Until two weeks ago, the Ace banner in Canada had a home with Peavey Industries. But a range of unforeseen circumstances—including the arrival of Covid—plus the challenging nature of hardware wholesaling in general in this country, led Peavey to terminate the Ace licence.

“I think definitely there were a lot of headwinds that we didn’t anticipate when we first entered into this venture,” says Peavey CEO Doug Anderson (shown here at the 2022 Peavey trade show). But he stresses that his Red Deer, Alta.-based retail hardware company put a serious effort into the Ace venture. That included developing a wholesale hardware business to service the Ace stores.

But that business encountered plenty of headwinds, as well. “We spent a lot of time and money trying to navigate through them and we closed a lot of gaps,” he adds, suggesting that the Ace team at Peavey was able to make great strides in developing the Ace supply chain.

“The dedication of the Ace team in our company was exceptional and unwavering. They fought hard to make things work. From our admin team to customer service teams to territory managers, everyone wore the Ace brand with pride and were very dealer-focused and dealer-oriented. They should all be proud of the work they did.”

Those smaller independent Ace stores tend to thrive on providing a range of products that’s carefully aligned with the towns they serve. Fulfilling such diversified orders put stresses on the system from early on. Anderson and his team continued to work on improvements, then finally had to decide whether to continue, even after making big gains in setting up the Ace business.

Those gains included coping with the technology challenges of building an online portal, establishing connectivity with suppliers, invoicing processes, and managing supply chain disruptions and increased costs, especially around transport and products. Peavey had to build a whole new supply chain for Ace—and all during Covid. As all of this was being developed on behalf of the Ace dealers, Peavey had to do it in a way that was profitable. “We also had to have a productivity level that made sense for us.”

Peavey’s efforts paid off and its connection with the dealers stayed solid, at least for a while. “Our relationship with Peavey in the last year has been stronger than ever,” says Barry Eidt, co-owner of three Ace stores in southwestern Ontario. “But in the last few months supply started to become an issue,” he adds. However, he remains positive about the relationship. “I can’t say enough good things about Peavey and I really wish them well.”

When all the pieces did not end up coming together as intended, the decision was made to  terminate the Ace agreement and focus on Peavey’s own retail strategy and maintain the strength of the Peavey Mart and MainStreet banners.

Anderson admits with regret that this was a very tough decision, “especially given the great relations that were built with dealers over the past four years.”

Another dealer, who switched from Ace last year, believed the Ace Canada team had a tough challenge, but adds that all the people involved at Peavey were very well-intentioned and really great to work with.

Eidt, along with other dealers Hardlines spoke to, say that the Ace licence will be taken over by Ace International when Peavey officially exits at the end of the year. Canadian supply will come out of Ace’s U.S. distribution centres and there will be support from Ace’s headquarters in Chicago. (Ace Hardware and Ace International did not respond to multiple requests from Hardlines for information.) Eidt says he and the other Ace dealers will get more info sometime this month.

“It’s unlikely customers even knew we’ve been with Peavey for four-plus years, so the main thing I told my store managers is that I want to keep it ‘business as usual.’ We’ll continue getting information in the coming months that will solidify a decision for each dealer across Canada, but as of right now Ace isn’t going away.”

The adoption of the Ace portfolio was a good fit for Peavey Industries when it bought the Ace business from Lowe’s Canada (now RONA inc.) four years ago. Peavey was already focused on farm and hardware retail for smaller communities across the country. And the commitment to those communities by the Ace dealers is something that reflects the business values of Peavey.

But a big part of taking over the Ace licence and deciding to serve Canada’s independent Ace dealers involved creating a brand-new hardware wholesaling business. Peavey CEO Doug Anderson admits that proved to be a struggle. Shipping hardware in this country to small accounts poses a big challenge.

“The luxury Ace dealers have as independents—and the strength they have—is that they can tailor their product mix to their local communities. Where that gets challenging from a distribution perspective is that it’s hard to tailor the same level of responsiveness and reliability to all those dealers based on their regional preferences,” Anderson says. “That certainly is a challenge, for sure.”

Anderson commented on the challenges of supplying a varied product mix to a marketplace that is widespread and thinly populated, especially compared to markets like the U.S.

However, he was pleased with Ace International and worked closely with that group to meet the needs of the Canadian dealers. “We’ve had a very transparent relationship with Ace International throughout the four years and at no time did I feel there was any contention or lack of support to find a solution.”

That support extended even as Peavey began the process to exit the relationship, “trying to find the best solution and outcome—a disappointing outcome but trying to find the best solution,” Anderson says.

“I still believe in the strategy but the reality of where retail is at in Canada, where we feel we need to focus going forward, is in our corporate retail strategy.”

Anderson’s personal disappointment in the outcome is clear when speaking with him. And he recognizes that this latest change is yet another distraction for the Ace dealers, one that Peavey will support them through. “We stand by our commitments 100 percent and we will stand by the dealers through the entire transition.”

The combined international association for home improvement retailers, EDRA/GHIN, based in Cologne, Germany, established a task force last year to tackle carbon emissions with its member companies. It partnered with Ricardo, an international strategic, environmental, and engineering consultancy, to help the task force—and the industry—develop its goals.

The task force has worked hard to develop a set of recommendations on how carbon data is treated through the supply chain, sharing best practices in both the reporting and refining the home improvement sector’s progress in reducing Scope 3 emissions (those not resulting from a company’s own activities).

Now, European retailer and wholesaler OBI, one of the founding members of the EDRA/GHIN Scope 3 Taskforce, has shared its commitment to both the Scope 3 Taskforce Targets and Science Based Targets Initiative (SBTi is considered the gold standard in terms of decarbonization), which involves setting decarbonization targets within the next two years. For retailers, the majority of Scope 3 emissions stem from purchased goods and services and the use of sold products.

OBI aims to meet hose targets working through SBTi, as well as collaborating with suppliers to set targets themselves within five years.

Two other major home improvement retailers, Kesko and Kingfisher, have already set near-term targets for carbon reduction and had these approved by the SBTi. Three other association members, Intergamma, Lowe’s Cos., and Maxeda DIY Group, have also committed to setting science-based targets.

“Only through working together can we begin to tackle the accelerated climate change we are seeing across our planet,” said John Herbert, general secretary of EDRA/GHIN. “This is a call to action to the entire industry to come together now and engage, challenge, and inspire one-another.”

(Any retailer or supplier in the home improvement industry who is interested in joining the EDRA/GHIN Scope 3 Taskforces should reach out to info@edra-ghin.org.)

At the latest annual general meeting of the Atlantic Building Supply Dealers Association, Tanya Hanson Rocca of Roblynn Home Hardware Building Centre in Oromocto, N.B., was appointed as the new chair of the board of directors. She is only the second female chairperson in the association's history. She replaces Peter Merrill of KM Agency, who remains on the board for another year as past chair. Merrill was the first associate member to be named chair of the board.

At the North American Hardware and Paint Association, Scott Wright has been promoted to the role of NHPA’s executive director of content development and executive editor for its media brands. Kim Peffley, who has been serving as NHPA’s director of organizational development and consulting, steps into a new position as executive director of educational development and consulting. Katie McHone-Jones, who most recently served as NHPA’s director of member services and events, will move into the role of executive director of retail engagement and events. Additionally, with the hiring of Greg Cole as NHPA’s national sales manager, Whitney Mancuso has been named executive director of marketing and industry relations. Lindsey Thompson has been promoted to the role of managing editor for the association’s media properties.

DID YOU KNOW...?

… that the latest edition of Hardlines Dealer News has hit subscriber inboxes? In this issue, we look at one dealer’s musical tribute to youth mental health, why merchandising isn’t just for the front end, and what to know about changes to the rules around Capital Gains Tax. Hardlines Dealer News is monthly and it’s free: click here to subscribe now!

RETAILER NEWS

Princess Auto has made a deal with the Canadian Football League that names the hardware and automotive retailer as the CFL’s official provider of tools and equipment. “This partnership represents the next step for the league and Princess Auto as they come together to provide unique experiences for their biggest fans,” the CFL said in a release. The partnership covers the entire regular season, the Grey Cup playoffs and the 111th Grey Cup game.

Big Box Outlet Store has opened its 19th location, this time in Sherwood Park, Alta. The Abbotsford, B.C.-based retailer’s offerings include electronics, apparel, hardware, appliances, furniture, and groceries. A 20th store, under construction in Lethbridge, Alta., is set to open later this summer.

Housewares are appearing on the shelves of Toys “‘R” Us stores bearing labels from the Rooms + Spaces banner. That chain got its start last year when the toy seller’s parent, Putman Investments, acquired a collection of properties vacated in the bankruptcy of Bed Bath & Beyond. In the past year, according to the Canadian Press, its footprint has shrunk from 24 standalone stores to just two, but Toys “R” Us outlets are carrying its merchandise in categories ranging from bedding to stemware.

The city of Wilsonville, Ore., has rejected Home Depot’s application to move into a former electronics store, accusing the retailer of bribery and intimidation. Home Depot in turn alleges the city’s decision did not comply with its own regulations and state law. It will appeal to the Oregon Land Use Board of Appeals and seek an enforcement order with the state’s Land Conservation and Development Commission.

SUPPLIER NEWS

Timber-Tech Truss LP, a portfolio company of Westcap Management Ltd., has acquired Calgary-based Brydon Stairs Ltd. The company designs and manufactures for multi-family homes and high-volume production and custom homes. Westcap completed its initial investment in Timber-Tech in December 2023, through buyout fund Westcap MBO III Investment LP.

Small businesses in the U.S. hit the highest level on their Optimism Index in June, rising by one percentage point to 91.5. (—U.S. National Federation of Independent Business)

Mental illness among youth shouldn’t be glossed over or buried, says Rob Faries. Besides being a RONA dealer with two stores on the edge of James Bay in northern Ontario, he’s also the front man for a rock and roll band called the Relic Kings. The band’s latest song, “Hey Good Night,” tackles the theme of teen addiction and mental health. “I think it’s a good story to tell. It’s better that we talk about it, so everyone can learn from it and console each other. Because we’re all going through the same thing,” says Faries. (And it’s a hell of a great rock and roll song. Click here and take a few minutes on this Monday morning to experience it. —your seriously impressed Editor)