Lowe's in Canada: who's on the team?

TORONTO–Lowe's is coming to Canada. Okay, you've heard that already, but after announcing their arrival, the company retrenched to build its Canadian team and scope out store sites. Unfortunately, Lowe's has kept so low-key (Lowe's-key?–Editor) about its plans that many in the industry began to wonder whether the world's second-largest home improvement retailer is, in fact, coming to Canada after all. Worry not (or keep worrying, depending on whether you are a vendor or retailer). Lowe's is busy working behind the scenes to sort a range of issues related to setting up in a foreign country. First, Lowe's is preparing to move into offices of its own just south of the corner of Yonge St. and Finch Ave. in Toronto's north end. That move will take place by the middle or end of May. The executive and buying teams are almost finalized. Doug Robinson leads the team, as president of Lowe's Canada. Although an American, Robinson had experience in Canada as the former president of Beaver Lumber, before that company was sold to Home Hardware Stores Ltd. in 1999. Joining him from Lowe's in the U.S. is Ben Mauceri, vice-president of merchandising. In addition, Catherine Townsend is vice-president of human resources. She worked about four years ago for Home Depot Canada. Lowe's Canada's vice-president of supply chain is Lauri Digulla, who was formerly at Hbc, with experience consulting on both sides of the border. Alan Huggins is vice-president of operations, also from Lowe's U.S. A director of marketing is still to be named. From what HARDLINES can determine, most of the merchandising team has been hired, as well. Lowe's is harvesting the bullpens of both Canadian Tire and Wal-Mart for buyers, reportedly offering anywhere from 20-40% more than the buyers were currently being paid. However, so far, no current Home Depot Canada buyers have been lured away. The line-up includes three directors of merchandising, under whom a number of merchants will report. Peter Bowes has joined as director of merchandising for hardware, in charge of power tools, hardware, outdoor power, appliances, and home environment. Bowes has a wide range of experience on the vendor side, most recently with Freud Canada, but also with Delta Porter-Cable and Karcher, among others. He has three merchants reporting to him. They are: Bob Vaillaincourt, who left his position as category manager for hand tools at Canadian Tire to act as Lowe's buyer for hand tools, and Rob Reesey, who also defected from Canadian Tire, reporting to Bowes in the hardware department. Al Challis is another former Canadian Tire and Home Depot buyer, is also in the hardware department under Bowes. Bob Sherwood, a former Beaver buyer, is now director of merchandising in charge of building materials. Buyers identified so far: Ron Krochuck, who was once a merchant at Home Depot Canada, has signed on as lumber merchant. Bernie Snider has been lured away from Wal-Mart Canada as building materials merchant. Snider had only recently taken over hand tools at Wal-Mart, having worked before that as their automotive merchant. His background includes Ace Hardware Canada and Beaver Lumber. (Stephanie Greene, his MA at Wal-Mart, is covering for him for the next three weeks or so until a replacement is named.) Cliff Pike has been lured away from Canadian Tire to join Lowe's as director of merchandising for lawn and garden/seasonal. Reporting to him is Jim Webb, who reportedly came over from White Rose. The other two people reporting to Pike are also from Canadian Tire: John Thager and Michelle Ritchie. The latter was formerly associate category manager for back-to-school and home office at Canadian Tire. A fourth director, whom Hardlines has yet to identify, will be director of merchandising for decor. Most of the new team headed down to Lowe's head office in Mooresville, N.C., yesterday for up to five weeks of training. Lowe's will enter Canada with up to 10 stores in 2007, beginning in the Greater Toronto Area. Exactly where those stores will be remains shrouded in mystery, but locations being cited–though still unconfirmed–include Toronto, near Home Depot's Castlefield store (being stalled by the city), a site closed in Hamilton on Barton St., and Molson Park Dr. in Barrie, across the street from a Rona Home & Garden. Other metro markets are expected to follow, with the eventual entry into rural markets, as well. Robinson at Lowe's Canada expects there's room for as many as 100 Lowe's stores in this country.

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SpanCan and ILDCA settle into hardlines partnership with TIM-BR MARTS

AJAX, Ont.–An alliance between two of Canada's biggest buying groups has successfully weathered its first months of existence, and is reportedly "doing quite well". Late last year, Independent Lumber Dealers Cooperative (ILDC) formed a hardlines buying alliance with TIM-BR MARTS Ltd., calling it Independent Hardware Dealers Alliance (IHDA). IHDA, in turn, partners with PRO Retail Sales–itself an alliance between CanWel, Hardware Division and TruServ Canada–to manage ILDC's hardware buying function within the group called SpanCan. Have all the bugs been worked out? "Like any new alliance, it takes time and work," says Andrew Battagliotti, general manager of ILDC and president of SpanCan. "It's like a marriage," he adds with a smile. ILDC negotiates its hardware purchases through SpanCan, sitting alongside its distributor of choice, CanWel, Hardware Division, working in conjunction with TruServ Canada under PRO Retail Services. But even with these latest additions, the original buying group stays intact. "SpanCan remains unchanged, operating as it has over the past six years, but now it is larger with two new partners," Battagliotti says. The two partners have the same mandate as in the past in that SpanCan (ILDC and PRO Retail Services) negotiates warehouse shipments for ILDC members, with CanWel serving, essentially, as the distributor of choice for those ILDC members, while IHDA (TIM-BR MARTS and ILDC) was formed to negotiate hardlines direct shipments for members of both groups. The end result for vendors is that they now effectively sit across the table from four partners: ILDC, TIM-BR MARTS, CanWel, Hardware Division, and TruServ, giving those partners a wider range of options. "Dealers now have the choice of going through distribution or going direct–whatever is most beneficial for them," says Battagliotti. (For more background IHDA and SpanCan, see vol. xi, no. 44, Nov. 21/05 –Editor.)

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Home Depot Canada launches online "flyer" specials

TORONTO–Home Depot Canada has introduced a new e-commerce initiative that offers consumers one limited-quantity product at an extremely low price every day. Called Hammer Drop, the site launched at 8 a.m. today, selling a Ridgid 14.4 volt drill, regularly priced at $249, for $99. Pat Wilkinson, director of marketing for Home Depot Canada, said in a release that the program is designed to meet consumer demand for a wide variety of home decor and renovation products, lighting and tools at attractive prices, adding that the number of products being offered at the reduced price will not be published, in order to encourage visitors to log on every morning. The move fits with Home Depot Canada's plans to use new media to connect with customers, a strategy articulated by Tom Taylor, executive vice-president of merchandising and marketing, at the HARDLINES Conference last September. It also reflects growing consumer acceptance of on-line marketing and shopping. According to eMarketer, which produces and publishes market research information about the Internet, online shopping is growing at a rate of 20% annually, and has become a significant influence in the retail home improvement industry. In 2005, sales on homedepot.ca grew by 500% over 2004, helping to establish the site as one of the fastest-growing websites in Canada.

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BMR's Ontario presence grows

LONGUEUIL, Que.–BMR the Group, the Quebec buying group and wholesale distributor of hardware and building materials, has been active in its efforts to grow membership beyond its provincial borders. Those efforts include a previously announced signing of 12 dealers from the Maritimes, plus inroads into Ontario. According to Dunc Wilson, director of hardware for BMR, the latest signing to the BMR banner is a former TIM-BR MART member in Central Ontario, Drummond Building Materials in Marmora. That dealer is currently converting the store to become Drummond Building Materials and Renovations, adopting the name being used by BMR members in anglophone markets. Drummond is the fourth BMR dealer signed in Canada's largest province; the others are in Ottawa, Hawkesbury, and Curry Hill (along the Quebec border near Alexandria). The group was formerly partnered with AWARD in Atlantic Canada, TIM-BR MART Ontario (formerly Homecare), and TIM-BR MARTS Ltd. in the West within the umbrella buying group Matreco. Each member respected the others' regional boundaries, but the Matreco partnership has deteriorated since three of its members have merged, leaving BMR on its own–and free to expand its geographic reach.

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Orders remain strong at Atlantic Building Materials Show

MONCTON, N.B.–Atlantic Canada's key buying event for building materials dealers was held last weekend, and despite grumblings about softer attendance figures, both attendance and buying activity remained high. The first day began quietly. Some few exhibitors expressed frustration with the small turnout but remained optimistic about Friday and Saturday. Nor were they to be disappointed. Friday and Saturday were certainly busier. In fact, despite perceptions, attendance at this year's show was up from 1,200 last year to more than 1,300 this year. However, said Don Sherwood, president of the Atlantic Building Supply Dealers Association, which owns and operates the show, the event ran for 2Ôø‡ days, instead of two last year. Those extended hours spread the crowds enough to make the show appear less busy than it was, he said. "Our membership is 292 dealers and we had 255–or 87%–registered to attend," he said, up from 243 members last year. They included key retailers, such as Kent, Chester Dawe and Notre Dame Agencies. Sherwood says he will request the ABSDA board to consider returning to a two-day event for next year. Distributors and retail groups, including RONA inc., TruServ Canada, BMR the Group, Guardian Building Products, and CanWel, all enjoyed a steady flow of traffic to their booths. For most exhibitors, however, the show was still worthwhile because they had face-to-face contact with their existing clients.

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What's in store for Hudson's Bay?

TORONTO–Canada's oldest retailer is now in the hands of Jerry Zucker, the South Carolina investor whose holding company took over Hbc last month. But Zucker, now CEO of Hbc, insists the company, which was established in 1670 and currently has 550 stores and five banners, will remain intact. In the face of rumors that he would sell off stores, he said that Hbc's new management team is, in fact, pursuing a strategy to revitalize and improve the company's current real estate portfolio in the coming year. "I purchased this company based on its fundamental value, part of which resides in the strong national franchise of stores we operate from coast to coast," said Zucker in a prepared release. "I am truly excited about this company's opportunities and we intend to grow Hbc's five formats by improving our portfolio, not through mass closures. That's just not in the cards and anyone speculating that it is, is not informed on my vision for Hbc. He added that a number of stores that had previously been targeted for closing are instead being revitalized and re-branded. A number of revitalizations, expansions and improvements are on the books for the year ahead. The Zellers mass merchant chain will open new replacement locations in Brandon, Man.; Saskatoon; Welland, Ont.; and Boisbriand and Joliette, Que. Billed as prototypes for the Zellers store of the future, they will be significantly larger than the existing locations. Another store, in Oakville, Ont., is currently being expanded and other openings are planned. Home Outfitters, the chain of home furnishings and accessories stores, will open three more outlets stores in Canada this year, two in Ontario and one in Quebec. Designer Depot, Hbc's new chain of specialty off-price stores, will continue to expand into Western Canada with openings in Calgary and Edmonton. This will give Hbc a total of four Designer Depot locations in Western Canada, in addition to five stores in Ontario. Additional expansions are planned for Fields, Hbc's chain of small general merchandise locations. Hbc increased the number of Fields from 103 to 118 in 2005 and intends to add units in 2006 depending on the availability of suitable sites.

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