The parent company of the Sexton Group is getting a new ownership structure. The Sexton Family of Companies (SFOC) is in the process of concluding a transaction that will turn majority ownership over to a group led by PFM Capital Inc.

Current SFOC chair Brian Kusisto (shown here with Steve Buckle, CEO of SFOC) will remain with the company as a board member and Sexton Investments will retain a portion of the ownership of SFOC.

The company was founded in 1967 by Ken and Bette Sexton and today includes the Sexton Group buying group, Kenroc Building Materials, Pan-Brick Inc., and the wholesale distributor Builders Choice. Ken Sexton passed away in 2019.

Earlier this year the Sexton and Kusisto families began to establish a plan for the SFOC, including all its operating divisions, to ensure its continued growth and success. The outcome of that planning was to seek out new investors. Kusisto and his team turned to PFM Capital. The Regina-based private equity investment firm has over $750 million in assets under management across several funds, focused on companies in the Prairies.

“I am excited to have PFM investing in our future,” said Steve Buckle. “They recognize that we are a financially strong, growing organization with high-performing employees and powerful customer, member, and vendor relationships. I look forward to continuing to drive success across the company.”

Deloitte Corporate Finance Inc. served as exclusive financial advisor for SFOC and MLT Aikins LLP provided legal counsel to SFOC. The transaction is subject to regulatory approvals and conditions and is expected to close this fall.

BMR’s CEO shares vision for his group’s national expansion strategy

The management at BMR Group, the Quebec-based buying group and wholesaler, has been through a lot of changes in recent months. For example, most recently, the company’s Agrizone division, a retail format for farm and ranch, got a new senior director (see “People on the move” in this issue.—Editor).

And only a couple of weeks before that, Claudie Gervais was named VP, marketing and communications. She reports directly to COO Antonio Di Pasquale.

All this change is happening under the direction of CEO Alexandre Lefebvre (pictured above), who is a relative newcomer himself, having joined BMR in March 2021. “I’m pretty excited about the team and where it’s headed right now,” he says.

With the revamped structure, Lefebvre believes the team is more agile now. Fewer people at the top means a flatter organizational structure, with more hands-on involvement from everyone. He now has most vice-presidents reporting into Di Pasquale, “so they’re not in silos and we can move more quickly.”

This kind of organizational vision stems from his own involvement at the helm of Lefebvre & Benoit. BMR bought a stake in that family-owned commercial dealer in July 2019. After the takeover, Lefebvre was tapped for the top job at BMR, succeeding Pascal Houle, who moved up to parent company Sollio Cooperative Group. With his tenure at Lefebvre & Benoit, “we now have experience to bring that to the company,” Lefebvre says. “It’s helping BMR as a whole.”

BMR itself consists of almost 300 independent dealers, most of them family operations. Lefebvre recognizes the importance of those roots. To respond effectively to their needs, the group needs to be able to act quickly. “It’s easy as an organization to forget how we started and forget our purpose,” he says.

“We have a massive strength of hundreds of dealers who work right on the retail floor. We’re trying to involve those dealers in our decision making.” That includes more committees, with dealers sitting together to advise and share their concerns over various product categories, such as seasonal, and challenge the BMR buyers and marketing team. “We’re talking to the dealers a lot more now.”

Another commitment from the top is to keep growing the BMR brand, especially outside its home province of Quebec. “Ontario is a key vector in our growth. We’ve signed a lot of key dealers in that market.” They include Roy and Muriel Perkins in Cornwall, and George Begley, who owns a contractor yard in Elmvale, whose store is now bannered as Elmvale BMR Pro. “We definitely want to be national,” says Lefebvre, but he expects BMR’s growth to be focused on Atlantic Canada and the Ontario corridor for the next few years.

That growth can come not only from new stores but also from new markets. Lefebvre says the expertise of his family’s company is helping BMR dealers expand their commercial business. And not just commercial and pro dealers are seeing growth. Even traditional LBM dealers that have typically relied on a core base of DIY business are realizing more and more commercial business. “With the addition of Lefebvre & Benoit, we have the experience and competitiveness to bid on those jobs,” Lefebvre notes.

“I think the BMR story is really sexy right now.”

(BMR’s head buyer, Charles Grégoire-Béliveau, recently promoted to vice president, merchandising, will share BMR’s vision for growth, and its relationship with its vendors, at next week’s Hardlines Conference in Niagara-on-the-Lake, Ont. Click here to get your ticket!)

Gillfor is ready to take its spot among Canada’s top LBM wholesalers

When it comes to national LBM wholesalers, Gillfor Distribution is not as well-known as its larger competitors, Taiga Building Products and CanWel Building Materials. But watch for that to change, and quickly, starting in the new year.

The Gillfor name is still relatively new, but the sum of its parts is not. Gillfor was formed by the merger of OWL Distribution in Woodstock, Ont. (shown here), McIlveen Lumber in Calgary, Brown & Rutherford in Winnipeg, and Brunswick Valley Distribution in Fredericton. Most recently, its acquisition of LBM giant AFA has cemented its position as a key player—and a truly national one.

And there’s more to come, says Mike Schneider, Gillfor’s vice president of business development. The various divisions will shed their names to reinforce the central brand. “On Jan. 1, 2023, we will launch the amalgamated company under the Gillfor name,” he says.

The consolidation will include merging systems, financing, and eliminating a few overlapping locations following the onboarding of AFA’s 16 warehouses with Gillfor’s existing six. Head office will remain in Woodstock, Ont., the original home of Gillfor’s original business, OWL Distribution.

To many, the takeover of AFA by the still-growing Gillfor was a case, says Schneider, of “the minnow swallowing the whale. But in fact, we like to say the minnow is going to saddle up the whale.”

The AFA deal brings a wider range of building materials to Gillfor’s existing portfolio of specialty lines. “That’s another reason why AFA is so valuable to us.” Lines like Trusscore, Rockwool, and AFA’s flooring program will be added to Gillfor’s existing brands.

“While we don’t expect to change any products going into 2023, we plan to expand some more product lines across the company’s different divisions,” Schneider explains, tapping into AFA’s broad lines of commodity and specialty products. Those lines will be shared through the company’s account managers. Currently, he says, every Gillfor account manager has about 30 accounts; each of those accounts will be exposed to the wider range of lines while staying responsive to regional differences.

But for the most part it will be business as usual under the unified Gillfor brand. “We think people will actually be underwhelmed by the amount of change that will take place after the amalgamation.”

Home Hardware’s private-label offerings featured prominently at its in-person Homecoming event, held last month for vendors and dealer-owners on the grounds of the Canadian National Exhibition in Toronto.

The relaunch of the BeautiTone and Benchmark brands are among the highlights of Home Hardware’s merchandising efforts over the past year. The hiring in August of Tracy Moorhouse as manager, private brands, reinforces the company’s focus on proprietary lines.

BeautiTone, Home Hardware’s trademark paint collection, was on display, unveiling its gentle-blue Colour of the Year, “Moments,” which Home Hardware’s colour expert Donna Robertson describes as “a calming colour, but a moving-forward colour.” BeautiTone has also modified its branding, with a hyphen-less spelling and an updated typeface.

Home’s proprietary kitchen and bath offerings are brought together under the Mosaic brand, which succeeds Kuradori in that category. In order to maximize kitchen space, the line includes several multi-functional implements, such as a serving spoon that is marked with lines for measurements. Mosaic is also positioning itself to continue Kuradori’s tradition of a strong lineup of knives.

In the home décor and kitchen and bath categories, the InStyle brand is reflecting current trends in outdoor living and interior décor products, and kitchen and bath assortments.

For tools, Home Hardware has the Benchmark brand, which has seen a significant refresh, “both aesthetically and functionally,” as merchandise manager Richard Sweeney (shown here) explains, targeting a new generation of customers. That includes a contractor line, Benchmark Pro. “We rebranded with a fresh new look in the stores, but with the same great products.”

Even before the pandemic, outside consultants were engaged to advise on the brand’s next steps. As a result, Benchmark has added “more than 1,500 new items in the last couple years,” Sweeney says, including outdoor power equipment like lawnmowers.

A significant transition in this segment has been the move away from corded to battery-operated power tools. “Consumers want to cut the cord,” Sweeney declares. The use of transferrable batteries allows customers to move batteries from one tool to another.

Other in-house brands include Radley, a new power tool line for trades and heavy DIYers, OmniMax heating and air conditioning products, and a partnership with Milwaukee to offer a national brand of power tools for pros.

At BMR Group, Audrey Poirier-Lemay has been promoted to the role of senior director, Agrizone, the group’s retail farm and ag division. She has been with BMR since 2011, most recently as an assistant director. She will continue to report to CEO Alexandre Lefebvre.

Bernie Gauthier is joining Home Hardware Stores as vice president, retail operations, effective Oct. 24. Prior to joining Home, he was sales director of siding and pressure treated lumber at Taiga Building Products. John Pierce joins as vice president, retail business development. He was most recently VP store operations for Loblaw Cos. Chris Marinis has been promoted to the role of vice president, information technology. He joined Home Hardware two years ago as senior director, business solutions. Melanie Beatty has been promoted to director, e-commerce. She joined Home Hardware in 2004. Kristi Stemmler is now director, brand management, marketing communications, and research. She joined Home Hardware in 2018 as director of content and media.

DID YOU KNOW...?

IKEA Canada held a grand opening recently for its new downtown Toronto store. Nestled at the bottom of the Aura condo development at the corner of Yonge and Gerrard Streets, the 66,000-square-foot location is a new look for the company. With only about 3,500 SKUs on display and limited inventory, it offers a convenience format for urban dwellers. It’s the 15th IKEA store in Canada.

Hudson’s Bay Co. will direct all gross profits from its iconic point blankets to a new fund for Indigenous initiatives, The Globe and Mail reports. Named Oshki Wupoowane (Ojibwe for “a new blanket”), it is a partnership between HBC and the Gord Downie & Chanie Wenjack Fund. Thousands of the blankets sell each year for between $325 and $550 each.

Costco Wholesale Corp. saw its Q4 sales rose 15.2 percent to $70.76 billion, from $61.44 billion a year ago. Earnings of $1.87 billion were up from to $1.67 billion in the comparable period last year. For the full fiscal year, sales rose 16 percent to $222.73 billion, compared with $192.05 billion the previous year. Earnings rose to $5.84 billion from $5.01 billion.

Loblaw Cos. Ltd. has put its first five self-driving delivery trucks on roads in the Greater Toronto Area. The grocer has teamed up with California startup Gatik to test the technology since 2020. Initial phases included a human “safety driver” on board, with the driverless phase beginning in August. “Autonomous vehicles are a reality, and the retail industry, the transportation industry, will be part of that evolution,” said David Markwell, Loblaw’s chief technology officer.

SUPPLIER NEWS

Eisenwarenmesse, the International Hardware Fair, has held its 2022 in-person edition last week after an absence of more than four years. Held at Cologne, Germany’s Koelnmesse complex, the show hosted more than 25,000 visitors from 125 countries.

IN MEMORIAM: Alex Guy, Coast Distributors

Alex Guy died on Sept. 25, just a few days before his 68th birthday. Guy, with his wife Gillian and their partners, established Coast Distributors in their garage in 1986. The hardware wholesaler grew quickly and eventually established a warehouse of its own in Lantzville, north of Nanaimo, B.C. After establishing an operation in Kelowna, the business continued to expand throughout the province’s Lower Mainland starting in 1996. A third facility was later opened in Surrey. Guy retired from the business 10 years ago. (A service will be held on Oct. 14 at 1:00 p.m. at Holy Trinity Catholic Parish, 6234 Spartan Road, Nanaimo.)

ECONOMIC INDICATORS

The value of building permits in Canada rose by 11.9 percent in August to $12.5 billion. Both the residential and non-residential sectors saw strong gains, with Ontario causing much of the increase. Residential permits for the month increased 12 percent to $8.4 billion nationally. Gains in Ontario offset losses posted in seven provinces. Construction intentions in the single-family homes component edged up 0.4 percent. (StatCan)

Lumber production decreased 16.9 percent from June to 3.74 million cubic metres in July. Production was down 10.2 percent from the previous July. Sawmills shipped 4.3 million cubic metres of lumber in July, down 5.5 percent from June and up 3.1 percent from July 2021. (StatCan)

Investment in U.S. construction fell by 0.7 percent, the largest drop since February 2021. August’s decline compounded the 0.6 decrease seen in July. In a Reuters poll, economists forecast that construction spending would edge down by 0.3 percent. Year-over-year, spending was up by 8.5 percent. (U.S. Commerce Dept.)

OVERHEARD...

“Fiona was the one of the worst hurricanes to hit Atlantic Canada in my lifetime.” —Arnold Hagen, owner of two Home Hardware Building Centre stores in the Truro, N.S. area. Hagen’s store in Bible Hill, just east of Truro, took “significant” damage to its roof and was flooded with water inside.