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IN THIS ISSUE:- TORBSA’s Bob Holmes: expect modest growth, more consolidation in 2020
- High freight costs a top priority for Canada’s northernmost dealer
- Lowe’s Cos. wrestles with the complexities of its Canadian business
- Why discount and dollar stores keep growing
PLUS: HBC chairman sweetens takeover offer, executive changes at Orgill, Lowe’s starts hiring for spring, electronics show focuses on smart home technology, housing starts, Global DIY Summit set for Amsterdam in June and more! |
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TORBSA’s Bob Holmes: expect modest growth, more consolidation in 2020
BOLTON, Ont. ― Dealers are facing a mixed outlook for 2020, but for one buying group, some parts of the industry will maintain last year’s momentum, even if that momentum was modest at best.
The majority of TORBSA dealers are commercial, or heavily contractor-oriented, so their fortunes rely on housing starts more than traditional dealers. Bob Holmes, general manager of TORBSA, expects single-family housing starts to “struggle until the second quarter or even into the third quarter.” To make matters worse, says Holmes, “People are still not buying.”
However, he remains optimistic overall. “I expect it to be okay in 2020.”
Holmes recognizes that issues such as amalgamation among independents will only continue in the future. It’s being spurred by factors such as the increasing age of dealer-owners and their need for succession, which can be exacerbated by the lack of younger family members who are willing to take over the business.
His group has seen a couple of defections near the end of 2019. They included Rigney Building Supplies in Kingston, Ont., which was bought by WSB Titan, itself owned by U.S. dealer chain GMS. “However, I take pride in helping those businesses to be strong and profitable―and these are the ones being acquired.”
And while U.S. interests like GMS and Foundation Building Supplies expand their reach here, Holmes notes that domestic companies like BMR have deep pockets and are making moves to pick up dealers, as well.
Amidst all of these changes, Holmes still sees a role for the buying groups, and not just for rebates. Members have access to best practices and shared knowledge. For vendors, a buying group provides central billing and a ready conduit for new products. “I think the independent will always be around, but they will need the support of their larger group.”
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High freight costs a top priority for Canada’s northernmost dealer
CAMBRIDGE BAY, Nunavut — Depending on the mode of transport, freight costs can add significantly to the final price tag on products, especially special orders that demand quick turnaround. In fact, air freight is the most expensive form of distribution in Canada’s North.
Kitikmeot Supplies is a retailer that’s operated for 24 years in Cambridge Bay, a hamlet on Victoria Island in the Kitikmeot Region of Nunavut. According to the store’s general manager, Bill Killin, it’s the northernmost hardware store in Canada. Winter months are marked by 24-hour darkness and temperatures as low as -60 C. Those conditions are a far cry from southern Ontario, where he once worked for Home Hardware and Home Depot.
When Killin orders products freight on board from Yellowknife, which is 851 kilometres away, freight costs to fly those orders to Cambridge Bay average $3 per pound. (The store is about two kilometres from the local airport.) Killin says that freight costs are based on weight and volume, so he needs to be smart about having the right combination of light and heavy products in a given order to lower the freight costs and get maximum value at retail.
Kitikmeot Supplies—which gets 40% of its annual sales from government and institutional accounts, half of which are contractors—orders directly from manufacturers, as well from a specialty distributor in Edmonton, and through Igloo Building Supplies, also in Edmonton, and through Winnipeg-based Sexton Group.
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Lowe’s Cos. wrestles with the complexities of its Canadian business
NEW YORK — Executives at Lowe’s Cos. in the U.S. are looking for ways to simplify the array of businesses that operate under Lowe’s division in Canada. That included the intention to close another 34 locations here, most of them by the end of this month.
Saying that the Canadian business has “struggled”, the execs explained to analysts at the Morgan Stanley Global Consumer and Retail Conference in New York late last year how the investment north of the border is playing out and where the positives lie.
“As you can well imagine, just given the performance that we’ve articulated over the first three quarters of this year, the Canadian business from a top line perspective has struggled,” said David Denton, Lowe’s executive vice president and CEO. He added that the model for the Canadian business, which operates a variety of store formats, including wholesaling to dealer-owned outlets, is quite different from the U.S. one. The result, he says, is a business “that is performing from an operating profit perspective below the company average.”
President and CEO Marvin Ellison added that he is pleased with the execution at store level, however, noting that “we have great associates in Canada. We just gave them a very complex business model that inhibited their ability to serve customers well.”
Ellison laid out the relative complexity of the Canadian business with five banners, all with legacy systems and different back-end systems that hampered the initial integration process. “It made it very difficult to create synergies from a marketing, merchandising, sourcing perspective and even in IT systems infrastructure, so part of what we’re doing here, in addition to closing under-performing stores, is ensuring that we are just simplifying the business model so we can give the customers a great experience and give our associates a more simplified operational process to manage.”
Ellison expects that the decisions being made, including the pending store closures, “are going to put us in a really good position,” facilitating improvements for Lowe’s Canada that will bear out positively over the long term, something the executives at Lowe’s made clear they are committed to. |
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Why discount and dollar stores keep growing
SPECIAL REPORT — Many retail segments have contracted in recent years, but dollar stores are on the rise. They compete with home improvement businesses in several categories, such as small hardware items, cleaning supplies and other consumables.
Neil Saunders, with data analytics company GlobalData, answered questions about why dollar stores represent a major growth segment for the NRHA’s magazine, Hardware Retailing.
Saunders calls dollar stores one of the top-growing segments in the U.S. market. “They’re outperforming retail market growth as a whole, growing at a faster clip than a lot of traditional segments.”
In the U.S., Dollar General leads the way, generating strong growth, now with more than 15,000 stores. “It’s an enormous operation, because you need that scale in order to make the low-margin business work,” Saunders says.
In Canada, Montreal-based Dollarama Inc. recently reported Q3 profits of $138.6 million, up from $132.1 million a year ago on higher sales. Sales of $947.6 million marked a surge from last year’s $864.3 million, while comparable store sales rose by a healthy 5.3%.
This tremendous growth is due to dollar stores carving out a niche as a convenient choice for picking up everyday products. “That has become especially important to value-conscious consumers following the worldwide recession of 2008,” Saunders notes.
“Dollar stores are very good options for them to get really good value for the money on consumables, household goods and food, as well as some hardware and home improvement products,” he adds.
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Orgill has announced changes to its team of executive vice presidents. Randy Williams has been promoted to the role of EVP, distribution. Prior to this position, Williams served as Orgill’s general manager and senior vice president of distribution. John Sieggreen has been promoted to the role of EVP, retail and will also maintain his current role as president for Orgill’s Central Network Retail Group (CNRG). Greg Stine has been promoted to EVP, marketing and communications. Most recently, Stine headed up the marketing team for Tyndale Advisors. Brett Hammers continues in his role as EVP, sales and purchasing, while Eric Divelbiss will continue as EVP and CFO.
At AFA Forest Products, Angelo Campagna, previously division manager at the head office, has been named director of strategic development. Stepping into Campagna’s former role is Mark Henriques, previously sales manager at the Bolton, Ont., office. George McCart, previously director of AFA’s Eastern Allied division, is taking on the newly created role of director of marketing. |
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DID YOU KNOW...
... that Hardlines offers various ways for you to stay up to date on the industry? Make sure you are subscribed to: our Daily News (free); monthly dealer newsletter (free); and our print magazine, Hardlines Home Improvement Quarterly (free to dealers)! For more information on all of our news, visit hardlines.news. Take on the New Year fully equipped with all the information resources you need for your business to succeed! |
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RETAILER NEWS
TORONTO — A majority shareholder group led by Chairman Richard Baker has sweetened its offer to take Hudson's Bay Co. private. The group is now offering $11 per share, compared with its original bid of $10.30. The increase has overcome the objections of minority shareholder Catalyst Capital Group, which considered the original offer to fall short of HBC’s value. A vote on the deal is expected for February and would require 75% of shareholder votes, as well as a simple majority of votes by minority shareholders.
MOORESVILLE, N.C. — Lowe’s Cos. is seeking at least 53,000 new employees ahead of the spring season. The company says it will welcome applicants to job fairs at each of its 1,700 U.S. stores over the next three months. |
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SUPPLIER NEWS
LAS VEGAS — The International Consumer Electronics Show (CES) took place last week. Once again, smart home technology was a hot category, from baby monitoring systems to a robot that tracks toilet paper supplies. Meanwhile, Amazon was showcasing Echo Auto, an adaptation of its digital home assistant for cars.
MONTREAL — AQMAT has opened nominations for its eighth Gala of Recognition, taking place March 7 at Montreal’s celebrated railway hotel, Fairmont Le Reine Elizabeth. The 16 award categories honour retailers (individuals and businesses) and suppliers who demonstrate exceptional talent, passion and hard work. Click here to submit a nomination.
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ECONOMIC CONDITIONS
The seasonally adjusted annual rate of housing starts was 197,329 units in December, a decrease of 3% from 204,320 units in November. The SAAR of urban starts decreased by 4% in December to 185,934 units. Multiple urban starts decreased by 5% to 138,049 units in December, while single-detached urban starts increased by 1% to 47,885 units. (CMHC) |
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NOTED
Canadian Gen Z consumers were taking things into their own hands this holiday season, with 21% admitting to typically returning some of their holiday gifts. That’s nearly double the number of Boomers who reported returning gifts (11%). These results come from the 2019 FedEx Returns Economy Survey, a poll conducted on behalf of FedEx Canada, a subsidiary of FedEx Corp. |
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OVERHEARD...
“... We talked a lot about our Canadian business, and we’ve made some tough decisions with store closures and leadership changes and simplification of all the multiple banners and SKU rationalization. Those things are ongoing, but we feel good about the potential of the Canadian business. So, positives [and] negatives, but all-in-all, we feel like we’re on track and we feel confident that we have a good plan in place.”
―Marvin Ellison, president and CEO of Lowe’s Cos. He presented recently at the Morgan Stanley Global Consumer and Retail Conference. |
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Classified Ads |
![](https://hardlines.ca/wp-content/uploads/2020/01/Taymor-Logo.png)
Taymor Industries Ltd. is now recruiting for a Sales Representative – Home Improvement Retail & New Construction Builders Markets located in Ottawa with travel to Eastern and Northern Ontario.
Family owned since 1948, Taymor is a leading designer and manufacturer of architectural hardware.
If you would like more information regarding the role please visit our company careers webpage athttps://www.taymor.ca/en/career/sales-representative-independent-retail-and-builders-markets. Please send requests for full detailed job descriptions, questions and resumes to careers@taymor.com.
![](https://hardlines.ca/wp-content/uploads/2019/12/slegg-300x84.jpg)
Responsibilities and Functions
- Act as an ambassador of the company with all employees and customers
- Maintain an emphasis on a safety culture, customer service, and efficiency as top priorities
- Responsible for maintaining and managing the safety, top line sales, profitability and reputation of the business in their trading zone
- Achieve and exceed established metrics for business success/ SG & A/ bottom line profit
- Optimize and improve the business’s market share and savings, and business efficiency
- Provide leadership to the business by assisting ownership with development of short and long term goals
- Manage and lead employees
- Develop direct and indirect reports to be promotable to the next level of the organization
- Community ambassador for the Slegg brand
- Other duties as assigned by management
Required Skills and Qualifications
- A broad knowledge of building supplies is necessary
- Diploma or degree in Business oriented discipline
- Strong leadership skills that include effective communication and a collaborative leadership style
- Outstanding customer service acumen
- Previous experience in performance management and conflict resolution
- Strong work ethic
- Expertise level of Microsoft Office Suite- including Word, Excel & Outlook
- Previous experience in a similar role is a must
- Strong communication skills
- Self-motivated, flexible and eager to learn new things
- A positive can do attitude is essential!
Compensation and Benefits
- Wages – competitive wages based on the market and experience
- Benefits
- Health Benefits including drug and dental coverage, practitioners, disability and life insurance
- Retirement savings – RRSP or other
- Perks – Company discounts (employee pricing, mobile phone plans, gym membership), recognition and training programs, opportunities for career advancement, group events and more
![](https://hardlines.ca/wp-content/uploads/2019/12/Orgill-Canadalogo-no-tagline.jpg)
PRO MARKETING MANAGER (#781)
Business Development Manager – Western Canada
Orgill Canada Hardlines, ULC is the nation's largest independently-owned hardlines distribution company that is recognized as an industry leader for its development of innovative retail programs and services that are designed to fulfil a simple mission; Help Our Customers Be Successful.
We exist to serve our customers and our mission is the foundation upon which all of our services, products and activities are built. Orgill Canada employees strive for the highest quality and endeavour to do things right the first time, constantly working towards improving everything they do. Employees want our customers to know that they can depend on us every time they do business with Orgill Canada.
POSITION SUMMARY:
Increase Orgill’s market share in an assigned geographic region by identifying, qualifying, and calling on prospective customers.
DUTIES & RESPONSIBILITIES:
- Increase dealer participation in Orgill buying and marketing programs with direct or indirect account responsibility. Make dealer presentations on all sales and marketing related issues to existing and prospective accounts, either with a Sales Representative, District Manager, or exclusively by the Business Development Manager
- Prospect for new business in the region with or without the Sales Representatives to gain new business opportunities in existing accounts
- Introduce niche-buying programs to enable the retailers to capture greater market share
- Attend trade shows and industry functions as and when directed in an effort to promote Orgill
- Gain knowledge and use of tools and technology developed for the Sales Department to create a stronger bond between Orgill and our customers
QUALIFICATIONS, SKILLS & COMPETENCIES:
- Effectively manage time and prioritize multiple responsibilities
- Interact effectively with other departments, all levels of management and external customers
- Accept, prioritize, and complete multiple tasks with minimal supervision
- Plan, organize, and implement a range of sales promotion ideas and programs
- Strong presentation and communication skills
- Must have experience in our industry and a thorough knowledge of the retail hardware, lumber, and building material industry’s concepts, practices, and procedures
- Must have a valid driver’s license with a good driving record
Please apply by January 12, 2020 and send your current resume and a cover letter to:
HRRH@ORGILL.COM
Please note the position title in the subject line
Orgill Canada Hardlines, ULC is an equal opportunity employer; this position is offered in accordance with this principle
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LBMAO PRESIDENT
Job Description
SCOPE
The President of the LBMAO reports to the Board of Directors of the LBMAO. This position is responsible for the day to day operation of the Association including the following:
- Financial management of the Association.
- Recruitment and retention of members.
- Providing editorial content for the LBMAO magazine as the managing editor.
- Overseeing the employees of the association including developing and maintaining company employee policies.
- Managing the company payroll including direct deposit through the 3rd party payroll management system.
- Attend industry functions representing the Association in a professional manner.
- Working with the board of directors to develop a strategic plan for growth of the association as well as searching out and developing member benefit programs.
QUALIFICATIONS
- Post -Secondary degree in Business administration or comparable industry experience.
- Excellent communication skills.
- Excellent computer skills in Microsoft word, Excel, Power-point.
ABOUT THE LUMBER AND BUILDING MATERIALS ASSOCIATION OF ONTARO (LBMAO)
The LBMAO is a not-for-profit trade association with a long history (102 years) of providing services, social functions and advocacy to the independent building supply retailers and their key suppliers in the province of Ontario. The association has evolved to meet the changing needs of its members and heavily weighted towards supplying relevant industry specific training, health and safety programs and communication platforms both hard copy and digital to keep its members informed and up to date on industry trends and changes.
REMUNERATION
- A base salary will be provided plus bonuses for member growth and retention.
- Comprehensive benefits package.
- RRSP matching contributions.
All applications with resume for this position should be submitted to the following address no later than January 30, 2020.
Mr. Ron Schell, Chairman
The Lumber and Building Materials Association of Ontario
120 Traders Blvd. E.
Mississauga, On L4Z 2H7
We thank all those who apply, however only those candidates who meet the qualifications will be contacted for an interview.
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