The 2024 Hardlines Conference is coming to the province of Quebec for the first time in its history. The event will take place at the Fairmont Le Manoir Richelieu, in the Charlevoix region, in collaboration with the Quebec industry association AQMAT, Oct. 22 to 23, 2024. (Shown l-r: David Chestnut, vice-president and publisher at Hardlines; Richard Darveau, president of AQMAT; and Hardlines’ Michael McLarney)

This is the only national event for the home improvement industry that is open to all banners and suppliers. We take great pride in being able to host top retailers and buying group executives from across the country, as well as leading wholesalers and manufacturers, working closely this year with AQMAT and its members.

We don’t want to give away too much (you’ll have to wait until next week for details—your sly Editor), but we have lined up senior executives from some of the country’s top retail groups. The event will be a truly national, bilingual experience, with presentations available in both official languages thanks to simultaneous translation onsite.

At the 28th annual Hardlines Conference, you will join your colleagues and customers for two incredible days of information and trends, as well as a fantastic networking experience. Please mark your calendars for Oct. 22 and 23!

For the second year in a row, TIMBER MART held its national buying show with a traditional in-person event, which was held at the Toronto Congress Centre in mid-February, supported by a virtual online version.

“Once again this year, we’re seeing very strong attendance and support for our show thanks to the virtual convenience it has to offer alongside the member-exclusive deals and great networking opportunities available,” said Bernie Owens, president & CEO of TIMBER MART. “The hybrid show format is proving to be a valuable and cost-effective option for dealers and vendors alike and is likely one that is here to stay.”

The physical show drew hundreds of TIMBER MART dealers and staff from across the country, who were able to check out 227 vendor booths on the 70,000-square-foot show floor. Highlights of the show included displays and attractions such as a pallet-buy area, with a wide range of products for sale in pallet quantities.

At the centre of the floor, the TIMBER MART area encompassed hubs for all of TIMBER MART’s services and programs, including TIMBER MART LBM distribution, dealer marketing, merchandising, and banner support.

Owens pointed out that the majority of TIMBER MART dealers don’t fly the TIMBER MART banner, preferring to rely on their own brand in their respective markets. On the other hand, some dealers embrace the TIMBER MART banner, making them "part of something bigger."  He sees this flexibility as a strength of the buying group, adding that the group can offer varied options to its dealers, depending on how each of them chooses to go to market. “It’s about adding value to the independent dealer without adding a heavy cost to them,” he told Hardlines.

On Feb. 14, TIMBER MART hosted dealer meetings where members were kept abreast of the group’s activities. At the end of that day, a welcome reception was held for attendees. And the show included a networking and recognition reception for vendors.  Select suppliers were presented with awards for their excellence in customer service, dealer support, product value and operations.

The Home Depot reported last week its financial results for Q4 as well as the fiscal year 2023. The year was marked by a lacklustre housing market that appears likely to continue well into 2024.

“I’d say we have a neutral look on housing for 2024,” CEO Ted Decker said during an earnings call. “We don’t think there’s incremental pressure, nor do we think that we’re quite ready for a hockey-stick recovery.”

Home Depot’s Q4 earnings of $2.80 billion represented a drop compared to $3.36 billion in the comparable period of 2022. Revenues in the quarter likewise declined to $34.79 billion from $35.83 billion. U.S. same-store sales for the quarter were down 3.5 percent, CFO Richard McPhail noted on the call. In Canada, the decline was less steep, while the Mexican market even saw comp sales grow.

For the full year, sales declined by three percent to $152.7 billion. Comp sales fell by 3.2 percent overall and by 3.5 percent in the U.S. Net earnings slid to $15.1 billion, compared to $17.1 billion in 2022.

The retailer’s focus on its contractor clientele was a theme of 2023 that Decker said will carry over into this year. December saw Home Depot acquire Construction Resources, a distributor of appliances and specialty products for pro customers.

“By the end of 2024,” Decker told analysts, “we will have 17 of our top pro markets equipped with new fulfilment options, localized product assortment, an expanded salesforce, and enhanced digital capabilities, with trade credit and order management in pilot or development.”

Still, the mood remains cautious for fiscal 2024, which is a week longer than last year. Home Depot is projecting only a one percent sales uptick this year, during which it will open 12 new stores.

“Our market is on its way back to normal demand conditions,” McPhail told CNBC. “We’re not quite there yet, but the pressures we saw in 2023 are receding.”

There was a time when dealers debated whether to charge for deliveries at all. Today, the need for charging customers for the range of services a dealer can offer, including getting product to a jobsite, is accepted. However, some dealers still offer free delivery, introduced during the pandemic. Either way, the logistics of managing those deliveries effectively are more complex than ever.

In recent years, new technologies have driven dealers to tweak their delivery services for greater efficiency. That’s often translating into centralized distribution and inventory management. For example, Fraser Valley Building Supplies’ three RONA affiliates in the Lower Mainland of British Columbia use the company’s biggest yard in Mission as their distribution point. That yard is stocked with higher levels of building materials, says Ray Cyr (pictured), Fraser Valley’s president.

Centralization saves time and money at a time when equipment and drivers are more expensive, and as dealers are considering where technology might fit into their delivery services and fleet management.

Delivery can be a significant expense, and what dealers charge their pro customers for the service is at best ancillary to the overall cost. In 2022, Fraser Valley spent $1.2 million to add to its fleet, which now consists of 25 vehicles, many of them boom trucks with arms up to 45 feet for second-floor drops and up to 105 feet to reach higher elevations. Cyr says that four of those vehicles are owned and operated by independent drivers, some of whom were once Fraser Valley employees.

Fraser Valley charges for delivery by zones, and the charges range from $55 to $155 per trip, plus $3 per minute for crane time, which typically averages around 20 minutes.

Driver shortages still pose a challenge, one that Cyr is meeting by looking to hire a part-time fleet manager. Their role, in part, would be to keep scheduled maintenance from falling through the cracks. Fraser Valley has 22 drivers, ranging in tenure from two to 30 years. Cyr says driver shortages in his market had abated somewhat over the past 18 months. But other dealers are still struggling to hire and replace drivers when they leave or retire.

(This is an excerpt from a larger article that will appear in the next issue of our sister publication, Hardlines Home Improvement Quarterly. This amazing magazine gets mailed out four times a year to 11,000 dealers and store managers across Canada. Retailers can subscribe to HHIQ for free and suppliers can get it for just $90 per year. Simply click here!—Your ever-helpful Editor.)

At Tyndale Advisors, Orgill’s marketing arm and subsidiary, Jim Rivas has been promoted to the position of president. Rivas was most recently director of retail technology at Orgill. In that role, he managed Orgill’s retail operations and technology services consulting.

DID YOU KNOW...?

… that the latest issue of Hardlines HR Advisor hit inboxes last week? In this edition, we look at the benefits of decision-making maps, the power of mentorship, and managing labour costs. If you’re not already receiving HR Advisor, click here to sign up for free!

RETAILER NEWS

Canadian Tire’s two product development labs, in Calgary and Toronto, were a focus of a Globe and Mail feature (titled “Inside the lab”) published on Feb. 21, as part of the newspaper’s Report on Business Magazine. The article said that, under the rubric of Canadian Tire’s “Better Connections” project, begun during the pandemic, the retail chain is trying to bring 12,000 newly-developed SKUs to market by the end of 2025.

Walmart reported Q4 earnings of $5.49 billion, compared to $6.27 billion a year earlier. Sales rose 5.7 percent to $173.38 billion. In Canada, net sales rose by 1.8 percent to $6.0 billion, with comp sales growth of 1.5 percent. At the same time, the retailer announced it will acquire TV maker Vizio for $2.3 billion.

Loblaw Cos. Ltd. reported Q4 net earnings of $541 million, or $1.72 per share, up from $529 million ($1.62) a year earlier. Sales rose by 3.7 percent to $14.5 billion. Revenues for the full year came to $59.53 billion, an increase of 5.4 percent. Net earnings grew by 9.4 percent $2.09 billion.

SUPPLIER NEWS

Owens Corning had a solid Q4, owing to a surge in roofing sales, and outperformed analyst expectations for its year-end results, the company announced on Feb. 14. The company reported that it had a US$131 million Q4 profit and US$9.68 billion in revenue for the year. Roofing sales were up 16 percent in the quarter, versus Q4 2022, driven by strong demand and favourable pricing. Insulation sales for the quarter were down three percent, while composite sales fell 13 percent.

Investment in building construction edged up 0.3 percent month over month to $19.8 billion in December. Residential construction spending grew by 0.3 percent to $13.8 billion, led by a 12 percent gain in Prince Edward Island. Investment in detached single-family homes declined 1.0% to $6.5 billion. (StatCan)

The national inflation rate dropped to 2.9 percent in January, a lower-than-expected number, and down from 3.4 percent in December. Lower gasoline prices were the primary driver of the drop. The Bank of Canada had raised interest rates 10 consecutive times before holding steady at five percent since last July. (StatCan)

The federal government’s Canada Greener Homes grant is coming to an end, expected to close to new applications by the end of next of month. The program provided up to $5,000 toward renovations increasing energy efficiency, and its demise is prompting concerns about the job security of the auditors who complete the required assessments.