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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  consolidated  balance  sheets of
Payless Cashways,  Inc. and subsidiary as of August 24, 1996 and August 26, 1995
and the related condensed consolidated statements of operations for the thirteen
and thirty-nine  week periods then ended and cash flows for the thirty-nine week
periods then ended. These condensed  consolidated  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 consolidated 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  consolidated  balance  sheet  of  Payless  Cashways,  Inc.  and
subsidiary  as of November 25, 1995 and the related  consolidated  statements of
operations,  shareholders'  equity and cash flows for the fiscal year then ended
(not presented herein); and in our report dated January 9, 1996, we expressed an
unqualified opinion on those consolidated financial statements.  In our opinion,
the information set forth in the  accompanying  condensed  consolidated  balance
sheet as of November 25, 1995 is fairly presented,  in all material respects, in
relation to the consolidated balance sheet from which it has been derived.




s/ KPMG Peat Marwick LLP

Kansas City, Missouri
September 9, 1996




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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 September 9,
1996 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
October 7, 1996