SPECIAL REPORT — The hardware and home improvement industry, like the world at large, is coping with concerns around the coronavirus pandemic worldwide. A slew of cancellations and postponements of conferences and trade shows has occurred everywhere, and now both the Home Hardware Spring Market and the National Hardware Show have been added to that list.

Home Hardware Stores Limited announced last Friday the cancellation of its show, set to be held in the Waterloo region from April 5 to 7. Reed Exhibitions, which owns the National Hardware Show, postponed its event just hours later. It was to be held in Las Vegas from May 5 to 7.

“The health and safety of the Home Hardware community, our dealer-owners, team members, suppliers, business partners and customers is, and will always be, our number-one priority,” said Kevin Macnab, Home Hardware’s president and CEO.

“We understand that this is the first time in Home’s 56-year history that a Market has been cancelled. This event hosts over 7,500 attendees from across the country and we believe this precaution is necessary.”

Meanwhile, south of the border, North America’s premier show for the industry, the National Hardware Show, has been postponed. That event, which is marking its 75th year, typically attracts delegates from all over the world to see upwards of 2,500 exhibitors across 15 product categories.

The decision was made after consulting customers, closely monitoring developments and reviewing guidance from public health officials, including the United States Centers for Disease Control (CDC) and the World Health Organization (WHO). Reed will establish new dates for the show later this year.

“As we face challenging times, we feel it even more important to band together as an industry to continue the long tradition of networking, sourcing new products, education and learning best practices at a common time and place,” said Rich Russo, industry vice president for the National Hardware Show.

Eisenwarenmesse, the International Hardware Fair, in Cologne, Germany, was cancelled just days before it was to begin on March 1. The Ace Hardware Spring Convention has been cancelled. It was scheduled to take place March 12 to 14 in Chicago. The National Housewares Show, which was also scheduled to take place this week in Chicago, has likewise been cancelled.

Dealers respond to double whammy of coronavirus, rail blockades

SPECIAL REPORT — A hardware store in Brooklyn charging $80 for hand sanitizer came to the attention of the city’s tabloid newspaper—and the city police. But the “variable pricing” related to the coronavirus, for everything from hand sanitizer and toilet paper to bottled water and dust masks, is becoming a reality for retailers in all channels.

Closer to home, Andrew Rothblott owns Rotblott’s Discount Warehouse, a hardware store in downtown Toronto. Two weeks ago, he was selling a package of 20 N95 dust masks for $60. They are usually priced around $25, he says, but reflected pricing among competitors around town. And now, if he can get his hands on any, his cost is $50 a box.

Here in Canada, the added challenge of sporadic rail blockades, which continue to appear across the country, is adding to the disruptions to business dealers are facing.

While some products are flying off the shelves, others aren’t even making it into the stores. Lee Harney, vice president of operations at Moffatt and Powell, a six-store chain of RONA stores in southwestern Ontario, has been watching the situation closely. “We’ve experienced delays in some lumber products—and everything shipped by rail from out West. That’s having an impact.” He cites products such as nails, some hardwoods and underlay.

Liz Kovach, president of the Western Retail Lumber Association, was interviewed late last month on Global News in Winnipeg concerning the blockades. “A big part of what is being impacted is the ability to transport goods, particularly to Eastern Canada, when you’re speaking about lumber.” Kovach says her comments found their way to the Office of the Premier in Alberta, “indicating the premier has been made aware of our comments,” she says.

And while most of the rail blockades have been removed, just a week ago, Thomas Foreman, president of the Building Supply Industry Association of British Columbia, could look out into Vancouver Harbour and see upwards of 60 ships that could neither load nor unload.

The industry shutdown in Asia has added an even bigger challenge as freight coming from China has nearly stopped completely. Talking to his dealers, Foreman reports that some of them are looking for alternative sources of supply. But, he notes, it’s difficult to replace products with the same, or similar specs. Even as the lines of supply open up, Foreman expects it will take another three to five weeks to re-establish a consistent flow of products and fulfill his dealers’ needs. 

Like Kovach, his colleague at the WRLA, Foreman has connected with various government agencies for input and direction, pushing them to understand the need for unobstructed transportation for building supply dealers.

“We have been assisting our members with crisis management plans in preparation for further threats that could potentially harm their businesses, now and into the future,” Foreman says. 

Rothblott at Rotblott’s Discount Warehouse calls the combination of events “a perfect storm.” Nor does he see an end in sight. “I predict that there will be shortages that continue for at least the next three months.”

RED DEER, Alta. — In one fell swoop, Peavey Industries has added 104 new stores to its network. It already has almost 100 of its own, but the difference is that those are all corporately owned, while the Ace stores represent independent dealers and every part of Canada.

Nevertheless, Peavey CEO Doug Anderson says he’s ready. Part of what he bought when he took over the license to Ace in Canada from Lowe’s Canada’s RONA division was a number of key people from the Ace team. They will join the Peavey team in Red Deer to ramp up services for the Ace dealers.

“We have a lot of skilled people with the right experience,” Anderson says.

The Peavey distribution centres in Red Deer and London, Ont., already supply stores under the Peavey Mart, TSC and MainStreet Hardware banners. In addition, TSC had experience as a distributor supplying builder and pro accounts. Derek Smith, who was overseeing the MainStreet Hardware banner, was previously both a RONA dealer and a buyer at head office. He will now serve as vice president of the Ace Canada division.

Guy Lichter, formerly director of dealer conversion for Ace at Lowe’s Canada, has been named national sales director for Ace at Peavey. He leads a team of eight territory support managers—all former regional managers at Lowe’s Canada. Bill Morrison, who ran Ace Hardware out of Winnipeg and then led the Ace licensing initiative when it became part of RONA and Lowe’s Canada, is Anderson’s lead consultant to oversee the transition.

“We’ve retained a lot of knowledge so there’s a lot of depth to what we’re doing,” Anderson adds.

ST. JACOBS, Ont. ― Home Hardware welcomed two new members in Quebec in February, while a third location is rejoining the banner in April after being sold to another group under a previous owner.

Quincaillerie Limoilou in Quebec City was founded in 1992 by current dealer-owner Dominic Poulin’s parents. Today, he operates it with his wife Audrey Gendron and their son Mathieu. In Baie-Comeau, Élise Caron and her husband Michel Charette have made the decision to transfer Matériaux Manic in Baie-Comeau, which they have owned since 2012, to the Home Hardware Building Centre banner.

In April, Réno Mat St-Etienne will reopen its doors in St-Etienne-de-Lauzon under the Home banner.

The wave of new dealer-owners is a significant gain for Home Hardware in Quebec, where Lowe’s Canada’s banners dominate the market, trailed by Canadian Tire and BMR. It also fits with the Canadian franchise’s efforts to respond to Quebec consumers’ support of domestic businesses.

Duncan Wilson, senior director of sales for Home Hardware Stores, says the business is ripe for expansion in Quebec. “We consider the province of Quebec a very, very strong growth potential for us,” he says. “We’ve grown substantially in the last five years.

“It’s underexposed as far as I’m concerned,” he adds, contrasting the situation with Home’s 400-plus stores in Ontario. “Quebec is 25 percent of the whole [Canadian] industry, so we’ve got room to grow. The Quebec market is important to us: we’re planning to grow and looking forward to introducing new dealers there.”

The banner reached its 100-store milestone in Quebec 10 years ago with the addition of a store in Ste-Brigitte-de-Laval outside Quebec City. Today, it has more than 130 stores across la belle province.

At Canadian Tire Corp., Greg Hicks has been named president, CEO and member of the board of directors, effective immediately. Hicks most recently served as president of the company’s largest division, Canadian Tire Retail (CTR). His predecessor, Stephen Wetmore, is stepping down from both the CEO position and the board of directors. He will remain on in an advisory capacity through the end of this year as honorary director to support Hicks during the transition.

DID YOU KNOW...

... that the Hardlines Retail Report is your single best marketing tool for understanding the size and growth of the retail home improvement industry in Canada? Who are the top players? What are their strategies? How much has the market grown year over year and which provinces are winning in market share? With 175 PowerPoint slides and dozens of charts and graphs, this report is a must-have for every marketer. Click here for more info and to order your copy!

RETAILER NEWS

TORONTO ― Canadian Tire Corp. and Home Hardware Stores Ltd. are among the companies named to the Platinum Club of Deloitte’s Canada’s Best Managed Companies awards. These firms have maintained their place on the Best Managed roster for seven years or more. Applicants are evaluated by an independent judging panel composed of representatives from program sponsors in addition to special guest judges.

BOUCHERVILLE, Que. ― A team of women volunteers from Lowe’s Canada kicked off the renovation of a five-plex located in Montreal’s Côte-Saint-Paul neighbourhood. The event was part of the International Women Build Week, an initiative carried out by Lowe’s Cos. and Habitat for Humanity. It brought together 6,000 women volunteers in more than 235 communities in Canada and the U.S.

LONDON, Ont. ― Moffatt & Powell has purchased the RONA store in Hanover, Ont. RONA Hanover, an independently owned dealer store within the RONA family, was owned by Jane and Brian Haack, who have retired. Their son Steve will continue to work in the business. Moffatt & Powell has been in business since 1956 and has carried the RONA banner since 2010. The company now owns and operates six stores in southwestern Ontario in Strathroy, London, Exeter, Tillsonburg, Mitchell and Hanover.

SAINT-GEORGES, Que. ― A youth employment organization has honoured a local Canac store for its commitment to hiring young students. Carrefour jeunesse-emploi de Beauce-Sud awarded the store a prize for its commitment to educational success as part of the organization’s School Retention Days, held last month. It cited the store’s proactive involvement with youth and respect for their limits in granting the award.

SASKATOON ― Over the past year, Federated Co-operatives has developed a program to nurture strong, forward-thinking leadership within the organization. “Inspire: The Co-op Leadership Experience,” is a self-directed opportunity for team members to develop and refine their leadership abilities. The Personal Leadership Stream offers development opportunities for all team members, while three other streams offer development opportunities for those already in leadership roles.

SUPPLIER NEWS

HALIFAX ― The Atlantic Building Supply Dealers Association (ABSDA) celebrated the past year at its annual dinner last week during the Atlantic Buying Supply Expo. More than 640 delegates attended the sold-out event, which highlighted some of the association’s achievements over the last year.

MONTREAL ― More than 450 industry members gathered at Montreal’s Fairmont Le Reine Elizabeth earlier this month for AQMAT’s eighth Gala Reconnaissance. A five-member independent jury panel selected the winners from 55 nominations voted by the association’s membership. A total of 12 companies and 15 employees or groups of employees were honoured. (Full list of winners here!)

VANCOUVER ― Fourth-quarter revenues at CanWel Building Materials increased 11.1 percent to $293.4 million, compared to $264 million in the same period in 2018. Net earnings rose to $3.4 million in 2019, from $370,000 in 2018. For the full year, revenues increased by 3.3 percent to a record $1.33 billion, compared to $1.29 billion the previous year. Net income fell to $17.2 million from $30 million in fiscal 2018.

CAMBRIDGE, Ont. ― Bunzl announced it has completed the process of bringing all its safety companies together under the Bunzl Safety banner. The national brand transition began last year. Previously, the business consisted of three separate companies for workwear, safety equipment and lifting and rigging products. Bunzl’s WorkHorse brand is unaffected by this integration.

ECONOMIC INDICATORS

The seasonally adjusted annual rate of housing starts in Canada was 210,069 units in February, a decrease of 1.9 percent from 214,031 units in January. The SAAR of urban starts for the month also declined by 1.9 percent to 199,304 units. Multiple urban starts fell by 6.1 percent to 146,072 units while single-detached urban starts increased by 11.9 percent to 53,232 units. Rural starts were estimated at a seasonally adjusted annual rate of 10,765 units. (StatCan)

NOTED

Consumers spent $601.75 billion online with U.S. merchants in 2019, up 14.9 percent from $523.64 billion the prior year, according to the latest figures from the U.S. Department of Commerce.

OVERHEARD...

“We share our profits with local co-ops and they have a direct, positive impact on the millions of members and hundreds of communities that support their local co-ops—it’s a virtuous circle.”
―Scott Banda, CEO of Federated Co-operatives, on the co-op’s 2019 year-end results.