HARDLINES™ Five years serving Canada's home improvement industry November 27, 2000 - Volume vi, #45 Michael McLarney, Editor & Publisher Ph: 416-489-3396 Fx: 416-489-6154 E-mail: buzz@hardlinesfax.com  
Check out our incredible Classifieds section!
* * * * * * * Canadian Tire launches online shopping * TSC gets new owners * Eatons relaunches in seven cities * Home Depot continues to forecast strong year-end results * * * * * * IT'S HERE AT LAST! EVERYTHING YOU NEED TO KNOW ABOUT THE RETAIL HOME IMPROVEMENT MARKET IN CANADA: The Hardlines Industry Report: Home Improvement Retailing in Canada is almost ready to ship! This incredible book is a comprehensive overview of the size of the market, how many stores are out there, who the key players are, their market position, the size and growth of the big boxes, the trends in housing and renovations, market trends ¯ and much, much more! 120-plus pages filled with charts, graphs and photos. Regular price: $945, but only $750 for subscribers. But call Bev right away for more details because she's cooked up some kind of additional price special if your order Before December 31!!! * * * * * * THE HARDLINES SHOW BREAKFAST AT CHS: Mark February 4, 2001 on your calendar. That's the date of our Sixth Annual FREE Hardlines Breakfast at the Canadian Hardware and Building Materials Show, held exclusively for Hardlines subscribers and friends! (Yes, I know, it's very, very early in the morning, but there's no better way to kick off the Show!) - Michael * * * * * * THE HARDLINES MARKETPLACE It's a great place to announce new lines or acquisitions, services or lines available. And of course they are an effective, low-cost way to hire new people. At just $16 per line, here's what you get with each Marketplace Ad: - two weeks in the fax version - three weeks in the email version - posted on our website for three weeks - your ad read by more than 3,000 people every single week - thousands of hits on our Website! - our boundless thanks for your support of Hardlines! Bev takes care of the Classifieds so contact her: bev@hardlinesfax.com or call her at 416-489-3396.  
CANADIAN TIRE GETS ONLINE IN TIME FOR CHRISTMAS Canadian Tire Corp. got into the online shopping game last week just in time for the Christmas season. And that gift market, says CEO Wayne Sales, is the one being targetted, at least for now, by the company that already has the bricks and mortar within 15 minutes of 91% of Canadians. But Sales also anticipates that online browsers will be drawn into the stores themselves to make the final purchase. "For every dollar spent online, another seven dollars will be spent in the store," was the mantra of a press conference Sales appeared at last week ¯ and a large part of the argument that convinced the dealers themselves to get onside ¯ and help pay for ¯ the online initiative. The need to gain dealer support was considered one of the road blocks to CTC 's e-retailing initiative, but Sales pointed out that the time is now right as Canadians have displayed their desire to "shop Canadian" online. He pointed out that 59% of Canadians have recently made a purchase online, while 89% said they have looked for a Canadian website when shopping. The company spent upwards of $15 million researching online strategies before this year, admitted Sales. The final strategy cost $21 million in total to implement, he said. While no profit targets were disclosed, he considers the project a long-term one, expecting that up to 4-5% of Canadian Tire's sales, or $200 million, will be realized online. Mark Foote, president of Canadian Tire Retail, said promotion of the online shopping site will be tied into existing "bricks and mortar" advertising. Cross-promotions and sponsorships with other Internet sites will also be developed, including Canoe and TSN Online. "It's important to guard the brand and the trust Canadians have placed in the Canadian Tire name," he said. About 5,500 products have been put online initially. The emphasis will be on seasonal, starting with Christmas, and Foote said shoppers will be able to find more of these types of products online than in the stores. Fulfilment has been outsourced to a third-party distributor, Kuhne & Nagle, that has warehousing of its own close to CTC's Brampton distribution centre. Deliveries will be made using either Purolator for 1-2 day delivery or Canada Post Express Ship for 3-5 day delivery. Foote was asked what costs for the site would be transferred to the vendors. However, he declined to comment. A number of vendors report that they are "just waiting" to find out what charges, if any, will be passed on to them. The site is cleverly designed, making it easy for browsers to shop by their choice of project, product category, gift idea or by price (ie., "Gifts under $10, Gifts under 25", etc.). Each section presents detailed product specs and includes "featured products." Shoppers can even get their orders giftwrapped for an additional $5. * * * * * * TSC STORES SOLD TO MANAGEMENT Ontario farm and hardware chain TSC Stores has been sold to senior management. Co-owners Murray Cummings and David Street, president and vice-president respectively, have been involved in the company for about three decades, and owned it for the past 14 years. Originally tied to Tractor Supply in the U.S., the company is completely unaffiliated now, except for membership in the Mutual buying group. Under Cummings and Street, London, ON-based TSC has grown to 17 stores throughout Central Ontario and 1999 sales of $60 million. Cummings will stay on until December 22, while Street will remain in a buying/consulting capacity for an undetermined time. have passed the company along to Roy Carter, vice-president, finance and administration, who takes over the president's role. John Kropp, formerly controller, has moved into Carter's position, while Gord Illes has moved from his role as vice-president, store operations to become vp merchandising. "These guys are intent on taking TSC to the next level," says Street. "They want to grow it from 17 stores to 25 in the next three years and focus on getting the warehouse more fully automated." * * * * * *  
COMPANIES IN THE NEWS The Building Box, Réno-Dépôt's banner in Ontario, will finally open two stores this Wednesday. One is Cambridge and the other in Scarborough, ON. The company had originally intended to have four stores open in the GTA by year's end. I'll have more to report when I check out the openings. The next two stores are slated to open in Kitchener and London, ON by next fall. RONA Inc. reported consolidated sales for the third quarter of $351.7 million, a 36.8% increase over $257.1 million for the same period in 1999. The increase was attributed primarily to the growth of RONA's big box stores and to the acquisition of Cashway Building Centres Ltd. For the nine month period, consolidated sales totalled $1 billion, up 32.5% over the $762.1 million posted a year earlier. This increase was due primarily to the acquisition of Cashway in March 2000. Net earnings for the third quarter were $5 million, an increase of 29.8% over $3.9 million a year earlier. Net earnings for the first nine months of the year totalled $15.1 million, up 26.1% over the first nine months of the previous year. Castle Building Centres Group has added the following new members: Angileri Lumber, Amherstburg, ON, Maureen (Mo) Bellefleur; G&H Home Specialties Inc., Marystown, NF., Gus Baker; Hearst Co-op, Hearst, ON, Herman Morin; Lakeside Castle Building Centre, Red Deer, AB, Art Anastasi; Newcastle Floors, Doors & More, Surrey, BC, Brad Newell; Pickard Lumber & Building Supplies Ltd., Simcoe, ON, Wally Pickard. Sear's relaunched Eatons on Saturday with the opening of seven Eatons stores across Canada. They are located in Toronto, Ottawa, Winnipeg, Calgary, Vancouver and Victoria represent a total of 2.5 million sq.ft. While the emphasis is on fashion, there is also an "e home" environment in all seven stores, that offers merchandise specifically geared toward the urban consumer. (More on this in a future issue ¯ I'll have to get in and have a peek ¯ MM.) Hudson's Bay Co. introduced its own online shopping service last week (www.hbc.com). The site is the online shopping partner of both the Bay and Zellers, offering a range of products, including home décor, toys, cosmetics, baby needs, intimate apparel and gifts. The assortment is based on, but not limited to, the Bay and Zellers' current in-store offerings and will expand over time. The online service will take orders from around the world and deliver across Canada. Home Depot Inc. remains confident it will have 23%-25% growth in earnings per share for fiscal 2001. The company also expects to have same-store sales for fiscal 2001 of 3%-4%. Home Depot's year end is January 31. It expects to open 2,300 stores by 2004 and 18 Expo stores in fiscal 2001, bringing the total to 44 stores. Home Depot currently operates 1,081 stores worldwide.
CANADIAN STOCK WATCH
COMPANY 52-WEEK HIGH 52-WEEK LOW CLOSE (FRI.)
       
Canadian Tire 37.35 15.10 17.50
Canfor 19.80 8.10 8.10
Goodfellow 12.55 8.50 8.50
Home Depot 70.00 34.68 37 1/2
Hudsons Bay 21.65 12.50 14.40
Lowe's Cos. 67.25 34.25 39 1/16
Sears Canada 42.50 20.00 21.00
Taiga Forest 14.20 6.80 8.85
West Fraser 39.50 25.80 31.00
"No animal ever invented anything so bad as drunkenness ¯ or so good as drink." ¯ G.K. Chesterton (1874-1936)
PEOPLE ON THE MOVE Kevin MacRae joins Philips Lighting as central region account manager, consumer/automotive, effective December 4. He will be in charge of growing key accounts in Ontario. MacRae was formerly with Melnor Canada as national sales manager. (416-292-3000)  
MARKET INDICATORS Retail trade was up 0.4% from August to September, says Stats Canada. Retailers sold $23.5 billion worth of goods in August, which in constant dollars represents relatively no change from the previous month. Retail sales have been rising for five straight months, although gains were weaker in August and September. Year over year, September's sales are 6.0% higher than September '99. Strongest increases were in Alberta (+1.1%) and Ontario (+0.6%). Provinces with declines were Newfoundland (-0.7%), Saskatchewan (-0.6%) and Manitoba (-0.4%). The other provinces remained virtually unchanged. Wholesale trade fell for the second consecutive month in September, down 0.9% from August to $31.6 billion. Although hardware, metals, plumbing and heating had a 1.9% increase in September over August, the sector fell for the third quarter by 0.6%, following a 0.7% drop in the second quarter. Lumber and building materials fell 1.6%, its fourth monthly decline, with the third quarter down 0.8% from the previous quarter. Despite generally strong demand, sales were affected by falling lumber prices. Meanwhile, inventories in September rose 0.5% over August.  
Are you reading your own copy of Hardlines? Find out about our special company rates!  
Hardlines Marketplace THE HARDLINES MARKETPLACE: It's a great place to announce new lines or acquisitions, services or lines available. And of course they are an effective, low-cost way to hire new people. At just $16 per line, here's what you get with each Marketplace Ad: - two weeks in the fax version - three weeks in the email version - posted on our website for three weeks - your ad read by more than 3,000 people every single week - thousands of hits on our Website! - our boundless thanks for your support of Hardlines! Beverly takes care of the Classifieds so contact her: bev@hardlinesfax.com or call her at 416-489-3396. at 416-489-3396, ext. 2, for more details. * * * * * * * HARDLINES™ the electronic newsletter. www.hardlinesfax.com phone: 416-489-3396; fax: 416-489-6154. E-mail: buzz@hardlinesfax.com Michael McLarney, Editor & Publisher (extension 1): mike@hardlinesfax.com Beverly Allen, Marketing Manager (extension 2): bev@hardlinesfax.com Nancy Wright, Administrative Assistant: nancy@hardlinesfax.com Hardlines is published weekly (except monthly in December and August) by McLARNEYCOM 542 Mount Pleasant Rd., Suite 302, Toronto, Ontario, Canada M4S 2M7 © 2000 by Michael McLarney. Reproduction in whole or in part is very uncool and strictly forbidden and really and truly against the law. Call for information on a site license for your company. Subscription: $185+$12.95 GST = $197.95 (or $27.75 HST = $212.75) per year (GST #13987 0398 RT). (Please make cheque payable to McLarneyCom.)  
    HARDLINES™ Five years serving Canada's home improvement industry November 27, 2000 - Volume vi, #45 Michael McLarney, Editor & Publisher Ph: 416-489-3396 Fx: 416-489-6154 E-mail: buzz@hardlinesfax.com  
Check out our incredible Classifieds section!
* * * * * * * Canadian Tire launches online shopping * TSC gets new owners * Eatons relaunches in seven cities * Home Depot continues to forecast strong year-end results * * * * * * IT'S HERE AT LAST! EVERYTHING YOU NEED TO KNOW ABOUT THE RETAIL HOME IMPROVEMENT MARKET IN CANADA: The Hardlines Industry Report: Home Improvement Retailing in Canada is almost ready to ship! This incredible book is a comprehensive overview of the size of the market, how many stores are out there, who the key players are, their market position, the size and growth of the big boxes, the trends in housing and renovations, market trends ¯ and much, much more! 120-plus pages filled with charts, graphs and photos. Regular price: $945, but only $750 for subscribers. But call Bev right away for more details because she's cooked up some kind of additional price special if your order Before December 31!!! * * * * * * THE HARDLINES SHOW BREAKFAST AT CHS: Mark February 4, 2001 on your calendar. That's the date of our Sixth Annual FREE Hardlines Breakfast at the Canadian Hardware and Building Materials Show, held exclusively for Hardlines subscribers and friends! (Yes, I know, it's very, very early in the morning, but there's no better way to kick off the Show!) - Michael * * * * * * THE HARDLINES MARKETPLACE It's a great place to announce new lines or acquisitions, services or lines available. And of course they are an effective, low-cost way to hire new people. At just $16 per line, here's what you get with each Marketplace Ad: - two weeks in the fax version - three weeks in the email version - posted on our website for three weeks - your ad read by more than 3,000 people every single week - thousands of hits on our Website! - our boundless thanks for your support of Hardlines! Bev takes care of the Classifieds so contact her: bev@hardlinesfax.com or call her at 416-489-3396.  
CANADIAN TIRE GETS ONLINE IN TIME FOR CHRISTMAS Canadian Tire Corp. got into the online shopping game last week just in time for the Christmas season. And that gift market, says CEO Wayne Sales, is the one being targetted, at least for now, by the company that already has the bricks and mortar within 15 minutes of 91% of Canadians. But Sales also anticipates that online browsers will be drawn into the stores themselves to make the final purchase. "For every dollar spent online, another seven dollars will be spent in the store," was the mantra of a press conference Sales appeared at last week ¯ and a large part of the argument that convinced the dealers themselves to get onside ¯ and help pay for ¯ the online initiative. The need to gain dealer support was considered one of the road blocks to CTC 's e-retailing initiative, but Sales pointed out that the time is now right as Canadians have displayed their desire to "shop Canadian" online. He pointed out that 59% of Canadians have recently made a purchase online, while 89% said they have looked for a Canadian website when shopping. The company spent upwards of $15 million researching online strategies before this year, admitted Sales. The final strategy cost $21 million in total to implement, he said. While no profit targets were disclosed, he considers the project a long-term one, expecting that up to 4-5% of Canadian Tire's sales, or $200 million, will be realized online. Mark Foote, president of Canadian Tire Retail, said promotion of the online shopping site will be tied into existing "bricks and mortar" advertising. Cross-promotions and sponsorships with other Internet sites will also be developed, including Canoe and TSN Online. "It's important to guard the brand and the trust Canadians have placed in the Canadian Tire name," he said. About 5,500 products have been put online initially. The emphasis will be on seasonal, starting with Christmas, and Foote said shoppers will be able to find more of these types of products online than in the stores. Fulfilment has been outsourced to a third-party distributor, Kuhne & Nagle, that has warehousing of its own close to CTC's Brampton distribution centre. Deliveries will be made using either Purolator for 1-2 day delivery or Canada Post Express Ship for 3-5 day delivery. Foote was asked what costs for the site would be transferred to the vendors. However, he declined to comment. A number of vendors report that they are "just waiting" to find out what charges, if any, will be passed on to them. The site is cleverly designed, making it easy for browsers to shop by their choice of project, product category, gift idea or by price (ie., "Gifts under $10, Gifts under 25", etc.). Each section presents detailed product specs and includes "featured products." Shoppers can even get their orders giftwrapped for an additional $5. * * * * * * TSC STORES SOLD TO MANAGEMENT Ontario farm and hardware chain TSC Stores has been sold to senior management. Co-owners Murray Cummings and David Street, president and vice-president respectively, have been involved in the company for about three decades, and owned it for the past 14 years. Originally tied to Tractor Supply in the U.S., the company is completely unaffiliated now, except for membership in the Mutual buying group. Under Cummings and Street, London, ON-based TSC has grown to 17 stores throughout Central Ontario and 1999 sales of $60 million. Cummings will stay on until December 22, while Street will remain in a buying/consulting capacity for an undetermined time. have passed the company along to Roy Carter, vice-president, finance and administration, who takes over the president's role. John Kropp, formerly controller, has moved into Carter's position, while Gord Illes has moved from his role as vice-president, store operations to become vp merchandising. "These guys are intent on taking TSC to the next level," says Street. "They want to grow it from 17 stores to 25 in the next three years and focus on getting the warehouse more fully automated." * * * * * *  
COMPANIES IN THE NEWS The Building Box, Réno-Dépôt's banner in Ontario, will finally open two stores this Wednesday. One is Cambridge and the other in Scarborough, ON. The company had originally intended to have four stores open in the GTA by year's end. I'll have more to report when I check out the openings. The next two stores are slated to open in Kitchener and London, ON by next fall. RONA Inc. reported consolidated sales for the third quarter of $351.7 million, a 36.8% increase over $257.1 million for the same period in 1999. The increase was attributed primarily to the growth of RONA's big box stores and to the acquisition of Cashway Building Centres Ltd. For the nine month period, consolidated sales totalled $1 billion, up 32.5% over the $762.1 million posted a year earlier. This increase was due primarily to the acquisition of Cashway in March 2000. Net earnings for the third quarter were $5 million, an increase of 29.8% over $3.9 million a year earlier. Net earnings for the first nine months of the year totalled $15.1 million, up 26.1% over the first nine months of the previous year. Castle Building Centres Group has added the following new members: Angileri Lumber, Amherstburg, ON, Maureen (Mo) Bellefleur; G&H Home Specialties Inc., Marystown, NF., Gus Baker; Hearst Co-op, Hearst, ON, Herman Morin; Lakeside Castle Building Centre, Red Deer, AB, Art Anastasi; Newcastle Floors, Doors & More, Surrey, BC, Brad Newell; Pickard Lumber & Building Supplies Ltd., Simcoe, ON, Wally Pickard. Sear's relaunched Eatons on Saturday with the opening of seven Eatons stores across Canada. They are located in Toronto, Ottawa, Winnipeg, Calgary, Vancouver and Victoria represent a total of 2.5 million sq.ft. While the emphasis is on fashion, there is also an "e home" environment in all seven stores, that offers merchandise specifically geared toward the urban consumer. (More on this in a future issue ¯ I'll have to get in and have a peek ¯ MM.) Hudson's Bay Co. introduced its own online shopping service last week (www.hbc.com). The site is the online shopping partner of both the Bay and Zellers, offering a range of products, including home décor, toys, cosmetics, baby needs, intimate apparel and gifts. The assortment is based on, but not limited to, the Bay and Zellers' current in-store offerings and will expand over time. The online service will take orders from around the world and deliver across Canada. Home Depot Inc. remains confident it will have 23%-25% growth in earnings per share for fiscal 2001. The company also expects to have same-store sales for fiscal 2001 of 3%-4%. Home Depot's year end is January 31. It expects to open 2,300 stores by 2004 and 18 Expo stores in fiscal 2001, bringing the total to 44 stores. Home Depot currently operates 1,081 stores worldwide.
CANADIAN STOCK WATCH
COMPANY 52-WEEK HIGH 52-WEEK LOW CLOSE (FRI.)
       
Canadian Tire 37.35 15.10 17.50
Canfor 19.80 8.10 8.10
Goodfellow 12.55 8.50 8.50
Home Depot 70.00 34.68 37 1/2
Hudsons Bay 21.65 12.50 14.40
Lowe's Cos. 67.25 34.25 39 1/16
Sears Canada 42.50 20.00 21.00
Taiga Forest 14.20 6.80 8.85
West Fraser 39.50 25.80 31.00
"No animal ever invented anything so bad as drunkenness ¯ or so good as drink." ¯ G.K. Chesterton (1874-1936)
PEOPLE ON THE MOVE Kevin MacRae joins Philips Lighting as central region account manager, consumer/automotive, effective December 4. He will be in charge of growing key accounts in Ontario. MacRae was formerly with Melnor Canada as national sales manager. (416-292-3000)  
MARKET INDICATORS Retail trade was up 0.4% from August to September, says Stats Canada. Retailers sold $23.5 billion worth of goods in August, which in constant dollars represents relatively no change from the previous month. Retail sales have been rising for five straight months, although gains were weaker in August and September. Year over year, September's sales are 6.0% higher than September '99. Strongest increases were in Alberta (+1.1%) and Ontario (+0.6%). Provinces with declines were Newfoundland (-0.7%), Saskatchewan (-0.6%) and Manitoba (-0.4%). The other provinces remained virtually unchanged. Wholesale trade fell for the second consecutive month in September, down 0.9% from August to $31.6 billion. Although hardware, metals, plumbing and heating had a 1.9% increase in September over August, the sector fell for the third quarter by 0.6%, following a 0.7% drop in the second quarter. Lumber and building materials fell 1.6%, its fourth monthly decline, with the third quarter down 0.8% from the previous quarter. Despite generally strong demand, sales were affected by falling lumber prices. Meanwhile, inventories in September rose 0.5% over August.  
Are you reading your own copy of Hardlines? Find out about our special company rates!  
Hardlines Marketplace THE HARDLINES MARKETPLACE: It's a great place to announce new lines or acquisitions, services or lines available. And of course they are an effective, low-cost way to hire new people. At just $16 per line, here's what you get with each Marketplace Ad: - two weeks in the fax version - three weeks in the email version - posted on our website for three weeks - your ad read by more than 3,000 people every single week - thousands of hits on our Website! - our boundless thanks for your support of Hardlines! Beverly takes care of the Classifieds so contact her: bev@hardlinesfax.com or call her at 416-489-3396. at 416-489-3396, ext. 2, for more details. * * * * * * * HARDLINES™ the electronic newsletter. www.hardlinesfax.com phone: 416-489-3396; fax: 416-489-6154. E-mail: buzz@hardlinesfax.com Michael McLarney, Editor & Publisher (extension 1): mike@hardlinesfax.com Beverly Allen, Marketing Manager (extension 2): bev@hardlinesfax.com Nancy Wright, Administrative Assistant: nancy@hardlinesfax.com Hardlines is published weekly (except monthly in December and August) by McLARNEYCOM 542 Mount Pleasant Rd., Suite 302, Toronto, Ontario, Canada M4S 2M7 © 2000 by Michael McLarney. Reproduction in whole or in part is very uncool and strictly forbidden and really and truly against the law. Call for information on a site license for your company. Subscription: $185+$12.95 GST = $197.95 (or $27.75 HST = $212.75) per year (GST #13987 0398 RT). (Please make cheque payable to McLarneyCom.)