| HARDWARE MANUFACTURERS ASSOCIATION CANCELS HARDWARE SHOW |
| CHICAGO — The AHMA Hardware Show is no more. The event was launched by the American Hardware Manufacturers Association in April of this year, but plans for a second show in 2005 were terminated last week.The AHMA started the show after ending its involvement in the National Hardware Show in February 2003. Until then, it had partnered with a trade show company, Reed Exhibitions, which owns NHS, in mounting the show each year in Chicago.
In its heyday, that show was one of the biggest trade shows held at McCormick Place. In 1999, more than 67,000 people came into the city, generating an estimated $85 million for Chicago. The show declined steadily after that, however, and dissatisfaction over how — and where — to operate it, drove Reed and the AHMA apart. Reed went on to relocate the NHS to Las Vegas in May 2004, just weeks after the AHMA held its first show.
In a statement posted on the AHMA website, Tim Farrell, president and CEO of the Association said this: "It's a tough decision because the Hardware Show has been such an important event to our members and our industry, and our association for such a long time, but that doesn't change the fact that it's the right decision."
While no specifics were offered about what future direction the AHMA will take on behalf of its members, Farrell's statement went on to say, "We've always made decisions in the best interests of our members and our industry, and this is one more example. We're excited about pursuing what's most valuable to our members and our industry now and in the future, not holding on to something that was valuable to them in the past."
Rob Cappiello, president of the National Hardware Show for Reed, says the cancellation of the competing show won't have much impact on his event. "We were sold out last year, and before this announcement we were already 86% sold out for next year." He hopes that having one show will result in a little less confusion for the industry.
But even Cappiello regards the termination of the Chicago show as a blow to the industry: "From an industry point of view, there's always a little bit of sadness when a show disappears." |
| HOME DEPOT FOCUSES ON SMALLER STORES |
| TORONTO — Small is beautiful for Home Depot, as its Canadian division rolls out 80,000 sq.ft. stores in Canada — four of them over the next six months.Although big boxes have only been in the Canadian market for a little over a decade, the country, a tenth of the size of the U.S., is fast reaching a saturation point with full-sized warehouse-style operations. In its quest to penetrate the market more completely, Home Depot Canada is turning to ever smaller stores. As far back as three years ago, the division was developing plans for stores that were 10-15% smaller than the traditional 135,000-sq.ft. footprint.
Now, Home Depot is building these smaller stores in smaller towns. In fact, three of them are scheduled to open by the end of 2Q 2005. The first one will be in Spruce Grove, Alta., north of Edmonton, followed by Chatham, Ont., and another site in Ontario, still to be announced.
"We're going to build these all over," says Annette Verschuren, President of Home Depot Canada and acting President of the Expo division.
A number of stores that opened over the past few months in Canada, including Brandon, Man., and Sioux St. Marie, Ont., and Trois Rivieres, Que., were all around 80,000 sq.ft., plus 15,000 sq.ft. of garden center.
The company will continue opening traditional sized stores, as well. Expansion efforts in Atlantic Canada will feature these, following the erection of a store in Charlottetown, the first (and likely, the only) big box on Prince Edward Island. New Brunswick, which already has a full-sized store in Moncton, will be the site of at least three more stores, says Verschuren, including Fredericton and Saint John. A store is also planned for Sydney, N.S. |
| LOWE'S EXPANDS MANUFACTURING |
| JANESVILLE, Wis. —The State of Wisconsin's Department of Commerce is lending Lowe's Cos. $500,000, which the retail chain has earmarked for its 210,000-sq.ft. millwork plant here. A board-cutting ceremony was held last week.The plant, which makes windows, doors and other wood products, currently employs 60 people, and could employ up to 100 over the next several months. Lowe's intends to invest $7.5 million into this facility over the next five years, including allocations for equipment and its lease.
"This marks the beginning of Lowe's relationship with the state of Wisconsin," said Mike Mabry, Lowe's executive vp-logistics and distribution. "This facility will support our growing store base in the Midwest, and help us deliver quality millwork products at an everyday competitive price to our customers."
Lowe's has two other millwork facilities — in White House, Tenn., and Thomasville, N.C. — that have opened within the past 15 years, according to Chris Ahearn, a Lowe's spokesperson. Lowe's will open its first store in Wisconsin later this year in Milwaukee, and its second store, in Plover, next spring.
Wisconsin Governor James Doyle was quoted as stating that his state's investment was in line with his administration's "Grow Wisconsin" initiative. The state is also providing Lowe's with a $225,000 loan that the dealer won't be required to repay if it operates the plant for 10 years. |
| ASIAN HARDWARE FAIR GAINS GROUND |
| COLOGNE, Germany — The second-ever Practical World Asia, taking place in Shanghai October 19-21, 2004, is set to top the success of last year's premiere, say the show's organizers. The event, a joint effort of Koelnmesse and the China International Hardware Show, is fully booked. At the two events, being held at the Shanghai International Expo Centre, more than 1,300 companies — up from 900 in 2003 — will present products ranging from tools, security systems, locks and fittings to DIY/home improvement.Exhibitor registrations to date indicate that 100-plus companies from four continents will be participating in Practical World Asia. They're coming from countries that include Germany, Italy, the U.K., Switzerland, the United States, Taiwan, India, Japan and Singapore.
The number of visitors is also expected to rise from last year, to around 40,000. Visitors to can register for the combined Practical World Asia/China International Hardware Show on the Internet at www.practicalworld-asia.com. |
| INTERFOR TO BUY RIVERSIDE FOREST PRODUCTS |
| BURNABY, B.C. — International Forest Products, better known as Interfor, has signed a definitive agreement to acquire Riverside Forest Products, the province's fourth-largest lumber producer and its second-largest supplier of plywood and veneer products. The combination would form the world's seventh-largest lumber producer, a $1.5 billion operation with a capacity of 2.3 billion board feet of lumber and 530 million board feet of panels.The $368 million deal calls for Interfor to pay $39 per share in cash and Interfor class A stock, and to assume Riverside's net debt of $28 million. That per-share amount represents a 34% premium over a $29-per-share unsolicited bid that Tolko Industries had made for Kelowna, B.C.-based Riverside in August. Montreal-based Tembec Inc. had recently acquired another 7% of Riverside's stock, and said as recently as last week that it was talking to the company about a possible takeover. But the Interfor deal "has the full and unequivocal support of the independent directors of Riverside Forest Products," said John McLernon, chairman of Riverside's Special Committee of independent directors.
Interfor's offer is subject to 51% of the shares of Riverside being tendered, the receipt of certain regulatory approvals and the satisfaction of various customary terms and conditions.
This agreement represents the latest in a series of takeovers within Canada's forest products industry. These include Canfor's acquisition of Slocan Forest Products Ltd.; West Fraser Timber buying Weldwood; and Interfor acquiring three Washington state mills owned by Crown Pacific Partners. |
| HALLOWEEN IS NUMBER-TWO HOLIDAY FOR DECORATIONS |
| STEVENS, Pa. —Halloween has become the second-most popular decorating holiday in the United States. No longer just the domain of children, today adults make merry on Halloween along with their kids.A new study by Unity Marketing reveals that the majority of American households this year will decorate their homes for Halloween. In fact, they'll spend more than $1 billion this year on Halloween decorations, up from last year's spending. And they'll decorate both the inside and outside of their homes.
According to Pam Danziger, president of Unity Marketing, and author of the study, natural decorations like pumpkins and cornstalks on the front porch are being joined by Halloween lights — Christmas fashion — around the eaves, and lighted, even moving, wire sculptures in the yard.
Inside the home, the focus is on tabletop centerpieces and decorative bowls for candy, candles and Halloween-themed candle accessories and paper and party decorations, Danziger says.
For more info on Unity Marketing's new study of the decorations market, Seasonal Decorations Market Report, 2004: The Who, What, Where, How Much, and Why of Holiday Home Decorating, click here. |
|
| COMPANIES IN THE NEWS |
| ORLANDO, Fla. — TruServ Corp. has got a new name. At its fall dealer convention, held here this past weekend, Pamela Forbes Lieberman, president and CEO of the Chicago-based co-op, unveiled the new name, True Value Co. The name reflects the business of 85% of the co-op's members, even though it remains committed to its other banners, including Home and Garden Showplace, Taylor Rental, Grand Rental Station and party Central.BEDFORD, N.S. — AWARD, the Atlantic region buying group, has made its second acquisition in as many months. The latest, Domac Building Supplies, is part of AWARD's effort to maintain its dealer base. Like the first acquisition, in Paquetville, N.B., this one will be sold back to an independent dealer. "AWARD is not in the corporate store business," says Tom Smith, president and CEO of AWARD, "but we are acting in the best interests of our members." Smith says the group worked closely with the new dealer to assume ownership of the operation. No other acquisitions are in the works at this time.
MESQUITE, Nev. — Do it Best Corp. will break ground on its newest retail service center here on October 25. This will be the eighth for the dealer-owned wholesaler, joining the ranks of facilities in Dixon, Ill.; Cape Girardeau, Mo.; Montgomery, N.Y.; Medina, Ohio; Woodburn, Ore.; Lexington, S.C.; and Waco, Tex. The Mesquite facility will service 250 stores throughout the Southwestern United States.
OLYMPIA, Wash. — We already know hurricanes are good for business, but volcanoes? It seems hardware dealers in communities near Mount St. Helens are having a run on dust masks and filters. The volcano has been spewing steam and ash at an increasing rate over the past several days, attracting a rash of tourists in the process.
SAINT-ANTONIN, Que. — Bargain Building Materials broke ground last week on a construction project at its head office here. The expansion, which is scheduled for completion by December 2004, represents a total investment of $550,000. In addition, the company has invested another $700,000 in its distribution center in Lachute, Que. to improve warehousing capacity by 20,000 sq.ft. Expansion efforts have been driven by the growth of Bargain's dealer base, which has reached 15 corporately owned stores, plus five independents operating under the retailer's "Authorized Retailer" program in Quebec, Ontario and the Maritimes.
MISSISSAUGA, Ont. — An application by the United Food and Commercial Workers Union to unionize Wal-Mart associates in Terrace, B.C. has been dismissed by the British Columbia Labour Relations Board. In its decision, the Labour Board ruled that the union does not have the minimum support among the store associates required by the B.C. Labour Relations Code to warrant the holding of a representation vote on the issue of unionization.
WINNIPEG — The recent opening of a True Value Hardware store in Brussels, Ont., marks the latest expansion effort by TruServ Canada, the dealer-owned co-op based here. The store has grown from 1,500 sq.ft. in 1945 to 8,000 sq.ft. today, and the switch to True Value has enabled the dealer to expand a number of lines, especially paint.
ISSAQUAH, Wash. — Costco Corp. enjoyed a 24% increase in profits for its fourth quarter, with same-store sales rising 8%. Net sales were up 11% to $14.8 billion. |
| PEOPLE ON THE MOVE |
| OGC Inc., the retail management and software company, has installed a Calgary office, adding Kevin A. Moore as Western sales manager. With his experience as an owner-manager and national sales manager, he will be servicing existing customers and managing OGC's new business from British Columbia to Manitoba. OGC supplies technology solutions, including retail sales operations, customer service, order processing, inventory and accounting, for retail hardware and home improvement dealers. (Call Moore at 1-877-642-9378; head office at 1-877-642-7587)Richard Matzke has been appointed vice-president of merchandising and advertising for Distribution America, the member-owned co-operative based in Des Plaines, Ill. Matzke, most recently was senior sourcing manager for Sears, Roebuck and Co. Prior to that, he was group merchandising manager for TruServ and merchandising director for Payless Cashways.
Andrew Sarch is back from China and tells us he's taken on the role of general manager in Canada for JinDing Group Co. Ltd. He'll be responsible for marketing, sales and service to support and grow the company's business in Canada. Prior to this, Sarch spent 25 years at Canadian Tire Corp., most recently as divisional vice-president in the marketing division. With a factory in Jiangsu province in China, and offices in Shanghai, Holland and Canada, JinDing Group is reportedly the world's largest OEM manufacturer of portable electric power tools, supplying more than 200 brands to some 100 countries around the world. (905-231-9933)
William Bolton, a market research executive with an extensive background in retailing, is now the first non-dealer member to be elected to Ace Hardware Corp.'s board of directors. Bolton is currently a consultant and advisor with Leo J. Shapiro & Associates, a Chicago-based market research firm whose clientele has included Home Depot and Sears. Over the past three decades, Bolton has also served in executive capacities with SuperValu, a grocery wholesaler; Bruno's, American Stores and Jewel Food/Osco Stores. Since October 2003, he has served on Ace's board in a retail advisory capacity. His term on Ace's board runs through 2007, when he will be eligible for re-election. |
| CANADIAN MARKET INDICATORS |
| Urban housing starts were down in September, reports CMHC. They fell to 231,000 units at seasonally adjusted annual rate from 241,100 in August. September housing starts in Canada's urban centres fell 4.7% to a seasonally adjusted annual rate of 204,200 units due solely to a decline in the volatile multi-family sector. Urban single detached starts rose 5.9% to 106,200 units, while urban multiples decreased 14.0% to 98,000.Construction intentions in Canada cooled off in August as the value of building permits fell 4.6% to $4.5 billion, says Statistics Canada. In the housing sector, municipalities issued $3.1 billion worth of permits, down 1.2% from July — and the third decline in four months — mainly due to a retreat in multi-family permits. Single-family intentions were up, however. The value of non-residential permits fell 11.0% to $1.5 billion. |
|
John Caulfield, Contributing Editor
vol. x, #41, October 11, 2004
BLACK EAGLE CONSULTING 2000 INC.
President Richard Simms has 35 years experience in the hardware/housewares industry – both as a manufacturer and a consultant. Black Eagle Consulting specializes in strategic plan analysis, organizational structure review, executive coaching/assessment, career counselling, succession planning. CHHMA affiliate member and Canadian Association Family Enterprise trained facilitator. See website www.blackeagle.ca or call 905-842-3010/email rsimms@blackeagle.ca for more information.
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