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Seven more sites are currently being reviewed, in addition to longer term considerations in both Québec and Ontario. The company continues to evaluate a location for Oakville, ON, just west of Toronto, where city council recently turned down an application by Réno-Dépôt.

Winnipeg, MB — TruServ Canada has updated its Electronic Product Information Catalogue and released it to its members. The catalogue, issued on CD, provides a full database of TruServ Canada’s inventory, searchable by keyword, department, class or SKU number.

The co-op wholesaler intends to issue monthly updates of the CD, featuring a summary section to showcase the latest new products available.

The rest of the panel consisted of Harry Rosen, renowned men’s clothier with 18 stores across Canada, Leon Goren, president of Justwhiteshirts.com, and the outspoken Saul Korman of Korry’s Apparel.

Despite the rhetoric, the upshot of the panel was that, when shopping for hard goods at least, “People are just people and there’s not that big a difference between the way women shop and men shop,” Verschuren told Hardlines afterwards.

There are some differences in the way the two sexes shop, however. Presentation is important, as men want to touch and feel a product more than women do. “Presentation has to be very crisp. Men like to make their decisions very quickly.”

However, it’s important to create a shopping environment that has something for both sexes. “The main thing is to get them shopping together,” Verschuren said. Home Depot — and any retailer, for that matter — must consider themselves in the entertainment business. To that end, Home Depot has invested heavily in the past couple of years to soften its stores’ assortments and merchandising presentations to appeal more to women as well as men, especially since 50%-60% of Home Depot’s instore shopping decisions are made by the woman. And once the woman is in the store along with the man, the value of the transaction will typically go up, Verschuren added.

Lower energy prices tempered the rise in the Consumer Price Index, resulting in a 1.0% increase in Canada’s inflation rate in May from May 2001. It’s the slowest advance since December 2001 and a big drop from the 1.7% increase recorded in April 2002

The U.S. Commerce Department reports that overall retail sales in there slid 0.9% in May and 0.4% excluding autos — the biggest monthly drop since November. Retail spending makes up two-thirds of economic activity in the States.

A new website from Home Hardware Stores targets consumers looking for paint and décor ideas. Visitors to www.beauti-tone.com can access colour tips, design trends, product information and tips on painting projects.

Sears Canada, which picked up the Martha Stewart brand after Zellers dropped it a couple of weeks ago, is considering launching stand-alone Martha Stewart stores to capture more of the home décor dollar. It would compete against Hudson’s Bay’s Home Outfitters, says a report in the Globe and Mail.

An appeal against Georgia-Pacific has upheld a US$9 million verdict in an asbestos liability lawsuit. A woman suffering from a rare asbestos-related lung cancer, claimed it was caused by a joint compound made by Georgia-Pacific in the early 1970s. GP faces about 62,000 such cases.

Kmart Corp.‘s net loss in its first quarter grew to US$1.45 billion from US$233 million a year earlier. The company took a big charge of US$758 million to write down inventory from 283 stores that were closed after the company filed for bankruptcy. Sales for the quarter fell 8.4% to US$7.64 billion, from US$8.34 billion a year earlier.

Home Depot has appointed Roger Plamondon as regional manager for Québec. He will oversee operations for Home Depot’s stores in that province. He will report to Jesse Jessop, regional operations manager for Eastern Canada. Plamondon was most recently assistant vice-president development, legal and corporate affairs for Costco Canada. (416-609-0852)

Dave Browne, national account manager for the Mibro Group, has left the company. No replacement has been named yet. (416-285-9000)

Jeff Cohen, president of Home Depot‘s At-Home Services division in Atlanta, has decided to retire from the company “to pursue outside business opportunities.”

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No area got hit worse than Calgary in May, when snow dumped on the city, but Greg Davidson of Davidson Enman Lumber says the business is there; it will just get pushed into June, July and August. The company’s increased focus on contractors and builders has served his company well. “We were very busy last month and expect to be busy right through to the Fall.”

Before the snow hit, many Ontario dealers reaped the benefits of a mild first quarter. Keith Moffatt, president of Moffatt & Powell, an ILDC member in Southwestern Ontario, says low interest rates teamed up with the mild weather to put his company far ahead of budget. Like Davidson Enman, Moffatt & Powell does a majority of its business with the trades. “We’re talking to contractors, and they’re very positive about the year ahead,” Moffatt notes.

Don Nash, president of Homecare, the Tim-BR Mart group in Ontario, echoes the good news in that province. His dealers, many of them facing big box competition head-on for the first time, are still showing same-store sales up 15% over this time last year.

Québec dealers enjoy similar optimism. Groupe BMR‘s 120 members in that province have seen sales grow more than 38% in the first four months of the year. BMR’s president, Yves Gagnon, expects to close the year 20%-25% ahead of last year, thanks not only to the addition of nine new members in 2001, but to stronger performance from existing members.

Other groups are just as buoyant. Castle Building Centres Group, with 225 dealers across the country, added 21 new stores last year – and recorded its largest year-over-year increase in the group’s 40 years, says Castle president Pro Wylie.

While the West coast has suffered from a flat economy for the better part of the decade, observers believe some areas are picking up at last. However, says George Tracy of the Building Supply Dealers Association of B.C., the impact of countervailing duties on the province’s economy is causing a big hit in unemployment. “I’m not as optimistic as I was last year,” he admits. “There has to be a huge improvement in the economy, but someone has to pay.”

His outlook, which he calls “cautiously optimistic,” calls for “some growth in 2002. Building supply dealers are not seeing huge breakthroughs — a little, but not a lot.”

Barrie Sali, president of Tim-BR-Marts Ltd., has dealers in every region west of the Lakehead. But in spite of both the weak B.C. economy and the loss of some key members last year, his group has ended 2001 with sales by all its dealers virtually on par with the previous year, at about $1.1 billion. Purchases through the group were also almost at a level with the previous year.

Atlantic Canada, which traditionally flat lines through the highs and lows in other parts of the country, anticipates a healthy year ahead. “I expect nice, slow conservative growth,” says Tom Smith, president of the AWARD buying group, which represents almost 90 dealers throughout Atlantic Canada. “I think it’s going to be a good year.”

Thanks to increased numbers of customer visits, coupled with a larger average sale per transaction, the new format stores generated average annualized sales of $14.8 million in the first quarter of 2002 (calculated on a rolling 12-month basis), up from $14.6 million in 1Q 2001. Traditional stores, by comparison, had average annualized sales in 1Q 2002 of $8.3 million, flat over the same period a year earlier.

However, CTC is still learning to maximize the use of the extra space in the new stores. Sales per square foot in the old-fashioned stores remain higher than in their newer cousins: $526, compared with $415.

A Home Depot store has been announced for Kamloops, BC. This is only the second store for Home Depot in the British Columbia interior (one went into Kamloops almost a year ago) and it’s scheduled to open on or around June 19, 2003.

A Building Box planned for Oakville, ON has been nixed by the town council there. The city-owned site will remain vacant until another use can be approved.

Matériaux À Bas Prix, a.k.a. Bargain Building Materials (“Nobody beats our prices!”) will open its 13th outlet on June 13. This one is in Beauharnois, QC on the south shore near Montréal.

Sales for Sears Canada in May decreased 2.6% to $483.2 million, from $496.2 million for the same period last year. Merchandise sales decreased by 2.7% and same-store sales fell 4.3%. Cool weather affected lawn and garden sales, but furniture, major appliances, bed and bath, and installed home improvement products enjoyed double-digit increases.

Castorama shareholders have voted to accept an offer of 67 euros per share by Kingfisher, which already owns 55% of the French DIY company. The purchase price was not supported by Castorama’s executive team, which sought a higher price and expressed concerns over possible conflict of interest between Kingfisher and the bank brokering the deal.

This year alone, Home Depot in Atlanta needs to hire 40,000 people, so it’s making a deal with various levels of government in the U.S. to create a pipeline to the labour pool. Working closely with state labour departments and local work-force boards, Home Depot will provide weekly lists of job openings that will be made available to a variety of workers, including unemployed whose welfare benefits have expired, ex-military personnel, laid-off workers and people looking to change careers.

Sears, Roebuck & Co. posted a drop in May’s store sales of 1.5% to US$2.26 billion, down from from US$2.29 billion. The Sears Hardware outlets performed better, with sales up about 5%. Same-store sales for the chain fell 4.4%.

Wal-Mart Stores reported sales in May of US$18.337 billion, an increase of 11.5% over May 2001. Profits year to date were up 12.7% and same-store sales rose 7.5%

About 320 jobs will be lost when Sears Canada closes three call centres: Kitchener Credit and HomeCentral, Toronto HomeCentral and Ottawa Travel. Call centres in Vancouver, Ottawa, Montreal, Calgary and Regina will take up the slack. The changes will be implemented by the end of July 2002.

Barrie Brooks is no longer at Coleman Powermate division of Sunbeam Canada. Formerly director of national accounts, his duties have been taken over by Bonni McChesney, vice-president of business development. (905-501-0146)

Jerry Kaell, formerly president of Wilton Industries Canada, has left the company following a restructuring. His duties will now be handled out of Wilton’s head office in Chicago. The sales function in Canada is still headed up by Jeff McLauchlin, vice-president of sales. (416-679-0790)

Dan Olsen, vice-president international sales for Ace Hardware, has left to start his own company, Global Assistance. Olsen was the first Ace guy to ever come up and check out the Canadian market, back in 1990 when he first established the international division for Ace.

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Boucherville, QC —Henri Drouin submitted his resignation as a director and chairman of Rona Inc. last week. Drouin, 61, spent the past 26 years as a director of the company and the last 21 as chairman, all the time remaining a dealer with stores of his own. With his resignation, he has also sold his interest in his Rona store in Amos, QC.

Speaking of Drouin at the company’s annual meeting last week, Gagnon said, “He has worked in every way for the growth of Rona since 1977. He was part of all major decisions that have enabled Rona to become Canada’s home renovation leader.”

Toronto, ON — They’re already doing it with fashion and cookware. Now they want to try it with hardware.

Following the company’s AGM last week, George Heller, president and CEO of Hudson’s Bay Co., announced a licensing deal with Federated Stores in the U.S. to carry selected fashion brands made for Federated’s stores in the U.S. The deal with HBC is similar to ones Federated is cutting around the world and includes INC women’s fashion and Tools of the Trade cookware.

But hardlines represent the fastest growing categories for HBC, so it’s also in the process of looking for a partner to provide these products, says Heller. In the first quarter, Zeller’s overall sales grew 1.1%, while its hardlines grew 7.3%. These products include décor, paint and seasonal — such as patio furniture.

Heller says HBC has expertise in getting product on the shelves and getting it into the hands of its customers. That’s its strength — so rather than “reinvent the wheel,” why not partner with an existing hardlines company whose strength is in hardlines.

While Heller would not be specific, he hopes to have a deal in place by as early as the end of this year.

Réno-Dépôt is not alone in its pursuit of the fickle pro customer. In the first three months of the year, Home Depot in the U.S. put its pro package into 234 more of its stores. The program provides special services to the professional customer. By the end of the first quarter, Home Depot had 769 stores carrying the pro initiative. However, none of them is in Canada, where the company derives an estimated 25% of its business from contractors.

However, even in Canada, the small contractor is important to Home Depot. “This is the business we’re focusing on,” says Anne Legault at the Home Depot on l’Acadie in downtown Montréal.

The very fact that there are so many big boxes out there makes the pitch to contractors easier, Hétu notes. “As there are more big boxes, the ‘hook and ladder’ trades are more likely to come in, because the big boxes are now more convenient. We want to make sure they choose Réno-Dépôt,” he says — or its Anglophone sister, Building Box.

Among the ways the company is trying to do that is to make the contractor’s visit as effortless as possible. Designated parking, with quick in and out via their own contractor desk, is combined with a strong in-stock position. “It’s simple,” says Hétu. “Time for them is money. We want them to be able to find what they want as quickly as possible.”

Ace Hardware Canada has found a source of paint domestically. Rather than ship paint from Ace’s own factory in the U.S., the Canadian division has formed a private-label deal with Unichem in Montréal.

Castle Building Centres Group has added the following new members: Mike’s Home Centre Inc., Southey, SK and Greenwood Building Supplies, Lethbridge, NF.

The takeover of House of Tools by Western Tool Supply has not materialized. The original deal would have the California-based chain buy Edmonton-based House of Tools for an undisclosed sum. The nine-store chain sells specialty tools to serious DIY and contractor customers. Like Western Tool, it has a strong web presence, through which it sells across the country.

Do it Best Corp. in the U.S. introduced a number of new initiatives at its Spring market, held earlier this month. They included an on-line product catalogue, handheld palm unit and a new employee hiring program. The big focus, however, was the introduction of expanded merchandising programs for housewares. These included small appliances, storage and RTA furniture.

LePage, division of Henkel Canada Corp., has changed its name to Henkel Canada Corp., Consumer Adhesives, and has a new corporate web site: www.henkelca.com . Headquartered in Brampton, ON, LePage’s Ltd. was purchased by Dusseldorf-based Henkel Group in 1995. With Manco, it forms Henkel’s North American consumer adhesives business.

Bakor has unveiled a new visual identity, comprising a new logo and packaging. Over the next six months The new identity will be adopted on all of the Mississauga, ON-based manufacturer’s consumer products and corporate communications. The new look was developed by Watt International.

Sears Canada is putting a push on its décor oriented stores with the opening of its latest furniture, appliance and home improvement store in Toronto, this one near Sherway Gardens in Etobicoke. The newly expanded, 52,000-sq.ft. store is the first of five scheduled to open by the end of the year, giving Sears a total of 42. These specialty outlets offer furniture and major appliances, and this one includes a 4,000-sq.ft. Sears HomeCentral showroom.

(Peter Norman, vice-president of Clayton Research, will be a keynote speaker at our Retail Strategies Conference on September 12, 2002.- MM)

• a minimum of 6 years in a regional sales management role
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• a well developed network in the hardware retail industry in Quebec
• knowledge of category management initiatives and national account management
• a track record of superior performance in retail account management

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He insists the independent dealer has the clout needed to compete against the big boxes, saying the big guys today are focusing more on margins than on sales. As a result, he adds, the price wars of a few years ago are just not happening today.” Independents today can compete with fair pricing, but also with knowledgeable customer service.”

While the Calgary stores, and another in Maple, ON have not panned out for Ace, deals like the one it recently struck with United Farmers of Alberta are giving the company much-needed sales volume. There, the new programs for 34 UFA stores have almost been completed.

Ace has duel-bannered 14 independent building centres so far this year and a new ground-up hardware store is planned for Richmond, BC in June. Also, Ace’s supply arrangement with Castle Building Centres is bearing fruit, with ten projects currently on the go. Acceptance is especially strong in Atlantic Canada, where eight of those 10 new banners are going in.

Ace has a total of 29 projects, ranging from ground up stores to remerchandising and expansions, that will all be completed within the next three months. Ace also has agreements with Growmark, Tim-BR-Marts, Sexton and Torbsa.

The store has almost doubled in size to 37,000 sq.ft. and switched to 12-ft. warehouse-style racking through most of the store. More space has been devoted to retail in an effort to get as much product on the floor as possible. With inventory increased from 19,000 to 26,000 SKUs, much of the new retail space has been turned over to expanded assortments, especially a more complete line of Rona private label products and more attention to seasonal. Most products are now being shipped out of Rona’s Boucherville, QC distribution centre or being direct shipped.

Another department that has been expanded is the contractor area. Designated parking outside, along with wider aisles, make it easier to get product out of the store. It also has its own entrance, complete with its own cashier.

Joel Marks, merchandise director for hardlines at Home Hardware, invited innovators and inventors with new products to approach his company. Despite an overall trend toward partnerships with vendors that can provide full programs, Marks was not alone in his stance on new products.

Suzanne Morgan, lead category manager for décor at Canadian Tire, said her company has to be open to new products, which are vital for differentiating CTC and sale opportunities. She cited the company’s website as an especially viable forum for innovation – including products that would not necessarily fit on the shelves of a Canadian Tire store.

Peter Vernon, Home Depot Canada‘s hardware merchant, used Stanley Works as an example of long term relationship with a full line supplier. The deal, which raised eyebrows throughout the industry, puts a lot of Stanley’s sales eggs in the Home Depot basket. Yet the long-term development of this relationship is one Home Depot is eager to invest in, said Vernon.

Some things won’t change, however, such as the need for vendors to work with retailers to buy back old stock, or at least help sell it off. “You hate it, we love it, but it helps us manage our inventory,” admitted Bernie Snider, group merchandise manager for hardlines at Ace Hardware Canada.

Rona will open a 125,000-sq.ft. Rona Home & Garden in Gloucester, ON this Wednesday, making it the second Rona big box in the Ottawa area.

Selkirk Industries has been sold to Tinicum Capital Partners, an investment group out of New York, for US$40 million in cash. The deal, struck with Selkirk’s parent, U.S. Industries, will close by the end of July. The purchase is expected to have no affect on Selkirk’s Canadian operations, where it’s “business as usual.” U.S. Industries’ other companies include Jacuzzi, Eljer and Sundance Spas.

For its fiscal first quarter, Home Depot‘s profits were up 35% to US$856 million, from US$632 million during the same period a year earlier. Sales were up 17% to US$14.3 billion. Growth was driven largely by new stores. During the quarter, Home Depot opened 57 new stores, the highest number of quarterly store openings in company history. By the end of the quarter, the company operated 1,386 stores. However, at Lowe’s Cos., sales rose 22.6% to US$6.47 billion, up from $5.28 billion in the first quarter of 2001. and profits were up 51.7%. Lowe’s same-store sales exceeded Home Depot’s, as well – 7.5% versus 5.0%.

Rona‘s award-winning website, www.rona.ca, has been redesigned, with the project planning needs of its customers in mind. In 2001 the Rona site averaged 150,000 visitors a month, an increase of 125% over the previous year. According to its most recent statistics, 246,000 Canadian visitors went to rona.ca in March 2002. Though the visits do not result in substantially more on-line sales, the site is being used for comparison shopping.

Wal-Mart Canada will open a new 81,000 sq.ft. free-standing store in Atholville, NB this Fall. Another store, at 108,000 sq.ft., is scheduled for New Minas, NS in the Spring of 2003.

Sears Canada will convert the Eatons Polo Park store in Winnipeg to a Sears store. It will remain open during the conversion. This store, along with the other five former Eatons locations and approximately 13 other larger Sears stores, will form the basis of a Sears “select” strategy, offering customers a broader assortment of better fashion merchandise.

At Do it Best Corp., Dave Heine has been appointed vice-president of retail development. He will oversee growth of the co-op retailer and manage its field staff. He was most recently vice-president of lumber and building materials … Quent Ondricek has been appointed vice-president of lumber and building materials, replacing Heine. He will oversee all LBM purchases. He was promoted from the position of national sales manager. (260-748-5300).

Wholesale sales in March were down 0.2%, but the first quarter of the year remains strong overall, up 2.4%. Lumber and building materials were up 1.7% in March, from February.

• a minimum of 6 years in a regional sales management role
• a passion for sales development and growth
• a proven ability to coach and build teams with a strong customer service focus
• a well developed network in the hardware retail industry in Quebec
• knowledge of category management initiatives and national account management
• a track record of superior performance in retail account management

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The buyers, from some of Canada’s key retail companies, appeared before about 150 vendors last week (we had more than twice the attendance we anticipated – we’ll get a bigger room next year, promise! – Michael) to share insights into how to approach buyers in a manner that saves everyone time and aggravation.

Suzanne Morgan, lead category manager for décor at Canadian Tire, advised vendors to familiarize themselves with CTC’s corporate goals and really understand the category their products sell into. Bernie Snider, group merchandise manager for hardlines at Ace Hardware Canada, explained that Ace’s international status gives vendors a great entry point for potential sales to Ace in the U.S. But, he adds, vendors have to come armed with information on their category – including other leading brands, their market shares and consumer buying trends.

James Jones, general merchandise manager for Réno-Dépôt Inc., highlighted some of the growth categories for his stores, such as storage, pool maintenance, interior mouldings, paint and floor coverings. Peter Vernon, Home Depot Canada‘s hardware merchant, explained that overall decisions are made in Atlanta, but buying decisions for Canada are still made by the team in Toronto.

Luc Lemonde, the new vice-president, merchandising for Sodisco-Howden Group, explained the new buying organization at SHG’s Montréal offices; Joel Marks stressed the philosophy of Home Hardware, which is built on integrity and honesty.

The store reflects some of parent company Réno-Dépôt‘s latest merchandising initiatives for the Ontario market.

One striking difference is the shift of the paint department from the traditional centre of the store to the front. The paint service counter is now at right angles to the front of the store, rather than parallel to it. It’s also supported by more staff, with the most popular paint bases behind the counter for easy access.

How-to seminars have been replaced by more vendor-driven demos in the aisles, an alternative that provides shoppers with hands-on education all day. “That is what we have learned from our consumers; what they’re actually looking for,” says Paul Hétu, vice-president marketing for Réno-Dépôt.

Reflecting a trend, not just among big boxes, but throughout the industry, this Building Box’s seasonal assortments have been expanded and the area remerchandised with wider aisles and more open space for pallet displays. Thanks to its connection with parent Castorama Group, the store’s selection included some buys that came out of Europe. A set of hardwood patio furniture is a Building Box exclusive for North America, while a buy on laminate flooring lets the store sell it at $1.98 per sq.ft. “Last year, the cost of laminate in Windsor was $4.98,” says James Jones, the company’s general merchandise manager.

Lighting featured a strong emphasis on halogen; in the bath department the warehouse concept has been refined to feature shower displays on the floor, instead of featured in vignettes atop the racking. Each display is accompanied by three or four models in boxes, ready to be pulled out and taken away by customers. This innovation, if successful, says Hétu, will be rolled back into other Réno-Dépôt stores.

Also new for this store: knock-down furniture, to capture the growing trend to maximize space within the home, including the home office. The range includes entry price points right up to classier models with maple finishes.

However, the deal may not go entirely smoothly. Last week, Kingfisher offered E5.1 billion ($CDN7.65 billion) for the remaining stake in Castorama. But the French company rejected the offer, which works out to about E67 per share, as shares on the Paris and London markets had by then risen E3 to E67.50.

Hudson’s Bay Co. is expanding its logistics function to include shipping product for other companies besides its own. A test program to keep HBC trucks filled by shipping for other firms is now being rolled out. With one of the largest fleets on Canadian roads, the company identified a low-cost opportunity to fill up outbound trucks and move more product on backhauls.

Ainsworth Lumber Co. had a first-quarter net loss of $2.0 million, compared with a net loss of $14.9 million for the same period last year.

The attempt by Stanley Works to bail out of the U.S. and set up in tax-sheltered Bermuda is being challenged by Connecticut’s attorney general, who says the company misled shareholders when it came time to vote on the move.

Profits for Wal-Mart were up in the first quarter by 19.7%, reaching US$1.65 billion. Sales in the first quarter rose 14.4% to US$54.9-billion. Same-store sales were up 8.1%.

Two of the West Fraser Timber‘s principal shareholders, Ketcham Investments and Tysa Investments, both owned by the Ketcham family, intend to sell approximately 200,000 of their common shares. The intended sales are being considered for investment diversification, estate planning and tax reasons.

Sears, Roebuck and Co. is buying the biggest catalogue retailer in the U.S., Lands’ End, for about US$1.9 billion. Sears will start introducing a selection of Lands’ End products into some of its stores by fall 2002.

Kmart is now being investigated by the FBI for possible criminal violations. Under review are the US$23 million in executive loans it dispersed between October 2001 and its bankruptcy filing in January 2002. It’s also being scrutinized for its vendor allowance policies. It seems the allowances, collected annually, were being entered into the ledger on a quarterly basis. If sales targets weren’t met, the real dollars could not be collected.

CORRECTION: That Rona Lansing that’s reopening in Markham, ON had its grand reopening this past Saturday, not the week before as stated in last week’s edition. (Don’t even ask! – MM)

• a minimum of 6 years in a regional sales management role
• a passion for sales development and growth
• a proven ability to coach and build teams with a strong customer service focus
• a well developed network in the hardware retail industry in Quebec
• knowledge of category management initiatives and national account management
• a track record of superior performance in retail account management

KEEP INFORMED.
VISIT hardlines.ca – EVERY DAY!

SHG had revenues of $86.6 million for the first quarter, up 19% over the same period a year earlier, due largely to the acquisition of the hardware and building materials business of Marchands Unis, and the strong performance of the LBM sector. Combined with integration costs of $1.8 million for the acquisition of Marchands Unis, the company recorded a net loss of $2.8 million in the first three months of the year.

However, the quarter also marked a transition period, during which SHG made a number of aggressive moves to streamline operations and reduce costs.

According to Jos Wintermans, president and CEO of SHG, the costs of the Marchands Unis acquisition are reflected in the 1Q results, but the benefits of added sales to these dealers will not emerge until later quarters. Hence the hit on the bottom line. However, he expects revenues to increase by as much as 20%, thanks to the new business. “I’m very confident of that and expect to see it in future quarters.”

Wintermans also points to the costs of consolidating the buying offices of its two divisions in Victoriaville, QC and London, ON. All decisions are now being made in Montréal, a move that was completed at the end of March. Again, the costs impact 1Q, “but I think the reorganization will make a great impact on the bottom line in the future,” he says. The impact will come not just from lower operating costs, but from a better negotiating position for the company’s combined divisions. “If you’re a Sodisco-Howden vendor, you’re now sitting across from a buyer who’s responsible for the whole national picture. So now you’re in a position to grow your market share with an organization that’s really growing.”

The positive results were driven in part by strong sales at Canadian Tire retail stores, which grew 9.4% to $989 million from $903.9 million. Same-store sales were up 5.8%. Growth was especially strong in core categories such as hardware, automotive and sporting goods. The increase does not include sales by Mark’s Work Wearhouse, which CTC bought in February 2002. Average sales by traditional stores in the first quarter were $8.3 million per year on an annualized basis; new-format stores had sales of $14.8 million on an annualized basis.

The company’s profit picture was enhanced by the retail division, which had an increase of 4.5% in gross operating revenue to $884 million, driven by a similar increase in shipments to dealers. While increases are harder to gauge because of the acquisition of Mark’s Work Wearhouse and by one-time gains from the sale of Hamilton Discount, its credit card arm, in the first quarter of last year, the company said net profit was up 27% year-over-year.

Speaking at its annual general meeting last Thursday, CTC president and CEO Wayne Sales reiterated the company’s interest in continuing its expansion into new categories and geographic markets. The Mark’s acquisition and the expansion of its car wash business are recent examples. But Sales also spoke about U.S. expansion or acquisition. (Old news, of course, for anyone attending last year’s Hardlines Marketing Conference, where Canadian Tire Retail president Mark Foote talked about the very same thing – Editor).
The company opened four new-format stores in the first quarter, for a total 451 outlets, 274 of them new-format, and plans to open another 18 this year. It ultimately wants to increase its store count by 40-50 for a total of 480 to 490 by the end of 2005, with 350-370 of them larger, revamped new-format stores. CTC also wants to increase its revenue by 10% a year and earnings by 10-15%.

The panel included representatives from Castle Building Centres, Homecare Building Centres, Home Hardware, ILDC, RONA Ontario Inc., Spancan, and the Canadian Hardware and Housewares Manufacturers Association. Talks also included the CRHA’s affiliated show sponsors, the Lumber and Building Materials Association of Ontario and the Paint and Decorating Retailers Association.

The show is undertaking lots of research to understand the needs of both delegates and exhibitors. But one prominent trend was the need to emphasize the role of CHS as a buying show.

Other initiatives developed from the meeting included keeping booth rates unchanged, creation of buying incentives such as discounts, terms, rebates, volume discounts and introductory offers by vendors, and special attention to good booth location for new exhibitors.

CHS also intends to work more closely with vendors, buying groups and dealers to develop product knowledge opportunities for store staff.

CHS 2003 will be held February 2-4 at The National Trade Centre in Toronto. For more information, visit www.crha.com or contact Joe Edwards, show manager at 905-821-3470; fax: 905-821-8946; or e-mail: crha@crha.com.

At their contractor appreciation event, or “Pro Show,” held in Ottawa, Home Hardware stores there benefitted from $20,000 in hockey tickets, courtesy of the Ottawa Senators hockey team. In addition, the Ottawa-area dealers ran advertising in the Senators’ fan magazine, which ended up garnering orders for about 20 home packages.

Kent Building Supplies had a grand opening celebration on May 4 weekend for its Mt. Pearl big box store, its second in St. John’s, NF. The 130,000-sq.ft. site appears more female-oriented, with a distinct emphasis on certain categories, especially an expanded lighting department and more vignettes devoted to kitchens and bath. The store had a soft opening in the middle of March.

Total revenues for Sears Canada in April increased 2.5% to $506.2 million, from $494.0 million for the same period last year. Merchandise sales increased by 3.9% in the month. Same store sales in retail stores decreased 1.5%.

TruServ Corp. in the U.S. reported a profit for its fiscal year ended March 30 of US$4.6 million, up from a loss of US$13.9 million a year earlier. However, going into 2002, 1Q sales were down 15.5% to US$553.2 million, from US$654.3 million a year ago.

Home Depot in the U.S. will try making its own appliance deliveries instead of outsourcing the service. According to Chain Store Age, the company will open a 40,000-50,000-sq.ft. distribution centre to handle the deliveries.

Housing starts in Canada decreased 11.3% in April to 184,500 units seasonally adjusted, from 208,000 units in March, according to CMHC. Urban singles declined 6.4% to 96,600 units in April to an annual rate of 96,600 units in April from 103,200 in March while urban multiple starts were down 17.7% to an annual rate of 62,000 units from 75,300. Rural starts, estimated at a seasonally adjusted annual rate of 25,900 units in April, were down from a revised 29,500 units in March. While seasonally adjusted starts are down after a record high March, actual starts are 25.2% higher than April 2001.

The value of residential building permits was down slightly in March. Contractors took out $2.4 billion in permits for housing in March, down 1.2% from a record high in February. However, it’s still up a whopping 30% for the first quarter of the year, compared with the same period a year ago. Housing permits reached $7.2 billion for the first three months of 2002. Nearly 53,000 new dwellings were authorized from January to March, the highest quarterly level since the first quarter of 1990. Three-quarters of that activity was in single-family unit intentions.

• a minimum of 6 years in a regional sales management role
• a passion for sales development and growth
• a proven ability to coach and build teams with a strong customer service focus
• a well developed network in the hardware retail industry in Quebec
• knowledge of category management initiatives and national account management
• a track record of superior performance in retail account management

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The line, which is overseen by Peg Hunter, general merchandise manager, housewares, Canadian Tire, was introduced at the company’s dealer show last September. It’s part of CTC’s strategy to go more upscale with everything from designer décor items by Laura Ashley and paint by Pratt & Lambert to more expensive bicycles and higher-end patio sets. The Persona line includes dinnerware, glassware, flatware, table cloths and pot holders, specialty gadgets and utensils and cookware, including an eight-piece stainless steel copper bottomed cookset. According to Canadian Tire Retail president Mark Foote, the idea for the line draws inspiration from Target Stores in the U.S., which goes more upscale than its chief competitor, Wal-Mart.

Besides being available in CTC stores Canada-wide, a selection of the dinnerware, cookware, small appliances and flatware are also being made available on CTC’s website: www.canadiantire.ca.

This past winter alone, Home has put on its “Pro Show” contractor appreciation events in Nanaimo, BC, Calgary, AB, Saskatoon, SK and Moncton, NB. In each location, the local Home Hardware dealers promote the event together and pull their respective trade customers to a local venue, such as a community hall. The Pro Show in Moncton was the first time for that city, and attracted almost 1,000 contractors and builders, who were bussed in from as far as four hours away.

Not only do the events build sales of innovative products featured by exhibiting vendors, but they build awareness among the trades of the size and clout of Home Hardware.

“Contractors don’t necessarily realize how big Home Hardware actually is until they come out to these shows and see the kind of buying power we have,” says Joe Jacklin, contractor communications and marketing manager at Home Hardware.

About eight Pro Shows are held each year, usually in either the late Fall or Winter. “Next year, our goal is to have them all in the Winter, before the dealers come up to their really busy season,” says Jacklin.

Home has used the addition of the Beaver stores as part of its strategy to move beyond the image of a neighbourhood hardware store (“Home of the Handyman”) and really leverage its strength as a chain with a strong network of home centres and building centres (“Help is close to Home”). With almost 400 of these stores, now all operating either as Home Hardware Building Centre (for home centre-type stores) or Home Building Centre (for more traditional yards), Home’s building centre dealers represent the single largest buying group in the country.

Montréal, QC – Réno-Dépôt‘s president and CEO has only been on the job since last October, but Sylvain Toutant has already been distinguished as one of Canada’s leading young business leaders.

Toutant has been named to this year’s Top Forty under 40, organized by Caldwell Partners and the Globe and Mail. It ranks winners on vision and leadership, innovation, achievement, community involvement and strategy for growth. More than 1,200 candidates were considered.

Toutant started with Groupe Val Royale in 1987, when it was a chain of seven traditional building centres in the Montréal area. Five years later, Toutant was part of the team that re-invented the company as a big box chain, under the Réno-Dépôt name. It currently has 14 Réno-Dépôt stores in Québec and five Building Box outlets in Ontario. A sixth will open in Windsor, ON on May 18.

Another event, being planned in Montréal for sometime in late Fall of this year, is already getting registrations. (More details to come on this one! – Michael)

According to a CBC story last Friday, Tembec CEO Frank Dottori regards the U.S. action as nothing more than a ploy to reduce the market share of Canadian softwood.

“The United States is contemptuously disregarding the principles of free and fair trade embodied in NAFTA in supporting this course of action. The action is tantamount to expropriation of our markets. This is a violation of the Free Trade Agreement and we are seeking compensation,” he was quoted as saying.

In future appeals, Dottori expects that bi-national NAFTA panels will find the imposition of countervailing and anti-dumping duties do no comply with U.S. law. In Tembec’s case, those duties will total 29%, slightly higher than the 27.22% average across the industry.

Shades of Wal-Mart! Loblaw Cos. has announced it will expand its President’s Choice brand to include everything from hardware, paint, home office supplies and even gasoline as it searches for ways to expand its market share in a mature grocery industry. (And ready itself for a possible takeover down the road by Wal-Mart? Just wondering – Editor) Loblaw wants to increase sales by 8-9% annually over the next five years. In Western Canada, as much as 35% of its superstores are already devoted to general merchandise.

Appliances were the fastest growing category for Lowe’s Cos. last year, with sales up 30% in 2001 to US$2.5 billion. Appliance sales rose US$582 million and made up 11% of the company’s $22.1 billion in total sales last year.

Hudson’s Bay Co. has taken steps to consolidate its brand among its three banners, The Bay, Zellers and Home Outfitters, and present them as different parts of one company serving customers through “multiple lifestyle formats.” Discrete credit card and rewards programs are now combined under the HBC brand, a strategy that will translate on the company’s web presence, www.hbc.com, as well.

A strong economy and a mild winter were factors that gave Emco Ltd. a net income of $3.8 million, compared with a net loss of $4 million for the same period in 2001. Sales for the quarter were $273 million, an increase of 6%.

The Zellers Friends of the Family Fund has made a donation of more than $2.2 million to the Canadian Cystic Fibrosis Foundation. The funds, which will help fund research in cystic fibrosis, were raised through Zellers employee and customer efforts.

Wal-Mart continues to do battle with unions. This time, it will stand trial in more than 15 locations in Texas, and California to face federal complaints by the United Food and Commercial Workers Union for violating workers’ rights. In an effort to curb complaints of safety violations, workers in College Station,TX were reportedly told that any fines imposed for these violations would adversely affect their store bonuses. In Lake Elsinore, CA workers who sought union representation were allegedly subjected to threats of job loss by company officials.

Americans are loosening their purse strings, which is helping turn the economy around, says the U.S. Commerce Department. Consumer spending rose 0.4% last month to $7.29 trillion after a 0.6% in February.

Manufacturers saw inventories level off and 25% of them expect to ratchet up their output in the months ahead, says the April Quarterly Business Conditions Survey from Statistics Canada. The transportation equipment, primary metals and wood product industries are particularly upbeat.

An incredible morning meeting with buyers from Canada’s top home improvement retailers! Only 20 spaces left and the event is full!! If you haven’t already signed up, click here for all the information.

Réno-Dépôt wants 20%-25% of the GTA – “That’s our main focus,” says Toutant. Expansion farther west, or even in the Maritimes, is at least three years out, until Ontario expansion has reached an adequate level. “We’re really busy building critical mass in Ontario.”

According to Celine Gamache, vice-president, marketing and business development for SHG, the move reflects SHG’s efforts to consolidate effectively its Sodisco division, which serves Québec from Victoriaville, and the London, ON-based Howden division, that serves the rest of Canada. “Our aim is to bring people back to the new reality, which is one company. By bringing people together in one show, it reinforces our role as a true national distributor,” she says.

The event will be offered in two languages, though details of how that will be handled have not been worked out. Gamache expects either simultaneous translation, or combined French-English presentations, or a combination of both. Some seminars may be offered twice, once in each language.

The company will send out a mailing to its dealers and vendors by mid-May confirming details of the new show. She would not speculate on how many dealers are expected to attend the new combined event.

The president and CEO of Hudson’s Bay Co. pointed out that households grew 24% in the last decade, while the population grew by only 14%. This growth is fuelling tremendous demand for home improvement and décor products, a trend he admits HBC was slow to jump on. Like other department store chains, too much emphasis was placed on high-margin fashion, while consumers were pouring dollars into their homes.

But he expects to capture market share, especially through expansion of the company’s specialty retail format, Home Outfitters. There are currently 22 open across the country, with 16 more openings planned for this year.

Meanwhile, both The Bay and Zellers have expanded their big ticket offerings in electronics, appliances and even RTA furniture. In an interview with Hardlines, Heller said the new Erin Mills Zellers store in Mississauga, ON is a prototype for sales of high-end products, such as $3,500 wide-screen televisions and quality patio furniture. While the Zellers hardware department will continue to offer convenience assortments, the range of home and lifestyle products will continue to increase.

For the second quarter ended February 28, 2002, Goodfellow Inc. had a net profit of $111,000, compared with a loss of $224,000 in last year’s second quarter. Sales reached $101.3 million, up from $91.5 million a year earlier. Mild winter conditions in eastern North America, low interest rates and a strong housing market helped buoy up sales. Sales for the first six months were $210.9 million, up 6% from $198.8 million a year earlier, while net earnings rose to $1.3 million, up from $1.1 million.

Home Depot‘s largest Expo Design Center yet opened on Saturday in Chicago. The 137,500-sq.ft. outlet will be the largest of the five stores in the Chicago area – and the first within the city limits. This urban store will feature more high-end items, including brand names such as Versace.

Wal-Mart is introducing used car sales, using the name Price 1 Auto. The company plans to lease property adjacent to five of its stores in the Houston, TX area to a Connecticut-based car sales company for six months.

Fuelled by a strong housing market in both Canada and the U.S., Masonite International‘s Q1 net income rose to US$16.1 million, compared with last year’s US$8.7 million. Sales were up 19% to US$380.6 million.

Weyerhaeuser Co. is part of a group of companies that has launched an ad campaign in retaliation to duties being imposed on softwood lumber being exported to the U.S. The group, which includes Home Depot and Lowe’s Cos., is running the ads in magazines and newspapers in the U.S. and Canada. Called “Friends and allies for more than 100 years. Why not now for lumber?,” the campaign, was launched last Wednesday.

Ikea will concentrate more on branding itself, with plans to do more to promote the names of its designers. Different furniture lines at Ikea currently bear the names of the designers of those lines. The company sells 10,000 items in its stores worldwide, including 23 in North America.

The Hoover Co. has entered into a strategic alliance with Friendly Robotics to jointly design and develop a robotic vacuum cleaner for residential use. Friendly, a privately held robotics concern based in Israel, is best known for its Robomower line of fully automatic lawn mowers, designed for domestic lawns.

An incredible morning meeting with buyers from Canada’s top home improvement retailers! If you haven’t already signed up, click here for all the information.

St. John, NB – Kent Building Supplies is currently expanding its presence in Woodstock, NB with a larger 55,000-sq.ft. outlet that will replace an existing 12,000-sq.ft. location. This will be Kent’s second refurbishing of an existing location, to fit a “mini” big box format. And in Rothesay, NB a 60,000-sq.ft. outlet is replacing an 11,000-sq.ft. store.

Kent already has seven big boxes in addition to its 12 traditional format stores. The last one was opened in St. John’s, NF. The store, in Mt. Pearl, is the second big box for Kent in that market. Kent will direct its energies to these mid-sized stores over the next couple of years, when another five are reportedly due to be developed.

Potential sites include existing stores and new markets for Kent within NB, NS and NF. Kent will likely stay out of PE for now, as fellow ILDC member Schurman holds sway in that province.

Vancouver, BC & Boucherville, QC – Under the aegis of Al Cheney, Rona’s big box stores in Ontario will now be more in sync with the Rona Revy stores in Western Canada. These include four former Revy stores, plus the former Rona Home Solutions store in Brampton, ON. All of them now bear the Rona Home and Garden banner. Together with the 10 Western stores, Cheney, who was appointed vice-president operations for Rona’s warehouse-style stores at the beginning of the year, oversees 15 stores in total.

Until now, the Ontario stores have been getting input from both the West and the Boucherville, QC head office operation. Cheney admits the big boxes had been “rudderless,” but now management of these stores will be more focused.

“Our challenge is to standardize operations,” says Cheney. “We’re taking best practices, not just from the West, but from the entire company, to implement to all our stores.” Emphasis will be placed on staff training, maintaining a strong in-stock position and keeping the stores bright and clean.

Part of the realignment of Cheney’s division includes a remerchandising of the Ontario stores, in many cases to put assortments more in line with Rona’s Boucherville, QC distribution mix. The store in Erin Mills, ON represents the latest merchandising innovations for the chain, says Cheney. It includes a re-vamped tool corral and more emphasis on seasonal products.

The stores in the Ottawa area (a second one is currently under construction there), fall under the Québec division, which is headed by Michel Robin, vice-president operations for Rona’s warehouse stores in francophone markets. Both Robin and Cheney report to Pierre Dandoy, executive vice-president for big box stores.

Georgia-Pacific Corp. reported first-quarter net income before unusual items of US$70 million, compared with a loss from continuing operations, before unusual items and goodwill amortization, of US$23 million during the same period last year. The company’s building products manufacturing and distribution operations reported first-quarter profits of US$74 million, up from a loss of US$24 million.

Sales in March for Sears Canada were down 2.8%, while sales for the first quarter were down 1.6%. Strong sales last year were attributed to sale pricing on excess inventory, hence a slight downturn in this year’s numbers. Profits for 1Q 2002 are actually up before extraordinary items; however, the company ended up recording a net loss of $115.9 million, due in part to a write-off on Eaton’s stores and on the sale of a corporate jet.

The investment status of Hudson’s Bay Co. has been revised to junk-level status, a reflection of poor profitability. Bay Street is wary of retail stocks in general and department stores in particular, as consumers slowly loosen purse strings.

Remodelling costs for its Canadian stores affected first-quarter results for Sears, Roebuck and Co., resulting in a 38% drop in net earnings. Net income fell to US$110 million, compared with US$176 million a year earlier.

Key buyers from some of Canada’s leading companies will gather on May 15 to explain how to approach their buying teams with new products and programs. This half-day seminar is ideal for any company attempting to make inroads with Canada’s top retailers – and for anyone already supplying them who wishes to sharpen their focus.
So far we’ve confirmed:
* Suzanne Morgan, Lead Buyer for décor products at Canadian Tire Corp.
* Luc Lemonde, Vice-President Merchandising, Sodisco-Howden Group
* Peter Vernon, Merchant for the Hardware Department (Tools and Hardware) at Home Depot
* Bernie Schneider and Dan McMurdy from Ace Hardware Canada
* James Jones, General Merchandising Manager for Réno-Dépôt and Building Box
* Buyer from Home Hardware Stores (tba)

We’re filling up fast – so book today!
Only $149 for subscribers, $249 for non-subscribers (+ appropriate taxes).
To register, call Nancy Wright at 416.489.3396, or email her at: nancy@hardlines.ca

Want to sponsor this exciting event? Call Beverly Allen, Marketing Manager at (416)489-3396 or email: bev@hardlines.ca.

The Canadian operation, under president Annette Verschuren, is part of the International division, which grew by 18%. While the Canadian division does not break out its sales, Home Depot grew its top line in Canada by an estimated 21% in 2001. Sales went from $2.78 billion in 2000 to an estimated $3.36 billion last year, putting it slightly ahead of Canadian Tire’s hardware and home improvement sales, estimated at $3.21 billion last year, and ahead of Home Hardware and Rona Inc.

The company also increased its store count over the past year. In 2001 it built 11 stores, for a total of 78 by the end of the calendar year.

Edmonton, AB – House of Tools, a privately held specialty chain with hardware stores in Alberta, British Columbia and Saskatchewan, has entered into an agreement to sell to Western Tool Supply. The California-based chain has provided a letter of intent to purchase House of Tools. The offer is subject to due diligence.

Western Tool Supply has a similar product mix to the Canadian retailer, namely a focus on hand and power tools, accessories and fasteners aimed at the contractor and industrial market. It has 30 stores throughout Washington, Oregon and California, plus one outlet in Idaho. And like House of Tools, it has a strong web presence, selling tools and fasteners online. House of Tools, which has been in business for 40 years, established online sales in 1998, and now ships across the country.

If the deal goes through as planned, Jon Nobleman, one of the two acting partners in the business, will continue to operate House of Tools. The other acting partner, Doran Viner, is expected to retire.

Sales by House of Tools were an estimated $57 million in 2001, with almost two-thirds of that going to contractors and professionals. Western Tool Supply, also a private company, does not disclose its sales.

“Over the last 11 years these companies have been together, there really hasn’t been consolidation until now,” he said. Sodisco bought up London, ON-based D.H.Howden & Co. in 1990. The company struggled with defining the powers of two buying teams ever since.

But since Wintermans took over last year, he has been committed to streamlining operations, despite two disparate cultures working out of three offices. The buying functions have recently been moved from Sodisco’s warehouse in Victoriaville, QC and the Howden distribution centre in London into its corporate headquarters in Montréal.

Wintermans pointed out that during his tenure, SHG has improved its picking and packing efficiencies by 20%-25%. Also during this period, inventories have been reduced by 25%, while fill rates have improved.

Doman Industries Ltd. managed to make its semi-annual interest payment on its outstanding US$388 million 8.75% senior unsecured notes. The original deadline for the payment was March 15, 2002. The company will continue its ongoing operations and the board of directors will continue to review and consider strategic and restructuring alternatives.

Sears Canada will open a Furniture, Appliances and Home Improvement store in Toronto’s west end in early Summer 2002. The 52,000-sq.ft. store will be devoted exclusively to furniture, décor, major appliances, and home improvement products. Sears has 37 such stores across the country so far, 18 of them in Ontario.

A developer who works closely with Target Stores in the U.S. says the department store chain looks at Canada with growing interest, especially since Wal-Mart is so successful here. He was speaking at a real estate conference here.

Sales for Wal-Mart during March reached US$21.489 billion, up 14.5% over March 2001. Year-to-date sales were US$38.696 billion, an increase of 15.0%. The Wal-Mart division’s sales were US$13.947 billion, up 17.0%. Same-store sales for Wal-Mart stores were up 10.7% year-over-year; for Sam’s Club the increase was 4.1%.

Steve Kennedy has left his post as general manager of Maytag Canada to join Newell Rubbermaid as group general manager in Mississauga, ON for its picture frame division, which comprises Intercraft, Burnes of Boston and Connoisseur; and its cookware division, with Wearever, Mirro and Calphalon. (905-275-3705)

At its latest annual general meeting, the Canadian Hardware and Housewares Manufacturers Association announced its new board of directors. Newly elected are: Tim Hunt, general manager of Emerson Tool Co. Canada … Bob Kendall, general manager of Ipex Homerite Products … Stewart Mathie, vice-president consumer products for Drummond Metal Products. Continuing their involvement with board are: Tony Duffy, vice-president sales and marketing for Tremco Inc. … Gerry Byle, general manager of Honeywell Consumer Products … John Seymour of Hamilton-Beach Proctor Silex, was re-elected as treasurer … Fred Pierce of Patrick Plastics remains past chairman. The board in turn has elected its executive: Pierre Vachon, general sales manager at Sico Inc. enters his second term as CHHMA chair … Jim Rotz of Pyrene Corp. is first vice-chair, Wendy Hanson of Varimpo Products is second vice-chair … Retiring from board: Murray Irvine of Energizer Canada and Gary Lawless of T.S. Simms (who is also retiring from the industry in June after 40-plus years with Simms). (416-282-0022)

Residential construction will continue to drive housing starts, says Statistics Canada, as building intentions for February remained unchanged from January’s 11-month high. The value of building permits for commercial construction was down 10.8%, however, so the total value of building permits issued by municipalities was down 4.2% in February.

Consumers continue to spend, but at a more modest pace, indicate the latest numbers on retail spending from the U.S. Department of Commerce. Sales grew to US$297.34 from February to March, as the country continues to climb out of last year’s recession.