Here at Hardlines, we’ve been tracking the sluggish performance of the retail home improvement industry over the past several months. The publicly-traded majors (The Home Depot and Lowe’s in the U.S., Canadian Tire in Canada) have announced their results for both 2023 and the first quarter of 2024. Their numbers are all down as the economy, and consumers, slog through the post-pandemic malaise of higher interest rates and rising costs.

You have likely already surmised that the industry will show negative growth in 2023. But by how much? Did Home Depot Canada perform better than Canadian Tire? How did banners like RONA and Home Hardware perform, and how did their performance vary from province to province? Building centres saw their sales surge in 2022; did that persist into 2023 and will it continue through this year? Why is the Canadian big box market share smaller than in the U.S.?

All these questions will be answered—as they are annually—in our forthcoming 2024 Hardlines Retail Report. We are currently reviewing the sales performance of independent dealers, which is sent to us annually in our Retail Report survey. The data and economic trends for each region of the country are being inputted into our massive Industry Database to calculate the size of the industry. Only Hardlines has the data on how much our industry has grown or shrunk annually, which retailers are pulling ahead, and which groups are slowing down.

This information will also be used, in a greatly abbreviated form, in a special Top 20 Retailers feature for the third-quarter edition of our print magazine, Hardlines Home Improvement Quarterly. The Top 20 edition of HHIQ will be mailed out to 11,000 dealers and store managers across the country in mid-July.

But for the full data on our industry, you need the 2024 Hardlines Retail Report, also available in July. This essential piece of research features:

• The size of the industry year-over-year based on 2023 year-end results
• In-depth analysis of the top four players, including Home Depot Canada, RONA inc., Home Hardware, and Canadian Tire Retail
• The winning formats—how the independents are faring against the big boxes
• The hot provinces and how market shares have changed by region
• The newest trends and challenges facing retailers today
• Forecasts for the industry in 2024 and 2025

Again, this research is proprietary to Hardlines. It is simply not available anywhere else.

This year’s Hardlines Retail Report includes a closer look at online sales penetration and how dealers are coping—or not—with this trend. It will also present brand new data that identifies sales according to customer type—whether it’s DIY, contractor, or industrial. Plus, we provide careful evaluations of the latest retail and economic trends, and how they will affect your business. It’s a must-have for every sales and marketing executive in the retail home improvement industry.  And remember, we've done the work for you! If you have a presentation to make about the Canadian industry, you need the 2024 Hardlines Retail Report—with its 150-plus detailed PowerPoint slides.

(For more info, and to pre-order your copy of the 2024 Hardlines Retail Report, click here now! If you have questions about the report, email us directly!)

On the last day of May, Kent Building Supplies officially launched appliance showrooms in six additional locations across Atlantic Canada. The latest Kent stores to carry a selection of washers, dryers, and refrigerators are located in Truro, Stellarton, and Sydney, N.S.; Edmundston, N.B.; and Gander and Corner Brook, N.L.

The retailer started with a pilot program at nine of its big box stores, with the intention to roll out to additional stores over time. With the latest additions, Kent now boasts appliance showrooms in 14 of its 48 stores in Atlantic Canada. The other stores carrying them are in Charlottetown, P.E.I.; Halifax and Dartmouth Crossing, N.S.; Fredericton South, Moncton, and Saint John East, N.B.; and St. John’s and Mount Pearl, N.L.

The showrooms carry a selection of major brands, including Samsung, Whirlpool, and GE. Customers can get home delivery along with removal of the existing appliances at the same time. Appliance purchases are also eligible for Air Miles points. Each store staffs the department with dedicated appliance sales specialists.

With Kent’s continued expansion of its services to contractors, the appliance showrooms represent an important added service when it comes to rounding out assortments for residential home improvements. It also gives Kent a way to seriously increase basket size among its customers.

Quebec home improvement retailer Canac has a new store in Sorel-Tracy, Que., roughly midway between Montreal and Trois-Rivières. The location opened to the public ahead of the May long weekend, but an official ribbon-cutting ceremony was held at the end of the month with media guests and local dignitaries in attendance. Groundbreaking on the site was first announced a year ago.

Store manager Gilok Chang Kai was joined by members of the Laberge family who own Canac, Canac general director Martin Gamache, and merchandising director Daniel Châtelain. Elected officials on hand included Sorel-Tracy mayor Patrick Péloquin.

“The media define us as a big box, but we operate on proximity,” Châtelain said, describing the close cooperation across departments. The store clocks in at more than 40,000 square feet and boasts a building materials warehouse of over 31,000 square feet, along with an outdoor lumber yard.

Charles Laberge, Canac’s senior business development manager, noted that there is “strong potential in our market for entrepreneurs looking for specific guidance” on products.

All staff positions in the store have already been filled. Some employees were wooed from competitors, while others are locals who jumped at the chance to quit their commute to Montreal.

The privately owned chain is in the midst of a $200 million, five-year expansion effort. Its Walmart-style strategy of everyday low pricing over promotional specials appeals to Quebecers. Since the takeover of RONA by Sycamore Partners, a New York-based equity fund, Canac has touted itself as a homegrown alternative. The retailer’s next opening is slated for the fall in Rivière-du-Loup.

Retailers are taking increasingly creative steps to combat theft, but balancing security with customer service is a delicate act.

Retail Council of Canada CEO Diane Brisebois told CBC News that organized retail crime is a growing problem. “We’re talking here about gangs that are in the business of stealing, and retail is the new frontier.”

While it’s difficult to quantify trends, Toronto police launched an awareness campaign last fall, saying that such crimes were becoming more frequent—and more violent. “These crimes are in fact costing all of us because they drive up the prices on products that we purchase on a regular basis,” Toronto Police chief Myron Demkiw said at the time. He claimed that an estimated two out of five incidents were violent in nature.

In Winnipeg, police have increased their presence around storefronts since spring break, in part out of concern for the danger that armed shoplifters can present to retail staff.

That concern has some retailers turning to such measures as placing wheel locks on shopping carts, executing random receipt checks, and erecting metal or plexiglass barriers. But some analysts warn those are blunt instruments unless retailers can distinguish between suspicious activity and innocent customers.

“There's a feeling that you’re a thief in the making until you prove otherwise,” Vancouver retail consultant—and Hardlines Conference presenter—David Ian Gray told the CBC. “The current status quo is just bad for shopper experience, and that's not what you want when you're in retail.”

One point of vulnerability in terms of loss prevention is self-checkout stations, where items may be missed or wrongly scanned, whether intentionally or not. Some retailers are starting to rethink them. As Globe and Mail columnist Rob Csernyik wrote, when it comes to self-checkout, “nobody’s happy.” Removing the stations can be a win-win, curbing both customer angst and opportunities for theft.

Scott Savage removed the self-checkout machines from the Stratford, Ont., Giant Tiger store last month. While it may improve security, that wasn’t his motivation: his customers, many of them seniors, simply resented having to do the work themselves. At least half a dozen Canadian Tire outlets in the province have done the same.

PEOPLE ON THE MOVE

Marc Gingras has been named chief strategy officer at Luxo Marbre. He brings more than 35 years of experience to the role, including serving as VP merchandising for building products at Lowe’s Canada/RONA, plus stints at Bélanger and Cobra Anchors.

DID YOU KNOW...?

… that the latest instalment of our podcast series What’s In Store is now live? This time, we talk with Nicole Gallucci, professor at Loyalist and George Brown Colleges and author of Life Blueprint: A Step-by-Step Guide for Creating an Extraordinary Life. She shares her insights on intergenerational collaboration in the workplace, including the arrival of Gen Z, and how AI is going to impact the way we work. All our podcasts feature great industry leaders with ideas and inspiration for you and your business. Sign up now to get updates about the latest free podcasts in your inbox!

RETAILER NEWS

eBay has dropped American Express as a credit card option for its customers. The online retailer is pushing back against the merchant fees charged by Amex. “After careful consideration, eBay has decided to no longer accept American Express globally effective Aug. 17 due to the unacceptably high fees American Express charges for processing credit card transactions,” the online retailer said in a statement. It added that it’s in the process of notifying its customers of the change. Costco dropped Amex in 2016.

Ace Hardware south of the border is experiencing an increase in traffic, according to Placer.ai, which uses cellular location data to determine where consumers are shopping. Reportage on CNN recently said that Ace’s big box rivals, Home Depot and Lowe’s, are experiencing a drop of monthly traffic—again according to Placer.ai.

Enhancing grocery offerings, especially in fresh departments, is key to Walmart Canada’s growth strategy, The Globe and Mail reports. The retailer is approaching the final year of its five-year plan to invest $3.5 billion in upgrading about two-thirds of its stores.

Toronto city councillor Jon Burnside made a citizen’s arrest last week when he visited the Leaside Home Depot and found two men leaving the store with unpaid merchandise. A 10-year Toronto Police Services veteran, Burnside acknowledged that the intervention was risky but said one of the men turned on him when he took out his phone to record the pair, who were pushing shopping carts filled with power tools. Two other men, a contractor and an off-duty firefighter, assisted him as he restrained one of the suspects until police arrived. The other suspect fled the scene.

SUPPLIER NEWS

AQMAT president Richard Darveau has issued an open letter to federal labour minister Seamus O’Regan. The missive comes weeks after O’Regan announced an inquiry into last summer’s port strike in British Columbia. Darveau calls for port workers to be designated an essential service, which would restrict their right to strike while in turn gaining them what he calls “salaries and conditions that defy all competition.”

MASTERGRAIN, the Woodbridge, Ont.-based door maker, has announced the acquisition of Fibercraft Door Co. in Hanover, Ont. Fibercraft specializes in large-format fibreglass pivot door systems in the Canadian luxury door market. The deal is seen as a way for MASTERGRAIN to enhance its manufacturing capabilities and broaden its product offerings.

Saint-Gobain, through its building products subsidiary CertainTeed Inc., and TimberHP, a manufacturer of insulating wood composites, have announced a distribution arrangement. CertainTeed will distribute TImberHP’s wood chip insulation in North America—and will be the exclusive distributor of the products in Canada. TimberHP is headquartered in Madison, Maine.

The Bank of Canada (BOC) has cut its policy rate, its key interest rate, to 4.75 percent. “We’ve come a long way in the fight against inflation,” said BOC governor Tiff Macklem. This is the first cut in interest rates by the central bank since March 2020. Macklem said he is confident that the inflation rate will continue to move closer to the BOC’s two percent target.

This year’s Hardlines Retail Report takes a closer look at online sales penetration and how dealers are coping—or not—with this trend. We will also present brand new data that identifies sales according to customer type—whether it’s DIY, contractor, or commercial/industrial. Plus, we provide careful evaluations of the latest retail and economic trends, and how they will affect your business. Available mid-July, it’s a must-have for every sales and marketing executive in the retail home improvement industry. (For more info, and to pre-order your copy of the 2024 Hardlines Retail Report, click here now!)