August 24, 2015 Volume xxi, #32

“The human race never solves any of its problems. It merely outlives them.”
—David Gerrold (American science fiction writer, 1944- )

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SUMMER PUBLISHING SCHEDULE

There will be no weekly edition of HARDLINES next week, August 31. The World Headquarters will remain open, however, during this time as we gear up for our incredible 20th Anniversary Hardlines Conference. The regular weekly schedule will resume September 7.

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Orgill to acquire Chalifour Canada from TIM-BR MART

VAUGHAN, Ont. & MEMPHIS — TIM-BR MART Group has announced the sale of the hardlines assets of its distribution arm, Chalifour Canada, to Memphis-based hardware wholesaler Orgill.

Bernie Owens, president of the TIM-BR MART Group, says the strategic alliance resulting from the sale will offer his company’s membership and Canadian independents at large a competitive foothold against big box stores in Canada. “This will empower our membership. It will give them better buying power and the local consumer in turn will be able to buy better,” he says. “This is a win-win for the independent and a win-win for local communities. It will keep business from draining into larger metropolitan centres.”

The new company, Orgill Canada Hardlines, will not offer a separate banner. The company does offer a range of services and promotional programs for dealers, however, and hosts a dealer market in the U.S. twice a year.

Orgill Canada’s acquisition of the assets will include its complete ownership and operation of Chalifour Canada’s London, Ont., distribution centre, as well as the purchase of the hardware inventory in Chalifour Canada’s Surrey, B.C., facility.

TIM-BR MART will maintain ownership and operation of its LBM distribution centre in St-Nicolas, Que., and continue to operate the Surrey facility, including Orgill Canada’s hardlines offering from that location.

The transaction is still subject to approval by the Canadian Competition Bureau.

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Home Depot now Canada’s largest home improvement retailer

TORONTO — The Home Depot Canada is now Canada’s largest home improvement retailer, while a collection of independent dealers operating under a single banner weighs in at the number-two spot.

According to the 2015 Home Improvement Retail Report, produced by Hardlines Inc., years of consistent, steady growth following the worldwide recession, combined with changes in the competitive landscape, pushed The Home Depot Canada to top spot based on volume of sales. Home Hardware Stores Limited, with almost 1,100 independent dealers across Canada, is the second largest.

The Home Depot Canada had estimated sales in 2014 of $5.65 billion, bumping RONA inc. from the top spot, a position it had held for seven years. Home Hardware Stores moved from third place in 2013 to the number-two spot in 2014, with sales of $5.49 billion.

RONA inc., with retail sales of $5.48 billion, moves to third position, followed by Canadian Tire Retail, with $5.26 billion in home improvement-related sales. (Note: Canadian Tire’s numbers reflect estimated sales in its hardware, housewares, and home improvement categories only, and exclude automotive and sporting goods.)

RONA held the top spot for many years, but has undergone restructuring under a new executive team since 2012. As RONA has trimmed its business for future growth—including the sale of its Noble industrial division—Home Depot has focused on maximizing sales from its existing stores. The result has been a radical change in the order of the industry’s top four players in 2014.

Together, the top four companies accounted for more than half (52.1%) of Canada’s $42 billion retail home improvement industry, as measured by the Hardlines Retail Report.

(The 2015 Hardlines Retail Report is a comprehensive overview and analysis of the retail home improvement industry in Canada. Featuring 175 PowerPoint slides filled with charts, graphs, and photographs, it offers exclusive research on the growth and market shares of the key sectors and retail companies in the industry. To learn more and to order your copy today, click here.)

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Orgill creates new entity to expand Canadian operations

MEMPHIS — Orgill, the giant U.S.-based hardware wholesaler, has solidified its growing presence in this country with the announced acquisition of Chalifour Canada. Chalifour is the hardware distribution business of the LBM buying group TIM-BR MART Group. The sale is just one of the changes coming out of TIM-BR MART under the leadership of President Bernie Owens.

The new company, Orgill Canada Hardlines, was created by Orgill as part of the takeover move. Like its U.S. counterpart, it will not offer a separate banner. “Our goal is to be inclusive rather than exclusive,” says Ron Beal, chairman, president, and CEO of Orgill, “and we will focus on providing a unique mix of products, competitive pricing, and cutting edge services to help Canadian independent retailers compete in their local markets.”

Orgill will consolidate its current warehousing operations, in Brampton, Ont., into the London facility over time. Service out of Surrey, B.C., will continue, however. “Our focus is to ensure that service to both Orgill Canada and Chalifour customers is maintained during and after our transition to a single company,” says Ron Beal, chairman, president, CEO of Orgill. “Our plans are to maintain both of these facilities for as long as they are needed to provide this service.”

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Lowe’s 40th store opens in Saskatoon


SASKATOON — Lowe’s opened its 40th store in Canada last week in Saskatoon. The latest opening reflects the retailer’s concentration on smaller footprints with about 86,000 square feet of retail space plus a 15,500-square-foot garden centre.

The store has been built with a number of energy-saving features, including photocell-controlled low consumption LED lighting fixtures, a white TPO “cool roof” roofing membrane to reduce urban heat island effect, and high-efficiency heating and air conditioning systems.

With 40,000 SKUs, the store features an extensive lineup of appliances and a year-round selection of barbecues. Reflecting its focus on pro customers, the store is hosting a VIP contractor appreciation event this afternoon.

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RONA’s Q2 results indicate effectiveness of turnaround strategy


BOUCHERVILLE, Que. ― RONA’s second-quarter results announced earlier this month painted a picture of a successful turnaround underway. RONA saw same-store sales increase by 5.4% in the second quarter, its fourth consecutive quarter of growth. Consolidated revenues totalled $1.26 billion, up 5.9% from $1.19 billion.

The increase mainly reflects 6.7% higher revenues in the retail segment due to the success of merchandising strategies and a repositioned Reno-Depot banner in Quebec. Same-store sales saw a fourth consecutive quarter of growth, rising by a healthy 5.4%.

But the company is reaping the fruits of other strategies, as well. It is restructuring its stores by moving franchisees within the corporate fold, allowing it to consolidate 20 different operating entities with differing business models into a leaner and meaner operation. Meanwhile, RONA is engaged in what CEO Robert Sawyer called a “resetting” of its core business in the big box and proximity stores.

The acquisition of franchisees will put the 79 RONA L’Entrepôt, RONA Home & Garden, and Reno-Depot stores under the corporate banner, and lift retail margins, while adding some expenses to the bottom line. Six of eight Coupal stores, which were contractor-oriented outlets, have been converted to the Marcil banner, increasing traffic with greater retail offerings.

The weak loonie forced a more aggressive approach in the latest quarter, with some new store openings and the elimination of some products. Asked about the effect of the home renovation tax credit expiring in Quebec, Sawyer observed little change was expected either way in the sluggish economy.

Regional variations played a role, with a strong spring in the Atlantic. Sawyer warned that RONA will be facing “turbulence” in Alberta where same-store sales will be “less positive” going forward. Continuing inflation will affect the company’s relationship with its vendors. One new initiative is a loyalty program for contractors, already being rolled out in select regions.

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U.S. housing recovery buoys Lowe’s, Home Depot’s results

MOORESVILLE, N.C. & ATLANTA ― Buoyed by a strong housing market in the U.S., the world’s two largest home improvement retailers posted solid second-quarter results.

Lowe’s had strong net earnings of $1.13 billion for the second quarter, an 8.4% increase over the same period a year ago. Sales increased 4.5% to $17.3 billion from $16.6 billion, and comparable sales increased 4.3%.

Sales for the six months were $31.5 billion, up 4.9%, and comparable sales increased 4.7%. Year-to-date net earnings increased 8.2%. The company reported strong growth in big-ticket categories such as appliances and outdoor power equipment.

Meanwhile, Lowe’s biggest rival, Home Depot, reported stronger growth than anticipated in same-store sales, which were up by 4.2%. High demand for indoor wares made up for lower demand in the outdoor category. Net income increased by approximately 9%, and net sales by 4.3%.

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Jeff Boyd has been promoted to the role of vice president, real estate, construction, and store design at Lowe’s Canada. He joined Lowe's Canada in October 2007 in the company’s real estate and construction division. In his newly created position, Boyd will continue to oversee Lowe’s Canada’s real estate, development, construction, and facilities management functions. He will also assume responsibility for market research, store design, and procurement.

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CLASSIFIED ADS

Product Merchandising Coordinator – Retail (St-Jean-sur-Richelieu, QC)

The Product Merchandising Coordinator is responsible for the structure and positioning of the product lines in accordance with regional electrical codes requirements (residential and light commercial markets) by accounts. He has an excellent understanding of the major home improvement retailers.

Responsibilities

• Serve as product expert
• Manage the product portfolio according to performances objectives
• Produce analysis with multiple inputs
• Develop excellent collaboration with the Sales team and excellent communication with internal and external clients

Projects

• Develop the product structure for the introduction of a new line of products including all related activities
• Participate in the development of added value strategies in consideration of line revisions
• Develop planograms for each client and product line
• Identify and coordinate cost saving projects
• Identify and communicate stock management improvement projects according to the clients’ needs
• Prepare a price list based on price increases or reductions, according to the established strategy

Qualifications

• College Diploma or Bachelor Degree in Marketing
• 5 years of experience in portfolio management or similar experience
• French and English: written and spoken
• Organization and excellent ability to manage and perform multiple tasks

Thank you in advance for sending your resume to hr_canada@tnb.com, quoting the position title in your email.

For further information on our company, please consult our web site at www.tnb.ca.

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