vol. viii, #25 June 24, 2002 

* Independents brace for big box wars in Québec * Alliance, Home Outfitters, Royal Bank join conference roster * Taiga shares to split * Sodisco-Howden gets Aeroplan loyalty program * Bankrupt White Rose seeks buyer

"Imagine how weird phones would look if your mouth was nowhere near your ears." — Steven Wright (U.S. comedian, quoted in the New York Times)


Québec City, QC — Despite not being a concern to consumers elsewhere in Canada, Guy Bedard is convinced customers in this city will care that Home Depot is a U.S. company. Bedard is general manager of Canac-Marquis Grenier, a 12-store chain considered by many to be one of the most progressive home improvement retailers in the country. Home Depot is planning to open its first two stores on Canac-Marquis Grenier's turf by late Fall of this year. Bedard is not too worried. Réno-Dépôt has been in Québec City seven years and last Fall opened its third store there. Home Depot, however, has faced some cultural dissonance since its invasion of this province last year.The eight stores in the Montréal area are battling against a total of 21 big boxes in that area. In Québec City, says Bedard, the Home Depot name will have very little consumer awareness. So when Home Depot gets here, says Bedard, "They will be seen as just another big box store." Bedard admits the big boxes do make a difference. He remembers when Réno-Dépôt arrived. "The novelty of having Réno-Dépôt here, in 1995, made a big impact." Two Canac-Marquis Grenier stores in the West end of the city, very close to the site of one of the two proposed Home Depot stores, will undoubtedly be affected, he says. But despite the big box invasion, Canac-Marquis Grenier's sales grew more than 15% last year to $115 million.
Unionville, ON — Plagued for years by underfinancing and mounting competition, White Rose Crafts and Nursery Sales has declared bankruptcy, naming PricewaterhouseCoopers as trustee-in-bankruptcy. The chain of 31 stores specialized in live goods and garden sales, complemented by crafts sales. Founded in 1957, it continued operations in the original Unionville location right up to the end. The company was taken over by management in 1993, and a year later went public with an IPO that went toward further expansion of the chain. It bought up W.H. Perron, a Montréal-based retailer with two stores. Those grew to eight outlets under White Rose's ownership, while the White Rose banner grew to 34 throughout Ontario by the late '90s. But the cost of expansion, coupled with the entry of other retailers, such as Home Depot and Canadian Tire, into gardening, plus the arrival of Michael's on the crafts side, finally caught up to White Rose, and by 1998 it was no longer able to meet its credit commitments, filing for bankruptcy protection. Under the reorganization, it closed two warehouses, two Ontario stores and all eight of its Québec stores. By 2000, sales had grown to $139 million, but its losses exceeded $9.3 million. Then, last year, under then-president Howard Board, who had worked for Peoples Jewellers during its bankruptcy protection battle, it repositioned to offer more home décor products, closing one store and renaming the remaining stores White Rose Home and Garden. It wasn't enough, however. White Rose's loss narrowed to roughly $6 million for its last fiscal year, ended July 29, 2001, as sales slipped to about $130 million. Now, with a debt load of more than $173 million, the company will operate day to day until a buyer can be found.
World Headquarters, Toronto, ON — Executives of two of Canada's most innovative specialty retailers, plus the vp of one of the country's top LBM wholesalers, will round out the next Hardlines Marketing Conference. Bill Morrison, general manager of Home Outfitters, is heading up an aggressive expansion plan by parent company Hudson's Bay Co. to double the number of its specialty décor and home furnishings outlets over the next three years. Morrison joins Leonard Lee, whose presentation at our 1998 conference drew resounding praise. Lee is the head of Lee Valley Tools, a specialty woodworking and garden supply company with catalogue sales and retail outlets across the country. And just confirmed: Jim Bradshaw, vice-president building products for Taiga Forest Products Ltd., has agreed to talk about the challenges and opportunities facing building materials distribution today. In addition, Albert Plant, national market manager, consumer products and retailing with RBC Royal Bank, will share his insights into the growth and consolidation within this industry, plus effective survival tactics for any retailer today. He's got a truly unique perspective as someone who was integral to many of the backroom negotiations that have been made over the past decade. The Hardlines Marketing Conference will be held September 13, 2002, and attracts almost 200 senior executives and managers from the retail and supply sides of home improvement retailing. Other speakers booked for the day include Greg Thomas of Alliance International LLC, Paul Ingevaldson of Ace Hardware and David Ford of the Council of Forest Industries. For more information, call us at 416-489-3396, or check out hardlines.ca/html/conference_upcoming.html.
Canadian Tire 33.08 18.50 32.10
Canfor 11.70 8.08 11.25
Emco 12.42 3.71 11.50
Goodfellow 11.90 8.00 11.00
Home Depot 52.60 30.30 35.67
Hudson's Bay 20.10 12.50 13.30
Lowe's Cos. 49.99 24.99 44.40
Sears Canada 25.10 12.50 22.10
Sodisco-Howden 2.35 0.75 1.44
Taiga Forest 12.75 7.49 12.25
West Fraser 44.42 26.13 41.30
Hardware distributor Sodisco-Howden Group has made a deal with Aeroplan to offer Air Canada's air points loyalty program through its stores. Beginning later this year, Aeroplan members who shop at Sodisco-Howden's franchised stores, PRO, Do-it center in English Canada, and Ferplus and Bâtitout in Québec, will get up to one Aeroplan Mile for every dollar spent. Once sold exclusively through specialty dealers, Deere & Co. has signed an agreement allowing Home Depot to sell John Deere lawn and garden tractors starting next spring. In addition, Deere will stop making its Scotts and Sabre brands. Currently, Home Depot has an exclusive on the Scotts brand. The board of directors of Taiga Forest Products has announced it will seek approval for a two-for-one share split at its annual general meeting on July 24. A 20-year-old policy by Home Depot in Atlanta has come back to haunt it during these intensely patriotic times in the U.S. The home improvement retailer doesn't want to get involved in all the extra paperwork required by government contractors, so it doesn't want to sell to the government. One of the things Home Depot would have to do is provide documentation of its affirmative action compliance. Maintenance Warehouse was a significant federal contractor until taken over by Home Depot in 1997. Taymor Industries Ltd. has donated more than $50,000 in bath hardware to Habitat for Humanity Canada. The donation will provide Habitat with enough bath accessories to outfit 350 homes. Wal-Mart Canada will open a store in Fort St. John, BC in the Fall of 2002. The 84,000 sq.ft. free-standing store will represent an investment of just under $20 million in the local community The 2003 DIY & Garden Show is to move to Earls Court in West London, England, because it's better known and enjoys better proximity to major transportation links. The show, which attracts companies from 30 countries, will take place January 26-28, 2003. For more information, contact: Christopher Leonard-Morgan, clm@firstevents.com; www.diyandgardenshow.com. Kmart Corp. is making big changes to its online shopping site, including renaming it from www.bluelight.com (the name of its wholly owned subsidiary that runs the site) to www.kmart.com. The website now features an updated look and more products.
Don Bilenduke has been appointed director of sales at Avant, the Mississauga, ON-based division of Hagen Pet Products. Headquartered in Montréal, Hagen sells pet supplies and water gardens to the mass merchant sector. (905-826-6699) Well, nobody else has told us about anybody on the move, but the jazz festival is on in Toronto, so I'll be on the move. I was thinking of heading downtown to catch some music this weekend… (whatever, enough space-wasting drivel — Editor)
Except for drug stores (down 0.7%), retail sales in Canada advanced 1.0% in April to $25.5 billion, following two slow months of growth. All provinces except New Brunswick (-3.8%) and Nova Scotia (-1.6%) showed gains. In January and in the last three months of 2001, retail sales grew at least 1.3% each month. Sales by Canada's large retailers were up in April from March by 6.5%. Sales of hardware and lawn and garden products, health and personal care products, and home furnishings and electronics were especially strong. Housing starts in the U.S. were up 11.6% in May, the biggest jump in seven years, says the U.S. Commerce Department. Single-family starts were up 9.6%.
"There's definitely interest and I think there'll be more interest. We believe there's a core business that 's viable here." - Rick Pettit, senior vice-president of PricewaterhouseCoopers Inc., the trustee in bankruptcy for White Rose Crafts and Nursery Sales, on the possibility of a buyer emerging for the 31-store chain.
The Spring issue of Hardlines Quarterly Report, available now, features: The Three Billion Dollar Club — find out which home improvement retailers dominate the Canadian scene...Who's winning the big box war? Big box expansion in Canada..... CLICK HERE to find out more!
****HARDLINES MARKETPLACE**** Check out Hardlines Classifieds on the web: https://hardlines.ca/html/classifieds_new.asp POSITIONS SOUGHT NATIONAL SALES MANAGER/ MANUFACTURER’S AGENT AVAILABLE Well respected, successful senior national sales executive available immediately to help you grow your key accounts. Skill set includes marketing manager and multi-line manufacturer's agent credentials. I have the skills to grow your sales to key accounts, with extensive experience servicing Home Depot, Canadian Tire, Sears, Home Hardware, Rona, Réno-Dépôt and all Canadian hardware buying group accounts. 10+ years experience successfully marketing brands. Let’s talk about how I can make your business grow. 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