Lumber Liquidators makes a move to bolster its supply chain
September 30, 2011 04:11 PM
Chain store and hardwood flooring retailer Lumber Liquidators Inc. is expanding its supply chain operation by making an acquisition in China.
Lumber Liquidators, No. 259 in the Internet Retailer Top 500 Guide, has acquired certain assets of Sequoia Floorings relating to Sequoia’s quality control, product development and logistics operations in China for about $8 million.
Sequoia provides product quality control and development services for Lumber Liquidator’s supply chain and product purchasing operations. The deal will help Lumber Liquidators, which sells online at LumberLiquidators.com, improve its supply chain flow, especially from Asian mills and lumber suppliers, the company says.
“One of the core components of Lumber Liquidators’ strategy and a key competitive differentiator has always been our ability to purchase products directly from mills, so we are excited to launch the third phase of our sourcing initiatives with the significant expansion of direct sourcing in China,” CEO Jeffrey Griffiths says.
The acquisition agreement includes a cash outlay of approximately $5 million, Lumber Liquidators says. The deal is expected to close by the end of the year.
“This acquisition will allow us to expand operating margin, while at the same time provide greater flexibility in our marketing programs to help us attract consumers with aggressive opening price points,” Griffiths says. “Most importantly, we look forward to working with our new Asian team and expanding our family of mills.”