vol. ix, 4 January 27, 2003

* Expect record attendance at Industry Awards Breakfast * Home Depot to focus on existing stores, staff training * Sodisco-Howden evaluates banner offerings * Reliance gears up for inaugural year * Rona debuts at Saskatoon show * CHS enhancements make show a buying proposition

"Nobody ever forgets where he buried a hatchet." — 'Kin' Hubbard (American journalist, 1868-1930)
I know, I know you can't believe we're putting on a breakfast at 7:30 on a Sunday morning. But faithful attendees from years past know our breakfast is absolutely the place to be to kick off the Canadian Hardware and Building Materials Show. More than 200 people have registered already! This year it's right in the Civic Ballroom of the Sheraton Centre Hotel, Toronto. We've joined with the folks at Hardware Merchandising to mount the First Ever Industry Awards Breakfast. This combined program guarantees a great wakeup for the CHS. The Awards Breakfast is free to Hardlines subscribers, and to guests of Hardlines and Hardware Merchandising magazine (with some restrictions!). You must reserve your space, so please RSVP to Nancy at 416-489-3396; nancy@hardlines.ca . It's filling up fast, so reserve now! Special thanks to our sponsors: · JDA Software · Zircon · Sterling Commerce · Dimensions Retail Systems · 3M
Advertise your products online and take advantage of our bonus circulation at CHS. Reach 2,000 more qualified readers at Canada's premiere trade show! Be part of the excitement that is Hardlines. Contact Beverly Allen, Marketing Manager, for details: bev@hardlines.ca

Montréal, QC Sodisco-Howden Group is actively promoting all its banners to customers and prospects. Ferplus and Batitout, the two banners picked up from Marchands Unis at the beginning of last year are in the mix, but Ace isn't - yet. (The Competition Bureau is currently wading through Sodisco-Howden's application. Despite the delay, the acquisition of Ace Hardware Canada is expected to close by the end of February.)

This, just three years after Sodisco-Howden made a big push to rationalize its banners. It went from five effectively to two. Pro is the flagship for both hardware and building centre dealers, while Do-it center remains the distributor's specialty building centre banner, supported by about 70 dealers across the country. Jos Wintermans, CEO of Sodisco-Howden Group, insists the Do-it banner will get continued support, especially in light of the fact these dealers, typically larger yards, provide big volumes for Sodisco-Howden. However, Do-it, which is managed out Sodisco-Howden's London, ON division, D.H. Howden, is not being developed very aggressively. In fact, Do-it's point man, Ernie Bruce, left the company last summer. Ferplus, on the other hand, is suitable for smaller hardware stores. The program comes without the added costs of full flyer programs . "It's suitable for the independent who wants to remain independent and choose the assortment of programs that's best for them," says Celine Gamache, vice-president marketing for Sodisco-Howden. Like Do-it center, Batitout remains a viable option for building centre dealers. "They're well known banners, so we'll continue to support them," says Gamache.
Winnipeg & Mississauga Like any big family, the Reliance Buying Group has found that communication is the key to getting along. Since its official kickoff at the beginning of this year, the amalgamation of two collective buying groups, comprising seven separate organizations, has been "generally well received by suppliers, who are our most important constituents," says Brian Kusisto, president of Sexton Group. The member groups are busy communicating the philosophy and benefits of the alliance to individual dealers, as well. Sexton, for one, has been holding meetings that include reviewing the key commodities suppliers being targetted under the new deal. "It's an opportunity for us to get some feedback on issues dealers are facing, especially with some of these suppliers." Negotiations with Reliance also give suppliers a point of entry with individual member groups for additional sales and programs. The other members are Castle Building Centres, Federated Co-operatives, Coopérative Fédérée de Québec, Torbsa, Delroc Industries and Irly Distributors. "Suppliers are recognizing up front that we're in a different league now," says Pro Wylie, president of Castle, "and some of them had to make adjustments in their pricing and rebates." The combined retail sales of the group are expected to top $3 billion. Castle and Sexton make up Reliance's two largest sources of building materials volume (Saskatoon-based Federated Co-op has greater sales overall, but these include petroleum, farm supplies and grocery).
Atlanta, GA Bracing to transform from a young, growth company to a "mature, balanced" one, Home Depot faces sales growth at the end of the fiscal year that ends February 2, 2003 of about 10%, about half of what it's used to. Although "disappointed personally" in the company's financial performance, Home Depot CEO Bob Nardelli promised analysts at a meeting recently that the company intends to maintain growth plans, avoiding store closures or layoffs. Instead, it will launch a US$250 million program to remodel its aging stock of stores, improve product availability, and retrain staff to improve customer service. While Home Depot's store locations are feeling the effects of cannibalization in the U.S., the Canadian division remains strong, and Nardelli took time during the analysts' meeting to praise the performance of Home Depot Canada, under its president, Annette Verschuren. Home Depot expects to open 200 stores and add 40,000 associates in fiscal 2003, but plans for its high-end Expo Design Centers continue to be slowed. Expo was to be Home Depot's bid for high-end renovation customers, but a faltering U.S. economy has slowed expansion plans. While Home Depot opened 11 new Expo Design Centers last year, it will open only two this year. Some of its 52 existing stores will be remodelled, as well. No Expo stores are planned for Canada in the near future.
Mississauga, ONThis year's Canadian Hardware and Building Materials Show has introduced more than 20 changes, everything from booth sales and events on the show floor to turnover in show staff (see People on the move). The enhancements were introduced to shore up booth traffic and provide incentives to attract more exhibitors. The show has placed special emphasis on buying, so more than 100 exhibitors have agreed to offer "hot buys", "show-only" specials, volume discounts, terms, bonus product and other financial incentives. Programs for this year include: a garage sale to let exhibitors sell discontinued items and clear outs; a $50 early bird discount on booths; Auto Focus pavilion featuring the latest automotive aftermarket products. At a breakfast session for sales agents on February 3, agents and reps will receive tips on getting the most out of their agreements with their principals. First-time exhibitors will get showcased, as well, letting buyers zero in on new ideas all in one area. "We are extremely excited by the positive changes we have made for the 2003 edition of CHS," says Maura Bella, CHS director. "The success of CHS depends on our ability to adapt to the changes taking place within the industry." CHS 2003 takes place February 2-4 at the National Trade Centre on Toronto's Canadian National Exhibition grounds.
"Wow!" — Judy Huston, outgoing executive director of the Western Retail Lumbermens Association, during a tribute made to her at the WRLA's Gala during the Prairie Showcase last week.
Canadian Tire 33.65 23.96 30.00
Canfor 11.70 6.83 9.25
Costco 46.90 27.09 28.90
Emco 14.23 6.50 13.80
Goodfellow 13.99 9.00 11.00
Home Depot 52.60 21.06 21.26
Hudson's Bay 15.55 5.87 9.36
Lowe's Cos. 49.99 32.50 34.12
Rona Inc. 14.75 13.25 13.35
Sears Canada 25.10 15.15 18.00
Sodisco-Howden 2.20 1.06 1.59
Taiga Forest 7.00 4.90 6.74
Wal-Mart 63.94 43.72 47.30
West Fraser 44.42 28.90 36.00
Rona Inc. exhibited for the first time in Saskatoon last week at the Prairie Showcase. The company has stated many times its desire to develop its dealer base in the West. Claude Bernier (r), executive vice-president of Rona's traditional stores, was present with Rona's store development team of John Longo (l) and Al Holton (centre). Rona started exhibiting last year at the Atlantic Building Supply Dealers Show in Moncton, NB. Hurt by US$26 million in countervailing duties, and the cost of integrating Willamette Industries, Weyerhaeuser reported 2002 net earnings of US$241 million on net sales of US$18.5 billion. This compares with net earnings of US$354 million on net sales of US$14.5 billion for 2001. Tembec's consolidated gross sales for the first quarter reached $840.8 million, up from $792.6 million a year earlier. The company generated a net loss of $41.8 million, compared with a net loss of $44.7 million at the end of the first quarter a year earlier. EBITDA totalled $18.2 million, down from $60.1 million. Do it Best Corp. is hosting 35 Executive Retail Symposiums across the U.S. next month. The aim of the program is to provide member-retailers with business management tools to ensure longterm success. Topics will include increasing profitability, succession planning and the benefits of the latest technology. Leviton Manufacturing has acquired OnQ Technologies Inc., a supplier of structured wiring and home networking technology. The purchase is part of Leviton's growth as a supplier of home networking and residential products. OnQ will be joined with Leviton Integrated Networks, the company's existing structured wiring division, creating Leviton OnQ. Canadian softwood timber producers are claiming a victory over the latest favourable ruling by the World Trade Organization. The B.C. Lumber Trade Council, which represents companies responsible for almost half of Canada's softwood lumber shipments to the U.S., is welcoming the WTO Appellate Body's ruling on the so-called Byrd Amendment, which had the U.S. giving money to U.S. companies deemed to have been hurt by Canadian softwood lumber.
Mark Henderson, chairman and CEO of Jeld-Wen of Canada, announced his retirement plans last week. He will step down effective March 31, 2003. In 1970, Henderson joined G. Henderson Distributors, the wholesale building materials distribution company started by his father a decade earlier. In 1997, Jeld-Wen acquired 50% of Henderson's business, and a year later acquired the other 50%. During the six years with Jeld-Wen, Henderson managed the company's Canadian strategy, including the integration of its Canadian manufacturing and distribution operations - a business model Jeld-Wen has since chosen for its operations world-wide. (204-694-6012) Linda Nodello, the ebullient marketing director of the Canadian Hardware and Building Materials Show, departed last week, just two weeks before the show itself. Nodello had spent 13 years in the employ of the show's owner, the Canadian Retail Hardware Association. Nodello is the last of the old guard to change; a new sales team spearheaded by Lynn Cronin was put in place over the past two years and show manager Joe Edwards, absent after a lengthy sick leave, was replaced recently by Maura Bella as CHS director. No replacement has been named for Nodello. (905-821-3470)
Retail sales declined 0.6% in November to $25.8 billion, following a 1.6% gain in October. Automobile and clothing purchases declined in November, after a spending spree in the previous month. Excluding auto sales, retail sales remained flat in November (+0.1%), after advancing rapidly in October (+1.4%). Despite little growth since the start of 2002, the level of consumer spending in retail stores was exceptionally strong in the first 11 months of the year, rising 2.2% from January to November. The Consumer Price Index increased by 3.9% in December 2002 over December 2001. The increase in inflation was less pronounced than November's 4.3% increase. However, that was due mostly to a drop in the Ontario electricity index. Spurred by low interest rates, U.S. housing starts were up 5% in December, says the Commerce Department. For the year, work was started on 1.70 million homes and apartments, up 6.4% from 2001, ending the best year for new housing since 1986.

****HARDLINES MARKETPLACE**** Check out Hardlines Classifieds on the web: https://hardlines.ca/html/classifieds_new.asp

HELP WANTED KEY ACCOUNT MANAGER Olympia Group USA is a leading worldwide manufacturer and importer of Hand Tools, Striking Tools, Lawn and Garden Tools, Automotive Tools and Abrasives, with offices all around the world. Its Canadian branch is expanding its sales team in the Quebec province. We are looking for a Key Account Manager. This team player will report directly to the Vice-President of Sales and will represent Olympia Canada to large customers in Quebec. His/her key role will be to; develop and implement sales and marketing strategies to increase our customer base and increase product listings for his/her accounts; provide forecasts to our purchasing team, provide feedback, store shop and competitiveness report to our product development team, budget customers and give weekly call and project progress report. Mandatory qualifications and experience: You must have a minimum of 5 years in key account representation, in the retail hardware industry, with proven track record. Strong analytical skills, highly develop communication and inter-relations skills and excellent in presentations and line review. Experience in merchandising is a must. The candidate must be bilingual written and spoken, computer literate; Excel, Word, Outlook, willing to travel, have a car with valid drivers license. We thank in advance all candidates and wish to inform that we will contact only the individuals retained for an interview. Please submit a resume by email, stating qualifications and income expectations to sales@olympiagroup.qc.ca. ***********************************************************************************  ITW Paslode is a world leader in the manufacturing and distribution of power nailing equipment & tools for the construction and industrial sectors in Canada. We are seeking a dynamic professional to join our Residential Business Unit. PRODUCT/MARKETING MANAGER In this key role your responsibility will be to develop & implement short-term and long-term marketing strategies for our Paslode product line of power nailing products sold through industrial, dealer and distribution channels. Using a trade focus approach you will work closely within a team based environment that includes a sales team and sales management to develop & launch new product & service packages and create brand awareness to identified trades in specific geographic areas. Additionally, you will coordinate, monitor and manage all promotions, advertising, trade shows and merchandising activities for this product line. Your qualifications will include a degree with a major in Marketing combined with 3 –5 years marketing management experience in the retail sector. A background in brand management & strategic planning/execution is preferred. Above average communication, presentation and inter-personal skills is also required. Join an industry leader that offers a challenging career, competitive salary, & a comprehensive benefits program. Please reply in confidence to: Human Resource Manager, ITW Construction Products, e-mail: resume@itwconstruction.ca or fax: 416-750-9601. For further information on our company please look us up on the web www.itwconstruction.ca or the Corporate website www.itw.com . We wish to thank all applicants for their interest, however, only those selected for an interview will be contacted.

*********************************************************************************** REP/AGENCY WANTED

National Manufacturing & Distribution Company requires Sales & Marketing Organization to sell Lawn & Garden Product lines to Independent Dealers networks in Ontario. Reply in strictest confidence to: bev@hardlines.ca (put Box 327 in your subject line); or fax in strictest confidence c/o Box 327, 416-489-6154. *********************************************************************************** EQUIPMENT FOR SALE Totem Building Supplies has twelve Vidir 8-roll Carpet machines available at the outstanding price of $3000.00 Cdn. each F.O.B. Calgary. Totem also has four (Two Vidir and two Floormaster) 16-roll linoleum racks at the great price of $2000.00 Cdn. each F.O.B. Calgary. As well, Totem has four Vidir cutting beds at $2000.00 Cdn., each F.O.B. Calgary. If interested, please contact Ed Mah at edmah@totem.ab.ca or contact via telephone at: 403-247-5599.


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Hardlines is published weekly (except monthly in December and August) by McLARNEYCOM 542 Mount Pleasant Rd., Suite 302, Toronto, Ontario, Canada M4S 2M7 © 2003 by Michael McLarney. HARDLINES™ the electronic newsletter hardlines.ca Phone: 416.489.3396; Fax: 416.489.6154 Michael McLarney, Editor & Publisher: mike@hardlines.ca Beverly Allen, Marketing Manager: bev@hardlines.ca Nancy Wright, Circulation Manager: nancy@hardlines.ca ______________________________________________ THE HARDLINES "FAIR PLAY" POLICY: Reproduction in whole or in part is very uncool and strictly forbidden and really and truly against the law. So please, play fair! Call for information on multiple subscriptions or a site license for your company. We do want as many people as possible to read Hardlines each week – but let us handle your internal routing from this end! ______________________________________________ Subscription: $199+$13.93 GST = $212.93 per year (GST #13987 0398 RT). Secondary subscriptions at the same office are only $34 + $2.38 GST = $36.38. Ask about our reduced rate for branch offices. You can pay online by VISA at our secure website or send us money. Please make cheque payable to McLarneyCom.