimited, free same-day deliveries and discounts on delivery upgrades and Pro pricing which gives subscription users up to 7% off on materials in the Toolbx catalog. Competitive delivery quotes are also available on bulk orders.
It says it also save customers money on bulk orders. Users who have a large order can send their materials list directly and they will get a competitive quote (using supplier partnerships) including delivery within 24 hours.
Toolbx is available now throughout Canada and is planning a rollout in the United States next year.
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