HARDLINES™
Five years serving Canada's home improvement industry
January 8, 2001 - Volume vii, #1
Michael McLarney, Editor & Publisher
Ph: 416-489-3396 Fx: 416-489-6154
E-mail: buzz@hardlinesfax.com Check out our incredible Classifieds section!* * * * * *
* Home's conversions of Beaver stores slip into high gear
* CanWel's Nykoliation replaced by McSherry
* Chatelaine readers give top marks to Castle, Home, and Pro Hardware
* Housing starts in Canada fall 5.5%
* Canadian Tire's new website creates ton of traffic before Christmas
* * * * * *PLEASE JOIN HARDLINES AT ITS SIXTH ANNUAL SHOW BREAKFAST to kick off the Canadian Hardware & Building Materials Show.Don't miss this key industry event on Sunday, February 4, 2001, 7:30 a.m. to 9:00 a.m. in Room 103 at the National Trade Centre, CNE grounds, where we will present the 2000 Newsmaker of the Year Award. We're ecstatic over how popular this event has become, but the result is that space gets really limited. Please book early to avoid disappointment! RSVP Nancy at 416-489-3396, send a fax to 416-489-6154; or email: hardline2@on.aibn.comBE PART OF OUR FREE WEBSITE SHOW TOUR: Introducing the Hardlines Virtual booth at CHS. We'll be wandering the aisles looking for scoops and taking pictures. We'll also take booth photos Saturday morning before the show. All exhibiting Hardlines subscribers are invited to participate FREE OF CHARGE! In exchange, we ask that you let us put a small sign in your booth advertising our "virtual booth" at the show. Contact us if you'd like your booth on our website. WHY are we doing this? Oh, just call us crazy! - Michael (Thanks to Fuji for sponsoring the Hardlines digital camera and Dremel and Newell Rubbermaid for joining as sponsors of our "virtual booth"!)* * * * * *PRE-SHOW SPECIAL: SAVE BIG ON YOUR PURCHASE OF THE HARDLINES INDUSTRY REPORT "Hardlines Industry Report: Home Improvement Retailing in Canada" is a comprehensive overview of the size of the market, how many stores are out there, who the key players are, their market position, the size and growth of the big boxes, the trends in housing and renovations, market trends - and much, much more! 120-plus pages filled with charts, graphs and photos. Regular price: $945, only $750 for subscribers. PRE-HARDWARE SHOW SPECIAL: order by February 6, 2001, and SAVE $55 off our regular price! Call Bev at 416-489-3396, or email her: bev@hardlinesfax.com* * * * * *WANT THE BIG PICTURE? THEN GET OVER TO the Cologne International Hardware Fair/DIY'TEC:Contact Trade Show Travel by phone (877-873-7469) or fax (403-247-2448) or to arrange your trip. BOOK EARLY! Packages include return air fare and accommodations, as well as admission to the Exhibition. And don't forget the Canada Night Reception sponsored by Hardlines and Cologne International Trade Shows! We'll see you in Cologne.Over 3,800 suppliers from 57 countries are expected in three trade fair theme areas: The World Tools Centre, Security Systems Locks and Fittings, and DIY'TEC. The Hardware sector will occupy the entire exhibition space at KolnMesse, that is over 3 million sq. ft. of hardware and building supplies!* * * * * *PRICING UPDATE: Effective January 1st, 2001, all Hardlines subscription renewals will have a price increase of 7.5% to $199 for basic subscriptions, and to $28 for additional email subscriptions at the same location. We've held off as long as we could: our last (and only) increase was January 1998. Since 1995, we've doubled our frequency - from bi-weekly to weekly - and more than doubled the amount of information in each issue. Plus you get our Classified section and all those great features online at our website! Thanks very much for your support - we look forward to keeping you informed for many years to come!HOME PUTS PUSH ON BEAVER CONVERSIONSThe next three months will see a fast track of Home Hardware's conversion of its Beaver Lumber stores. "The conversion process has been spread out over four months [December 2000-March 2001]," says Paul Strauss, vice-president and CEO of Home Hardware Stores Ltd. "That will allow us to make the merchandise and system conversions more manageable."The first Beaver dealer to make the switch was Brian Buck's Bridgewater, NS store, which converted at the beginning of December. There is already a Home Hardware in town, but it's a hardware store right downtown, and the former Beaver site is out on the highway. He was one of the nine Beaver stores in the Maritimes to make the switch before Christmas.As the stores switch, they will convert inventory and POS systems to integrate with Home's distribution system. At the same time, they will switch from the hardware supply agreement they had with Ace Hardware Canada and begin receiving their hardware from one of Home's three distribution centres. By March 31, all the stores will have made the switch and at that time the Ace deal will be formally terminated.Changes at Home's head office following the acquisition include beefing up of its building materials division. Erick Konescni, vice-president and general manager, Joel Marks, director of merchandising, and Jack Baillie, director of marketing, have all moved from Beaver's Markham, ON offices to work in Home's head office in St. Jacob's. The architectural and computer staff, along with some accounting people, will remain in Markham. They too, will move eventually, says Straus, but he declined to put a time line on that move. In the meantime, Konescni and company will shuttle back and forth between the two offices until March 31.* * * * * *HOME IMPROVEMENT DEALERS GO EXTRA MILE IN CONSUMER SURVEYA national consumer survey conducted by Chatelaine magazine ranked Castle Building Centres Group fifth out of 40 Canadian retail networks. Home Hardware's independent dealers ranked a close sixth, with Pro Hardware following in eighth place.The survey used criteria such as staff accessibility and their knowledge of store policies and product application; it was compiled from the reports of mystery shoppers sent to 40 of Canada's largest retail chains. To qualify, chains had to have more than 100 stores and be open for business in at least six provinces. The survey, which appears in the January issue of Chatelaine, focuses on stores catering to the magazine's target readership, women ages 25 to 49.According to Chatelaine's Shandley McMurray, the hardware/home improvement stores represented unique circumstances. While most of the chains cited in the study were corporately owned, the Castle, Home and Pro stores are independently owned, meaning the style and quality of service can vary widely from store to store. However, all stores within the top-ranked dealer networks inspected by Chatelaine's mystery shoppers proved to be consistently good, she said.COMPANIES IN THE NEWSFor the first time in the history of the chain, Home Depot held a store-wide sale in all its U.S. and Canadian stores. The 10% sale, held December 21-24, was advertised in radio and television nationwide. Revy matched competitive prices instore, while Home Depot's U.S. competitor, Lowe's, offered a similar discount throughout the last days of its holiday selling season. Home Depot, on the heels of sluggish 3Q results, remains confident it will have 23%-25% growth in earnings per share in fiscal 2001, which ends January 31, 2001.Weyerhaeuser Co.'s pulp mill at Kamloops, BC has achieved registration to the ISO 14001 EMS standard. Registration followed a thorough independent audit by the Quality Management Institute, a division of the Canadian Standards Association. The same certification was given to Weyerhaeuser's Timberlands operations near Port Alberni in early December 2000. Weyerhaeuser expects to have all its units ISO 14001 certified by 2002 and certified to the CSA's Sustainable Forest Management standard by 2003.Canadian Tire's new website moved into the top five e-commerce sites in Canada within two weeks of launch, according to a report from Nielsen/NetRatings. The website received close to 500,000 first-time visits in its first two weeks, and was approaching 700,000 total visits in the period running up to Christmas.HomeBase, Irvine, CA, has announced its departure from home improvement to reposition itself in the home decorating market, as noted by The Hard Fax. In September 2000, HomeBase opened five House2Home test stores in Southern California and Las Vegas. The company will open an additional 62 stores to the House2Home format, and close the remaining 22 home improvement stores. Each of the House2Home stores will offer 100,000 square feet of interior selling space with an adjoining outdoor nursery and garden centre.On December 15, 2000, The Supreme Court of Canada dismissed an appeal by Camco Inc. of a 1997 Federal Court of Canada decision on a patent infringement suit initiated by Whirlpool and its Canadian subsidiary, Inglis, in 1995.The patent in question involved a minor, flexible-fin feature on a dual-agitator washing machine. As the patent expired almost three years ago, the Court's decision will have no impact on the washing machines Camco currently sells in Canada.CANADIAN STOCK WATCH