Ferguson Enterprises, Inc. , one of the country's largest wholesale distributors of plumbing and heating products, expanded its reach in the MRO world this fall with the purchase of Endries International, a vendor-managed inventory, MRO services, and industrial fastener distributor headquartered in Brillion, Wis.

Some industry experts say this is yet another sign of a growing industry trend, as already large distributorships branch out into other industries to command more market share and expand their customer base.

The acquisition includes Endries' headquarters in Brillion, as well as customer sites and leased locations in the United States. The purchase of Endries gives Ferguson, a part of Wolseley plc, expansion opportunities in the fastener and VMI business areas. Endries will operate as part of Ferguson's Commercial/Industrial Business Group, and trade as Endries International, Inc., and Endries Inc., Ferguson subsidiaries.

Wolseley is one of the largest distributors of building materials, plumbing and heating products in North America, the United Kingdom and Continental Europe.

This is the seventh, but arguably the largest, acquisition by Ferguson in the last 12 months. The company also purchased R Supply Co., a plumbing, heating and industrial tool wholesale distributor headquartered in Reno, Nev., in a transaction completed Dec. 6, 2004; J.D. Daddario, Inc., a plumbing wholesale distributor headquartered in Franklin, Mass., on Jan. 31, 2005; Meckco Supply Co., a wholesale plumbing distributor headquartered in Charlotte, N.C., on Feb. 7; Camellia Valley Supply, a waterworks wholesaler based in Sacramento, in October; John H. Frischkorn, Jr., Inc., a pipe, valves and fittings distributor headquartered in Richmond, Va., in a transaction that was expected to close on Nov. 30; and LAB Distributing, Inc., an independent dealer of General Electric appliances in the Raleigh-Durham, N.C., market on Nov. 7.

'Ferguson's commitment to customer, supplier and associate growth will provide exciting opportunities for all involved,' said Endries president Steve Endries, who will remain with the company.

Endries, number 32 on Industrial Distribution's list of the Big 50 industrial distributors, has annual sales of about $150 million and employs more than 500 associates. Ferguson , listed as No. 1 on the Big 50, has sales of about $7.1 billion, and more than 18,500 associates in nearly 990 service centers across the country, Puerto Rico and Mexico.

'Ferguson is excited to have the Endries family as part of our team,' said John Stegeman, Ferguson's president and chief executive officer. 'Their expertise in the fastener business, combined with vendor-managed inventory and materials handling capabilities, offers our company great opportunities for further growth and process improvement.'

As for marketplace changes that may occur due to the purchase, Mark Dancer, vice president and principal of Pembroke Consulting, said he couldn't comment on Ferguson's specific strategy or intent, but has some thoughts on the subject.

'Large customers in industrial and construction markets are implementing buying practices that may motivate distributors to expand,' he said in response to a question about whether he thought Ferguson may continue to buy fastener distributorships. 'In industrial markets,...distributors can attempt to build clout by expanding their product lines and offering new value-added services related to procurement or operational improvement that shift the focus to total cost of ownership.

'In construction markets, large production builders are also seeking to use their buying power for economic gains,' he said. 'Sometimes they ask for price concessions and rebates. But they are also driving for labor-only contracts in many product categories. Under these arrangements, contractors are only paid for installation, and the builder negotiates prices and captures some supply chain margins. Again, large distributors can offer arrangements that cover more of what a builder may need to procure and may have the clout or motivation to innovate new job site support arrangements.'

On Nov. 1, another Wolseley company, Stock Building Supply, purchased Seigle's, Inc., a distributor of building materials and contractor services. Seigle's has 11 locations across Chicago and northern Illinois. Stock Building Supply also acquired Canyon Drive Lumber, a distributor of building materials in Amarillo, Texas, on Nov. 7.

Wolseley has, since August 2005, acquired 15 distribution business in Europe and North America (including Ferguson's) for about 418 million pounds in cash. These acquisitions are expected to add about 617 million pounds to group turnover in a year. The acquisitions, divided up by Wolseley's divisions, total: four in European distribution; nine in North American plumbing and heating distribution; and two in U.S. building materials distribution.

Said Charlie Banks, group chief executive of Wolseley, 'I am delighted to announce these...new acquisitions, which will further strengthen our presence in North America. They support our strategy of growing the business at double-digit rates through acquisitions and organic growth.'