Canadian Tire Corp. felt the pinch in its first quarter as consumers held back on discretionary spending. The company reported revenues for the quarter totalling $3.52 billion, a 4.9 percent decline from $3.71 billion in Q1 of last year.

Like many retailers, CTC sees its most modest results in the first quarter, after the dust has settled from the holiday rush. Its financial services business often drives profits during that period of the year.

Comp sales fell by 1.6 percent overall but slid by just 0.6 percent at the namesake Canadian Tire banner. Mark’s comps were down by 1.2 percent while at SportChek same-store sales declined by 6.5 percent.

As CEO and president Greg Hicks noted on a call to analysts, “Canadian Tire often acts as a barometer for the Canadian economy overall.” He added that “the increased cost of living combined with higher interest rates has created a period of hesitation among Canadian consumers. This has had an obvious impact on our operations.”

Essential categories at CTR were up two percent, led by automotive. Growth in seasonal and gardening categories was an exception to the trend away from non-essential purchases.

CTC continues to lean into its Triangle Rewards loyalty program. “In Q1, loyalty sales outpaced non-loyalty sales, underlining the value our customers are seeing in our membership program,” Hicks said. Accordingly, the company announced “our biggest rewards event of the season,” which took place May 9 to 16. During the Triangle Max Stack Event, customers could combine multiple promotions to maximize savings across the Canadian Tire, Mark’s, and SportChek banners.

During the quarter, private label brands continued to play a strong role in CTC’s offering. “We continue to put a lot of strategic emphasis on owned brands,” EVP and Canadian Tire Retail president TJ Flood told analysts, noting that the company was “slightly up in penetration in owned brands” for the quarter.

The Home Depot reported first-quarter financials that underscored how the retail home improvement industry remained stalled well into 2024. Revenues fell 2.3 percent to $36.42 billion, while comp sales declined for the sixth consecutive quarter. Total company comps were down 2.8 percent enterprise-wide, while comps in the U.S. showed an even deeper dip, down 3.2 percent.

Those lower comps represented a drop in both the number of transactions and the average ticket size.

In Canada, where customers are feeling the pain in their pocketbooks from higher prices and prolonged high interest rates, comps fell slightly below that 2.8 percent company average. In a call to analysts, Home Depot president and CEO Ted Decker noted that a late spring impacted the retailer’s results across the board—something felt in most parts of Canada, as well—while homeowners have slowed spending on discretionary projects.

While that DIY spend remains the basis of the company’s success, Home Depot continues to look for ways to grow its connection with larger contractors and builders. According to Decker, “our focus remains on creating the best inter-connected experience growing pro wallet share with a differentiated set of capabilities in building new stores. Driving sales growth with our pro customers remains one of our top focus areas.”

He added that Home Depot continues adding services and programs to woo the pro. “We are developing more fulfilment options, a dedicated sales force, specific digital assets, trade credit, and order management capabilities geared at the residential pro who shops across categories.”

A key part of that pro trajectory has included the development of a distribution network that will serve the pros with large next-day job lot deliveries. Called flatbed distribution centres, the first has opened in Canada in Mississauga, Ont., giving the Canadian division an important tool to build its pro penetration.

That service will be enhanced later this year when the company will enable jobsite pickup for returns back to the FDC, rather than a pro having to take the return back to a store, “which will be a game changer for pro shopping experience,” said Ann-Marie Campbell, Home Depot’s senior executive vice-president. (Home Depot Canada president Michael Rowe reports to Campbell in Atlanta.)

RONA inc.’s commitment to its independent, or affiliated, dealers remains intact following the company’s takeover at the beginning of 2023 by a New York-based private equity company, Sycamore Partners. RONA continues to add points of sale to its affiliate dealer network, including one returning dealer.

“Since we announced our new business positioning, along with a series of new programs last December at Connexia, our annual dealers’ event, 11 stores have chosen to join the network of RONA affiliated dealers to take advantage of its unique and highly competitive positioning,” says Alain Ménard, senior vice-president, RONA affiliated dealers.

Most recently, these six dealers have joined the RONA ranks:

• RONA Manotick in Ontario, near Ottawa, owned by Joe Reid, Ryan Austin, and Pat Butler. It is the town’s very first home improvement store, with 14,000 square feet of retail space.
• RONA Timmins, also in Ontario, owned by Jean and Shannon Gauthier. It’s a brand new store that will open this month.
• Two stores in Alberta—RONA Lac La Biche, which is owned by Greg and Valerie Bouchard, and RONA Olds, acquired last January by Garth Dagg and Sheldon Foss who switched it to RONA. A $1 million investment will expand the retail space from 10,000 square feet to 16,000 square feet.
• RONA Agassiz in British Columbia is a family business owned by Paul and Rose Tebrinke and their son, Shaun. The store features 6,000 square feet of retail space, along with a 5,000-square-foot indoor lumber yard and a 98,000-square-foot outdoor lumber yard.
• RONA Quincaillerie Saint-Jean-Baptiste in Quebec, owned by François Thifault, is coming back to RONA after a short stint with another banner.

A dedicated trade show for affiliated dealers, called Connexia, is another way the company is engaging independents. This year, it will be held Oct. 8 and 9.

“I welcome our new dealer-owners and congratulate those who are opening or acquiring new stores, but, above all, I thank them for trusting us,” Ménard added. “Together, we have the strength, the energy, and the means to increase our network’s footprint in Canada and to propel their businesses to new heights.”

The latest effort to unionize at a Canadian facility that is part of a U.S. retail chain is currently underway. But it’s hardly the first time such a move has been attempted.

Workers at Amazon’s DXT4 warehouse in Laval, Que., can unionize, says the province’s labour tribunal. The workers have been trying to join the Confédération des syndicats nationaux union (CSN) for two years. Caroline Senneville, president of the CSN, told the CBC that employees are dissatisfied by what they claim is a hectic work pace, low wages, and inadequate health and safety measures.

Amazon says it will contest the decision in a hearing set for June 10. If a union is formed, it will be the first Amazon fulfilment centre to unionize in Canada, where the company has some 25 such facilities.

“We believe it’s important for all employees to have their voices heard, but card check auto-certification does the opposite,” said Barbara Agrait, an Amazon spokesperson, who sent her company's official statement to Hardlines. “For example, if someone joins a union at a previous employer or before being hired by Amazon, the law assumes they want that union to represent them at any future employer – whether they actually want that or not.”

However, Senneville pointed out that the process to vote in a union is completely legal.

While the Amazon spokesperson’s response did not address the Amazon unionization directly, it did lay out some concerns for the well-being of future workers.

“And if a simple majority of people at an employer have joined a union at any point (whether while there or at a previous company), then there’s no vote and representation is automatic for all employees—including maybe dozens or hundreds of employees who didn’t even know it was being considered,” Agrait added.

“We believe everyone should have the right to get informed and vote based on their current circumstances and beliefs – just like they do in any other type of election.”

U.S.-based companies have been battling unions in Canada for decades. When a Walmart store in Jonquière, Que., voted to unionize in 2004, on the day the vote was sent to arbitration, Walmart announced it would close the store, which it did three months later, putting 190 people out of work. The retailer said the store was unprofitable.

When The Home Depot acquired the Aikenhead’s chain from Molson Cos. in 1994, it also got 25 percent ownership of the Réno-Dépôt chain that Molson already owned. When Réno-Dépôt went up for sale a few years later, Home Depot Canada did not exercise its right of first refusal to acquire the Quebec stores. Home Depot Canada president Annette Verschuren at the time told Hardlines that the presence of the union at Réno-Dépôt was an important factor in turning down the deal.

PEOPLE ON THE MOVE

Sylvain Dulude marks 35 years at Techniseal this year. The company is celebrating this milestone for its VP and general manager, who started out in 1989 as head of operations. He arrived in 1989 and began work as Techniseal’s operations manager. From there, he advanced to R&D, where he participated in the development of 30-plus products. Among his numerous awards, Dulude earned the 2021 Hardware Industry Manager Award from AQMAT. He won the 2020 Company of the Year Award, plus the 2020 and 2023 President of the Year Awards, awarded by parent company Oldcastle APG. “Throughout his career, his innovative spirit, leadership abilities, and unifying qualities have instilled strength and demonstrated his commitment,” Techniseal stated in a release.

Alysha Kearney has left her position as assistant manager, public relations, at Home Hardware Stores Ltd.'s head office in St. Jacobs, Ont. Her new position is a communications strategist at Southlake Health Centre in Newmarket, Ont.

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RETAILER NEWS

RONA has established the dates for this year’s Connexia dealer event. This third consecutive annual edition will be held on Oct. 8 and 9. Affiliated dealers from across the country will gather at the Fairmont Queen Elizabeth hotel in Montreal for a day of networking with meetings and workshops. These will be followed by a trade show for affiliates only, featuring selected RONA vendors who will present their new products for 2025.

Walmart has increased its range of drone use for deliveries in the Dallas-Fort Worth market. The company started with drones in that area last August, but the addition of a couple more Walmart stores with the service at the end of April means up to 75 percent of area residents can now access drone deliveries.

Online furniture and home décor seller Wayfair Inc. is opening its first bricks-and-mortar store. The 150,000-square-foot location is located in Edens Plaza in Wilmette, Ill. The grand opening will be on May 23. Besides furniture, home decor, housewares, and home improvement products, the store has an onsite restaurant.

Walmart posted Q1 earnings of $5.10 billion, up from $1.67 billion a year earlier. Revenues increased by six percent to $161.51 billion, from $152.3 billion in Q1 of 2023. In Canada, sales grew by 3.9 percent to $5.3 billion.

SUPPLIER NEWS

At Doman Building Materials Group Ltd., Q1 revenues fell by 1.1 percent to $602.5 million, from $609.1 million in 2023. The company attributed the decline to a slowing construction materials market, along with declining lumber pricing. Net earnings of $14.4 million were down from $14.9 million a year earlier.

The Atlantic Building Supply Dealers Association, in partnership with the Canadian Mental Health Association, will hold a two-hour webinar on mental health education in the workplace. The date is May 28, and the webinar will take place from 8 a.m. to 10 a.m. If you are interested in attending, please email the ABSDA.

Koelnmesse, whose events include Eisenwarenmesse—the International Hardware Fair in Cologne, Germany, has partnered with another international trade show company, dmg events. They have signed a Memorandum of Understanding to collaborate on developing key trade exhibitions across the Middle East. This strategic partnership will combine their respective brands to take advantage of growth opportunities in those growing markets. Shows being considered include office décor and furniture, as well as possible shows for the hardware and tools segment. dmg has offices in 10 countries including Canada.

Lafarge Canada and Geocycle Canada have completed a pilot at the Lafarge Brookfield Cement Plant in Nova Scotia. The project uses recycled minerals recovered from waste sources to produce high-quality clinker, the main ingredient in cement. The result is 100 percent recycled cement, which in turn, is the main component of concrete. The aim is to reduce CO2 levels by as much as 60 percent per tonne of clinker. Both Lafarge Canada and Geocycle Canada are part of Holcim Group. This is the first-ever pilot in North America and only the second in the world across the parent company.

Sales of existing homes fell 1.7 percent between March and April, coming in a little below the average of the last 10 years. At the same time, the number of newly listed homes rose by 2.8 percent on a month-over-month basis. The actual (not seasonally adjusted) number of transactions came in 10.1 percent above April 2023; however, a significant part of that gain likely reflected the timing of the Easter long weekend. (Canadian Real Estate Assoc.)

The value of building permits decreased 11.7 percent to $10.5 billion in March compared with the previous month. Construction intentions in the residential sector decreased by 8.3 percent to $6.5 billion, led by a 13.7 percent decline in Ontario. Five other provinces, however, saw residential permits increase, including Quebec and Manitoba. Across Canada, 4,200 new single-family homes were authorized in March. (StatCan)

Globally, each year, more concrete is sold than all other building materials combined, according to Lafarge Canada.