HARDLINES™ Five years serving Canada's home improvement industry August 31, 2000 - Volume vi, #32 Michael McLarney, Editor & Publisher Ph: 416-489-3396 Fx: 416-489-6154 E-mail: buzz@hardlinesfax.com  
Check out our incredible Classifieds section!
* * * * * * * IN THIS ISSUE: * Chicago Hardware Show faces crisis of faith * Canadian Hardware Show adds Décor Show * Home Depot to open first Montréal store * Lowe's in lead among big boxes selling appliances * * * * * *   FIFTH ANNUAL HARDLINES MARKETING CONFERENCE: September 14, 2000. An incredible one-day symposium featuring some of North America's leaders in retail, including the executive team from Home Depot Canada, plus McMillan/Doolittle, Gardener's Supply, J&H Builder's Warehouse (an amazing Tim-BR- Mart dealer from Saskatoon), Tim Silk from UWO's Ivey Business School, sessions on branding, competitive intelligence and e- commerce - and much more! Expect about 200 retail and vendor executives to attend! NO HARDLINES NEXT WEEK But we're in the office, just working on other stuff. Like our incredible Marketing Conference and shipping hot-off-the-presses Who's Who Directories. Our next issue comes out September 5. See you then! - Michael WE WERE WIRED FOR SOUND AT NHS: Bev and I kept in touch during the National Hardware Show in Chicago with a very cool pair of Motorola GT two-way radios. They're used in retail to help staff keep in touch from aisle to aisle or floor to floor, in the yard, etc. My thanks to David Poirier at Lenbrook Industries (905-831-6555, ext. 4283); dpoirier@lenbrook.com  
CHICAGO HARDWARE SHOW: BACK NEXT YEAR? Most of the key Canadian buyers were represented, including Ace Hardware Canada, Sodisco-Howden, Canadian Tire, Home Hardware, Peavey Mart, Home Depot, etc. In fact, preregistration was up enough to leave organizers anticipating a 2-3% increase in attendance over last year's 67,600 visitors.   The companies that weren't there were previous exhibitors conspicuous by their absence. The likes of Black & Decker, which along with Bosch, Owens Corning and others, chose to sit out this year's Show. Ryobi decided two years ago to opt out altogether. They may well represent the thin edge of the wedge. A number of companies told me they will not return or seriously consider dropping out next year. B&D and Bosch will alternate between Chicago and the International Hardware Fair in Cologne, Germany. The move has appeal for a number of vendors who find the costs surrounding trade shows rising even as orders continue to fall. Bosch's presence at the Cologne Fair reportedly cost about $12 million for the booth alone. Why the discord? It boils down to the problem surrounding many shows today. Despite getting "face time" with key buyers, the real buying decisions, the key programs, are presented in the buyers' offices - well in advance of any public showing of "what's new." The shows that remain the most effective buying shows are the dealer shows, such as Home Hardware's, and regional shows, such as the WRLA's event in Saskatoon in January or the ABSDA's in Moncton each spring. Even the Canadian Hardware and Building Materials Show is cannily consolidating its position as a strong regional showcase - only the region is Canada within a larger marketplace that now spans North and South America. The drop off in traditional vendors at NHS is being taken up by e- business providers. At least 20 B2B companies were at the show, offering a range of services from online quotes and catalogues to trading and liquidation services. * * * * * * CHS ADDS PAINT AND DÉCOR SHOW The Canadian Hardware and Building Materials Show has formed an alliance with the Paint and Decorating Retailers Association to add the PDRA's Interiors Show to the CHS. The move will give Canada's largest hardware show its own "Décor Showcase" and increase representation by up to 6,000 paint and décor retailers who would have attended the Interiors Show in the past. The coalition follows last year's alliance with the LBMAO, which married that association's Canadian Home CentreShow with CHS.  
COMPANIES IN THE NEWS   Home Depot Canada will open its first store in Québec province this week. The store will go into the Montréal area in Laval. For the second quarter ended June 30, Sodisco-Howden Group had sales of $134.8 million, up 3.1% from $130.8 million a year earlier. Net earnings grew 79% to $5.8 million, from $3.2 million, a result of lower financial expenses subsequent to the conversion of debentures, the revaluation of future income tax assets and margin improvement. Slocan Forest Products Ltd. will shut down all of its sawmills, planers and related woodlands operations for a two-week period commencing in late August. The company says the closings are in response to "difficult market conditions and the oversupply situation of lumber to the North American market." The Home Depot in Atlanta reported net earnings of US$838 million for the second quarter of fiscal 2000, up 23% from US$679 million in the second quarter of 1999. Sales totalled US$12.62 billion, up 21% from the same period a year earlier. Same-store sales for the second quarter rose 6% from the same period last year. Sales for the first half of the year were US$23.73 billion, up from US$19.38 billion. Duxton Windows & Doors has moved its window and fabrication facilities to a new address: 10A Higgins Ave., Winnipeg MB. Camco Inc. announced net income of $6.3 million for the first six months of 2000, compared with $0.6 million for the first six months of 1999. Sales for the first half of the year were $333.0 million, up from $291.6 million for the same period last year. Lowe's Cos. has joined a growing movement by retailers to phase out wood products made with wood from endangered forests. It announced it will boycott wood products from an area on British Columbia's coast (coined the"Great Bear Rainforest" by environmental activists). However, according to the Forest Alliance of B.C., Lowe's purchases "a negligible amount of product from that area." For the three-month period ended June 30, Sico Inc. recorded sales of $68.5 million, compared with $71.5 million for the same quarter last year, a decrease of 4.1 %. Net earnings amounted to $4.2 million, down 20% from the same period in 1999. The company cited poor weather throughout Eastern Canada and increased advertising costs as reasons for the drop. Maytag has formed a "Global Supply Chain" function to consolidate and coordinate procurement, manufacturing, and logistics for all of the corporation's businesses and brands. The move is part of Maytag's effort to build its brand recognition and consumer demand for its products, which include Maytag, Hoover, Jenn-Air, Blodgett and Dixie-Narco. The move occurs just as North American home improvement big boxes emerge as serious outlets for major appliances. Lowe's is already the number two seller of major appliances in the U.S., after Sears and ahead of Home Depot. It devotes approximately 9,500 sq.ft. in each of its 600 stores to 200- plus major appliances.
  CANADIAN STOCK WATCH
COMPANY 52-WEEK HIGH 52-WEEK LOW CLOSE (FRI.)
       
Canadian Tire 43.40 18.40 22.10
Canfor 19.80 10.10 11.20
Goodfellow 12.55 8.75 9.85
Home Depot 70.00 35.75 51 5/16
Hudsons Bay 23.85 12.50 16.00
Lowe's Cos. 67.25 40.37 46 1/16
Sears Canada 42.50 29.00 33.50
Taiga Forest 14.75 7.00 7.00
West Fraser 41.00 27.50 27.50
    "We should consider every day lost in which we do not dance once." - Friedrich Nietzche (1844 - 1900)
PEOPLE ON THE MOVE   Jim Hunter has joined Philips Lighting as director of marketing and retail sales. He was formerly with Scott Paper as director of marketing … Kris Oustaas has been appointed national sales manager for Home Depot, reporting to Hunter. He comes over from Fiskars Canada … Sheryl Hawkes has also joined Philips. Formerly with Siemens, she takes on the title of channel marketing manager. (416-292-3000) David Creglia has been appointed vice-president marketing at Globe Electric Co. Inc. He was formerly an automotive buyer with Canadian Tire Corp. (416-480-3000)  
MARKET INDICATORS   Wholesale trade creeped up 0.3% in June over May, according to Stats Canada. The increase was due largely to shipments of computers and motor vehicles. Shipments of metals, hardware, plumbing and heating dropped 0.7% from May to June, but were up 5.6% year-over-year. Lumber and building materials shipments fell 0.6% from month to month, representing a 0.6% drop from June of last year, due in large part to soft lumber prices this spring. The consumer price index rose 3% in July, compared with July 1999, according to Stats Canada. Higher energy prices were a big factor in the increase. Housing starts in the U.S. slipped to a 1.51 million annual rate, down 3.3% from June and the lowest level of starts since November 1997, according to the U.S. Commerce Department. July's drop marked the third consecutive decline in starts. Starts were already down 1.8% from May to June. Single-family starts were down 2%, a third straight decline. Multi-family starts were down 7.9%.  
HARDLINES SEMINAR AT CAN-SAVE We are pleased to be part of the Can-Save Summer Buying Expo 2000 at Can-Save's new warehouse in Barrie, ON on August 22. We'll present a seminar called: "Winning strategies of independents who compete alongside the big box". We share the bill with Canadian Contractor magazine, which will do a presentation on "Installed Sales." For more information about the day, call Can-Save at 1-800-461-5411. - Michael   THE WOMEN'S CONSUMER PRODUCTS NETWORK August 15: Breakfast meeting during the CGTA Show. Featuring the proven communication methods of Robin Kennedy, vice-president of Communicare. September 21: "Fully Alive From 9 to 5!" Featuring author Louise LeBrun. Details coming soon. Meanwhile, check out her website at: www.partnersinrenewal.com For more information about these events, please phone: (905) 212-3826; fax: (905) 274-7646; email:wcpn99@yahoo.com, or check out their website: www.wcpncanada.org  
Hardlines Classifieds   Got new products? Looking for new staff or lines? Hardlines Classifieds are read each week by North America's key decision makers in home improvement retailing and manufacturing. If you want to build your sales team or find new agents or new lines, this is the place! Only $16 per line. Call Beverly at 416-489-3396, ext. 2, for more details. * * * * * * * HARDLINES™ the electronic newsletter. www.hardlinesfax.com phone: 416-489-3396; fax: 416-489-6154. E-mail: buzz@hardlinesfax.com Michael McLarney, Editor & Publisher (extension 1): mike@hardlinesfax.com Beverly Allen, Marketing Manager (extension 2): bev@hardlinesfax.com Nancy Wright, Administrative Assistant: nancy@hardlinesfax.com Hardlines is published weekly (except monthly in December and August) by McLARNEYCOM 542 Mount Pleasant Rd., Suite 302, Toronto, Ontario, Canada M4S 2M7 © 2000 by Michael McLarney. Reproduction in whole or in part is very uncool and strictly forbidden and really and truly against the law. Call for information on a site license for your company. Subscription: $185+$12.95 GST = $197.95 (or $27.75 HST = $212.75) per year (GST #13987 0398 RT). (Please make cheque payable to McLarneyCom.)  
  HARDLINES™ Five years serving Canada's home improvement industry August 31, 2000 - Volume vi, #32 Michael McLarney, Editor & Publisher Ph: 416-489-3396 Fx: 416-489-6154 E-mail: buzz@hardlinesfax.com  
Check out our incredible Classifieds section!
* * * * * * * IN THIS ISSUE: * Chicago Hardware Show faces crisis of faith * Canadian Hardware Show adds Décor Show * Home Depot to open first Montréal store * Lowe's in lead among big boxes selling appliances * * * * * *   FIFTH ANNUAL HARDLINES MARKETING CONFERENCE: September 14, 2000. An incredible one-day symposium featuring some of North America's leaders in retail, including the executive team from Home Depot Canada, plus McMillan/Doolittle, Gardener's Supply, J&H Builder's Warehouse (an amazing Tim-BR- Mart dealer from Saskatoon), Tim Silk from UWO's Ivey Business School, sessions on branding, competitive intelligence and e- commerce - and much more! Expect about 200 retail and vendor executives to attend! NO HARDLINES NEXT WEEK But we're in the office, just working on other stuff. Like our incredible Marketing Conference and shipping hot-off-the-presses Who's Who Directories. Our next issue comes out September 5. See you then! - Michael WE WERE WIRED FOR SOUND AT NHS: Bev and I kept in touch during the National Hardware Show in Chicago with a very cool pair of Motorola GT two-way radios. They're used in retail to help staff keep in touch from aisle to aisle or floor to floor, in the yard, etc. My thanks to David Poirier at Lenbrook Industries (905-831-6555, ext. 4283); dpoirier@lenbrook.com  
CHICAGO HARDWARE SHOW: BACK NEXT YEAR? Most of the key Canadian buyers were represented, including Ace Hardware Canada, Sodisco-Howden, Canadian Tire, Home Hardware, Peavey Mart, Home Depot, etc. In fact, preregistration was up enough to leave organizers anticipating a 2-3% increase in attendance over last year's 67,600 visitors.   The companies that weren't there were previous exhibitors conspicuous by their absence. The likes of Black & Decker, which along with Bosch, Owens Corning and others, chose to sit out this year's Show. Ryobi decided two years ago to opt out altogether. They may well represent the thin edge of the wedge. A number of companies told me they will not return or seriously consider dropping out next year. B&D and Bosch will alternate between Chicago and the International Hardware Fair in Cologne, Germany. The move has appeal for a number of vendors who find the costs surrounding trade shows rising even as orders continue to fall. Bosch's presence at the Cologne Fair reportedly cost about $12 million for the booth alone. Why the discord? It boils down to the problem surrounding many shows today. Despite getting "face time" with key buyers, the real buying decisions, the key programs, are presented in the buyers' offices - well in advance of any public showing of "what's new." The shows that remain the most effective buying shows are the dealer shows, such as Home Hardware's, and regional shows, such as the WRLA's event in Saskatoon in January or the ABSDA's in Moncton each spring. Even the Canadian Hardware and Building Materials Show is cannily consolidating its position as a strong regional showcase - only the region is Canada within a larger marketplace that now spans North and South America. The drop off in traditional vendors at NHS is being taken up by e- business providers. At least 20 B2B companies were at the show, offering a range of services from online quotes and catalogues to trading and liquidation services. * * * * * * CHS ADDS PAINT AND DÉCOR SHOW The Canadian Hardware and Building Materials Show has formed an alliance with the Paint and Decorating Retailers Association to add the PDRA's Interiors Show to the CHS. The move will give Canada's largest hardware show its own "Décor Showcase" and increase representation by up to 6,000 paint and décor retailers who would have attended the Interiors Show in the past. The coalition follows last year's alliance with the LBMAO, which married that association's Canadian Home CentreShow with CHS.  
COMPANIES IN THE NEWS   Home Depot Canada will open its first store in Québec province this week. The store will go into the Montréal area in Laval. For the second quarter ended June 30, Sodisco-Howden Group had sales of $134.8 million, up 3.1% from $130.8 million a year earlier. Net earnings grew 79% to $5.8 million, from $3.2 million, a result of lower financial expenses subsequent to the conversion of debentures, the revaluation of future income tax assets and margin improvement. Slocan Forest Products Ltd. will shut down all of its sawmills, planers and related woodlands operations for a two-week period commencing in late August. The company says the closings are in response to "difficult market conditions and the oversupply situation of lumber to the North American market." The Home Depot in Atlanta reported net earnings of US$838 million for the second quarter of fiscal 2000, up 23% from US$679 million in the second quarter of 1999. Sales totalled US$12.62 billion, up 21% from the same period a year earlier. Same-store sales for the second quarter rose 6% from the same period last year. Sales for the first half of the year were US$23.73 billion, up from US$19.38 billion. Duxton Windows & Doors has moved its window and fabrication facilities to a new address: 10A Higgins Ave., Winnipeg MB. Camco Inc. announced net income of $6.3 million for the first six months of 2000, compared with $0.6 million for the first six months of 1999. Sales for the first half of the year were $333.0 million, up from $291.6 million for the same period last year. Lowe's Cos. has joined a growing movement by retailers to phase out wood products made with wood from endangered forests. It announced it will boycott wood products from an area on British Columbia's coast (coined the"Great Bear Rainforest" by environmental activists). However, according to the Forest Alliance of B.C., Lowe's purchases "a negligible amount of product from that area." For the three-month period ended June 30, Sico Inc. recorded sales of $68.5 million, compared with $71.5 million for the same quarter last year, a decrease of 4.1 %. Net earnings amounted to $4.2 million, down 20% from the same period in 1999. The company cited poor weather throughout Eastern Canada and increased advertising costs as reasons for the drop. Maytag has formed a "Global Supply Chain" function to consolidate and coordinate procurement, manufacturing, and logistics for all of the corporation's businesses and brands. The move is part of Maytag's effort to build its brand recognition and consumer demand for its products, which include Maytag, Hoover, Jenn-Air, Blodgett and Dixie-Narco. The move occurs just as North American home improvement big boxes emerge as serious outlets for major appliances. Lowe's is already the number two seller of major appliances in the U.S., after Sears and ahead of Home Depot. It devotes approximately 9,500 sq.ft. in each of its 600 stores to 200- plus major appliances.
  CANADIAN STOCK WATCH
COMPANY 52-WEEK HIGH 52-WEEK LOW CLOSE (FRI.)
       
Canadian Tire 43.40 18.40 22.10
Canfor 19.80 10.10 11.20
Goodfellow 12.55 8.75 9.85
Home Depot 70.00 35.75 51 5/16
Hudsons Bay 23.85 12.50 16.00
Lowe's Cos. 67.25 40.37 46 1/16
Sears Canada 42.50 29.00 33.50
Taiga Forest 14.75 7.00 7.00
West Fraser 41.00 27.50 27.50
    "We should consider every day lost in which we do not dance once." - Friedrich Nietzche (1844 - 1900)
PEOPLE ON THE MOVE   Jim Hunter has joined Philips Lighting as director of marketing and retail sales. He was formerly with Scott Paper as director of marketing … Kris Oustaas has been appointed national sales manager for Home Depot, reporting to Hunter. He comes over from Fiskars Canada … Sheryl Hawkes has also joined Philips. Formerly with Siemens, she takes on the title of channel marketing manager. (416-292-3000) David Creglia has been appointed vice-president marketing at Globe Electric Co. Inc. He was formerly an automotive buyer with Canadian Tire Corp. (416-480-3000)  
MARKET INDICATORS   Wholesale trade creeped up 0.3% in June over May, according to Stats Canada. The increase was due largely to shipments of computers and motor vehicles. Shipments of metals, hardware, plumbing and heating dropped 0.7% from May to June, but were up 5.6% year-over-year. Lumber and building materials shipments fell 0.6% from month to month, representing a 0.6% drop from June of last year, due in large part to soft lumber prices this spring. The consumer price index rose 3% in July, compared with July 1999, according to Stats Canada. Higher energy prices were a big factor in the increase. Housing starts in the U.S. slipped to a 1.51 million annual rate, down 3.3% from June and the lowest level of starts since November 1997, according to the U.S. Commerce Department. July's drop marked the third consecutive decline in starts. Starts were already down 1.8% from May to June. Single-family starts were down 2%, a third straight decline. Multi-family starts were down 7.9%.  
HARDLINES SEMINAR AT CAN-SAVE We are pleased to be part of the Can-Save Summer Buying Expo 2000 at Can-Save's new warehouse in Barrie, ON on August 22. We'll present a seminar called: "Winning strategies of independents who compete alongside the big box". We share the bill with Canadian Contractor magazine, which will do a presentation on "Installed Sales." For more information about the day, call Can-Save at 1-800-461-5411. - Michael   THE WOMEN'S CONSUMER PRODUCTS NETWORK August 15: Breakfast meeting during the CGTA Show. Featuring the proven communication methods of Robin Kennedy, vice-president of Communicare. September 21: "Fully Alive From 9 to 5!" Featuring author Louise LeBrun. Details coming soon. Meanwhile, check out her website at: www.partnersinrenewal.com For more information about these events, please phone: (905) 212-3826; fax: (905) 274-7646; email:wcpn99@yahoo.com, or check out their website: www.wcpncanada.org  
Hardlines Classifieds   Got new products? Looking for new staff or lines? Hardlines Classifieds are read each week by North America's key decision makers in home improvement retailing and manufacturing. If you want to build your sales team or find new agents or new lines, this is the place! Only $16 per line. Call Beverly at 416-489-3396, ext. 2, for more details. * * * * * * * HARDLINES™ the electronic newsletter. www.hardlinesfax.com phone: 416-489-3396; fax: 416-489-6154. E-mail: buzz@hardlinesfax.com Michael McLarney, Editor & Publisher (extension 1): mike@hardlinesfax.com Beverly Allen, Marketing Manager (extension 2): bev@hardlinesfax.com Nancy Wright, Administrative Assistant: nancy@hardlinesfax.com Hardlines is published weekly (except monthly in December and August) by McLARNEYCOM 542 Mount Pleasant Rd., Suite 302, Toronto, Ontario, Canada M4S 2M7 © 2000 by Michael McLarney. Reproduction in whole or in part is very uncool and strictly forbidden and really and truly against the law. Call for information on a site license for your company. Subscription: $185+$12.95 GST = $197.95 (or $27.75 HST = $212.75) per year (GST #13987 0398 RT). (Please make cheque payable to McLarneyCom.)