This was the view builders merchant Tony Elliott put to the London Softwood Club annual meeting and lunch in a speech entitled "Can you survive on timber alone?".

Mr Elliott, now non-executive director of Lawsons (Timber and Building Supplies), told the 77-strong audience how, when he started his career with timber merchant Elliott Perkins in London in the late 1960s, "everybody kept to a market niche".

"You had timber and builders merchants, plumbing supply and electrical specialists and so on," he said. "Businesses stuck to their own furrow."

When Elliott Perkins merged with fellow timber merchant Sandell Smythe and Drayson, however, the new business, Sandell Perkins, embarked on a different strategy, adding a wider range of heavyside products both to its original outlets and branches it acquired in a rapid expansion programme.

"The key to the new policy was location. The branches had to be in busy, buzzy areas; not just with a strong existing customer base, but potential for picking up more passing trade."

The benefits of the move quickly paid off.

"Branches attracted new custom, more passing and collected trade, and logistics became more efficient, as delivery vehicles to and from the yards were more likely to be full – for the average timber merchant, transport costs were 8% of sales, at mixed merchants it went down to 6%. You instantly added 2% to the bottom line," he said. "Multi-product sites overall made better, more efficient and profitable use of premises."

In the late 1980s when Sandell Perkins merged with Travis Arnold to become Travis Perkins – where Mr Elliott was made south-east regional managing director – the multi-product merchant approach became more embedded. The merger also brought tool hire and other activities into the equation.

Mr Elliott insisted he was not saying there was no future for pure timber merchanting. "It can still be a strong business in the right place, with the right products, people and expertise," he said.

In the current competitive climate, however, it was worth exploring other approaches.

"If you’re in a strong location, you could benefit," he said. "Other businesses are trying to peck away at your sales from different angles, so why not respond? Why see a customer come into your premises to buy timber, then go somewhere else for other building products?"