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Michael McLarney, President & Editor mike@hardlines.ca Beverly Allen, Publisher bev@hardlines.ca John Caulfield, Contributing Editor Phone: 416-489-3396 |
| October 27, 2008, Vol. xiv, #40 | |
| In This Issue | ||||||||||||||||||||||||||||||
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“The best way to escape from a problem is to solve it.” — Anonymous |
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| Hardlines Conference: new ideas, strategic vision | ||||||||||||||||||||||||||||||
TORONTO — A company that uses solar panels to power one of its stores, another which is buying up retail chains to broaden its reach to its core customer, and a U.S. co-op that can ship container loads to Canadian dealers from Shanghai were  among the companies represented onstage at the 13th Annual Hardlines Conference, held here last week.The Conference attracted about 140 industry representatives, from the retail, wholesale and vendor sectors. Despite the sudden downturn in the economy, they shared a passion to learn how to maximize their ability to survive this downturn with the latest economic retail and information and insights.
Overriding themes of the two-day event included:
Sustainability. Going green means much more than selling products made  from recycled materials. Greg Hicks, COO of TSC Stores, a chain of farm and hardware stores based in London, Ont., talked about the appetite for green initiatives among his customers, and how they are being satisfied with green audits and a pilot store that is powered by solar panels, while TSC awaits approvals to hoist a wind turbine atop another store. Keynote speaker Ray Civello, trained as a hairdresser and went on to become the marketing powerhouse behind Aveda Products, a line of organic cosmetics. His philosophies about sustainability extended to the ingredients used in the Aveda line and to how retailers can operate more efficiently to reduce waste water and energy.
Fine-tuning systems and procedures. Greg Dinsdale from LBMX explained how buying groups and their vendors can enhance their tech systems to reduce paper, speed rebate calculations and more. Mark Scherer, the COO of Scherer Bros. Lumber in the Minneapolis area, talked about the plan he needed, and the systems he put in place, to weather a devastating downturn in his country, one that has yet to bottom out. His analysis of his business included everything from careful examination of which staff were effective and which ones had to be cut, to tracking every delivery with GPS to determine which drivers were most effective.
Boldness. Whether it’s the courage to make your product or merchandising stand out with unique or unusual colours to break the pattern of sameness on store shelves, per Bruce Smith of DMD Strategy; or the wherewithal to get tough on customers — yes, customers — who have inefficient practices that end up costing you money in the long run (this from Mark Scherer of Scherer Brothers), the current downturn will require tough decisions fortified by boldness.
This theme was one not lost on an audience that had the courage to invest their valuable time and tightening funds to be part of this incredible learning and networking event.
(Photos courtesy of www.tizzardmarketing.com) Top. |
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| Lowe’s Canada receives Newsmaker Award | ||||||||||||||||||||||||||||||
TORONTO — Lowe’s Canada began making news almost two years before it opened its first store in Canada. The world’s second-largest home improvement retailer had spent the early part of this decade driving expansion in markets such as Chicago, New York and Atlanta before setting its sights north of the border. But when it arrived, it did so with a bang. That bang earned Lowe’s Canada the 2008 Newsmaker of the Year Award, which is presented by Hardlines each year at the Hardlines Conference, to recognize a company that has made a significant impact on the industry in the past year. The award, sponsored by OSRAM Sylvania, was presented by OSRAM’s JoAnn McKeown, vice-president sales and marketing, to Ben Mauceri, vice-president merchandising for Lowe’s Canada, at the Awards Breakfast on Oct. 24.
Lowe’s arrival put the industry (and especially its main competitor in the U.S., Home Depot) on alert. Its methodical, process-driven approach to operation and growth was also a new standard in an industry still dominated by independents. The company also sets high standards for training (each store’s team underwent a total of 10,000 hours of training before the stores even opened), and product assortment (Lowe’s is a leading retailer of large appliances in the U.S., second only to Sears).
(Photos courtesy of www.tizzardmarketing.com) |
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| TSC tests smaller, franchise format | ||||||||||||||||||||||||||||||
| TORONTO — A departure from the corporately owned store model is just one of the initiatives for growth being explored by TSC Stores. This and other initiatives were unveiled by the London, Ont.-based farm and hardware chain’s COO, Greg Hicks, at the latest Hardlines Conference.The acquisition of a former Country Depot store in Milton, Ont., last month will become a pilot for a franchised operation, the first for TSC, which already has 41 stores. Hicks noted that the farm supply industry in Canada is highly fragmented, leaving an opportunity for TSC to gain market share. “We need to determine the best business model — corporate-owned or dealer owned.” According to Hicks, TSC has identified more than 300 markets in Canada that would be suitable for this new concept, which would have a footprint of 5,000-10,000 sq.ft. with a yard between a half-acre and one acre in size. Few changes were made to the Milton store, which was purchased in September. “Our work efforts have been focused on the deal itself, building improvements and staff and customer retention, with minimal changes to the store itself.” The new smaller store has a new name, as well, and a temporary “TSC Villager” sign now hangs in front of the Milton store. “Our intent is to operate the Milton store as a lab store for both a small-store concept and to determine the feasibility of a TSC franchised business model,” he told the Conference delegates. | ||||||||||||||||||||||||||||||
| New Dealer Conference gives independents tools for success | ||||||||||||||||||||||||||||||
TORONTO — How will home improvement dealers survive the current downturn in Canada’s economy? That’s the topic being addressed at a new conference from the industry’s leading information provider. Hardlines, Canada’s news and information service for the retail home improvement industry, has joined forces with global building products manufacturer Johns Manville (JM) to create a competitive information event for Canada’s home improvement dealers. The Johns Manville Hardlines Dealer Conference will provide keynotes and workshops on a range of topics vital to the prosperity of independents across the country.“With Canada’s red-hot home improvement market finally cooling, dealers will need tools to help them operate competitively,” said Michael McLarney, Editor of Hardlines. “That’s why the focus of this new conference will be to offer concrete ways dealers can weather this downturn in the economy and maximize their competitiveness.”
To increase the accessibility of the event to independent dealers, the JM Hardlines Dealer Conference will be presented in conjunction with the Canadian Home Improvement Show, a high-impact buying event that attracts retailers from across Ontario and beyond. There, they will get a chance to meet top vendors and get special buys for their stores for the year ahead.
“It’s important for our dealers to have access to the latest new product innovations. But they also need the latest information on trends,” said Gino Allegro, Manager of Canadian Sales for Johns Manville Canada. “This conference will be a powerful resource for networking with a focused group of independents.”
Topics of the JM Hardlines Dealer Conference will include:
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| Guardian buys up Ottawa Fibre | ||||||||||||||||||||||||||||||
| VALLEY FORGE, Pa. — Saint-Gobain, the giant global building materials company, has signed an agreement to purchase, through its subsidiary, CertainTeed Insulation Canada Inc., Canadian fibreglass insulation manufacturer Ottawa Fibre. Under the agreement, CertainTeed will acquire all of the operating assets of Ottawa Fibre for approximately $41 million and the assumption of adjusted debt.The acquisition includes manufacturing facilities in Ottawa and Tillsonburg, Ont., and Redcliff, Alta., as well as a ceiling tile plant in Ottawa. The sale is expected to be finalized in early January 2009, following unit-holder and regulatory approvals. Saint-Gobain employs some 212,000 people worldwide and with sales in 2007 of €43.4 billion (CDN$70.0 billion). | ||||||||||||||||||||||||||||||
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| COMPANIES IN THE NEWS |
| KINGSTON, Ont. — Lowe’s Canada is appealing a motion by city council here denying the retailer’s application for re-zoning of a property and a furor is erupting over the potential costs to the city of this appeal. According to the Kingston Whig Standard, Lowe’s is taking its appeal to the Ontario Municipal Board, which rules on all development disputes in the province. Now city councillors are facing a proposal that would permit the release of costs to be borne by the city to fight the appeal. In a vote of 7-6, City council voted earlier this year to turn down Lowe’s application to rezone the property from industrial to commercial.MISSISSAUGA, Ont. — Wal-Mart Canada has launched a program to recycle polystyrene as part of its goal to achieve zero waste production. Grace Canada, a producer of specialty construction materials, will collect used expandable polystyrene packaging from eight Wal-Mart Canada locations and reuse it in the production of its fire-resistant commercial insulation product. In 2007, Wal-Mart Canada diverted over 100,000,000 kilograms of waste from landfill and has seen an over 20% increase in waste diversion already over last year. RALEIGH, N.C. — Wolseley plc, the British-based building materials distributor, has announced it was restructuring the operations of its U.S. pro dealer business, Stock Building Supply, and would close 86 of its locations. That decision will result in Stock exiting 16 markets in six states and reducing its workforce by more than 25% to 8,700 associates. NEW YORK — Anthropologie, the U.S. apparel and home-decor retailer, will open a store in Toronto next year, reports the Financial Post. Although the company has been serving Canadians through a website for about a year, this will be its first store in the Canadian market. NEW BRITAIN, Conn. — For its latest quarter, Stanley Works’ earnings rose nearly 80%, to $164.5 million, on revenue that inched up 1.2% to $1.12 billion. Through the first nine months of its fiscal year, Stanley reported a 3.3% gain in sales, to $3.35 billion, and 27.8% jump in net income to $312.1 million. TOWSON, Md. — Black & Decker Corp., the power tools and accessories maker, reported a decline in third-quarter net profit, on sales that decreased 4% from the same period a year earlier. Third-quarter net earnings were $85.8 million or $1.42 per share, down from $104.6 million or $1.59 per share a year ago. Sales for the third quarter were down 4% to $1.57 billion. Sales in the Power Tools and Accessories segment decreased 6% for the quarter. Sales in the Hardware and Home Improvement segment decreased 13% for the quarter. In the Fastening and Assembly Systems segment, sales decreased 2% for the quarter. Strong results in Asia could not fully offset the impact of a double-digit decline in domestic automotive production. MILTON KEYNES, UK — Homebase, the U.K. DIY chain, is finding its value plummet amidst the country’s tough economic climate. Homebase’s parent company, Home Retail Group, which also owns the Argos chain, says it will write off up to £600 million, reducing the company’s worth to between £300 and £400 million. SOCHI, Russia — Carrefour, Europe’s largest retailer, reports that it has signed an agreement to invest in its first store in Russia. The site will be in Krasnodar, a region considered to have considerable economic potential and a favourable investment climate. The first store will open in 2009 and the agreement anticipates an investment by Carrefour of up to US$100 million over a five-year period and the opening of several hypermarkets or other retail formats. |
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ECONOMIC INDICATORS |
| Sales of automotive products fell 11.7% in August to $7.0 billion, offsetting the gains over the two previous months. A 13.2% decline in motor vehicle sales was behind most of the drop, while sales of motor vehicle parts and accessories fell 5.8%. Much of the decline in motor vehicle sales can be attributed to slowing demand for larger less fuel-efficient vehicles. (Stats Canada) |
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OVERHEARD… |
| “The industry continues to be plagued by tighter mortgage availability, a growing number of foreclosures, and a historically high supply of unsold homes.” —Richard Dugas, CEO of Pulte Homes, America’s third-largest home builder, which suffered a 36.7% revenue during its latest quarter. |
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