Operations at one of Canadian Tire’s largest DCs remain suspended, two weeks after a fire on March 15 damaged the facility on Goreway Drive in Brampton, Ont. All of the employees at the facility were safely evacuated, the company says. However, delayed shipments are occurring.

The 1.2 million-square-foot A.J. Billes Distribution Centre distributes goods nationally. The company said that the suspension of the facility’s operations will impact Canadian Tire’s first quarter results, due to be released on May 11.

“Priority inventory” is being transferred to other Canadian Tire distribution centres, the company says, and temporary distribution facilities are being prepared. The extent of the damage and the reopening time frame are still being assessed, it added.

The losses to the firm include damaged or destroyed inventory, building damage, and the costs of cleanup and repairs. However, Canadian Tire’s insurance company is involved. The company says it plans to reopen the facility in stages when repairs are complete.

According to Canadian Tire, the A.J. Billes Distribution Centre, which was built in 1991, can fill 200,000 cartons and 120 truckloads of product a day. In 2006, it and the company’s Calgary DC were sold to H&R Real Estate and leased back from that firm. That lease expires in 2027, according to information made public at the time of the lease-back.

Canadian Tire also has two other DCs in this area on the west side of the GTA. One of them is a state-of-the-art bulk facility measuring 1.4 million square feet in Bolton, Ont. (sometimes referred to as the Caledon DC). It is 20 kilometres northwest of the stricken A.J. Billes facility. The company also has a second DC in Brampton, 14 kilometres to the west of the closed DC, on Hurontario St. This DC was completed last year—and is also considered state-of-the-art. It measures 1.3 million square feet.

Why should hardware and home improvement dealers be interested in the latest opening by industrial plumbing and heating supplier Wolseley? Because it’s another example of how the lines between channels are getting blurred.

In recent years, Wolseley has updated its merchandising and its overall offering to contractors and trades. But its new outlet in Ajax, Ont., on the east side of the Greater Toronto Area, features a recent new addition to the Wolseley offering: “Studio,” a showroom that features higher-end fixtures and fittings.

The Wolseley Studio has a separate entrance and more upscale feel than the rest of the store. The expanded offering includes high-end faucets and lines of bath hooks and towel racks. There is also an in-house designer to help contractors offer suggestions for their end-user customers and to put together a full package for a project.

There are currently 200-plus Wolseley locations in Canada and only 26 of them have a Studio, but watch for more to come. “We have plans to open more showrooms across Canada in coming years in those markets where it makes sense,” says David Stern, Wolseley’s vice-president for eastern Canada.

The target customer, he adds, is the residential contractor, typically someone doing a reno versus building a new home. The first Studio showrooms appeared in western Canada, and the first one in Ontario was in an outlet in Hamilton. Another half a dozen stores that will open in coming years will have the showrooms, including, says Stern, two that are expected to open this year. “We see this as part of our sales proposition to our plumbing contractors.”

The pandemic has obviously created all kinds of disruptions in the retail home improvement industry. Groups have experienced ownership changes, executive shuffles, and even new distribution models, driving many dealers to re-examine their strategic alliances. But BMR Group says it has seen very little attrition during Covid—and even gained four dealer-members last year.

Two of those dealers were in BMR’s home province of Quebec, says Charles Grégoire-Béliveau, vice-president of merchandising, where the banner has its strongest presence. But the group continues to set its sights farther afield, especially in Ontario. While Grégoire-Béliveau can’t offer up details of deals in the works, he says BMR will definitely sign more dealers before the year is out.

“We’ve enjoyed stability during these constantly changing times,” he adds. But why are the dealers staying put? It’s all about how BMR connects with and communicates to its members, according to Grégoire-Béliveau. “I think it’s the way we address those dealers and work with them in the market. We include them.”

The dealers are part of much of what goes on at head office, including line reviews, he points out. “They are part of the category review process.” He cites as an example of this inclusion the fact that BMR merchants took 35 dealers to the National Hardware Show in Las Vegas back in January—the second year in a row the dealers accompanied his team to the show. There, those dealers provided input and guidance on the various new products on display. “We involve them in the decision-making and they feel involved in the process.”

The barriers between head office and the stores are eliminated in other ways as well. For example, dealers have access to the cell phone numbers of all the merchants and executives. “I think it’s very personal what we have here,” says Grégoire-Béliveau.

“For them to switch or move away from BMR, they would not find this kind of family relationship.”

The Canadian Home Products Trade Association (CHPTA) has been monitoring the grocery industry as that channel works toward establishing a business “code of conduct” between grocery retailers and their suppliers. Now the CHPTA wants to implement a similar initiative for the hardlines industry.

According to CHPTA president Sam Moncada, his association’s goal is to leverage the final version of the grocery industry agreement and introduce a similar code of conduct for hardware, housewares, and home improvement products. “We’ve been talking and collaborating with grocery producers as they’ve worked for years and years on this, and they have a draft that they’ve shared with us,” says Moncada.

The grocery industry is looking to have its code of conduct implemented by the end of 2023, according to federal agriculture minister Marie-Claude Bibeau. Though the grocery retailers have come to the table to work on this, delays have come from their inability to find a common ground, Moncada notes.

The need for such a code in the hardlines industry is underscored by the sheer size of retailers and their ability to dictate terms—often changing them after a deal has been signed. Moncada cites a recent mandate from one retailer that added an approximately one percent back-end charge.

Manufacturers understand that circumstances can change, says Moncada, but leaving the vendors out of the negotiations is counter-productive. “When a retailer arbitrarily changes the terms without consultation, it definitely hurts the manufacturers.”

The federal government received a draft of the grocery code last November, the result of more than a year of negotiations between industry groups representing farmers, food processors and suppliers, independent grocers, and national retail chains. They worked with a government-appointed mediator. Using the grocery initiative as a template, says Moncada, “we want to invite all the players in the hardware and home products categories to the table to talk.”

(The CHPTA will reach out to retailers to participate in developing a similar code of conduct for this industry. It will also be inviting individuals from its member companies to serve on an advisory committee to help with this process. If you would be interested in participating on the advisory committee, email Sam or call him at 416-282-0022, ext. 125.)

Regal ideas has named Derrick Czayka as its new territory manager for Alberta as well as the Kootenays, Cranbrook, Fernie, Creston, and Trout Lake. His CV includes management positions at InFarm and The Home Depot Canada. As a result of this appointment, Bob Lloyd will move into a new position in business development and special projects.

Brian Greig joins the Telesteps Ladders team as director of business development and national accounts. He holds diplomas in marketing from York University and Seneca College and was previously national sales manager for Liteline’s retail division.

DID YOU KNOW...?

... that the latest edition of Hardlines HR Advisor is now available? This publication provides case studies and meaningful tips for managing the people side of your business. In this latest issue, we examine the problem of employee “ghosting,” getting your team passionate about sales, and useful suggestions for preventing repetitive strain injuries. If you’re not already receiving this monthly publication, click here now to sign up for free!

RETAILER NEWS

Russ Jones and his family, owners of Coast Builders in the Sunshine Coast region of British Columbia, last week celebrated the opening of two new kitchen and appliance showrooms, located at their Sechelt and Madeira Park RONA stores. This new showroom concept, which is aimed at both pros and DIYers, is designed to support customers through their home or professional kitchen improvement projects, from design to installation. The stores’ showrooms feature kitchen products and appliances displayed in a boutique environment.

Nunavut Logistic Solutions Inc. has joined Sexton Group. The company will transport construction materials from Quebec to northern Canada to support projects ranging from commercial construction to affordable housing projects, in collaboration with Nunavut Logistics’ sister company NCC Development Ltd.

Canac, the independently owned home improvement giant in Quebec, has decided on its two new locations. Rivière-du-Loup, on the St. Lawrence River some 200 kilometres northeast of Montreal, will be the site of the 33rd Canac location. Construction will begin on access roads and services this year. Meanwhile, Sorel-Tracy, a city about 80 kilometres northeast of Montreal, will be the site of Canac’s 34th location. That store is expected to open in 2024.

RONA has launched its sixth annual fundraising campaign for Children’s Miracle Network and Opération Enfant Soleil, a cause which supports 14 children’s hospitals in Canada. Until April 28, all corporate Lowe’s, RONA, and Réno-Dépôt stores across the country, as well as 42 RONA affiliated dealers and six distribution centres, will join forces to raise funds in stores and online.

Montreal-based discount mass merchant Dollarama had a strong close to 2022, with fourth-quarter sales up by 20.3 percent to $1.47 billion. Comparable store sales grew 15.9 percent. For the year, Dollarama’s sales increased by 16.7 percent to $5.05 billion, with comp sales up 12.0 percent. In addition, the company opened 65 new stores during the year, bringing its total to 1,486.

SUPPLIER NEWS

RenoRun Inc. filed for creditor protection in Quebec on March 28 as it begins the process of finding a buyer or investor. The firm, which provides Instacart-style delivery for construction materials, received a US$142 million investment last year led by Tiger Global Management. Since then, ballooning interest rates and disagreements with potential investors have landed it in financial difficulty. The company was started in Montreal in 2017 before expanding to Toronto and Austin, Texas, shortly thereafter.

ECONOMIC INDICATORS

Retail sales increased 1.4 percent to $66.4 billion in January. The increase was led by higher sales at motor vehicle and parts dealers, up 3.0 percent, and gasoline stations and fuel vendors, which rose by 2.9 percent. Sales in LBM and garden categories rose by 1.5 percent from December but remained 8.4 percent below January 2022 levels. (StatCan)

NOTED

The federal government unveiled its new budget last week, earmarking $20.9 billion over five years to “green” the economy. The bulk of those funds go to investment tax credits for clean energy. The document offers competition to incentives under the U.S. Inflation Reduction Act, which had the potential to attract investment away from Canada.

OVERHEARD...

‘‘It is truly an honour to help improve the health and quality of life of children across the country and to help hospitals provide advanced care. We are also proud to see the mobilization of our network’s employees, as well as the contribution of our customers at each campaign and the generosity of our suppliers who donate materials for the Maison Enfant Soleil.”
—Mélanie Lussier, director, external communications and sustainable development, at RONA inc., on the retailer’s initiatives over the past five years, which have raised a total of $4.7 million for children’s hospital foundations across Canada.

“We understand that circumstances can change, but there should be some consultation and some collaboration—and some negotiation.”
—Sam Moncada, president of the Canadian Home Products Trade Association, on his association’s efforts to implement a code of conduct for retailers in this sector.