HARDLINES™
Five years serving Canada's home improvement industryApril 10, 2000 - Volume vi, #14
Michael McLarney, Editor & Publisher
Ph: 416-489-3396 Fx: 416-489-6154
E-mail: buzz@hardlinesfax.com Check out our incredible Classifieds section at the end of this issue!* * * * * *
* Canadian Tire goes after more department store customers with upscale assortments
* The Bay reveals its new positioning strategy
* Amazon.com starts an online lawn & garden store
* Home Depot scoops one of Rona's buyers for its Montréal team
* Sales of hardware and lawn & garden products in department stores grows 10% in 1999
* * * * * *CALENDAR UPDATE:OUR AMAZING NETWORKING EVENT Nitty Gritty C&W on Queen St. West! Rancho Relaxo Bar & Grill: Toronto, May 24, 4-9 pm "Getting Organized" &emdash; Management Workshop with organizational guru Estelle Gee. Enough about all this e-commerce stuff already. I can't even find anything on my desk! You too? Ok then. Join us. We'll have some fun breaking the ice and learning some important self-management skills. Plus: Killer country & western band The Wayward Angels. Don't forget to bring lots of business cards! Tickets are only $79 + GST each and include drinks, fahitas, entertainment, prizes and more! Who should attend? Any vendor, retailer or service provider in packaged goods retailing who wants to increase their business contacts &emdash; and just have fun. If you're in sales, marketing, buying, operations or admin, this is a great way to meet other people in your industry. Check out last year's event!* * * * * * Looking for new personnel or new lines? Hardlines Classifieds are read each week by North America's key decision makers in home improvement retailing and manufacturing. Get results fast. Only $16 per line. Call Beverly at 416-489-3396, ext. 2, for more detailsCANADIAN TIRE PURSUES FEMALE, UPSCALE CONSUMERS Canadian Tire's latest remerchandising efforts position the company more than ever as a mass merchant competing against the likes of Sears. An update of its "class of" remodelling program initiated in the early '90s, the "Next Generation" features more national brands and more upscale assortments. Sporting goods will include the latest in fishing accessories, bicycles will no longer be strictly lower end starter models but include $500- plus bikes; and even patio furniture now includes price points as high as $1,500. In the housewares department alone, some 600 SKUs have been added, including $500 sets of pots and pans, providing items that shoppers would typically go to Sears in search of, says Wayne Sales, CTC's executive vice&endash;president. One admitted goal of the new assortments is to reach the female customer more effectively, says Sales. This aim is also reflected in new merchandising and layouts. On entering the new store, departments are signed by pictograms and fixtures at the front of the store have been lowered to four ft., giving the customer a clear view of the paint department, flanked by lighting and electrical, at the back. National brand logos paper the tops of the walls. Power tools have been moved front and centre (where a Tim Horton's coffee kiosk once would have been) and "boutiqued," similar to a big box. Clearer signage in camping and sporting goods attempts, with less success, a boutique approach, as well. Another tip from the big boxes is reflected in higher endcaps, up to 108 inches from 84 inches. Aisles are broken up with six-ft. wide breaks to provide crossover access, a response to criticisms by shoppers who didn't like having to walk all the way to the end of an aisle to move on. * * * * * * *BAY REPOSITIONS ITSELF FOR THE BOOMER MARKET Watch for a new look from The Bay this spring, says Marc Chouinard, the retailer's president and COO. More seasonal selling, remerchandising and greater emphasis on national brands (see Canadian Tire story in this issue) all reflect a clearer focus on its target customer &emdash; the 35-55 year old baby boomer. And that means leaving the lower end to Wal-Mart and pulling back on the high end, Chouinard told a group of vendors at last week's annual meeting of the Canadian Hardware and Housewares Manufacturers Association in Toronto. "Wal-Mart and Sears are growing because they are best at pursuing the value proposition in Canada," he said. Besides value, however, people seek brands and quality, and that's what The Bay is aiming at, to capture some of the market share owned by specialty retailers like Gap. So watch for more national brands in stores and a reduction of its own myriad of private labels to half a dozen by the fall. The new strategy is reflected in a new slogan: "Stylish ideas made easy." The company will focus more on hard goods such as furniture, after years of increasing its soft lines did not have the desired impact on profitability. * * * * * * *AMAZON.COM ENTERS THE LAWN & GARDEN/OUTDOOR MARKET Amazon.com has launched a new online lawn & patio store, featuring outdoor grills, patio furniture, birdfeeders, lawn mowers, garden tools and decorative ornaments from more than 50 national brands. Shipping for all products (even something as large as a riding lawnmower) is US$4.95. At the new website, customers can browse through 13 categories: birds and wildlife, clothing and gear, decoration and lighting, furniture, outdoor cooking, ponds and structures, pots and planters, power equipment, seeds and fertilizer, storage and cleanup, tools, watering, and weed and pest control. Click on: www.amazon.com/lawnandpatio/ COMPANIES IN THE NEWSTurkstra Lumber had its annual contractor appreciation night on April 5. It drew an estimated 2,000 tradespeople from throughout Southern Ontario's Niagara Peninsula, customers of Turkstra's nine- store chain, and featured about two dozen vendors in a small trade show. Beaver Lumber dealers will be closer to owning 100% of their businesses starting in December 2000. That's when Home Hardware, which acquired Beaver last fall, will initiate the process of sorting out financing needed by each dealer to buy the half of their businesses formerly owned by Beaver Lumber itself. Guardian Industries Corp. and its affiliate, Builder Marts of America Inc., have revised their bid to purchase all outstanding shares of Cameron Ashley Building Products, offering US$18.50 per share. This ups the ante from an offer from CABP's own management team, headed by chairman Ron Ross, of US$17.00 per share. Sodisco-Howden Group finalized its purchase of western hardware wholesaler Smith-Barregar on April 3. The cash deal gives SHG three distribution centres: Victoriaville, Qué., London, Ont., and Vancouver. Approximately 43,000 sq.ft. of a 103,000-sq.ft. former Eaton's location at Carrefour Angrignon in LaSalle, Qué., will be converted to a Sears Furniture and Appliances store. The store is scheduled to open in early fall. Zellers Inc. has opened a new flagship store at a former Eaton's in the Square One Mall in Mississauga, Ont. The 167,000-sq.ft. site is part of a store upgrade program that began with the acquisition of 67 Kmart stores in February 1998. The new Zellers features wider, "stroller-friendly" aisles, improved departmental layouts and adjacencies, enhanced signage and sightlines, more accessible display units and store fixtures, and the addition of a diner. Rayovac has announced a price increase for selected products, effective May 29, 2000. The overall price for the products will increase on average by 4-5%, depending on the product. The company says it will use some of the funds to invest in R&D. Nu-Gro Corp. has announced its intention to purchase the assets of Agrola Inc. in Crossfield, Alta. The 6.8-acre property, 40 km north of Calgary, will facilitate continued growth of Nu-Gro, while its 1.4- acre Calgary location will be sold off. The deal, worth $4 million, is expected to close during 3Q 2000. CANADIAN STOCK WATCH