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                     [Letterhead of KPMG Peat Marwick LLP]

                                                                    EXHIBIT 15.1



                          INDEPENDENT AUDITORS' REPORT
                          ----------------------------


The Board of Directors
Payless Cashways, Inc.:


We have reviewed the accompanying  condensed balance sheets of Payless Cashways,
Inc. as of March 1, 1997 and February 24, 1996 and the related condensed 
statements of operations and cash flows for the thirteen week periods then
ended.  These condensed  financial  statements are the responsibility of the
Company's management.

We  conducted  our  reviews in  accordance  with  standards  established  by the
American  Institute  of  Certified  Public  Accountants.  A  review  of  interim
financial  information consists principally of applying analytical procedures to
financial  data and making  inquiries of persons  responsible  for financial and
accounting matters. It is substantially less in scope than an audit conducted in
accordance with generally accepted auditing standards, the objective of which is
the  expression  of an opinion  regarding the  financial  statements  taken as a
whole.  Accordingly, we do not express such an opinion.

Based on our reviews, we are not aware of any material modifications that should
be made to the accompanying condensed financial statements for them to be in
conformity with generally accepted accounting principles.

We have  previously  audited,  in accordance  with generally  accepted  auditing
standards,  the balance sheet of Payless Cashways,  Inc. as of November 30, 1996
and the related  statements of operations,  shareholders'  equity and cash flows
for the fiscal year then ended (not presented  herein);  and in our report dated
January  13,  1997,  we  expressed  an  unqualified  opinion on those  financial
statements.  As discussed  in note H to the  financial  statements,  the Company
adopted Statement of Financial Accounting Standards No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of," in
fiscal  1996.  In our opinion,  the  information  set forth in the  accompanying
condensed  balance  sheet as of November  30, 1996 is fairly  presented,  in all
material  respects, in  relation to  the balance sheet from  which it  has  been
derived.





s/ KPMG Peat Marwick LLP

Kansas City, Missouri
March 14, 1997




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                     [Letterhead of KPMG Peat Marwick LLP]

                                                                    EXHIBIT 15.1



Payless Cashways, Inc.
Kansas City, Missouri

Gentlemen:

With respect to the subject registration statements on Form S-8 and Form S-3, we
acknowledge  our awareness of the use therein of our report dated March 14, 1997
related to our review of interim financial information.

Pursuant to Rule 436(c)  under the  Securities  Act of 1933,  such report is not
considered  a part of a  registration  statement  prepared  or  certified  by an
accountant or a report prepared or certified by an accountant within the meaning
of Sections 7 and 11 of the Securities Act.





                                                 s/ KPMG Peat Marwick LLP

                                               
Kansas City, Missouri
March 14, 1997