The following dates have been confirmed for openings so far this year: Moncton, NB on April 24; Bracebridge, ON on May 8; Lethbridge, AB on May 29; Sherwood Park, AB on June 5; Kamloops, BC on June 12; Orangeville, ON on July 17; Prince George, BC on July 31; Niagara Falls, ON on September 11; Aurora, ON on September 18; Thunder Bay, ON on October 9; and
Grande Prairie, AB on October 23.

Three or four openings in November will be announced at a later date.

In total, Home Depot expects to open a total of 200 stores in 2003, and to push its sales up by 9-12% company wide.

“The new store will act as more of a regional centre,” says Jimm Holland, director of brand management for UFA.

While merchandising is being brightened up, the focus of UFA remains squarely on the agricultural customer. “Our traditional customer is primarily the mid-sized family farm. But by expanding the trading area, this new store will better position us, not only to attract more of our core customers, but also the larger, commercial farmer and the hobby farmer. “

While incorporating used building materials into renovation has been slow to catch on, it’s gaining in popularity. The cost of disposing of used materials keeps rising, even as homeowners show more interest in old growth timbers, vintage architectural trimmings, and antique doorknobs and hardware.

Home Again, a Toronto-based outlet that sells reclaimed building supplies, as well as end-of-line, surplus and discontinued goods. Kevin McGroarty, owner of Home Again, says that business is healthy enough that expansion is a real possibility within the next two years. With minimum savings of 30% across the board, and up to 90% on certain items, his products appeal to a range of customers: 40% are contractors, the rest DIYers.

Currently, McGroarty has a contract to supply a property management company with 200 kitchens, and has recently begun selling discounted kitchen suites to consumers. As well, he exports material to Trinidad and the Bahamas.

This was the first time since 1990 that investment in new housing accounted for more than 55% of total residential construction expenditures. Spending on renovations, the second-largest component, totalled $18.6 billion in 2002, up 7.2% from 2001. Building intentions for January support a strong outlook for 2003, with building permits in the residential sector up 14.4% from December.

Lowe’s says it expects total sales in the current first quarter to increase 15%, and same-store sales to rise 2-4%. During an investor conference last week, Lowe’s reported that it expects sales for the year to grow 16-17%, with same-store sales increasing 4-5%. Lowe’s expects to open 130 stores this year and 140 next year. Square footage will increase 15-16% this year and 14-15% next year.

Following 11 consecutive months of profits, TruServ Corp. reported a 2002 net margin of US$21.2 million on revenue of US$2.2 billion, versus a net loss of US$50.7 million in 2001 on revenue of US$2.6 billion for the same period a year ago. Approximately US$105.8 million of the decline reflects the effect of the prior year’s divestitures of the lumber business and its Canadian business, TruServ Canada.

Costco Wholesale Corp. reported net sales of US$9.92 billion for the second quarter of fiscal 2003. That’s up from US$9.21 billion during the second quarter of fiscal 2002. Net income for the quarter fell 5% to US$182.1 million. Net sales for the first half of the year were up 8% to US$18.93 billion. However, in the second quarter, net sales increased 8% to $9.92 billion from US$9.21 billion, but profits fell 5% from US$192.6 million to US$182.1 million.

For the first time in its history, Home Depot will hold its annual general meeting outside its home town of Atlanta. Instead, it will move to Chicago this year, and rotate to other cities where there are high concentrations of customers and shareholders. The AGM is scheduled for May 30.

Hudson’s Bay Co. had 4Q revenue of $2.445 billion, down slightly from $2.468 billion in the same period a year earlier. Net earnings for the quarter were $105.1 million, up from $66.3 million. Sales and revenue, on a normalized basis after excluding a gain on the sale of accounts receivables, fell from $2.459 billion to $2.443 billion in the fourth quarter. Sales and revenue for fiscal 2002 reached $7.384 billion, up from $7.446 billion in fiscal 2001. Net earnings were $111.5 million, versus $72.8 million last year.

Georgia Lighting, a subsidiary of Home Depot since the big box retailer purchased it in 1999, is being rolled in more tightly with another Home Depot division. The management of the specialty lighting retailer will move to the Expo Design Center division. The shift will not effect Georgia Lighting’s operations, but its manufacturing and distribution arm, World Imports, will now be managed by Your “other” Warehouse, the Home Depot division based in Baton Rouge.

Sico Inc. had net earnings of $12.0 million in fiscal 2002, a 50.0% increase over net earnings of $8.0 million a year earlier. Sales totalled $257.0 million, compared with $224.3 million in 2001, an increase of 14.5%.

The place to be on March 9, 2003 to hook up with the key players in North American hardware/home improvement retailing. The beer is on us! For more information about Practical World, the International Hardware Fair/DIY’TEC, call Barbara Hills, Canadian Sales Representative, at 416-598-3343 or email: b.hills@koelnmessenafta.com.

(PS: The unofficial Canadian pub crawl in Cologne will kick off on Saturday, March 9. Look for your fellow Canucks on the steps of the Dom Cathedral at 4 p.m.— Michael)

The Show’s organizers, Reed Exhibitions, will relocate NHS, under the National Hardware Show name, to the Sands Expo and Convention Center in Las Vegas from May 10-12, 2004. However, the Show’s biggest supporter, the American Hardware Manufacturers Association, says Reed doesn’t in fact own the show outright, but owns the name only.

Tim Farrell, executive vice-president and COO of the AHMA, says his association “sponsors and conducts the show, while Reed manages and produces the show.” In addition, the seminar series held concurrently with NHS, International Hardware Week, is owned by the AHMA, he says.

The AHMA is pulling its support from the show in 2004 and starting its own show almost a month earlier. Called the AHMA Hardware Show, it will remain at McCormick Place in Chicago. But the date will change to April 18-20, 2004.

Farrell first let the news of the change slip while speaking to an audience at the Distribution America meetings in Colorado Springs last week.

The AHMA’s new show will be consistent with the AHMA’s mission for the industry, says Farrell. Both shows will have to compete head on to attract exhibitors, as they vie for industry credibility. The show has a history in Chicago and the AHMA is relying on the support of its members, which, he says, are largely concentrated in the Midwest and east of the Mississippi.

“Running the industry show independently will be to the benefit of our industry, and we feel Chicago, versus Las Vegas, is the best venue for the hardware show,” says Farrell. “This is based on independent research over several years and countless amount of feedback.”

But Reed has been doing research of its own. “Customer research indicated that the Spring is an ideal time for product buying at retail and that pretty much drove the decision,” says Rob Cappiello, industry vice-president in charge of the National Hardware Show at Reed Exhibitions. He recently moved over from his role as publisher of Home Channel News to work for the show.

Las Vegas is considered one of the nation’s top business and family destinations, and already plays host to a raft of trade shows, including six by Reed Exhibitions. Reed will move to Las Vegas with both the name and the legacy of the existing event, billing itself as the 59th edition of the National Hardware Show. It will also feature a new segment, the first annual Lawn & Garden World, as well as a full conference program.

Besides competing against each other, the Spring dates will put the two shows up against a number of other events. Practical World, the International Hardware Fair/DIY’TEC in Cologne, Germany, is probably the U.S. show’s biggest rival. It’s typically held in the first or second week of March. The Housewares Show, also held in Chicago’s McCormick Place, will likewise move in 2004 from January to a date in March. In addition, the Canadian Hardware and Building Materials Show takes place only a few weeks beforehand, commencing on the first Sunday of February.

“We’re getting good feedback from the industry,” Farrell adds of his new event. “We’re gaining industry support and our hope and belief is that our show will be the show for the industry, and supported by the industry.”

This year’s National Hardware Show, which has been in Chicago since 1974, will take place there for the last time in its current form from August 10-12. About 2,000 vendors are expected to exhibit.

Atlanta, GA & Wilkesboro, NC — Both Home Depot and Lowe’s Cos. unveiled their results last week. And while Home Depot remains about twice the size of its closest competitor, its star is no longer shining as brightly on Wall Street as it once was. Its stock has fallen more than 50% in the last 12 months and closed another 0.7% when its results were announced. By comparison, Lowe’s share price went up almost 6% when its results were unveiled.

Home Depot enjoyed record earnings of US$3.7 billion for fiscal 2002, compared with US$3.0 billion in fiscal 2001. Its sales for the year increased 9% to US$58.2 billion. Same-store sales for the year were flat, however, while Lowe’s saw same-store sales increase 5.6%. Lowe’s, on the other hand, enjoyed net earnings growth of 43.8% to US$1.47 billion, following a rise in profits of 46% in its fourth quarter. For fiscal 2002, Home Depot’s net earnings reached US$686 million, down from US$710 million. Lowe’s sales increased 19.8% to US$26.5 billion from US$22.1 billion a year ago.

Fourth quarter results for both companies typified the contrast between their respective performance. Profits for Lowe’s reached US$319.4 million, up from US$218 million a year earlier. Total sales rose 16.5% to US$6.1 billion for the fourth quarter, while sales by Home Depot for the fourth quarter were actually down 2% to US$13.2 billion.

According to Robert Tillman, chairman of Lowe’s, 2002 was “the best year in our 57-year history.”

Bob Nardelli, chairman and CEO of Home Depot, had a different message for analysts, however. “We are disappointed with the sales growth, as it fell short of our expectations,” he admitted.

Same-store sales for Lowe’s didn’t grow as much in 4Q 2002 as in the same period a year earlier – up 4.1%, compared with a 7.4%. But it’s up over Home Depot’s 4Q same-store sales, which fell 6% for the quarter.

Categories that enjoyed strong growth in 2002 at Lowe’s included plumbing, paint, flooring, and home organization. Home Depot has been trying to expand its installed services, which are considered a huge growth market for them. In fact, sales in services grew 26% for Home Depot in its fourth quarter.

What’s ahead? Lowe’s is rapidly gaining entry into new markets, including ones Home Depot is already in. It has 744 stores in 42 states, 112 of which were new last year, with another 11 being relocated during that time. Home Depot ended the year with 1,532 stores, including 89 in Canada. It expects to open another 200 in 2003. However, it faces competition from its own outlets. Cannibalization affected about 21% of its existing stores, resulting in a 4% negative impact on same-store sales. Other factors downgrading stores’ top line included the implementation of the company’s new performance standards, called SPI, as well as the refitting of a number of departments across the chain. Home Depot expects sales for fiscal 2003 to increase 9%-12% and earnings per diluted share to increase between 9 and 14%.

While some of the growth is attributable to Rona’s acquisition of Revy and Lansing in June, 2002, same-store sales for the year increased 7.0% for Rona’s corporate and dealer-owned stores. Sales overall at retail increased 33.3%, reflecting, in part, the Revy and Lansing acquisition, the opening of two corporate big box stores during the year, and the closure of five under-performing Rona Cashway stores in Ontario. Retail sales by all Rona’s stores, both corporate and dealer-owned, are anticipated to total almost $3 billion again this year.

The company’s growth in the second half of the year was considered “completely organic.” In the fourth quarter, consolidated net sales reached, $539.9 million, up 6.3% over $508.1 million in 4Q 2001. Net earnings for the quarter were up 94.4% to $9.1 million, attributed again to organic growth and to increases in operating efficiency. Same-store sales in the fourth quarter increased 3.7%.

During the past year, Rona launched a successful IPO on the Toronto Exchange, raising $150 million, half of which went toward the paying down of debt. The remainder will be used for further expansion, with more growth targetted for Western Canada. The company will also invest in an intensive advertising campaign, which will begin later in April.

While Canadian Tire scored healthy sales by its stores in 2002, with overall sales up 4.7% from 2001, same-store sales were up only 1.4%. Sales boosts have traditionally come with the company’s investment in new and expanded stores, so it continues to fine-tune its retail formula to foster continued growth. Its Next Generation of stores has been under way since the early ’90s years and the most recent enhancement to the program appeared in January 2001.

The first four 20/20 stores will all be “A” type stores, with about 100,000 sq.ft. of space. However, the retail area will be expanded by up to 16% over traditional “A” stores, as warehousing will be reduced and more space devoted to merchandising.

Some of the categories that will be added or expanded into the new space are designed to attract more female shoppers. The company’s research indicates that about half the shoppers in their stores are women, yet they account for only about 40% purchases. New categories will include consumables, namely household cleaning products, which are considered high repeat traffic items. Kitchenwares, storage and ready-to-assemble furniture assortments will also be expanded. A gift registry is also expected to be in place in its stores by the end of 2003 or early 2004.

The takeover of Matco Ravary by a syndicate of 16 dealers within Le Groupe BMR has been postponed. Originally slated to close on February 28, both parties have agreed to close the transaction on or about March 6, 2003, instead, to allow finalization of paperwork. The deal, worth $24.5 million in cash plus the assumption of $13 million in Matco Ravary’s debt, had already been approved by Matco Ravary’s board of directors, but was challenged unsuccessfully by Rona Inc., which tried to file an injunction against the sale. Rona owns about 30% of Matco’s shares. The six-store chain in the Montréal area, formerly a member of Rona, has been buying from BMR since December 19, 2002 and will represent the addition of about $60 million in retail sales to the BMR organization. Carmel Chaput, chairman of Matco Ravary, and Gilles Nolet, president, who together held 47% of the company’s voting shares, will remain with the company in their current roles for an unspecified time.

Home Hardware Stores launched its own gift card this past weekend. Available in any denomination, the Home Gift Card will be accepted at all Home Hardware locations across Canada, aimed at the birthday, housewarming, bridal shower, anniversary and holiday gift-giving market. It’s also being promoted as part of an employee reward or customer appreciation program.

Gerber Plumbing Fixtures Corp. has announced that most of its assets have been sold to a new entity, Gerber Plumbing Fixtures LLC. Chicago-based Globe Union Group is the majority owner of Gerber Plumbing Fixtures. Gerber’s 2002 revenues exceeded $100 million. Gerber will operate as a stand-alone subsidiary of Globe Union. Ila Lewis, current Gerber chairman and granddaughter of founder Max Gerber, has been named chairman of the new company. Terms of the transaction were not announced.

Wal-Mart de Mexico SA will invest close to 6.4 billion pesos (US$610 million) within the next 18 months to expand its retail network. Shareholders have approved the expenditure plan for the opening of 61 retail outlets. In Mexico, Wal-Mart operates under the Walmex banner.

At Johns Manville, Gino Allegro has been promoted to the position of Canadian regional sales manager, in charge of the Canadian sales team and their support staff. He was formerly national accounts manager for Canada. (204-488-6765)

Canadian Tire Corp. has announced two senior executive appointments at Mark’s Work Wearhouse, concurrent with the retirement of president Garth Mitchell. Michael Lambert, formerly CFO, has been named president, Mark’s Work Wearhouse, and executive vice-president and officer of Canadian Tire Corp., reporting to CTC president and CEO Wayne Sales. In this role, Michael will be accountable for the continued integration of Mark’s within Canadian Tire as well as new business development and support of Mark’s operations … Paul Wilson, currently COO, has been appointed president and COO of Mark’s. His duties will include the continued conversion of Work World stores to the Mark’s banner and new merchandising growth strategies. (403-250-1222)

In the latest release of its housing affordability index, Royal Bank expects rising house prices and increasing mortgage rates to reduce the affordability of Canadian homes. The proportion of pre-tax household income needed to service the costs of owning a home climbed in 2002 from 30.6% to 31.8%. The index is expected to rise to 32.7% in 1Q 2003.

The Consumer Price Index rose 4.5% in January year over year, with energy costs accounting for the bulk of the increase. Without energy costs, inflation grew 3.5% from January 2002 to January 2003.

Kingfisher has already stated it will consider selling off its holdings in any country where it is not the industry leader. However, in Canada, where Réno-Dépôt is the number three big box player, after Home Depot and Rona‘s big box stores, it remains a profitable operation, with overall sales up an estimated 7.3% in 2002. Kingfisher’s decision to drop the chain will have more to do with its desire to focus on Europe and Asia.

With sales hitting an estimated $786.5 million in 2002, Réno-Dépôt remains profitable, even though same-store sales were down somewhat in the fourth quarter year over year, a strong 4Q in 2001 made the latest results a tough act to follow. In fact, Réno-Dépôt’s same-store sales were “in line” with the international division’s, at around 5%.

Despite a U.K. report that Réno-Dépôt may be sold off, its future is far from conclusive. Any plans will be the result of Kingfisher’s review of its international operations, which is expected to conclude sometime in March.

Réno-Dépôt opened only one store last year, a Building Box in Windsor, ON, bringing the chain to 20 outlets. Plans for continued expansion will be unveiled sometime next month.

The distribution centre will service 150 Country Depot and FS co-op stores, which comprised Growmark’s former retail division. “We will also use the facility to handle certain other merchandise for our member stores,” says Léo Charrière, president of TruServ Canada. TruServ already has 140 True Value and V&S member stores of its own in Ontario.

TruServ has seen the Growmark acquisition as a key strategic step in increasing its critical mass as a contender to be a hardlines supplier coast to coast. The move will consolidate its presence in Canada’s largest province, eventually giving it quicker access to customers in Atlantic Canada. Sixteen people have been brought over from Growmark to join the new TruServ team, including a buying team that will operate out of Kitchener, overseeing pet and farm products for all of TruServ (see People on the move).

Growmark will sub-lease part of the new distribution centre to handle agro products for its own farm co-op outlets.

The Growmark deal may be the beginning of a trend, as TruServ keeps its eye open for more acquisitions. “We are looking for more,” says Charrière.

Markham, ON — Sam’s Club, Wal-Mart‘s club store banner, will have both the “treasure hunt” approach to merchandising and a range of fixed merchandise when it arrives in Canada.

“For our personal members, it’s all about change,” he says. But the club’s business members come to rely on consistency of supply on certain products and supplies. “For our business members, it’s a little more static. They don’t like change.”

The seasonal changes in Canada are ideal, he says, for the “treasure hunt” aspect of club shopping. “Our policy is ‘early in, early out.’ This is especially important in seasonal. We’ll change seasons earlier than anyone else.”

Edwards expects Sam’s to break ground on its first stores sometime next month, with an estimated six stores opening by September or October of this year. The first stores will be in the Greater Toronto Area. While there are already 61 Price Clubs in Canada, he says the country can sustain another 40-60 club stores.

“The big players, such as Home Depot, Rona and even Home Hardware, don’t need the Canadian Hardware Show,” he continues, “but it’s the only place for smaller guys like us to find new products and new ideas, so it puts us at a competitive disadvantage.”

Valcour’s company, a business unit of J.D. Irving, is no small potatoes in its own right. With sales estimated at around $250 million, it’s one of the 10 largest home improvement dealers in the country. it’s the largest member of the Independent Lumber Dealers Co-operative. It now has 22 stores, since the addition of three former Pro stores in Edmunston, NB.

However, its sales are still only one-third those of Réno-Dépôt, while the combined sales of Home Hardware’s dealers is nearly 14 times greater, with a show of its own. Valcour sent his buyers to walk CHS, following ILDC buyer meetings held in Toronto during the time of CHS.

The purchase of Ace Hardware Canada by Sodisco-Howden Group, announced in October 2002, has finally closed. In the deal, that got stalled by the Canadian Competition Bureau during the holiday season, Sodisco-Howden struck an alliance with Ace Hardware Corp. of Oak Brook, IL to buy up all issued and outstanding shares of the Canadian subsidiary.

Net sales for Canfor grew in the fourth quarter to $480.5 million, up $22.9 million over the same quarter in 2001. For the full year, the company’s profit fell to $11.5 million, down from $26.4 million in 2001. Net sales for 2002 were $2.11 billion, up $126.6 million.

Budget Canada has signed a five-year deal with Canadian Tire to install car rental kiosks in 100 Canadian Tire stores across the country. The program will roll out over the next 12-24 months. People who get their cars repaired at Canadian Tire, as well as Auto Club members, will get discounted rental rates.

Rona Inc. has opened its first store under the Rona Building Centre banner. The 40,000-sq.ft. former Rona Cashway in Midland, ON is similar in concept to Rona’s Québec banner, Rona l’express Matériaux, but with a more distinct focus on contractors, tradespeople and heavy DIYers. The 40,000 sq.ft. store carries 20,000 SKUs, and includes a building materials warehouse, a “Tool Zone” for electric and manual tools, and specialty boutiques for paint, floor coverings, kitchens, and doors and windows.

Wal-Mart‘s net sales for the year ended January 31, 2003 were up 12.3% to US$244.524 billion. Net income for the year was US$8.039 billion, up from US$6.671 billion. Earnings in the fourth quarter ended January 31 reached US$2.53 billion, compared with US$2.19 billion a year earlier. Sales for the quarter were US$71.07 billion, up 10.7% from $64.2 billion a year earlier.

Benjamin Mooore has been voted Canada’s most trusted brand in paint, according to the third annual Reader’s Digest Trust Poll. The survey, which looks at the level of trust Canadians place in different professions and brands, asked respondents to assess factors such as honesty, integrity and product quality.

In preparation for the busy Spring season, Home Depot is looking for an additional 60,000 part-time staff for its 1,500 stores North America-wide. The giant retailer has entered into an initiative with the U.S. Department of Labor, using the agency’s career centres to recruit.

Wal-Mart has opened a new export office at its Arkansas headquarters to identify U.S. products that can be shipped worldwide. The new office, “GP USA Export,” is a branch of Wal-Mart Global Procurement, an internal buying agency formed by the company in 2002. Wal-Mart Global Procurement has sourcing offices in 17 countries, working directly with Wal-Mart merchandise buyers in the States, Puerto Rico, Canada, Mexico, Argentina, Brazil, China, Korea, Japan, the U.K. and Germany.

Chris Henwood has joined Prosel Marketing as sales manager. He was formerly senior buyer for home décor at Ace Hardware Canada. (416-661-1414)

Rob Capiello has moved over from his role as publisher of Home Channel News, the U.S. trade magazine for the home improvement industry, to work for Reed Exhibitions. He is now industry vice-president, in charge of the National Hardware Show, which is held in Chicago each August. (203-840-5493)

Wholesalers posted a seventh consecutive monthly increase in their sales in December, with sales reaching $36.1 billion, up 0.3% from November. Wholesale sales of lumber and building materials had the strongest growth in December of the 11 trade groups tracked by Statistics Canada, growing 3.2%. This rebound follows a 2.1% drop in November. For the year, wholesale sales were up 6.2%, compared with only 2.5% in 2001. U.S. wholesalers posted a 1.5% gain in 2002.

The group of about 80 large retailers in Canada had sales increase 6.1% in 2002, says Statistics Canada, surpassing the healthy 5.6% gains in both 2000 and 2001. These retailers represent about 38% of total annual retail sales, excluding recreational and motor vehicle dealers. Sales in December reached $10.2 billion, up only slightly from December 2001. Home furnishings and décor were up 7.8% year-over-year, while hardware and lawn and garden products were up 4.5%.

The U.S. Commerce Department reports that housing starts stayed high in December, at a rate of 1.850 million units seasonally adjusted. That’s up 0.2% from 1.847 million units in December 2001.

Lack of snow before Christmas in many markets depressed seasonal sales for Canadian Tire dealers. In addition, the company’s retreat from low-margin home electronics and toys to more high-end giftwares adversely affected sales more than anticipated. As a result, sales in the fourth quarter dropped 0.4% from 4Q 2001 and same-store sales fell 2.5%.

For the year, however, total sales at retail (a combination of Canadian Tire retail, Mark’s Work Wearhouse, PartSource and gas stations) climbed 11.6% to $7.2 billion. Although sales by Mark’s were essentially flat, the Mark’s acquisition added incremental sales of $480 million. Sales by Canadian Tire member dealers were up only 4.7% to $5.8 billion in 2002. Same-store sales were up 1.4%.

Consolidated operating revenue for the whole company reached $5.9 billion, a 10.6% increase over the company’s top line in 2001. Net earnings grew 14.6% to $202.4 million from $176.7 million in 2001.

Moncton, NB — The much anticipated arrival of Home Depot to this city will occur later this Spring. It will be only the third Home Depot store in Atlantic Canada (the others are in Halifax and Dartmouth, NS). The store is expected to be about 95,000 sq.ft., but despite its slightly smaller size, Moncton is considered by many to be overstored already in the home improvement sector. Either way, the Kent Superstore, located on Trinity Drive, right on the other side of the highway, has been preparing for the new competition for at least a year.

The big box store has been undergoing a fine tuning, including better displays and extensive remerchandising. The store, which has typically enjoyed some healthy margins, has also been getting more competitive, as prices have been lowering over the past year.

The first card, for consumers, is a Visa card co-branded with Rona. It’s usable anywhere and gives customers access to special card options at Rona stores. It also makes card holders eligible for personal financing instore. Called “Financement accord D” in Québec, and “Community Retail Financing” in the rest of Canada, the program creates a profile of each card holder. This profile, accessible at POS, gives the customer the option to use either their Visa card or get longer-term financing at favourable interest rates when buying materials for larger projects.

The program has been on trial for about 18 months in Rona’s big box store in Brossard, QC. “A lot of consumers find this possibility for financing good, because it’s an easier way to get credit for a home improvement project,” says Sylvain Morissette, communications director for Rona. “It takes only about 20 minutes — right in the store.”

The other two cards, one for contractors and one for institutions and government agencies, will be a private-label card. “For our professional customers, it’s another way for them to lower their cost of operations,” says Morissette. “It provides a monthly bill that’s easier than establishing credit at just one Rona store.”

Taiga Forest Products recorded 3Q sales of $203 million. That’s up from $182 million for the same period in the previous year. Earnings for the quarter were $364,000, compared with $1.8 million. Sales for the nine months ending December 31, 2002 were $703 million, up from $648 million. Profits for the same period climbed to $8.5 million from $5.5 million. During the quarter, Taiga acquired LP Corp.‘s Rocklin, CA building products distribution centre.

West Fraser Timber Co. Ltd. announced 4Q earnings of $36 million on sales of $405 million, compared with earnings of $11 million on sales of $364 million in 4Q 2001. For the year, earnings were $138 million on sales of $1.63 billion, up from earnings of $115 million on sales of $1.56 billion in 2001. The yearly earnings increase was due primarily to increased production, along with lower unit costs.

Home Depot chairman and CEO Bob Nardelli says the company needs a president as part of its succession planning, but he hasn’t given a timetable for the appointment. He has hinted, though, that the job will be given to someone inside the company. Nardelli left GE in 2000 to become president and CEO of Home Depot. He assumed the chairman’s title last year.

Shoppers Drug Mart, Canada’s largest pharmacy chain, posted 4Q profits of $62 million, up from $4 million for the same period a year earlier. For the year, the retailer earned $209 million, up from $7 million. Sales for the year rose 8.9% to $5.44 billion; same-store sales increased 7%. Shoppers expects sales in 2003 to increase 11%-12%, with growth coming from the development of large-format stores and expansion of its merchandise offerings. It also wants to revitalize its private label offerings.

JDA Software Group Inc. has awarded $5.24 million of JDA Portfolio space, category management and planning software and services to Ryerson University, School of Retail Management. Ryerson will use the Portfolio applications to teach visual merchandising, product and demand planning, customer data analysis and assortment optimization. The Ryerson School of Retail Management offers the only university-level degree in retail management in Canada.

Americans are responding to the threat of war with Iraq by stocking up on supplies at their local hardware stores. People are buying everything from wood stoves and drums to collect rainwater to duct tape and plastic sheeting. Stores are stocking up on lamp oil, batteries and other emergency supplies.

Wal-Mart‘s anti-union policies are finally catching up with it. It currently faces about 40 lawsuits in the U.S. from employees for everything from unpaid overtime to sexual discrimination. Labour groups are starting to work together, intensifying efforts to get higher wages and better conditions.

Special thanks to our sponsors:
· JDA Software, sponsor of Sodisco-Howden Group,
Newsmaker of the Year
· Sterling Commerce, sponsor of Rona Inc.,
and Richelieu Hardware, Newsmakers of the Year

And to these fine sponsors of the Outstanding Retailer Awards by Hardware Merchandising:
· 3M
· Dimensions Retail Systems
· IKO
· CGC
· Zircon

Exhibitor presence was down again, especially as major vendors continue to vote with their feet. However, the show was aggressive in recruiting new companies, which showcased a wide range of the very new and innovative products that buyers seek. While numbers dropped from 500 exhibiting companies in 2002 to 400, 165 of them were brand new to the show. And a lot of them were pretty cool. (See next week for our highlights from CHS — MM). The new product showcase featured 350 products.

Nonetheless, compare vendor numbers to as recently as 1999, when 720 companies were represented at CHS.

While new and innovative companies added lustre to this year’s show, veteran companies with new products also got good response. Henkel was back after an absence of several years, spurred by an abundance of new products it wanted to show off. While U.S. attendance fell off post-9/11, a number of American companies were present. For Hillman, it was their second year at this show, back due to good response the previous year.

Taymor, Delta Porter Cable and CanWel were among the traditional suppliers who hung in. “Dealer attendance was down,” admitted Mike Piggot of CanWel, “but we’re still writing some good business.”

However, sales were off for a large number of exhibitors interviewed, even though the show introduced a number of initiatives to increase buying in the aisles, including a lot of show specials. Dealer attendance appeared lighter again this year (the show’s official tally of attendance was not ready as of press time), though Sunday, the first day of the show, had some good traffic.

Stephen Murdoch, communications coordinator for CHS, concurs: “Quantity was down, but quality was up,” he said. “We heard that from a lot of exhibitors. Eveybody I talked to said they met quality buyers.”

Buyers were definitely present: Greg Hollander of TruServ Canada brought three with him, and so did Jean Lamarche of Réno-Dépôt. Joel Marks brought members of his team from Home Hardware, as well. Home Depot‘s head hardware buyer, Peter Vernon, was spotted on the show floor, and ILDC let its dealer members loose following its buyer negotiations on Sunday morning.

Schurman Building Supplies brought 14 people from PEI to the show. While much of that attendance may have been on the strength of the fact it won an award in Hardware Merchandising’s Outstanding Retailer Awards, two Schurman buyers said they saw some new and interesting items. “We picked up a few things and placed a few orders,” said Angela Millar, buyer for plumbing and paint. “I didn’t find as many plumbing vendors as I would have hoped for, though, and saw nobody new in that category.”

A number of initiatives were attempted this year. Training and information seminars abounded, and Centre magazine’s Awards program was admirably executed by editor Elena Opasini. But a number of ideas either misfired or failed to get off the ground, due to their last-minute nature. A vendor-buyer breakfast, apparently modelled after Hardlines‘ own Meet the Buyers Breakfast Series, failed to attract adequate attendance and was cancelled two weeks before the show – and only days after it was announced in the first place. A contractor night, built around a power tool information event, attracted only a limited number of tradespeople and kept the show open until 8 p.m. on the second day, to the chagrin of many exhibitors who had no involvement with the event.

The seminar program was better than ever this year, with speakers such as Anthony Stokan and Dr. Richard Loreto presenting. Still, they weren’t as well attended as they could have been. “The seminars were good, but we have to make them more central and perhaps tie them into a lunch,” said Murdoch. “We had a lot of people saying they had trouble finding the rooms.”

The show’s future is further confounded by talk of the Lumber and Building Materials Association of Ontario pulling its support of CHS. The LBMAO merged with CHS in 2000, after its own Canadian Home Centre Show was discontinued and some board members expressed concern about both the attendance at the show and the LBMAO’s return on its investment.

Non-exhibiting vendors were charged $200 for walking the show, a reasonable price on the face of it, since these vendors did not have to incur any show setup costs. And exhibitors were favourable to this restriction. However, vendors that had participated in the past resented being hit with the charge. As one said, they wanted a chance to see the show first-hand to evaluate their future participation.

In fact, the surcharge managed to keep away at least one of the inventors sought after by CHS. A woman phoned the World Headquarters just last Thursday, looking for information on how to break into the market. She admitted being frustrated by the cost of attending the show.

CHS’s declining attendance is a common challenge for trade shows today, including the National Hardware Show in Chicago. However, the Canadian show is actively – and admirably – trying to reinvent itself and the show management is optimistic it can turn the event around.

“We’re pleased,” says Murdoch. “I know a couple of things have to be revaluated, but we’ll be bigger and better next year.”

The dates for next year’s show are February 1-3, 2004.

Arlington, TX — Home Depot has announced it will begin expanding its lawn and garden specialty stores in Texas and will open its first new store in Arlington, near Dallas-Fort Worth, on February 13. Additional locations will open later this Spring in Plano, Grapevine, Lewisville and Dallas.

Home Depot Landscape Supply has been tested in three markets around the retailer’s home base of Atlanta, GA since last summer, expanding on Home Depot’s seasonal and live goods assortments, and aiming at the trade customer as well as the serious consumer. Each store has approximately 30 staff, including certified nursery experts.

Each store stocks a wide selection of products ranging from live goods and chemicals to tools and landscaping materials. A 12,000 sq.ft.climate-controlled area includes a tool rental department in front of a covered greenhouse. Each store also features up to seven fenced-in acres called the “Pro-Yard.”

The stores are set up with separate entrances for the professional landscaper and the DIYer. The pro side of the store features job-lot quantities with bulk items stacked nearby. The other side of the store resembles a greenhouse, complete with exotic plants and flowers.

“These stores are our response to demands from professional landscapers and avid do-it- yourselfers alike,” says Todd Williams, president of Landscape Supply. “We want to take Home Depot’s lawn/garden offerings to a higher level to reach a new set of customers.”

According to Home Depot Canada’s president, Annette Verschuren, she wants to let the company’s specialty store formats get tested thoroughly in the U.S. before she considers bringing them north of the border.

Joe Galli Jr., the head of Newell Rubbermaid, has been the centre of attention as he pushes Newell through acquisition after acquisition (see Companies in the News for the latest from Newell — Ed.). He has agreed to speak at the conference along with two key Canadian retail leaders, Jos Wintermans, president and CEO of Sodisco-Howden Group, and Sylvain Toutant, president and CEO of Réno-Dépôt.

John Herbert, general manager of BHB, the German retail hardware association, will speak, as well. Herbert is a true expert on the international retail scene who has seen duty on both sides of the Atlantic. He is the former general manager of Knauber, a ground-breaking DIY chain in Germany that became a mecca for everyone from Home Depot to Canadian Tire. Herbert was picked by Home Depot to become vice-president of its Expo stores and develop that banner in the U.S., before moving back to Germany in 2001.

The innovation and passion of an award-winning independent wil be represented by Tanya Rocca, owner/manager of Roblynn Home Hardware in Oromocto, NB. Rocca won the Young Retailer of the Year Award for all of North America last year.

The Hardlines Marketing Conference annually brings together North America’s leading retail executives for a forum of ideas, innovation, trends and networking. About 200 retailers and vendors are expected at this year’s Conference, which will be held at the Four Points Sheraton Hotel, near the Toronto International Airport. It’s part of the Hardlines Conference Series, running September 3-4, 2003. The Series includes the third annual Retail Education Forum on September 3, an intensive half-day focusing on the competitive issues specifically affecting the industry, such as housing trends, economic forecasts and trends within home improvement retailing. The International Business Seminar, “Global Selling: tools for opening overseas markets,” will be held in the morning before the Education Forum, completing the two-day series.

For more information on the Hardlines Conference Series, and to take advantage of Nancy’s early bird specials, contact: nancy@hardlines.ca or call 416-489-3396.

Nexfor lost US$6 million in the fourth quarter, compared with a break-even in the final quarter of 2001. Revenues were up 19% to US$384 million on the strength of acquisition, while earnings for the year reached US$13 million on a sales increase of 12%.

Faced with stiff competition from China and Mexico, Canada’s largest appliance maker may close its Canadian manufacturing. Camco, 51% owned by American-based General Electric, reported a “modestly solid” 4Q profit, but added it’s looking elsewhere.

Masco has purchased Powershot Co. In Canada, both Arrow Fastener Inc. products and Powershot products will be distributed by Jardel Distributors.

Freeport, IL-based Newell Rubbermaid will relocate to Atlanta, GA. Newell plans to build a 300,000-sq.ft. complex somewhere in north Fulton County. The company employs about 350 at its current headquarters. Newell has 48,000 employees worldwide.

Sherwin-Williams Co. had an increase of 26% in its 4Q profit, boosted by cost cuts and paint sales to DIYers. However, the faltering U.S. economy has cut into Sherwin-Williams’ industrial and automotive business. The company posted a quarterly profit of US$57.1 million, compared with US$45.4 million. Sales rose 2% to US$1.16 billion. The company expects 2003 to be a tough year, due to uncertain worldwide economic conditions, the threat of war with Iraq and the slow, long-term recovery expected in the domestic economy.

Pro Wylie, president of Castle Building Centres Group, received the Industry Achievement Award from the Lumber and Building Materials Association of Ontario last week. On receiving the award, Wylie announced he has renewed his contract to head up the Castle buying group for another four years. (905-564-3307)

Eric Roberts has been named director of sales, consumer markets for Osram Sylvania. He assumes the newly created position after stints at Sealey, Moulinex and Sanyo Canada. (905-671-5582)

Catalina Lighting Inc. has promoted James W. Scott to the position of managing director of its Canadian subsidiary, Catalina Canada. Scott has been with Catalina for the past seven years, most recently as vice-president of sales and marketing, responsible for managing the company’s large Canadian retail accounts. He replaces Don Planche, who has left the company. (905-795-9995)

In December, U.S. residential construction spending hit a record US$434.6 billion seasonally adjusted, according to the U.S. Commerce Department. A 1.2% increase in spending pushed the value of residential and commercial construction projects to US$858.3 billion seasonally adjusted, following a 0.9% increase in November.

Sodisco-Howden Group
Jos Wintermans of Sodisco-Howden receiving the award from Desmond Preudhomme of JDA

Rona Inc.
Curtis Popovich of Sterling Commerce presents the award to Claude Bernier of Rona

And at the Canadian Hardware and Building Materials Show:

Ezgi Unal, Henkel Canada, demonstrating new products:

In the same ceremony, Montréal-based Richelieu Hardware Ltd. won the Vendor Newsmaker Award.

“Each of these companies has made a huge impact on the retail landscape over the past year,” said Michael McLarney, editor and publisher of Hardlines. “Rona made headlines across the country for the bold launch of its IPO when other companies were pulling back. The aggressive consolidation efforts of Sodisco-Howden Group have changed indelibly the character of hardlines distribution in Canada. Richelieu has sustained rapid growth while maintaining the infrastructure to deliver superior products and services.”

In February, Sodisco-Howden acquired the hardware and building materials assets of Marchands Unis Inc., potentially increasing its annual revenues by 25% and making it the strategic partner of choice for an increasing number of independent retailers. But that was only the beginning of a year in the headlines.

In June, Sodisco-Howden announced a partnership with Aeroplan, becoming the first retailer to reward Aeroplan Miles for home improvement purchases. Then in October, the company announced that it would purchase all shares of Ace Hardware Canada Ltd. The purchase of Ace is pending regulatory clearance and is expected to close in the first quarter of 2003.

Rona began the year by creating more than 1,200 new jobs and announcing that 2001 had been a record year, with a 36.8% increase in net income. By the end of its second quarter in 2002, Rona boasted a record performance, increasing its net earnings by a whopping 113.1%.

Rona’s staggering growth continued, and by the end of the year, Rona Inc. was officially welcomed into the Toronto Stock Exchange.

Richelieu began the year with its 27th consecutive quarter of growth. First-quarter sales were up by 15% from the same period in 2001. Richelieu’s exceptional growth continued throughout 2002, and in September, the company made its latest acquisition, 75% of Menuiserie des Pins Ltée, a Québec manufacturer and distributor of products for window and door manufacturers.

“Our Vendor Award winner, Richelieu Hardware, has been a key consolidator in the hardware industry,” said McLarney. “At the same time, it has proven itself an innovator in both products and merchandising for home improvement retailers.”

Toronto, ON – Even as Home Depot in the U.S. battles bad press and worsening stock prices, the Canadian division, now one of only six in North America, shows no signs of letting up. After opening 14 stores in 2002, another 14 are planned for this year. Although, says Canadian president Annette Verschuren, her CEO is pushing for even more. “Bob Nardelli wants me to open more,” she says. “I’ll see if I can get [a 15th store] opened this year.”

Nardelli has already announced Home Depot will open 200 stores this year. That’s the same number it opened last year, down from the highs of the late ’90s, when a new store was opening, on average, every 36 hours and the stock split five times over the last decade. Nardelli is relying on much of that expansion from its international divisions, including Canada.

In fact, the Canadian division leads the pack. “Our sales performance still exceeds that of the whole company,” Verschuren says. While Nardelli expects less than 10% growth company wide, Verschuren is confident Canadian growth will stay in the mid to high double digits in the year ahead.

A number of factors are driving the sustained growth north of the border. Verschuren’s team faces a less mature big box market than in the U.S. In addition, there’s a lack of aggressive expansion by competitors like Lowe’s stateside. While Rona is bent on expansion, its big box plans are not as ambitious as Home Depot’s, and Réno-Dépôt is keeping quiet about its plans for at least a couple of more weeks (we’ll keep you posted—MM).

But Verschuren also knows that not all of her new stores will necessarily be as big as their predecessors. Home Depot Canada is actively developing store footprints up to 20% smaller than the standard 135,000-sq.ft. size. It’s also looking for inner city sites to develop what Verschuren calls “Home Depot light” stores. Called “urban neighbourhood” stores in the U.S., where pilot sites have been erected in Chicago and Brooklyn, they weigh in at no more than 65,000 sq.ft.

While she’s alluded to an urban store in Toronto’s West end, to relieve pressure on the Stockyards store at St. Clair and Keele, the first confirmed urban location will be in Vancouver’s Park Royal shopping complex in North Vancouver. In fact, says Verschuren, that city can accommodate another four Home Depot stores.

Prout’s Castle Building Centre houses a 6,000-sq.ft. store-within-a-store, supplied and merchandised by TSC Stores Ltd. Called TSC Villager, the section carries a selection of farm and hardware products, providing add-on sales for Prout’s traditional LBM trade, while carving out a new niche for the 21-store TSC chain.

Nor has the quiet experiment gone unnoticed. “We’ve had a lot of interest in this concept, from quite far afield,” says Roy Carter, president of TSC. “From the U.S. and from local operators, too.”

The Villager program has been in place for just one year. However, both companies have enough confidence in the concept that they’ve extended their operating agreement for another two years.

Home Depot Canada has registered in the province of Prince Edward Island. The registration is standard procedure for any company intending to do business there. Annette Verschuren, president of Home Depot Canada, once told this Editor that Charlottetown is a city she’s considering. Over the Christmas holidays, the retailer also had pollsters evaluating customer habits at its store at Highway #7 and Yonge Street in Thornhill, just north of Toronto. Appears a store at Bayview and Elgin Mills is under consideration to tap into the lucrative community of Aurora, north of there. In the West, Prince George, BC is slated to get a Home Depot, probably a smaller store. We’ll keep you posted…

A.E. Hickman Co. Ltd., which sold off its three building centres to Chester Dawe Ltd. in June 2001, is being sued by John Deere Ltd. for more than $2 million owed to the tractor manufacturer by bankrupt Hickman Equipment Ltd. According to the St. John’s Telegram, Hickman had guaranteed all debts to John Deere back in 1985. The suit applies to purchases of heavy equipment, as well as to amounts owing under a lease/finance agreement with Hickman Equipment.

TSC Stores Ltd. has relocated its head office in London, ON. The new address is: 1950 Oxford St. E., London, ON N5V 2Z8. Phone stays the same (519-453-5270). The warehousing, from two facilities at the old Industrial Rd. address, is expected to begin consolidation into the new location in about three months.

Weyerhaeuser‘s Saskatchewan forestlands operations have been certified to meet the Canadian Standards Association‘s standard for sustainable forest management. The CSA Z809 standard covers 4.9 million hectares (12.1 million acres) of forest in the Prince Albert and Pasquia Porcupine Forest Management Areas.

In its continued effort to centralize its operations, Home Depot has announced it will roll its New England division, which includes stores from New York to Maine, into the Atlanta-based Eastern Division. The Eastern Division will be expanded accordingly to support 600-plus stores. The consolidation will take place over the next 60 days, leaving the company with six divisions, down from nine when Bob Nardelli took over the company two years ago.

Home Depot is about to begin construction of a new western distribution centre in Stockton, CA, according to a report in Home Channel News. The 756,000-square-foot facility will cost an estimated US$27 million, and is expected to be finished by August. The new warehouse will serve Home Depot stores in Northern California.

Selectone Paint Ltd. has partnered with specialty paint producer Devine Color, a new premium paint from Oregon, to handle the manufacturing and distribution of the line in Canada. The launch, at this year’s Canadian Hardware and Building Materials Show in Toronto, features a selected palette of 115 colours developed by the line’s innovator, Gretchen Schauffler.

Sinclair-Erie Ltd., one of the existing supplier partners of Waterloo, ON-based Supplierpipeline Inc. has purchased the assets of Erie, a manufacturer of wheelbarrows and contractor tools. This follows the addition last Fall of a new Supplierpipeline stocking warehouse in Mississauga, ON.

Kmart Corp. has received judicial approval to close 316 stores. The judge overseeing the ailing retailer’s bankruptcy proceedings granted final approval for the closure of 316 stores and gave permission to proceed with a US$2 billion exit financing package. The sell off should leave Kmart with about 1,500 stores, compared with about 2,200 before it went into bankruptcy one year ago.

Robert Niblock has been promoted to president of Lowe’s Cos. Niblock joined Lowe’s in 1993 and currently serves as executive vice-president and CFO. In his new role, he will be responsible for store operations, merchandising, logistics and distribution, reporting to chairman and CEO Robert Tillman … Larry Stone, executive vice-president operations, has been promoted to senior executive vice-president operations … Dale Pond has been promoted to the position of senior executive vice president merchandising. He was formerly executive vice-president merchandising. (1-800-445-6937)

The monthly growth rate of Canada’s composite leading indicator rose to 0.4% in December. This upturn was led by the firming of the stock market, as well as strong domestic demand. Two components fell, four were unchanged and four rose. Services employment was up 0.7%, while durable goods, especially furniture and appliances, continued to increase gradually, with housing remaining strong.

This year it’s right in the Civic Ballroom of the Sheraton Centre Hotel, Toronto. We’ve joined with the folks at Hardware Merchandising to mount the First Ever Industry Awards Breakfast. This combined program guarantees a great wakeup for the CHS.

The Awards Breakfast is free to Hardlines subscribers, and to guests of Hardlines and Hardware Merchandising magazine (with some restrictions!). You must reserve your space, so please RSVP to Nancy at 416-489-3396; nancy@hardlines.ca . It’s filling up fast, so reserve now!

Special thanks to our sponsors:
· JDA Software
· Zircon
· Sterling Commerce
· Dimensions Retail Systems
· 3M

Montréal, QC — Sodisco-Howden Group is actively promoting all its banners to customers and prospects. Ferplus and Batitout, the two banners picked up from Marchands Unis at the beginning of last year are in the mix, but Ace isn’t – yet. (The Competition Bureau is currently wading through Sodisco-Howden’s application. Despite the delay, the acquisition of Ace Hardware Canada is expected to close by the end of February.)

This, just three years after Sodisco-Howden made a big push to rationalize its banners. It went from five effectively to two. Pro is the flagship for both hardware and building centre dealers, while Do-it center remains the distributor’s specialty building centre banner, supported by about 70 dealers across the country. Jos Wintermans, CEO of Sodisco-Howden Group, insists the Do-it banner will get continued support, especially in light of the fact these dealers, typically larger yards, provide big volumes for Sodisco-Howden.

However, Do-it, which is managed out Sodisco-Howden’s London, ON division, D.H. Howden, is not being developed very aggressively. In fact, Do-it’s point man, Ernie Bruce, left the company last summer.

Ferplus, on the other hand, is suitable for smaller hardware stores. The program comes without the added costs of full flyer programs . “It’s suitable for the independent who wants to remain independent and choose the assortment of programs that’s best for them,” says Celine Gamache, vice-president marketing for Sodisco-Howden.

Like Do-it center, Batitout remains a viable option for building centre dealers.

“They’re well known banners, so we’ll continue to support them,” says Gamache.

The member groups are busy communicating the philosophy and benefits of the alliance to individual dealers, as well. Sexton, for one, has been holding meetings that include reviewing the key commodities suppliers being targetted under the new deal. “It’s an opportunity for us to get some feedback on issues dealers are facing, especially with some of these suppliers.”

Negotiations with Reliance also give suppliers a point of entry with individual member groups for additional sales and programs. The other members are Castle Building Centres, Federated Co-operatives, Coopérative Fédérée de Québec, Torbsa, Delroc Industries and Irly Distributors.

“Suppliers are recognizing up front that we’re in a different league now,” says Pro Wylie, president of Castle, “and some of them had to make adjustments in their pricing and rebates.” The combined retail sales of the group are expected to top $3 billion. Castle and Sexton make up Reliance’s two largest sources of building materials volume (Saskatoon-based Federated Co-op has greater sales overall, but these include petroleum, farm supplies and grocery).

While Home Depot’s store locations are feeling the effects of cannibalization in the U.S., the Canadian division remains strong, and Nardelli took time during the analysts’ meeting to praise the performance of Home Depot Canada, under its president, Annette Verschuren.

Home Depot expects to open 200 stores and add 40,000 associates in fiscal 2003, but plans for its high-end Expo Design Centers continue to be slowed. Expo was to be Home Depot’s bid for high-end renovation customers, but a faltering U.S. economy has slowed expansion plans. While Home Depot opened 11 new Expo Design Centers last year, it will open only two this year. Some of its 52 existing stores will be remodelled, as well. No Expo stores are planned for Canada in the near future.

Programs for this year include: a garage sale to let exhibitors sell discontinued items and clear outs; a $50 early bird discount on booths; Auto Focus pavilion featuring the latest automotive aftermarket products. At a breakfast session for sales agents on February 3, agents and reps will receive tips on getting the most out of their agreements with their principals. First-time exhibitors will get showcased, as well, letting buyers zero in on new ideas all in one area.

“We are extremely excited by the positive changes we have made for the 2003 edition of CHS,” says Maura Bella, CHS director. “The success of CHS depends on our ability to adapt to the changes taking place within the industry.”

CHS 2003 takes place February 2-4 at the National Trade Centre on Toronto’s Canadian National Exhibition grounds.

Rona Inc. exhibited for the first time in Saskatoon last week at the Prairie Showcase. The company has stated many times its desire to develop its dealer base in the West. Claude Bernier (r), executive vice-president of Rona’s traditional stores, was present with Rona’s store development team of John Longo (l) and Al Holton (centre). Rona started exhibiting last year at the Atlantic Building Supply Dealers Show in Moncton, NB.

Hurt by US$26 million in countervailing duties, and the cost of integrating Willamette Industries, Weyerhaeuser reported 2002 net earnings of US$241 million on net sales of US$18.5 billion. This compares with net earnings of US$354 million on net sales of US$14.5 billion for 2001.

Tembec‘s consolidated gross sales for the first quarter reached $840.8 million, up from $792.6 million a year earlier. The company generated a net loss of $41.8 million, compared with a net loss of $44.7 million at the end of the first quarter a year earlier. EBITDA totalled $18.2 million, down from $60.1 million.

Do it Best Corp. is hosting 35 Executive Retail Symposiums across the U.S. next month. The aim of the program is to provide member-retailers with business management tools to ensure longterm success. Topics will include increasing profitability, succession planning and the benefits of the latest technology.

Leviton Manufacturing has acquired OnQ Technologies Inc., a supplier of structured wiring and home networking technology. The purchase is part of Leviton’s growth as a supplier of home networking and residential products. OnQ will be joined with Leviton Integrated Networks, the company’s existing structured wiring division, creating Leviton OnQ.

Canadian softwood timber producers are claiming a victory over the latest favourable ruling by the World Trade Organization. The B.C. Lumber Trade Council, which represents companies responsible for almost half of Canada’s softwood lumber shipments to the U.S., is welcoming the WTO Appellate Body’s ruling on the so-called Byrd Amendment, which had the U.S. giving money to U.S. companies deemed to have been hurt by Canadian softwood lumber.

Linda Nodello, the ebullient marketing director of the Canadian Hardware and Building Materials Show, departed last week, just two weeks before the show itself. Nodello had spent 13 years in the employ of the show’s owner, the Canadian Retail Hardware Association. Nodello is the last of the old guard to change; a new sales team spearheaded by Lynn Cronin was put in place over the past two years and show manager Joe Edwards, absent after a lengthy sick leave, was replaced recently by Maura Bella as CHS director. No replacement has been named for Nodello. (905-821-3470)

The Consumer Price Index increased by 3.9% in December 2002 over December 2001. The increase in inflation was less pronounced than November’s 4.3% increase. However, that was due mostly to a drop in the Ontario electricity index.

Spurred by low interest rates, U.S. housing starts were up 5% in December, says the Commerce Department. For the year, work was started on 1.70 million homes and apartments, up 6.4% from 2001, ending the best year for new housing since 1986.

This year, we’re combining the world famous Hardlines Industry Awards Breakfast with the Outstanding Retailer Awards. This combined program guarantees a great wakeup for the CHS.

The Awards Breakfast is free to Hardlines subscribers, and to guests of Hardlines and Hardware Merchandising magazine (with some restrictions!). You must reserve your space, so please RSVP to Nancy at 416-489-3396; nancy@hardlines.ca . Remember, the Hardlines Show Breakfast is held exclusively for Hardlines subscribers and guests, so be sure and join us!

Special thanks to our sponsors:
· JDA Software
· Zircon
· Sterling Commerce
· Dimensions Retail Systems
· 3M

Vancouver, BC — After 33 years at the helm of the West’s largest buying group, Barrie Sali has confirmed he will step down at the end of his current contract with Tim-BR-Marts Ltd. at the end of December 2003.

Sali called a meeting of his dealers in Saskatoon just prior to the WRLA Prairie Showcase to advise them of his decision, which he announced internally on January 11.

Sali led Tim-BR-Marts since its early years as a group with 22 stores in Western Canada. At the time, he said he could take the group to $100 million in sales within a decade. Today, sales through its 185 member stores surpass $1 billion annually.

Known at times as the toughest buyer in Canada and a man many loved to hate, he was in fact fiercely loyal to his dealers (referring to them as “my guys”) and to key suppliers, as well as a devoted family man.

Over the past two years, Sali has steered the group through a turbulent time. the historically stable group saw the defection of some of its key members to ILDC. However, Tim-BR-Marts dealers have given Sali overwhelming support right up to the end. The group has managed to maintain its status as one of the country’s top buying groups, adding new volumes from the growth of members such as McDiarmid Lumber and Slegg Lumber, and through the expansion of its drywall supply business.

Three brothers have sold off their shares. Dave Thorogood will leave as manager of the Midnapore store in Calgary. Doug Thorogood was formerly Totem’s buyer for flooring, carpet, furniture and storage. He’ll be replaced by Jim’s nephew, Rob Thorogood, who comes over from a manager’s role at the Forest Lawn store in Calgary. Dick Thorogood was vice-president, operations. He’ll be replaced by Jim’s son Ryan Thorogood, who was formerly buyer for doors and mouldings.

Colin Robertson, Totem’s vice-president, marketing, has also sold off his interest in the company. However, he’ll continue on for two more years. He’s been with Totem since it started in 1970.

Besides his duties as head of the company, Jim Thorogood will keep his hand in the buying side as buyer for lumber and plywood, assisted by Jackie Gorlick. “I do it more because I enjoy doing it,” he notes.

“It was tough one for everybody,” says Thorogood of the exit of so many seasoned members of the team. “But we’re fortunate to have some young, capable people to fill the roles.”

Totem has been steadily growing in the Alberta market, despite the plethora of big box competitors, especially in Edmonton and Calgary. The chain’s 14th retail store (it also has a contractor yard) will open by this Fall in St. Albert, just outside Edmonton.

How many more stores does Totem intend to open? “I don’t know that there is a magic number,” says Thorogood. “The economy is very, very good, but we have to make the money to buy each one.” He adds that sales in 2002 grew from about $180 million to “well over $200 million.”

Meanwhile, the upgrading of existing stores is ongoing. A major renovation was made in Edmonton, including an addition that took that site from 20,000 to 36,000 sq.ft., while an expansion of the Grande Prairie store is currently under way.

Close to 600 sales agents attended the show last year, spurring show officials to develop a program catering to them specifically. Following the seminar, Serdivan will be available for individual, 15-minute consultation sessions to any agents who wish to discuss legal issues confidentially. The breakfast seminar will be held on the last day of the show, February 4, at 7:30 a.m. in Room 107 of the National Trade Centre in Toronto. Tickets are $45 each.

To register for the seminar and breakfast, contact Shona Paterson: 905-821-3470; spaterson@crha.com.

Castle Building Centres Group Ltd. has added the following new members: AFAB Industries Inc., Rocanville, SK; Cape John Industries Ltd., La Scie, NF; Harwell Hesco Electrical Supply Co. Ltd., Toronto, ON; Strathmore Building Supplies, Strathmore, AB; North Cobalt Flea Market, North Cobalt, ON; Northland Lumber Ltd., Melfort, SK.

Randy Britton has established Randy Britton Sales and Marketing, representing West Bend as its sales agent in Canada. Britton was formerly with West Bend Canada as sales manager before the Canadian operation was closed. He’s on the lookout for additional lines. You can contact him at: 519-856-1031.

The Canadian Hardware and Housewares Manufacturers Association will feature the impressionist André-Philippe Gagnon as entertainment for the 2003 Industry Gala Night, Sunday, February 2, 2003 at the Royal York Hotel. The fund-raiser for Easter Seals is a key social event during the Canadian Hardware and Building Materials Show. For more info, call: 416-282-0022.

The research and technology environment of the University of Manitoba Smartpark has added its first tenant: ProfitMaster Canada. The new address is: 300-135 Innovation Dr., Winnipeg MB R3T 6A8; phone: 800-340-4492.

Kmart Corp. has confirmed it will close more 326 stores and lay off 37,000 across the U.S. Kmart filed for bankruptcy court protection a year ago, then closed 283 stores the time. The company had a profit of US$349 million in January, but same-store sales fell 5.7%.

Santa Fe Custom Shutters and Doors, New Mexico manufacturer, has been awarded US$12 million after Home Depot, its only customer, cut off orders, despite verbal reassurances to the contrary. The loss of business drove the supplier out of business. Home Depot says it does not intend to appeal.

Bonni McChesney has left Coleman Powermate after four years to start McChesney Sales, a sales, warehousing and distribution company in Brantford, ON. (519-720-0745)

Mary Houston is now sales manager for Nielsen and Bainbridge in Markham, ON. The art and framing company supplies retail chains, OEM and independent frame shopgalleries. She was formerly with News Canada Marketing. (905-475-7511)

Brad Rossetto, formerly head of PPG Architectural Coatings Architectural Coatings Canada as architectural coatings director, has been made managing director, Asia Pacific, for the Transitions Optical division of PPG Industries, based in Australia … Todd Bourgon, formerly key account manager, has been promoted to regional sales manager for Architectural Coatings. (905-790-5335) … Robert Fierheller remains team leader, dealer development for the Canadian Architectural Coatings Business. (905-790-5336) … Jeff Duldhardt has joined as retail sales representative for Southwestern Ontario … James Dornn has joined on as area manager for Manitoba. (Main: 905-790-5349)

Reynold Hert has been named vice-president, Canadian Forestlands for Weyerhaeuser Co. He will manage Weyerhaeuser’s timberlands operations from the B.C. Interior to New Brunswick, reporting to Richard E. Hanson, executive vice-president, Timberlands and International … Paul Perkins will become vice-president, Policy and Planning for the Canadian operations. He will be responsible for strategic and geographic planning for all of Weyerhaeuser’s assets in Canada. (604-669-8714)

The Mibro Group has expanded it sales team: David Jones has been promoted to the position of director of national accounts. He was most recently national account manager … Larry Lucyshyn has been promoted to director of national accounts. He was most recently national account manager … Robert Sehn has joined Mibro as of director of regional accounts. Everybody reports to Stephen Jones, senior vice-president sales. (416-285-9000)

Investment in non-residential building construction reached a record high in the fourth quarter, says Statistics Canada, fuelled by spending in the public sector. Overall, businesses and governments spent $6.4 billion, up 1.2% from the third quarter.

The Awards Breakfast is free to Hardlines subscribers, and to guests of Hardlines and Hardware Merchandising magazine (with some restrictions!). You must reserve your space, so please RSVP to Nancy at 416-489-3396; nancy@hardlines.ca . Remember, the Hardlines Show Breakfast is held exclusively for Hardlines subscribers and guests, so be sure and join us!

London, UK – Hammered by the ailing German economy, Kingfisher plc will close its six-store German subsidiary, Castorama Deutschland GmbH. The move is part of the Group’s review of its international home improvement operations. The closures will take place over the next eight months and affect 391 staff. The financial impact to Kingfisher will be an anticipated exceptional charge of around £35 million ($87.2 million).

Castorama established itself in Germany in 1990 and operates stores in Kamen, Koblenz, Wildau, Chemnitz, Castrop-Rauxel and Kassel. In recent years, the stores were enlarged and converted to big boxes under the Casto-Depot banner. Despite the repositioning, the chain is expected to incur a £5 million ($12.5 million) loss on sales of £40 million ($99.7 million) for the fiscal year ended February 1, 2003.

Réno-Dépôt, Castorama’s Canadian division, is part of Kingfisher’s review process, but a key criterion for consideration is each division’s profitability. “At this time, Réno-Dépôt is performing in line with our own expectations and generating a profit,” says Jonathan Miller, a spokesperson for Kingfisher in the U.K.

But other considerations include long-term prospects. “At the end of the day, the purpose of the review is to identify markets where we’ll get the greatest return on our investment,” Miller adds. “At the moment, we plan to complete our review by the end of this month, when any actions concerning a particular division will be announced.” In the meantime, it’s business as usual for Réno-Dépôt, which currently has 19 stores, and is expected within a few weeks to announce further openings in 2003.

Rona, which owns about 30% of Matco Ravary, did not make a counter offer to BMR’s bid in earlier negotiations. In October 2002, BMR submitted two proposals to Matco Ravary’s board, the second of which was accepted. Rona could have submitted a counter offer, but chose not to.

If the sale does go through, ownership of the Montréal-area chain, which has sales of about $60 million, mainly to contractors, would revert to a syndicate of 16 BMR dealers and operate under the BMR banner. Although Matco Ravary has seen profits slip in recent years, the stores give Rona an effective beach head in the Metro area.

The program has proven to have special appeal for Black & Decker, whose DeWalt brand is aimed directly at the trades. B&D has been absent from the show in recent years, and though the company will not have a booth this year, the Power Focus event gives the company an appealing forum for being involved. Delta Porter Cable, a long time exhibitor and supporter of CHS, is the other company to sign up so far for this event, with others pending.

Show hours on Monday have been extended to 8 p.m. to accommodate the contractor traffic. The show will close on Tuesday, February 4 at 1 p.m. instead of 3 p.m. On Sunday, February 2, the show starts at 9 a.m., right after the Industry Awards Breakfast presented by Hardlines and Hardware Merchandising at the Sheraton Centre Hotel in Toronto.

CHS 2003 takes place February 2-4 at the National Trade Centre in Toronto. Registration is free in advance or $25 at the door. Non-exhibiting manufacturers who attend CHS 2003 will now pay a registration fee of $200. For show information, visit www.crha.com or contact Maura Bella at (905) 821-3470; fax: (905) 821-8946; crha@crha.com.

According to David Weingarden at CMHC, the market remained strong last year thanks to low mortgage rates, growing employment and increasing incomes. He also mentions that Canada’s inventory of completed and unoccupied new housing “is very close to the lowest levels ever since we’ve been recording them, so that tells us there’s a very strong demand for housing, which has to come from additional stock.”

However, there are signs that things may slow down into 2003. Housing starts dipped in December, reaching 198,500 seasonally adjusted, down 6.7% from November’s rate of 212,900 units. Urban single starts rose 0.7%, but urban multiple starts fell 17.9%. In addition, the value of building permits issued in December was down 2.7% overall and residential intentions fell 7.8%, an indicator of the expected level of construction activity in the months ahead.

Despite the decline, the level remained high, as construction intentions revolved around the $4.0 billion mark for the fourth time in the last five months. However, the previous month’s level remained 30.8% higher than November 2001.

Nevertheless, Weingarden expects a healthy start to 2003. “Basically, inventory levels show demand is still there, so I expect the market to remain robust, at least in the near term.”

Mutual Hardware Inc. has moved from its location on Argentia Road in Missauga, ON to: Suite 402, 627 Lyons Lane, Oakville, ON, L6J 5Z7. New phone: 905-337-1184; fax: 905-337-1185.

Tractor Supply has reported year-end sales of US$1.21 billion, up 42% from the previous year. The company expects net income to range from US$36.1 million to US$37.1 million, up from US$25.8 million. 4Q earnings are expected to be higher than previously estimated because of strong sales of winter work clothing and heating products.

The U.S. claims it would drop duties on Canadian softwood lumber if this country will adopt U.S.-style forestry practices. Since last Spring, Canadian suppliers have been forced to pay an average tariff of 27% on exports to the U.S. This means opening the market to the highest bidders, and potentially unprecendented U.S. control of Canadian timber sources.

Mired in bankruptcy proceedings, Kmart Corp. will likely announce a raft of closings next week. Analysts and industry experts expect the retailer to close between 300 and 500 stores. The company also intends to emerge from bankruptcy sometime this year.

Sandy D. McDade will take over the role of senior vice-president at Weyerhaeuser Canada, when Bill Gaynor retires later this year. McDade will also assume the role of president, Weyerhaeuser Co. Ltd., a wholly owned subsidiary of Weyerhaeuser Co. … Susan Mersereau will become vice-president, Information Technology and CIO, replacing Thom Ped. (604-669-8714)

Alison White has departed from Innovak, where she was product manager, to join Globe Electric in the newly created position of merchandising manager. She reports to Dave Creglia, Globe’s vice-president of marketing. (1-800-361-2861)

New house prices continued to climb in November, as Stats Canada’s New Housing Price Index rose 0.6% from October, up from 0.5% a month earlier. Compared with November 2001, this index of contractors’ selling prices increased 5.0%. A healthy demand for new housing in conjunction with increased costs to builders for skilled labour and building materials helped push prices upward nationally.

Construction in the U.S. was up for the third straight month in November, reports the Commerce Department. Construction spending on homes, hotels and highways increased 0.3% to US$843.2 billion from October, which was up 1%.

This year, we’re combining the world famous Hardlines Industry Awards Breakfast with the Outstanding Retailer Awards. This combined program guarantees a great wakeup for the CHS.

The Awards Breakfast is free to Hardlines subscribers, and to guests of Hardlines and Hardware Merchandising magazine (with some restrictions!). You must reserve your space, so please RSVP to Nancy at 416-489-3396; nancy@hardlines.ca . Remember, the Hardlines Show Breakfast is held exclusively for Hardlines subscribers and guests, so be sure and join us!

Advertise your products online and take advantage of our bonus circulation at CHS. Reach 2,000 more qualified readers at Canada’s premiere trade show! Be part of the excitement that is Hardlines. Contact Beverly Allen, Marketing Manager, for details: bev@hardlines.ca

The delay does not, however, bode ill for the deal, says Sodisco-Howden president and CEO Jos Wintermans. “The parties are working well together,” he says, referring to his company’s negotiations with both Ace and the Competition Bureau. “There’s no reason to believe that this won’t be closed in this quarter, or at the latest early in the next quarter.”

He explains that a routine investigation is under way, delayed more by the Christmas holidays than any complications in the deal itself. Wintermans has met with them already, and has additional briefs prepared to send them this week.

On October 22, 2002, Sodisco-Howden announced it had signed a letter of intent with Ace Hardware Corp. of Oak Brook, IL to purchase the assets and outstanding shares of Ace’s Canadian operation. The result will be a strategic alliance that sees Sodisco-Howden licensing the Ace banner in Canada.

Boucherville, QC — With more than one-quarter of its business already coming from Western Canada, Rona Inc. wants to continue expanding its dealer base in the West, says Robert Dutton, president and CEO of Rona.

In an exclusive interview with Hardlines Quarterly Report, Dutton outlined his plan to make Rona a household name west of Ontario. “That’s why we want to build a new distribution centre in the West in 2003,” he says. “Our facility in Calgary is currently 80,000 sq.ft. To accommodate growth, we’ll need around 200,000 more sq.ft. That will give us a good base for recruitment and to expand our Revelstoke and Revy stores.”

Dutton has made clear his intention to continue looking for further acquisitions. While he admits to having some discussions with retailers, no deals are on the table at this time. Rona owns almost 11% of the hardware/home improvement market (according to HQR’s ranking of the industry’s top retailers). Dutton wants to push that share to 20% by 2007.

(For the full interview with Robert Dutton, see the latest issue of our sister publication, Hardlines Quarterly Report. Also in that issue: our annual Retail Trends Report and the incredible Buying Group Org Chart.)

Cologne, Germany — A world forum on home improvement retailing will kick off the 2003 edition of Practical World, the International Hardware Fair/DIY’TEC. Organized by BHB, the German association of hardware retailers, the one-day conference will be held on Saturday, March 8, 2003.

Practical World Conference will feature Joseph Galli, Jr. of Newell Rubbermaid, former Home Depot executive Jim Inglis, Gilles Caille of Fediyma (and past presenter at the Hardlines Marketing Conference), George Adams of Britain’s B&Q, and many others. The highlight of the day will be a keynote by Robert L. Tillman, president & CEO of Lowe’s Cos.

Topics of the day will include panel discussions on the international DIY scene, partnerships between retailers and suppliers, and new concepts in consumer preferences. The day concludes with a cocktail reception, beginning at 5:30 p.m.

Cost for the Practical World Conference is 490 euros + VAT. This includes lunch, beverages and admission to the Practical World Hardware Fair, which begins the following day. Discounts are available for multiple registrations.

(For more information about attending Practical World and the Practical World Conference, contact: Barbara Hills, Canadian manager for Cologne International Trade Shows: 416-598-3343; colognet@idirect.com. )

Goodfellow Inc. reported 1Q sales of $128 million, up from $109.6 million a year earlier. Net profit for the period was $406,000, compared with $1.2 million during the first quarter of the previous year. The dent in profits was attributed in part to extremely competitive markets since September 2002, combined with a sharp downturn in U.S. business. Goodfellow is Eastern Canada’s largest independent re-manufacturer and distributor of lumber products and the largest distributor of hardwood flooring products in Canada.

Home Depot said it expects its profit for fiscal 2002 to be between US$1.53 and US$1.55 a share, versus earlier expectations of US$1.57. The retailer blamed lower-than-expected U.S. holiday sales of power tools and hardware, and a “challenging environment” well into fiscal 2003. Home Depot earned $1.29 a share in fiscal 2001.

Home Depot opened its 1,500th store last month, this one one in Abilene, TX. The company expects to finish the fiscal year, which ends January 31, 2003, with a total of 200 new locations.

Softwood lumber producers got a Christmas present from the federal government, $15 million to help them while Canada battles with the U.S. over its ridiculous tariffs on Canadian softwood. The money will be used by lumber industry associations that have acted as liaisons between Ottawa and the sector.

84 Lumber Co. reached a milestone at the end of 2002, exceeding more than US$2 billion in sales for the first time in the company’s history. The Pennsylvania-based retailer, which focuses on professional contractors, claims to be the largest privately-held building supply company in the U.S., with 435 stores in 34 states and another 11 component plants in nine states. Sales in 2002 rose16.5% over 2001.

Canarm Ltd., a producer of consumer lighting products and ceiling fans, was awarded as one of Canada’s Top 50 best managed companies.The awards program recognizes Canadian companies that have world-class best business practices in a range of industries, including technology, retail, manufacturing and services.

Intercraft, a division of Newell Rubbermaid, relocated at the end of December 2002. The new address is: 6711 Mississauga Rd., Unit 404, Mississauga, ON, L5N 2W3; phone: 905-363-2350.

Restoration Hardware anticipates that fourth-quarter results will fall well below plan, citing weaker-than-expected Christmas holiday sales. The California-based high-end home furnishings retailer expects to post a net profit of 25-30 cents a share, down from previous guidance of 41-42 cents. Restoration is projecting same-store sales to grow a modest 2-4% in the fourth quarter, compared with its initial target of high single-digit to low double-digit growth. In December 2002, the company delayed filing its quarterly report to correct accounting irregularities. The errors will have no effect on earnings for the current fiscal year, the company said.

Greg Bolig has been appointed vice-president of sales for Builders FirstSource‘s Southeast Group. The newly created appointment is part of a revised sales strategy for the retailer. He will direct and support the group’s sales efforts to create a stronger, sales-oriented approach to the business.

Canadian consumers experienced a 4.3% increase in inflation in November, compared with the same month a year earlier, according to Statistics Canada’s Consumer Price Index. This increase is considerably larger than October’s 3.2% rise, but due largely to low energy prices last year.

Wholesale sales rose 0.6% in October to $35.5 billion dollars, says Statistics Canada. However, not including automotive products, which were up 3.6%, total wholesale sales would have been flat (-0.1%). Otherwise, wholesale sales have been on the rise since the fall of 2001.

Housing starts in the U.S. edged up in November by 2.4%, partly reversing a big slide in October, says the Commerce Department. But home building intentions, as tracked by sales of building permits, were down 2.7%.

Sales of new homes in the U.S. rose 5.7% in November, according to a government report. The lowest mortgage rates in more than three decades encouraged buyers, especially first-time buyers, as affordable, single-dwelling housing led the way.