Valleforge pairs distribution operators with enterprise software built for building products distributors: HVAC, plumbing and heating, electrical, and the categories around them. We start with pricing, the most powerful lever you have, finding the margin hiding in your contracts, matrices and quotes, then helping your team capture it.
Industry margins have barely moved in 20 years, and the inflation bump didn’t last
Volume is hard to grab and costs are hard to cut, so price is the most powerful lever left. But most distributors still price on cost-plus rules, subject to scattered enterprise data and rep discretion—losing about 6% of annual revenue on average (Source: Bain).
Up to500 bps
the margin uplift for distributors who treat pricing as a strategic system.
As an illustrative scenario, move the sliders to estimate the added margin for a business like yours.
≈ $1.5M margin lift+14% operating profit
$10M$1B
PA&S means parts, accessories and supplies: the categories you price yourself. Equipment pricing is often set by the manufacturer.
10%90%
20%40%
Your operating expenses as a share of annual sales, not including cost of goods sold.
12%20%
200 bps500 bps
Margin you create
$1.5M margin lift
+14%operating profit· ≈$125K per month
To earn the same without pricing
+9%more sales ($9M)
or−11%in cost reductions
Margin you protect, every year
Pricing operations keep your $1.5M lift from eroding, year after year. Without them, the average distributor loses about 6% of revenue to discounts and leakage (Bain).
Free margin assessment, from data you already have.
Case study
A regional HVAC distributor, half equipment and half PA&S.
~$50M sales
annual sales, multiple locations
$850K–$1.5M margin
found in low-demand products and overrides alone
How it works
First, solve your data challenge with Kinect Manifold™, our pre-built ontology for the industry. Then the PriceKinect™ Platform delivers quick wins that earn the reps’ trust. High-volume, high-stakes adjustments are tackled last.
Margin you create
1–3 weeks
1
Connect your data
Kinect Manifold™ data foundation
To solve the data challenge that holds most pricing projects back, we bring data from your ERP and surrounding systems into our Kinect Manifold™ data layer, cleansed and unified under an ontology built for your industry and business.
First lift in weeks
2
Recover contract leakage
Contract Margin Guardian
Flag eroding contracts, reprice low-demand and non-stock items to reclaim margin, without asking the reps to risk their customer relationships.
6–12 months
3
Reprice in stages
Price Matrix OptimizerDynamic Revenue Advisor
Collaborate with reps to understand and reduce overrides. Our software helps flag incorrect price matrices, update stale cost basis, and provide pricing insights for each transaction to support the reps on the final call.
Margin you protect, every year
Ongoing
4
Protect the margin
Demand Elasticity EnginePricing operations
Our software tracks how customers respond to price and keeps prices current as costs and competitors move. Our software recommends and tracks pricing overrides so the margin you've won stays won.
Built for your industry
Your industry
A data model made for distribution
Generic pricing tools assume clean, harmonized data, so projects stall before they price anything. Valleforge starts from a data model built for the building products distribution industry, so you go from raw data to live prices in weeks, not quarters.
Contracts & SPAs
Ship-and-debit, claim-backs, escalators
Job & project quotes
Takeoffs, release schedules, win/loss
Price matrices
Multipliers, column pricing, effective dates
Rebates & buying groups
Vendor, customer and co-op programs
Massive, messy catalogs
UOM conversions, substitutes, categories
Landed cost
Freight, duties, tariffs and surcharges
Who we work with: Independent and co-op distributors in HVAC, plumbing and heating, electrical, roofing and building envelope, waterworks, and industrial MRO, especially those still pricing cost-plus.
Our team
Built by people who know distribution
Designed and run by former operators from Marcone, Johnstone Supply and Ferguson.
Ben Merritt, CPA
Chief Product Officer
Ex-VP Revenue Optimization, Marcone; 17 years at Johnstone
Our team will reach out to you shortly at your email.
Questions distributors ask us
Getting started
We work best with independent and co-op distributors that have outgrown cost-plus pricing but don’t have a large in-house pricing team. If you’re unsure, the assessment conversation will tell us both quickly.
For the free assessment, just 3–12 months of anonymized transaction data. If we move forward, you’ll need an executive who owns the outcome, access to your ERP and sales data, and a pricing or sales lead to work alongside our team. We do the heavy lifting on data and analysis.
The assessment shows the size of the opportunity within the first few weeks, and contract leakage recovery typically delivers the first margin lift soon after. Rolling new prices across all of your sales volume usually takes 6–12 months, working hand in hand with your sales team.
Data and systems
No. Valleforge works alongside your ERP and the systems around it, including Eclipse and DDI. Approved prices are either exported for your team to load or written back directly into your ERP, depending on the access you grant us. Every price is traceable to its source, and your team keeps working where it works today.
That’s where we start. Cleaning and unifying pricing data from your ERP and other sources is the first phase of every engagement, and our data model is built for the conventions of this industry.
Yes. We sign an NDA before you share anything, and we delete your data whenever you ask. Our platform runs on Microsoft Azure and Databricks, both SOC 2 and ISO 27001 certified environments, and we follow cloud data privacy and security best practices.
Cost and results
Three parts. A fixed setup fee, scoped during the free assessment, covers building your data foundation. After that, we earn a gainshare on the margin we create: you keep 70–80%, and gainshare starts only after the margin we deliver has paid back your setup fee. A small ongoing fee covers pricing operations, so the margin stays won. See pricing →
Before any price changes, we agree on a baseline with you. Margin lift is measured against that baseline, and every price change is traceable, so the gainshare is based on numbers your finance team can verify.
Working together
User adoption is built into the engagement, drawing on our experience as consultants and operators in distribution. An owner or executive owns the outcome, and reps own the execution. Reps keep control of the levers, see the reasoning behind each price, and share in the margin they create. We start where reps don’t have to change anything, and expand as results build trust.
Pricing software gives you tools and leaves the work to your team. Consultants give you a one-time study and leave. We bring both, built for building products distribution, and stay to run pricing with you. And because we’re paid from the margin we create, we only do well when you do.
Have a question that isn’t here? Email [email protected] and a member of our pricing team will reply.
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