Nov. 23, 2000

HARDLINES™

Five years serving Canada’s home improvement industry

October 23, 2000 – Volume vi, #40

Michael
McLarney,
Editor & Publisher

Ph: 416-489-3396 Fx: 416-489-6154

E-mail: buzz@hardlinesfax.com

Check out our incredible Classifieds
section!

* * * * * *

* Grubbe
retires from TruServ Canada

* Sodisco-Howden
positions Pro as “independent
alternative”

* “Treasure
hunt” mentality drives high sales at Price
Costco

* 3Q
sales flat for Revy, down slightly for
Taiga

* Halifax
store is Home Depot’s 60th in Canada

* * * * * *

THE
HARDLINES MARKETPLACE It’s a great place to announce new lines or
acquisitions, services or lines available. And of course they are an
effective, low-cost way to hire new people. At just $16 per line,
here’s what you get with each Marketplace Ad:

– two weeks
in the fax version

– three weeks in the email version

– posted on our website for three weeks

– your ad read by more than 3,000 people every single week

– thousands of hits on our Website!

– our boundless thanks for your support of Hardlines!

Bev takes
care of the Classifieds so contact her: bev@hardlinesfax.com
or call her at 416-489-3396.

HARDLINES
WHO’S WHO 2000-2001 EDITION: The only annual guide to Canada’s
leading hardware and home improvement retailers, wholesalers, buying
groups, mass merchants and co-ops. It lists more than 100 companies.
Each listing features executives, product categories, sales, number
of outlets, buyers, etc. No salesperson or marketing person should be
without this little beauty! In fact, some of our subscribers are
buying three and four copies, so the whole sales force will be armed
with the right names and numbers while they’re on the road. Don’t be
caught without it! The cost is only $125 for subscribers, or
$165 for non-subscribers (+ GST/HST). Order
online
or call us at 416-489-3396.

TRUSERV CANADA CEO RETIRES AHEAD OF SCHEDULE

David Grubbe
will retire as president and CEO of TruServ Canada on October 31. The
announcement was made at the dealer-owned co-op’s recent dealer
market. Leo Charriere, currently vice-president, business
development, will replace Grubbe in the top job.

Grubbe, 56,
was originally slated to finish up at the end of the year and has
been winding down his involvement since August. However, the sudden
death of his sistermade him reconsider his plans. “I shook my head
and said, ‘hey,’ what am I waiting for,” he said. As a result, he and
his wife are moving to Medicine Hat. “It’s time to spend some time
with my family,” he told the members during his farewell address at
the Winnipeg Convention Centre on October 16. He will remain involved
with the company in an advisory capacity until December
2001.

Grubbe
started with the company as a furniture and appliance salesman 33
years ago, back when it was Macleod-Stedman Inc. Through the years he
owned two Macleod’s stores of his own, one in Shaunavon, SK and
another in Maple Creek, SK. His career at head office has included
everything from real estate and member development to merchandising.
He took over as president in January 1995 from Bob Nowalski, who had
been sent up by Cotter in the U.S. to run the Canadian operation
following its conversion from Macleod-Stedman to Cotter Canada.

* * * * *
*

COSTCO
VP DESCRIBES EAST-WEST BUYING STRATEGY

While its
Burnaby and Montréal offices operate discretely, the majority
of purchasing decisions at Price Costco Canada are made on a national
basis. This and other insights into Canada’s only wholesale club
store chain were provided by Dave Nickel, vice-president and general
merchandising manager of Price Costco.

Nickel spoke
to vendors in Vancouver at a recent meeting held by the Canadian
Hardware and Housewares Manufacturers Association.

Because the
company’s SKUs are so low (typically around 3,600), new products are
brought in all the time in great volume. Price Costco’s mandate, said
Nickel, is to keep the assortment fresh, providing excitement to
shoppers who bring to the stores what he terms a “treasure hunt”
mentality. It also results in a much higher dollar value per customer
visit, Nickel added.

* * * * *
*

SODISCO-HOWDEN
ENVISIONS PRO AS INDEPENDENT ALTERNATIVE

There will
be two big boxes in the Canadian marketplace – “Home Depot and
someone else,” predicts Tony Molluso, president and CEO of
Sodisco-Howden Group.

Molluso
expects dealer consolidation to happen at a faster rate than ever
before. His company supplies hardware to some 1,400 independent
Canadian dealers; part of its strategy is to put together financial
incentives that will enable groups of dealers to become multi-store
owners.

He sees his
company’s Pro Hardware program as “an alternate independent banner.”
Last summer, Sodisco-Howden converted its diverse dealer base from
five banners to two. By the end of the year, he says, there will be
720 Pro stores across the country, with that number growing to 1,000
over the next two years.

Sodisco-Howden
still maintains a secondary banner, Do-it center. This DIY-friendly
home centre program, licensed from Do-it Best Corp. in the US., is
expected to grow from its current 51 to 100 stores in total. The most
recent dealer to join Do-it is Albertson’s Home Centre, a Tim-BR-Mart
dealer in Parksville, BC, which signed on last week.

COMPANIES IN THE NEWS

Here’s the
list of Home Depot Canada openings to the end of 2000: Halifax, which
opened last Thursday, October 19 (the 60th store in Canada);
Brantford (first store in that market) and Markham “East,” ON on
October 26; Castlefield Road in Toronto’s west end, October 26.
Dartmouth, NS, November 2; Lachenaie, QC (the second store there) on
November 16; and Mississauga “West,” ON on November 23. A store in
Leaside, in Toronto’s east end, will likely open sometime in 2001.
The company continues to option sites in other markets, including one
in Sarnia, ON and Grande Prairie, AB.

With the
completion of a new big box in St. John, NB early next year, Kent’s
stores will total six big boxes and 12 regular building centres. The
next Kent big box to open will be in St. John, NB. Originally slated
to open in December, it will now open in January 2001. At 105,000
sq.ft., it will replace a traditional 35,000-sq.ft. store. The
company has also confirmed the purchase of property in St. John’s for
a second store in that city. Ground is expected to break there in
Spring 2001.

West Fraser
Timber Co. Ltd. earned $24 million on sales of $569 million in the
third quarter ended September 30, compared with earnings of $57
million on sales of $610 million in the same period in 1999. For the
first three quarters of the year, earnings were $109 million on sales
of $1.754 billion, compared with earnings of $108 million. The retail
home improvement segment (Revy Home Centres Inc.) generated EBITDA of
$15 million, compared with $16 million in the same quarter of 1999.
In spite of lower building material prices, Revy’s sales were up
slightly in the quarter, from $227.4 million to $227.7
million.

Taiga Forest
Products Ltd. had sales of $201.9 million for the second quarter
ended September 30. This is down from $227.3 million during the same
period in 1999. Earnings for the quarter were down $2.0 million to
$243,000. The drop in sales and earnings was attributed to soft
prices in lumber and panel products. For the six-month period, sales
were $447.3 million, compared with $455.9 million a year earlier.
Earnings fell from $4.6 million to $514,000 in the first half of the
year. During the quarter, Taiga completed construction of a new
distribution centre in Saskatoon, which was up and running September
25, 2000. Also during the quarter, the company commenced construction
of a new distribution centre in Calgary, AB, scheduled for completion
in the spring 2001.

Castle
relaunched its website last week, complete with store search,
contractor information, and online catalogue and services index for
dealers (http://www.castle.ca). The site does not include, however,
the end-user feature that was originally supported by Weber Supply,
as this service was not supported by Sodisco-Howden after that
company took over Weber’s retail operations in June of this
year.

Rona inc.
has made a five-year commitment to the Children’s Aid Foundation in
Toronto to finance facilities for neglected and abused children who
use the CAF’s services in the downtown Toronto area. The downtown
centre will be renamed the Rona Child Access Centre, and will feature
a new playground and improvements to its visiting rooms for children
in foster care who have supervised meetings with their natural
parents.

Richelieu
Hardware Ltd. has acquired the principle assets of
Montréal-based Reliable Fasteners, as well as all of the
shares of Les Boiseries Lussier et Fils, a Québec City-based
distributor of decorative mouldings for furniture and kitchen
cabinets. Both companies’ teams are joining Richelieu’s workforce.
The deals, valued at $10 million, will be financed by the company’s
cash flow from operations and increase Richelieu’s sales by about $15
million annually.

Colonial
Elegance Inc. has opened a U.S. distribution centre located at: Suite
D, 5905 Greenpointe Drive South, Groveport, OH 43125; phone:
1-800-361-2030.

Dy-Mon
Sales, headed by Harvey Dyck, has been appointed to represent RCR
International in Manitoba and Saskatchewan. The firm will be
responsible for major accounts in this region.

Sears Canada
reported third quarter revenues for the 13 weeks ended September 30
of $1.543 billion, up 5.9% over $1.457 billion during the same period
last year. Net earnings improved to $36.2 million from $35.3 million
last year. For the first nine months of 2000, Sears posted a profit
of $105.6 million, compared with $92.5 million last year. Revenues
for the year to date increased 9.8% to $4.524 billion from $4.119
billion.

TruServ
Corp. in the U.S. has made a deal with SecureRite.com, an Internet
co-operative of security professionals, to offer security products
and installed services through TruServ stores in the U.S. SecureRite
has commercial, industrial and residential security products. The
deal is estimated to be worth US$9 million over the next 5
years.

Lowe’s Cos.
has teamed with NationsRent Inc., a construction equipment rental
company, to install its rental centres in Lowe’s stores in 22 markets
by the end of 2001. The agreement follows a six-month pilot program
in six stores.

Sears,
Roebuck and Co. had an 18% increase in third-quarter income of US$278
million, compared with US$236 million in the same quarter a year ago.
Total revenues in the quarter climbed to US$9.63 billion from US$9.20
billion a year ago. The revenue increase was due primarily to
improvements in Sears department stores and Sears Canada. Domestic
comparable store sales increased 3.5%.

Wal-Mart in
the U.S. has begun selling its own brand of discount wine. The hooch,
priced at US$5 and US$6, is supplied by Gallo under the “Alcott Ridge
Vineyards” label, according to The Hard Fax newsletter.

CANADIAN
STOCK WATCH

COMPANY	52-WEEK HIGH	52-WEEK LOW	CLOSE (FRI.)

Canadian Tire	37.35	15.10	15.10
Canfor	19.80	8.10	8.25
Goodfellow	12.55	8.50	8.50
Home Depot	70.00	34.68	39 ^7/16
Hudsons Bay	21.65	12.50	13.20
Lowe’s Cos.	67.25	34.25	41 ^1/4
Sears Canada	42.50	30.75	24.60
Taiga Forest	14.20	6.80	8.50
West Fraser	39.50	25.90	26.60

“Rest and be
thankful.” – An inscription on an ancient stone seat in the Highlands
of Scotland

PEOPLE ON THE MOVE

Doug Carter
has left the D.H. Howden division of Sodisco-Howden Group to start
his own consulting business outside of the hardware industry. Most
recently director of sales, Carter spent 18 years at Howden, starting
on the retail side in the company’s corporate stores. Through the
years he held positions in sales, advertising and national accounts
… Glen Duczek has moved from new business development at Howden
to become Pro banner manager. (519-686-2200)

Bernard
Nadeau has been appointed general director of sales and marketing at
Montréal-based Colonial Elegance Inc. He spent the last 10
years as the company’s marketing director. (514-640-1212)

MARKET INDICATORS

The new
housing price index rose 0.3% from July to August, according to Stats
Canada. Year-over-year (August 1999 to August 2000), the index of
contractors’ selling prices for new homes increased 2.4%. On an
annual basis, Ottawa-Hull led the pack (+7.2%), followed by
Kitchener-Waterloo (+4.2%) and Montréal ($.0%). The biggest
drop was in Victoria (-4.4%).

Are
you reading your own copy of Hardlines? Find out about our special
company rates!

Hardlines
Marketplace

Got new
products? Looking for new staff or lines? Hardlines Marketplace is
read each week by North America’s key decision makers in home
improvement retailing and manufacturing. If you want to build your
sales team or find new agents or new lines, this is the place! Only
$16 per line. Call Beverly
at 416-489-3396, ext. 2, for more details.

* * * * * *
*

HARDLINES™
the electronic newsletter. www.hardlinesfax.com
phone: 416-489-3396; fax: 416-489-6154. E-mail: buzz@hardlinesfax.com

Michael
McLarney, Editor & Publisher (extension 1):

mike@hardlinesfax.com

Beverly
Allen, Marketing Manager (extension 2):

bev@hardlinesfax.com

Nancy
Wright, Administrative Assistant:

nancy@hardlinesfax.com

Hardlines is
published weekly (except monthly in December and August) by
McLARNEYCOM 542 Mount Pleasant Rd., Suite 302, Toronto, Ontario,
Canada M4S 2M7 © 2000 by Michael McLarney. Reproduction in whole
or in part is very uncool and strictly forbidden and really and truly
against the law. Call for information on a site license for your
company. Subscription:
$185+$12.95 GST = $197.95 (or $27.75 HST = $212.75) per year (GST
#13987 0398 RT). (Please make cheque payable to
McLarneyCom.)

HARDLINES™

Five years serving Canada’s home improvement industry

October 23, 2000 – Volume vi, #40

Michael
McLarney,
Editor & Publisher

Ph: 416-489-3396 Fx: 416-489-6154

E-mail: buzz@hardlinesfax.com

Check out our incredible Classifieds
section!

* * * * * *

* Grubbe
retires from TruServ Canada

* Sodisco-Howden
positions Pro as “independent
alternative”

* “Treasure
hunt” mentality drives high sales at Price
Costco

* 3Q
sales flat for Revy, down slightly for
Taiga

* Halifax
store is Home Depot’s 60th in Canada

* * * * * *

– two weeks
in the fax version

– three weeks in the email version

– posted on our website for three weeks

– your ad read by more than 3,000 people every single week

– thousands of hits on our Website!

– our boundless thanks for your support of Hardlines!

Bev takes
care of the Classifieds so contact her: bev@hardlinesfax.com
or call her at 416-489-3396.

TRUSERV CANADA CEO RETIRES AHEAD OF SCHEDULE

* * * * *
*

COSTCO
VP DESCRIBES EAST-WEST BUYING STRATEGY

Nickel spoke
to vendors in Vancouver at a recent meeting held by the Canadian
Hardware and Housewares Manufacturers Association.

* * * * *
*

SODISCO-HOWDEN
ENVISIONS PRO AS INDEPENDENT ALTERNATIVE

There will
be two big boxes in the Canadian marketplace – “Home Depot and
someone else,” predicts Tony Molluso, president and CEO of
Sodisco-Howden Group.

COMPANIES IN THE NEWS

Colonial
Elegance Inc. has opened a U.S. distribution centre located at: Suite
D, 5905 Greenpointe Drive South, Groveport, OH 43125; phone:
1-800-361-2030.

Dy-Mon
Sales, headed by Harvey Dyck, has been appointed to represent RCR
International in Manitoba and Saskatchewan. The firm will be
responsible for major accounts in this region.

CANADIAN
STOCK WATCH

COMPANY	52-WEEK HIGH	52-WEEK LOW	CLOSE (FRI.)

Canadian Tire	37.35	15.10	15.10
Canfor	19.80	8.10	8.25
Goodfellow	12.55	8.50	8.50
Home Depot	70.00	34.68	39 ^7/16
Hudsons Bay	21.65	12.50	13.20
Lowe’s Cos.	67.25	34.25	41 ^1/4
Sears Canada	42.50	30.75	24.60
Taiga Forest	14.20	6.80	8.50
West Fraser	39.50	25.90	26.60

“Rest and be
thankful.” – An inscription on an ancient stone seat in the Highlands
of Scotland

PEOPLE ON THE MOVE

Bernard
Nadeau has been appointed general director of sales and marketing at
Montréal-based Colonial Elegance Inc. He spent the last 10
years as the company’s marketing director. (514-640-1212)

MARKET INDICATORS

Are
you reading your own copy of Hardlines? Find out about our special
company rates!

Hardlines
Marketplace

* * * * * *
*

HARDLINES™
the electronic newsletter. www.hardlinesfax.com
phone: 416-489-3396; fax: 416-489-6154. E-mail: buzz@hardlinesfax.com

Michael
McLarney, Editor & Publisher (extension 1):

mike@hardlinesfax.com

Beverly
Allen, Marketing Manager (extension 2):

bev@hardlinesfax.com

Nancy
Wright, Administrative Assistant:

nancy@hardlinesfax.com

Nov20_00

HARDLINES™
Five years serving Canada’s home improvement industry
November 20, 2000 – Volume vi, #44
Michael McLarney, Editor & Publisher
Ph: 416-489-3396 Fx: 416-489-6154
E-mail: buzz@hardlinesfax.com

Check out our incredible Classifieds section!

* * * * * *
* Canadian Tire sales down in third quarter
* Rona to focus big box growth in Ontario
* Home Depot tries out HVAC installations in the U.S.
* U.S. retail is down slightly in October
* * * * * *

A VERY SPECIAL REPORT ON HOME IMPROVEMENT RETAILING IN CANADA: The Hardlines Industry Report: Home Improvement Retailing in Canada is almost ready to ship! This incredible book is a comprehensive overview of the size of the market, how many stores are out there, who the key players are, their market position, the size and growth of the big boxes, the trends in housing and renovations, market trends – and much, much more! 120-plus pages filled with charts, graphs and photos. Regular price: $945, but only $750 for subscribers. But call or e-mail Bev right away for more details because she’s cooked up some kind of additional price special if your order Before December 31!!!

* * * * * *

THE HARDLINES SHOW BREAKFAST AT CHS: Mark February 4, 2001 on your calendar. That’s the date of our Sixth Annual FREE Hardlines Breakfast at the Canadian Hardware and Building Materials Show, held exclusively for Hardlines subscribers and friends! (Yes, I know, it’s very, very early in the morning, but there’s no better way to kick off the Show!) – Michael

* * * * * *

THE HARDLINES MARKETPLACE It’s a great place to announce new lines or acquisitions, services or lines available. And of course they are an effective, low-cost way to hire new people. At just $16 per line, here’s what you get with each Marketplace Ad:

– two weeks in the fax version
– three weeks in the email version
– posted on our website for three weeks
– your ad read by more than 3,000 people every single week
– thousands of hits on our Website!
– our boundless thanks for your support of Hardlines!

Bev takes care of the Classifieds so contact her: bev@hardlinesfax.com or call her at 416-489-3396.

HOWDEN REINSTATES ITS OWN SPRING SHOW

After five years associated with the Canadian Hardware and Building Materials Show, Sodisco-Howden Group has decided to pull its support and reinstate its own spring dealer show in Ontario.

The new show will be held March 31-April 1at the Toronto Congress Centre. For five years previous, Sodisco-Howden had used CHS as its spring showcase for its dealers. Howden suppliers at CHS were invited to offer special discounts and buys to Howden customers. In return, Howden promoted the show to its dealer base. Howden had made the move originally in an effort to begin reducing the number of shows in the industry. At the time, Howden executives and suppliers hoped to set a precedent for other distributors to follow suit, throw their support behind CHS and ease the glut of shows in this industry.

But it never happened.

Bob Elliott, executive director of the Canadian Retail Hardware Association, which owns CHS, notes that Sodisco-Howden will continue its presence at the national show and continue to support it.

The Sodisco-Howden show will include, for the first time, Sodisco dealers from Québec. Although Sodisco hosts a small Christmas buying show, which will continue, it has never had a spring show of its own. West coast dealers served by the Smith-Barregar division are also being invited.

* * * * * *

RONA FINE-TUNES CASHWAY BANNER IN ONTARIO

Rona’s latest makeover of its Cashway stores in Ontario to Rona Cashway includes one exception. The Cambridge, ON store was reopened last Wednesday as Rona Home Centre. The 25,000-sq.ft. store added about 5,000 more SKUs, especially in décor and flooring, as well as an increased seasonal department and a Rona trademark – specialty boutiques for paint and doors and windows.

The paint boutique includes more SKUs than before and all departments are being merchandised in a tidier, more “dressed up” fashion, says general manager Brian Salo. He expects the smarter look of the store, which departs from the more traditional LBM approach of the former Cashway, will be “a real traffic builder.”

Seasonal, a department Cashway had essentially exited over the past five years, is also expected to be a draw – especially for women shoppers – complete with artificial Christmas trees and outdoor decorations. Other departments, like windows and steel doors, now feature permanent displays. Henri Drouin, chairman of Rona Inc., says the Cashway stores will all be converted to dealer-owned within two years. As they change over, they will all become Rona Home Centres.

* * * * * *

SPOOLS LUMBER TO CLOSE, CITING ECONOMY, DESIRE TO RETIRE

The economy is only one factor affecting the imminent closing of Spools Lumber after 60 years serving British Columbia’s lower mainland. Spools president Harry Mortimer also feels it’s just time to retire. The real estate alone the company sits on “is worth too much money,” he says.

Mortimer represents the second generation of the family owned operation. He’s reluctant to give his age, but does admit he’s been in the business for some 30 years.

Spools’s main store is in Richmond, the second in Surrey. In addition, the company owns non-retail facilities, including a pre-hung door manufacturing plant. They will wind down operations by year’s end. Mortimer expects many of his staff to be picked up by other building centres, including Curtis Lumber, which has already hired a couple of his people.

COMPANIES IN THE NEWS

For the third quarter ended September 30, Sodisco-Howden Group Inc. reported sales of $100.3 million, compared with $113.7 million at the same date last year. (This quarter had one week less in billings than last year’s.) However, the company’s net earnings were up 55% to $2.8 million, from $1.8 million last year. The increased profitability was attributed to a greater focus on higher-margin products and services. For the nine months ended September 30, 2000, sales increased $2.3 million to $321.4 million. Net earnings were $8.7 million, compared with $5.1 million for the same period in 1999.

The Home Depot saw sales rise 17% in its third quarter ended October 29, to US$11.545 billion, from US$9.877 billion in the same period a year earlier. Same-store sales for the third quarter rose 4%. The company blamed these lower-than-expected results on low lumber and building materials pricing at retail this year. But it also said strong sales in 3Q ’99, due to the hurricanes and Y2K-related sales, made it a tough act to follow. Net earnings reached US$650 million, up 13% from US$573 million in 1999. Home Depot says it expects the fourth quarter results to be affected by the same conditions. Sales for the year to date were up 21% to $35.275 billion, from US$29.260 billion.

A US$1 billion takeover of Benjamin Moore was initiated last Friday by Warren Buffett’s holding company, Berkshire Hathaway. The outcome will result in Benny Moore becoming a wholly owned subsidiary of Berkshire Hathaway. The deal calls for a cash tender offer of US7.82 per share to holders of Benjamin Moore common stock by a wholly owned subsidiary of Berkshire Hathaway. The Board of Directors of Benjamin Moore has unanimously approved the merger agreement.

A bid for shares of Maytag Corp. by a Canadian company is being considered hostile. Maytag’s board of directors has advised its shareholders to reject an unsolicited “below-market mini-tender” offer by TRC Capital Corp. to acquire about 3.4% of Maytag’s outstanding common stock. The”mini-tender” is reportedly at a below-market price of US$25.50, 11.7% below last Thursday’s closing market price for Maytag’s stock.

Nu-Gro Corp. had sales of $28.04 million for the fourth quarter ended September 30, up from $24.58 million a year earlier. The increase reflects the acquisition of Scott’s ProTurf business last spring. Net earnings rose from $1.14 million to $1.29 million. Sales for the year were $142.71 million, up from $131.15 million.

CANADIAN STOCK WATCH

COMPANY	52-WEEK HIGH	52-WEEK LOW	CLOSE (FRI.)

Canadian Tire	37.35	15.10	17.90
Canfor	19.80	8.10	8.80
Goodfellow	12.55	8.50	8.50
Home Depot	70.00	34.68	36 ^1/4
Hudsons Bay	21.65	12.50	14.60
Lowe’s Cos.	67.25	34.25	39 ^15/16
Sears Canada	42.50	20.00	23.30
Taiga Forest	14.20	6.80	8.85
West Fraser	39.50	25.80	27.30

“Were’t not for gold and women, there would be no damnation.” – Cyril Tourneur (from “The Revenger’s Tragedy”)

PEOPLE ON THE MOVE

Bernie Bosch has moved over to Gardener’s Delight as director of sales and marketing. She was formerly national sales manager at Wells Lamont. (519-756-4330)

OVERHEARD …

“You want a Christmas tree? Come on down!” – Brian Salo, general manager of the newly refurbished Rona Home Centre (formerly Cashway) in Cambridge, ON. Moving away from Cashway’s more traditional lumber yard approach, the store has broadened its product range and customer appeal by expanding certain categories – and by getting back into seasonal products.

“Sodisco-Howden fully intends to draw on its excellent financial position and national marketing program to expand its market share in Canada. Further acquisitions or strategic agreements continue to be a priority for the company.” – Tony Molluso, president and CEO of Sodisco-Howden Group, referring to the strength of the company’s third-quarter results.

MARKET INDICATORS

The new housing price index rose 2.4% in September, compared with September 1999, the fifth consecutive month of year-over-year increases, says Stats Canada. On a monthly basis, the index of contractors’ selling prices rose 0.2% from August to September.

Municipalities issued $3.3 billion worth of building permits in September, up 1.2% from August, reflecting the non-residential sector’s best monthly performance in 11 years. However, residential permits fell 13.4% to $1.6 billion, mainly because of a drop in multiple-family construction (-34.2% to $429 million). Permits for single-family housing were down 2.4% to $1.2 billion. Year to date, the value of construction intentions reached $28.2 billion, up 8.2% from the same nine-month period in 1999.

U.S. housing construction was up slightly in October, as multiple starts grew but singles were down. According to the U.S. Commerce Department, builders began work on new homes at a seasonally adjusted annual rate of 1.53 million last month, up a mere 0.1% seasonally adjusted from September. Multiple starts were up 1.3% while single-family homes fell by 0.2%.

Are you reading your own copy of Hardlines? Find out about our special company rates!

Hardlines Marketplace

THE HARDLINES MARKETPLACE:

It’s a great place to announce new lines or acquisitions, services or lines available. And of course they are an effective, low-cost way to hire new people. At just $16 per line, here’s what you get with each Marketplace Ad:

Beverly takes care of the Classifieds so contact her: bev@hardlinesfax.com or call her at 416-489-3396. at 416-489-3396, ext. 2, for more details.

* * * * * * *

HARDLINES™ the electronic newsletter. www.hardlinesfax.com phone: 416-489-3396; fax: 416-489-6154. E-mail: buzz@hardlinesfax.com

Michael McLarney, Editor & Publisher (extension 1):
mike@hardlinesfax.com

Beverly Allen, Marketing Manager (extension 2):
bev@hardlinesfax.com

Nancy Wright, Administrative Assistant:
nancy@hardlinesfax.com

Hardlines is published weekly (except monthly in December and August) by McLARNEYCOM 542 Mount Pleasant Rd., Suite 302, Toronto, Ontario, Canada M4S 2M7 © 2000 by Michael McLarney. Reproduction in whole or in part is very uncool and strictly forbidden and really and truly against the law. Call for information on a site license for your company. Subscription: $185+$12.95 GST = $197.95 (or $27.75 HST = $212.75) per year (GST #13987 0398 RT). (Please make cheque payable to McLarneyCom.)

Check out our incredible Classifieds section!

* * * * * *

Bev takes care of the Classifieds so contact her: bev@hardlinesfax.com or call her at 416-489-3396.

HOWDEN REINSTATES ITS OWN SPRING SHOW

After five years associated with the Canadian Hardware and Building Materials Show, Sodisco-Howden Group has decided to pull its support and reinstate its own spring dealer show in Ontario.

But it never happened.

Bob Elliott, executive director of the Canadian Retail Hardware Association, which owns CHS, notes that Sodisco-Howden will continue its presence at the national show and continue to support it.

* * * * * *

RONA FINE-TUNES CASHWAY BANNER IN ONTARIO

* * * * * *

SPOOLS LUMBER TO CLOSE, CITING ECONOMY, DESIRE TO RETIRE

Mortimer represents the second generation of the family owned operation. He’s reluctant to give his age, but does admit he’s been in the business for some 30 years.

COMPANIES IN THE NEWS

CANADIAN STOCK WATCH

COMPANY	52-WEEK HIGH	52-WEEK LOW	CLOSE (FRI.)

Canadian Tire	37.35	15.10	17.90
Canfor	19.80	8.10	8.80
Goodfellow	12.55	8.50	8.50
Home Depot	70.00	34.68	36 ^1/4
Hudsons Bay	21.65	12.50	14.60
Lowe’s Cos.	67.25	34.25	39 ^15/16
Sears Canada	42.50	20.00	23.30
Taiga Forest	14.20	6.80	8.85
West Fraser	39.50	25.80	27.30

“Were’t not for gold and women, there would be no damnation.” – Cyril Tourneur (from “The Revenger’s Tragedy”)

PEOPLE ON THE MOVE

Bernie Bosch has moved over to Gardener’s Delight as director of sales and marketing. She was formerly national sales manager at Wells Lamont. (519-756-4330)

OVERHEARD …

MARKET INDICATORS

Are you reading your own copy of Hardlines? Find out about our special company rates!

Hardlines Marketplace

THE HARDLINES MARKETPLACE:

Beverly takes care of the Classifieds so contact her: bev@hardlinesfax.com or call her at 416-489-3396. at 416-489-3396, ext. 2, for more details.

* * * * * * *

HARDLINES™ the electronic newsletter. www.hardlinesfax.com phone: 416-489-3396; fax: 416-489-6154. E-mail: buzz@hardlinesfax.com

Michael McLarney, Editor & Publisher (extension 1):
mike@hardlinesfax.com

Beverly Allen, Marketing Manager (extension 2):
bev@hardlinesfax.com

Nancy Wright, Administrative Assistant:
nancy@hardlinesfax.com

Hardlines is published weekly (except monthly in December and August) by McLARNEYCOM 542 Mount Pleasant Rd., Suite 302, Toronto, Ontario, Canada M4S 2M7 © 2000 by Michael McLarney. Reproduction in whole or in part is very uncool and strictly forbidden and really and truly against the law. Call for information on a site license for your company. Subscription: $185+$12.95 GST = $197.95 (or $27.75 HST = $212.75) per year (GST #13987 0398 RT). (Please make cheque payable to McLarneyCom.)

Nov. 15, 2000

November
15, 1999 – Volume v, #46

Michael McLarney, Editor & Publisher

Ph: 416-489-3396 Fx: 416-489-6154

NEWSMAKER OF THE YEAR AWARD: Next year will mark the fifth
anniversary of Canada’s one and only newsletter for the home
improvement industry. Be sure and join us at the Hardlines Show
Breakfast at the Canadian Hardware and Building Materials Show on
February 6, 2000. There we’ll award the Newsmaker of the Year
&endash; and kick off the show with a rock n’ roll twist. Remember,
this event is for Hardlines subscribers and guests only &endash; so
don’t miss it! – Michael

* * * * *
* *

WHO ARE
THE TOP PLAYERS IN THE U.S.?

I get asked
this question a lot, so now there’s a handy directory with the
answers you need. Our brand new TOP 50 Directory of leading home
improvement retailers in the U.S. is a handy, affordable way to
check out the action south of the border. It’s not as comprehensive
as our blockbuster Who’s Who Directory of Canadian Retailers, so
we’ve priced it accordingly &endash; just $45 for subscribers. Call
or e-mail
us for more information.

This week in Hardlines:

LBM
EXHIBITORS GET ON BOARD CHS FOR 2000

The next
edition of the Canadian Hardware and Building Materials Show,
February 6-8, 2000, is the first to encorporate the LBMAO’s own show
and convention. The Canadian Home Centre Show was folded in favour of
joining forces with the CRHA’s own hardware show.

CHS has
already identified more than 50 new exhibitors who formerly exhibited
at the LBMAO show. Many other LBM companies that had previously
exhibited in both shows will return to CHS in 2000.

The LBMAO
will host an industry “Icebreaker” reception on Saturday night,
February 5. The Industry Gala, mounted by the CHHMA to benefit the
Easter Seals Society of Canada, will be held on Sunday night,
February 6. Monday’s Awards Night honours the industry’s outstanding
products and the LBMAO Annual Gala Dinner takes place later that same
night.

And of
course, Sunday morning the show kicks off with the fifth Annual
Hardlines Show Breakfast (see shameless promotion elsewhere in this
issue).

More than
20,000 delegates are expected to register as CHS celebrates its 95th
anniversary in Y2K. For more information, call 905-821-3470; fax:
905-821-8946; e-mail: crha@crha.com, or click here: www.crha.com

* * * * *
* *

RESULTS
POISE SODISCO-HOWDEN FOR FUTURE ACQUISITION

Sodisco-Howden
Group’s third quarter sales results showed a 20% increase over 3Q
1998 and a year-to-date sales increase of 15.1% to $319.1 million.
This turnaround of the hardware wholesaler’s fortunes marks its
eleventh consecutive quarter of improved earnings &endash; and
“positions the company for a possible future acquisition,” says
Sodisco-Howden president and CEO Tony Molluso.

Buoyed by 3Q
earnings of $3.6 million on sales of $113.7 million, versus $2.7
million on sales of $94.8 million a year earlier, Molluso repeated
his desire to consider growing the company by acquisition. (For the
nine-month period, net earnings grew 155% from $2.0 million to $5.1
million.) Molluso had previously announced (Hardlines, Oct. 25/99)
that two companies were under consideration for possible acquisition,
one of which he expected to close by year’s end.

COMPANIES IN THE NEWS

The Ontario
Municipal Board has rejected Home Depot Canada’s proposal to erect a
store at Cherry Street and Lakeshore Boulevard in downtown Toronto’s
waterfront area. According to an article in the Globe & Mail on
Friday, the proposal met with opposition from downtown businesses,
politicians and associations. Large retail development does not fit
in with the OMB’s plans for redeveloping the waterfront. The area may
also be developed as part of a proposal for Toronto to bid for the
Olympics in 2008.

UFA Farm
Supply Co-op has reached an agreement with Ace Hardware Canada to
have Ace supply some hardware to two of its 34 corporately owned
stores in Alberta on a test basis. The stores, in High River and
Claresholm, will increase their hardware offerings with new programs
from Ace. Product lines are now being finalized, with plumbing,
electrical and hardware under consideration.

Amazon.com
Inc. is broadening its product selection online to include home
improvement products, as well as computer software and video games.
The launch was timed to the Christmas season, steered by Amazon
president Joe Galli, former president of Black & Decker. Products
will include hardware, hand and power tools &endash; and even
benchtop tools &endash; and all will have a US$4.95 shipping charge.
Amazon recently bought a North Dakota-based catalogue company, Tool
Crib, to facilitate its expansion into home improvement. Although
reportedly being the most visited site on the Internet, Amazon has
yet to make a profit after four years. (It lost US$197 million in the
third quarter.)

Last week,
RONA opened its latest Le Rénovateur Régional, this one
in St-Hyacinthe, Qué. The 90,000-sq.ft. store carries 40,000
SKUs. The dealer-owners are André Gagnon and Jean-Guy
Hébert (who was also named RONA’s retailer of the year). Both
are also co-owners of the Rénovateur Régional in
Granby, which opened September 15.

Five
Wal-Mart stores opened last Friday: Leamington, Owen Sound and
Pembroke, Ont.; Langley, B.C.; and Saint John, N.B.

Home Depot
in the U.S. now sells gift certificates online. Called Home Depot
Gift Cards, they can be purchased in amounts of $10, $25, $50 or
$100, redeemable only at Home Depot stores in the U.S.

Corning
Consumer Products Corp. (CCPC) Holding Co. Inc. has completed the
acquisition of General Housewares Corp., following approval by
General’s shareholders to accept US$28.75 per share in cash.
General’s key brands include Chicago Cutlery and Olfa. Annual sales
in 1998 were U.S.$97 million.

Nu-Gro Corp.
has broken off negotiations to purchase Consolidated Envirowaste
Industries Inc. Nu-Gro will seek alternative ways to expand its soil
operations in Western Canada.

CANADIAN
STOCK WATCH

COMPANY	52-WEEK HIGH	52-WEEK LOW	CLOSE (FRI.)
Canadian Tire	46.00	29.00	34.30
Canfor	13.30	4.25	14.80
Goodfellow	11.80	6.00	11.10
Hudsons Bay	23.85	4.00	17.20
MacMillan Blo.	27.85	12.05	24.50
Sears Canada	34.35	15.25	37.10
Taiga Forest	14.75	8.65	13.50
West Fraser	41.00	9.05	33.00

“There is no
fear in love; but perfect love casteth out fear.”

– John iv: 18

PEOPLE ON
THE MOVE

Pierre
Langevin has joined In-Store Services Canada Inc. as director of
business development. Langevin has spent 30 years in the industry and
will now work with In-Store Services to meet the growing demand for
merchandising services. One of his initial responsibilities will be
to establish the company’s presence in Québec.
(905-507-3119)

MARKET INDICATORS

Housing
starts in Canada slipped 2.2% in October to 147,500 units, down from
150,800 units seasonally adjusted in September, according to CMHC.
Urban multiple starts rose 0.7% to 54,700, while urban singles
decreased 5.1% to 72,100 units.

* * * * * *
*

The new
housing price index increased 1.2% in September over the same month a
year earlier. This was the highest annual increase since December
1997, says Stats Canada. This index of contractors’ selling prices
for new houses rose 0.2% from August to September.

Calgary had
the highest annual increase (+4.3%), while significant increases also
occurred in Halifax (+3.9%) and Ottawa-Hull (+3.6%). Vancouver and
Victoria had the greatest decreases (-3.3% and &endash;4.6%
respectively). St. John’s increased 1.1%, Montréal was up
2.7%, Toronto up 1.7%, Winnipeg up 3.0% and Edmonton up 2.3% over
September 1998.

“As of
today, more than $50 million worth of forest products have been
sidelined or diverted to other ports at great cost to industry. As
this lock out drags on, sales will be lost and valued customers will
be snapped up by competing jurisdictions. Even the ability to
maintain operations at our mills will soon be in jeopardy.” &endash;
from a letter to Prime Minister Jean Chrétien from the Council
of Forest Industries, urging the PM to legislate the re-opening of
the Port of Vancouver’s and other B.C. ports. Labour Minister
Claudette Bradshaw later imposed a Sunday deadline for both sides to
reach a collective agreement.

“It’s the
merchandising support that they’re bringing to the table that is
really the coup for them.” &endash; Barry Hofstetter, senior buyer
for UFA, on the recent supply agreement it has signed with Ace
Hardware Canada.

COME TO THE COLOGNE HARDWARE FAIR WITH HARDLINES:

Join us to attend the world’s largest hardware show March 12-15,
2000.

Here’s
why:

1.
Escorted travel from Toronto to Cologne via Frankfurt -let us
help you make your voyage worry-free by taking care of the
details.

2.
“Canada Night” Reception in Cologne&endash; A night of
networking with fellow Canadian retailers and vendors, and a
presentation by key European buyers.

3.
Pre-show seminar &endash; Hardlines and the Canadian office of
the Cologne Trade Fairs will jointly present tips on how to
maximize your presence at the Show.

4.
Hardlines Handbook of the European market &endash; a helpful
guide to European markets.

5.
Store tours &endash; We’ll take you on a tour of the European
big-boxes and independents so you can take home the latest
ideas for merchandising, packaging and store
layout.

6.
Spouses’ program &endash; Join us to discover the sights and
scenes of historic Cologne.

Come to the
Cologne International Hardware Fair/DIY’TEC with HARDLINES, March
12-15, 2000, in Cologne, Germany.

Travel to
the International Hardware Fair in Cologne to position yourself as a
key player in the 21st century. Find out where the growth
opportunities lie, discover how the world’s markets are changing and
learn about the latest new products.

Hardlines
has arranged special travel packages that will make your trip
painless and affordable. Not only will we help you with your travel
arrangements, but we’ll also ensure your trip is beneficial to both
you and your company.

Affordable,
comprehensive travel packages are available in two- and five-star
accommodations. Just email us for more information. Our recommended
Canadian travel agent will contact you to arrange your personalized
travel package.

Hardlines
Classifieds

FIND THAT NEW PERSON, NEW AGENCY OR NEW LINE WITH HARDLINES
CLASSIFIEDS. THEY’RE A LOW-COST WAY TO REACH MORE THAN 2,000 PEOPLE
EVERY WEEK. ONE AD RUNS FOR TWO WEEKS IN THE FAX EDITION AND THREE
WEEKS IN THE E-MAIL EDITION OF HARDLINES. TO PLACE YOUR CLASSIFIED
AD, JUST CALL BEVERLY ALLEN AT 416- 489-3396, EXT. 2.

* * * * * *
*

HARDLINES
the electronic newsletter. Michael McLarney, Editor & Publisher.
Published weekly (except monthly in December and August) by
McLARNEYCOM 283 Belsize Dr., Toronto, ON Canada M4S 1M5.
416-489-3396; fax: 416-489-6154. E-mail: hardline@terraport.net
© 1999 by Michael McLarney. Reproduction in whole or in part is
strictly forbidden. Subscription: $185+$12.95 GST = $197.95 (or
$27.75 HST=$212.75) per year (GST #13987 0398 RT). Please make cheque
payable to McLarneyCom.

November
15, 1999 – Volume v, #46

Michael McLarney, Editor & Publisher

Ph: 416-489-3396 Fx: 416-489-6154

* * * * *
* *

WHO ARE
THE TOP PLAYERS IN THE U.S.?

This week in Hardlines:

LBM
EXHIBITORS GET ON BOARD CHS FOR 2000

CHS has
already identified more than 50 new exhibitors who formerly exhibited
at the LBMAO show. Many other LBM companies that had previously
exhibited in both shows will return to CHS in 2000.

And of
course, Sunday morning the show kicks off with the fifth Annual
Hardlines Show Breakfast (see shameless promotion elsewhere in this
issue).

* * * * *
* *

RESULTS
POISE SODISCO-HOWDEN FOR FUTURE ACQUISITION

COMPANIES IN THE NEWS

Five
Wal-Mart stores opened last Friday: Leamington, Owen Sound and
Pembroke, Ont.; Langley, B.C.; and Saint John, N.B.

Home Depot
in the U.S. now sells gift certificates online. Called Home Depot
Gift Cards, they can be purchased in amounts of $10, $25, $50 or
$100, redeemable only at Home Depot stores in the U.S.

Nu-Gro Corp.
has broken off negotiations to purchase Consolidated Envirowaste
Industries Inc. Nu-Gro will seek alternative ways to expand its soil
operations in Western Canada.

CANADIAN
STOCK WATCH

COMPANY	52-WEEK HIGH	52-WEEK LOW	CLOSE (FRI.)
Canadian Tire	46.00	29.00	34.30
Canfor	13.30	4.25	14.80
Goodfellow	11.80	6.00	11.10
Hudsons Bay	23.85	4.00	17.20
MacMillan Blo.	27.85	12.05	24.50
Sears Canada	34.35	15.25	37.10
Taiga Forest	14.75	8.65	13.50
West Fraser	41.00	9.05	33.00

“There is no
fear in love; but perfect love casteth out fear.”

– John iv: 18

PEOPLE ON
THE MOVE

MARKET INDICATORS

* * * * * *
*

COME TO THE COLOGNE HARDWARE FAIR WITH HARDLINES:

Join us to attend the world’s largest hardware show March 12-15,
2000.

Here’s
why:

1.
Escorted travel from Toronto to Cologne via Frankfurt -let us
help you make your voyage worry-free by taking care of the
details.

2.
“Canada Night” Reception in Cologne&endash; A night of
networking with fellow Canadian retailers and vendors, and a
presentation by key European buyers.

3.
Pre-show seminar &endash; Hardlines and the Canadian office of
the Cologne Trade Fairs will jointly present tips on how to
maximize your presence at the Show.

4.
Hardlines Handbook of the European market &endash; a helpful
guide to European markets.

5.
Store tours &endash; We’ll take you on a tour of the European
big-boxes and independents so you can take home the latest
ideas for merchandising, packaging and store
layout.

6.
Spouses’ program &endash; Join us to discover the sights and
scenes of historic Cologne.

Come to the
Cologne International Hardware Fair/DIY’TEC with HARDLINES, March
12-15, 2000, in Cologne, Germany.

Hardlines
Classifieds

* * * * * *
*

Nov13_00

HARDLINES™
Five years serving Canada’s home improvement industry
November 13, 2000 – Volume vi, #43
Michael McLarney, Editor & Publisher
Ph: 416-489-3396 Fx: 416-489-6154
E-mail: buzz@hardlinesfax.com

Check out our incredible Classifieds section!

* * * * * *
* Totem’s newest store will open by next February
* Canadian Tire acquires Vancouver area stores
* Beetle infestation threatens Nova Scotia timberlands
* Home Depot opens second Québec store this week
* Sodisco-Howden sponsors Canada’s freestyle ski teamr
* * * * * *

PLEASE TAKE A MOMENT TO READ THIS …

You may be on the route slip for Hardlines, but how often have you finally gotten your hands on it hours -; or even days -; after the fact? That’s why we ‘re offering an email special: Since you’re already paying for a regularly priced subscription, we’ll send additional subs to as many people as you like in your company for a mere $26 per person per year *. Let us do the routing for you! It ensures that everyone in your team gets Hardlines over the weekend (especially valuable for salespeople who are on the road first thing Monday morning).

This arrangement is a value-added service for you and it means each member of your team can have their own access password to the Hardlines website. But it also helps us control our circulation and protect our copyright. So let us know who else at your company should be receiving Hardlines each week, and we’ll sign them up!

To get more info on this great package, please call Nancy Wright at hardline2@on.aibn.com; or phone her at: 416-489-3396. ( * Okay, here’s the fine print: the low price is for additional email subs only, and only at the same company address. Ask Nancy about a “site licence” for multiple locations.)

TOTEM LUMBER CONTINUES ALBERTA EXPANSION

Despite delays, Totem Building Supplies Ltd. is nearing completion of its 11th retail outlet in Alberta, with a 12th already on the books. Airdrie, a bedroom community about 20 minutes north of Calgary, is the site of the next store, which is expected to open by mid-February, with a grand opening at the beginning of March. It was originally slated to open its doors before the end of this year.

At 24,000 sq.ft., plus a 16,000 sq.ft. drive-through, the Airdrie outlet will be slightly smaller than a typical Totem store, which averages 30,000 sq.ft. Less emphasis will be placed on housewares and flooring, while other lines will be beefed up, such as ceramic tile and hardwood flooring – “lines we’re really, really good at,” says Colin Robertson, Totem’s vice-president, marketing. The store will have a square footprint, instead of the rectangular design of other Totem stores, making it easier to merchandise, Robertson adds.

Totem will also go ahead with another store next year, this one in Camrose. It will be a smaller size store, like Airdrie, says Robertson. He expects it to open by September 2001. Totem currently has 10 building centres throughout Alberta plus one contractor sales office in Calgary.

* * * * * *

CANADIAN TIRE BUYS UP ITS VANCOUVER STORES

Canadian Tire Corp. has taken control of a group of CTC stores in the lower mainland of British Columbia, effective September 1, 2000. The franchise for the region, a unique arrangement for Canadian Tire, originally belonged to Pacific Associate Stores Ltd., which had operated 20 Canadian Tire stores in the Greater Vancouver area.

The acquisition will give CTC the control it wants to continue developing the greater Vancouver marketplace. That includes upgrading some of the older, smaller stores there to its “Class of” format. The stores will also be converted eventually to joint-venture operations, to conform with CTC’s ownership model throughout the rest of the country.

* * * * * *

BEETLE INFESTATION MAY THREATEN NOVA SCOTIA FORESTS

The spread of the brown spruce longhorn beetle in the Maritimes has become a concern to the Nova Scotia Forest Products Association. It’s legal counsel has submitted to the Federal Court of Canada a motion seeking “intervener status” in a current judicial review of the pest and its impact. The NSFPA hopew a ruling in its favour will force the Halifax Regional Municipality to dispose of the infected trees, which are located at Point Pleasant Park.

Back in the summer, some 10,000 trees were identified as infested by the brown spruce longhorn beetle, including red, white, Norway and blue spruces; and Scotch and Austrian pines. However, a concerned citizens’ group won a federal court injunction, halting further cutting and removal of any trees.

Since the summer months, though, signs of infestation have been found beyond the boundaries of the park, sparking further concerns that the province’s timber reserves are in peril. Forestry and related sectors employed about 13,000 people in Nova Scotia in 1998.

The brown spruce longhorn beetle began its incursion of North America in Massachusetts, becoming a problem in cities such as Boston and Chicago.

COMPANIES IN THE NEWS

Sodisco-Howden Group has become a major sponsor of Canada’s Freestyle Ski Association. The three year-long, $500,000 sponsorship will put the Pro Hardware logo on team jackets and involve the 22 team members in openings and promotions in participating Pro and Do-it center stores across the country.

Home Depot Canada will open its second Québec store on Thursday. This one is in Lachenaie and the opening will include Caroline Brunet, Canadian silver medalist at the Sydney Olympics; Marcel Therrien, mayor of Lachenaie; Annette Verschuren, president of Home Depot Canada and store manager Theresa Cerini.

CLARIFICATION: A larger big box-style Kent store in St. John, NB to replace an existing 35,000-sq.ft. outlet is running ahead of schedule and now closed in. It is expected to open in Spring 2001. A second big box Kent store in St. John’s, NF is expected to begin construction by Fall 2001.

Sears Canada had total revenues for the four-week period ending October 29 of $577.0 million, up 3.8% from $555.9 million for the same period last year. Full-line store sales increased 5.0%, however same-store sales for full-line stores decreased 1.7%. Catalogue sales decreased by 4.3%. Off-mall sales increased 19.7%. Same store sales for off-mall stores decreased by 4.5%.

For the third quarter period ended September 30, Lafarge Corp. posted net sales of $892.3 million, up 2% from $872.4 million last year. Net income was down, however, to $127.3 million, compared with $139.0 million in the third quarter of 1999. The company attributed the slip to declining drywall prices and higher operating costs.

CANADIAN STOCK WATCH

COMPANY	52-WEEK HIGH	52-WEEK LOW	CLOSE (FRI.)

Canadian Tire	37.35	15.10	17.90
Canfor	19.80	8.10	8.80
Goodfellow	12.55	8.50	8.50
Home Depot	70.00	34.68	36 ^1/4
Hudsons Bay	21.65	12.50	14.60
Lowe’s Cos.	67.25	34.25	39 ^15/16
Sears Canada	42.50	23.30	23.30
Taiga Forest	14.20	6.80	8.85
West Fraser	39.50	25.80	27.30

“Politicians are the same all over. They promise to build a bridge even when there is no river.” -; Nikita Khruschev (Russian leader, 1960)

PEOPLE ON THE MOVE

B2B e-marketplace infrastructure provider LBMX has added the following new account executives: Larry Tysoe, formerly hardline product co-ordinator at Independent Lumber Dealers’ Cooperative; Greg Beresford, formerly director of sales, Noma Lighting; Dave Campbell, formerly general manager retail division, Hensall District Co-op; and Steve Blair, formerly account executive residential and commercial division, Trojan Technologies. (877-429-5269).

Rod Dempster, formerly vice president of Weyerhaeuser’s Western OSB business, has been appointed vice-president of business development for the company’s wood products businesses. Dempster, who spent the last five years as vice-president of Western OSB, will remain in Edmonton and continue to report to William R. Corbin, executive vice-president of wood products for Weyerhaeuser. (780-452-5395)

OVERHEARD …

“We’re going on the stength of the fact that we’re the only true outdoor lumberyard left anywhere in the Calgary and Edmonton markets, and we’re playing up that side of it.” – Colin Robertson, vice-president, marketing at Totem Building Supplies, whose company continues to growing despite competition from the many big boxes in its marketplace.

MARKET INDICATORS

Housing starts rose 4.9% in October to 164,800 units seasonally adjusted, compared with 157,100 in September, according CMHC. Urban multiples starts were up 14.8% to 72,300 units, compared with 63,000 in September. Urban singles starts decreased 1.7% from 72,500 units in September to 71,300 in October.

In British Columbia, 18,700 urban starts were recorded last month, an increase of 39.6% from September. Multiples were up 67.1% and singles 6.6%. Vancouver starts rose 75.0% to 14,700. Ontario urban starts rose 9.1% to 73,500 units in October, primarily due to a 24.0% increase in multiples. This was offstet by a 4.2% decrease in singles. Toronto starts at 46,400 units were up 16.9%.

In Québec, urban starts were down 1.8% to 21,500 units from 21,900 in September. Multiples rose 0.9% but singles were down 4.7%. Montreal starts were 13,000 units in October.

Prairie urban starts decreased 9.0% in October to 24,300 units. Singles were up 1.9% while multiples were down 24.8%. In the Atlantic Region, overall urban starts were down 8.2% to 5,600 units. Activity increased in all Atlantic Provinces except in New Brunswick.

Are you reading your own copy of Hardlines? Find out about our special company rates!

Hardlines Marketplace

THE HARDLINES MARKETPLACE:

Beverly takes care of the Classifieds so contact her: bev@hardlinesfax.com or call her at 416-489-3396. at 416-489-3396, ext. 2, for more details.

* * * * * * *

HARDLINES™ the electronic newsletter. www.hardlinesfax.com phone: 416-489-3396; fax: 416-489-6154. E-mail: buzz@hardlinesfax.com

Michael McLarney, Editor & Publisher (extension 1):
mike@hardlinesfax.com

Beverly Allen, Marketing Manager (extension 2):
bev@hardlinesfax.com

Nancy Wright, Administrative Assistant:
nancy@hardlinesfax.com

Hardlines is published weekly (except monthly in December and August) by McLARNEYCOM 542 Mount Pleasant Rd., Suite 302, Toronto, Ontario, Canada M4S 2M7 © 2000 by Michael McLarney. Reproduction in whole or in part is very uncool and strictly forbidden and really and truly against the law. Call for information on a site license for your company. Subscription: $185+$12.95 GST = $197.95 (or $27.75 HST = $212.75) per year (GST #13987 0398 RT). (Please make cheque payable to McLarneyCom.)

Check out our incredible Classifieds section!

PLEASE TAKE A MOMENT TO READ THIS …

TOTEM LUMBER CONTINUES ALBERTA EXPANSION

* * * * * *

CANADIAN TIRE BUYS UP ITS VANCOUVER STORES

* * * * * *

BEETLE INFESTATION MAY THREATEN NOVA SCOTIA FORESTS

The brown spruce longhorn beetle began its incursion of North America in Massachusetts, becoming a problem in cities such as Boston and Chicago.

COMPANIES IN THE NEWS

CANADIAN STOCK WATCH

COMPANY	52-WEEK HIGH	52-WEEK LOW	CLOSE (FRI.)

Canadian Tire	37.35	15.10	17.90
Canfor	19.80	8.10	8.80
Goodfellow	12.55	8.50	8.50
Home Depot	70.00	34.68	36 ^1/4
Hudsons Bay	21.65	12.50	14.60
Lowe’s Cos.	67.25	34.25	39 ^15/16
Sears Canada	42.50	23.30	23.30
Taiga Forest	14.20	6.80	8.85
West Fraser	39.50	25.80	27.30

“Politicians are the same all over. They promise to build a bridge even when there is no river.” -; Nikita Khruschev (Russian leader, 1960)

PEOPLE ON THE MOVE

OVERHEARD …

MARKET INDICATORS

In Québec, urban starts were down 1.8% to 21,500 units from 21,900 in September. Multiples rose 0.9% but singles were down 4.7%. Montreal starts were 13,000 units in October.

Are you reading your own copy of Hardlines? Find out about our special company rates!

Hardlines Marketplace

THE HARDLINES MARKETPLACE:

Beverly takes care of the Classifieds so contact her: bev@hardlinesfax.com or call her at 416-489-3396. at 416-489-3396, ext. 2, for more details.

* * * * * * *

HARDLINES™ the electronic newsletter. www.hardlinesfax.com phone: 416-489-3396; fax: 416-489-6154. E-mail: buzz@hardlinesfax.com

Michael McLarney, Editor & Publisher (extension 1):
mike@hardlinesfax.com

Beverly Allen, Marketing Manager (extension 2):
bev@hardlinesfax.com

Nancy Wright, Administrative Assistant:
nancy@hardlinesfax.com

Hardlines is published weekly (except monthly in December and August) by McLARNEYCOM 542 Mount Pleasant Rd., Suite 302, Toronto, Ontario, Canada M4S 2M7 © 2000 by Michael McLarney. Reproduction in whole or in part is very uncool and strictly forbidden and really and truly against the law. Call for information on a site license for your company. Subscription: $185+$12.95 GST = $197.95 (or $27.75 HST = $212.75) per year (GST #13987 0398 RT). (Please make cheque payable to McLarneyCom.)

Nov6_00

HARDLINES™
Five years serving Canada’s home improvement industry
November 6, 2000 – Volume vi, #42
Michael McLarney, Editor & Publisher
Ph: 416-489-3396 Fx: 416-489-6154
E-mail: buzz@hardlinesfax.com

Check out our incredible Classifieds section!

Bev takes care of the Classifieds so contact her: bev@hardlinesfax.com or call her at 416-489-3396.

HARDLINES WHO’S WHO 2000-2001 EDITION: The only annual guide to Canada’s leading hardware and home improvement retailers, wholesalers, buying groups, mass merchants and co-ops. It lists more than 100 companies. Each listing features executives, product categories, sales, number of outlets, buyers, etc. No salesperson or marketing person should be without this little beauty! In fact, some of our subscribers are buying three and four copies, so the whole sales force will be armed with the right names and numbers while they’re on the road. Don’t be caught without it! The cost is only $125 for subscribers, or $165 for non-subscribers (+ GST/HST). Order online or call us at 416-489-3396.

BAD WEATHER STALLS CANADIAN TIRE PROFITS IN THIRD QUARTER

Sales were flat for Canadian Tire dealers in the third quarter, while profits dropped even Sales were flat for Canadian Tire dealers in the third quarter, while profits dropped even further. In the retail sales division, associate dealers’ sales were up 6.2% over 1999, and 4.2% for the first nine months over 1999. Same-store sales were flat for the quarter and down 1.6% for the year to date, compared with 1999. According to the company, it had strong sales in home products, tires and automotive service, but sales in sports and leisure were soft because of the cold, wet weather in the third quarter.

The retail division had gross operating revenue of $1.027 billion, up 6.1% from $968.0 million in 1999. The increase in gross operating revenue reflects a 6.2% rise in third quarter shipments to associate dealers compared with the same period last year.

In the first nine months, CTR’s revenue was $2.964 billion, up 6.9% from $2.774 billion a year earlier, reflecting a 6.9% increase in shipments to its dealers.

The company’s overall performance resulted in third-quarter consolidated net earnings of $43.0 million, compared with $52.5 million in 1999. Net earnings for the year to date were $116.2 million on sales of $1.325 billion, down from $133.0 million on sales of $1.210 billion last year. The profit drop was attributed to higher distribution expenses, the investment in the imminent launch of its e-commerce site called Canadian Tire Online, and increased depreciation expenses.

The higher distribution expenses are related to increased wages and the soft performance of of seasonal merchandise in the Spring and Summer.

* * * * * *

RONA PUTS REGIONAL STORES IN MONTREAL’S BIG BOX MARKET

Home Depot’s entry last summer into the Montréal area has certainly heated up that market. But despite the arrival of the big guns, Rona Retail Canada is relying on smaller, more targetted ammunition for that competitive market.

Two stores have begun construction, in Longueuil and Laval. But they’re Régional stores rather than big boxes. The shift coincides with Rona’s intention to focus its big box growth in Ontario. Rona Régional stores are “mini-big boxes,” typically around 65,000 sq.ft., with high racking and wide assortment. But they’re also well lit and interpersed with more upscale boutiques for paint, interior décor and doors and windows.

The smaller size means more choice for consumers, says Sylvain Morissette, Rona’s director of communications. “The regional stores have the greater assortment along with the intimacy of the boutiques.”

The new stores are expected to open in Spring 2001. At the same time, a big box Warehouse store will open in Brampton, ON. The search is on, however, says Morissette, for more regional stores in Québec.

* * * * * *

COMPANIES IN THE NEWS

A larger big box-style Kent store is breaking ground in St. John, NB to replace an A larger big box-style Kent store is breaking ground in St. John, NB to replace an existing 35,000-sq.ft. outlet. It is expected to open in Summer 2001. A second big box Kent store is expected to begin construction by Fall 2001.

Wal-Mart Canada will open its fourth store in Scarborough, ON in Summer 2001. The new 160,000-sq.ft. store will be located in the Scarborough Town Centre at Highway 401 and McCowan Road.

Not to be outdone by Eaton’s as it hits consumers’ nostalgia buttons with a revived Eaton’s catalogue and Eaton’s float at the Santa Claus Parade, The Bay has reinstalled its elaborate Christmas window displays of yore, complete with animated characters and fun for the whole family. The displays, once a thing of magic for kids of all ages, it gradually gave way to designer clothing and furniture … until now!

Rona inc. will be the title sponsor of a women’s cycling team, the company’s first international sports sponsorship. Team Rona will initially comprise six athletes, including Geneviève Jeanson, 1999 world junior champion, Olympic athlete and the only Canadian woman to make the top 20 rankings by the International Cycling Union.

Canadian Tire Corp. officially broke ground on its new 500,000-sq.ft. distribution centre in southeast Calgary. The facility is slated to open in the first quarter of 2002 and ship more than 10,000,000 cu.ft. of product annually to 125 stores in western Canada. The site will receive product directly from manufacturers and distributors from across Canada, the U.S. and the Orient.

Following the buyout of Bay Mills by Saint-Gobain Technical Fabrics America Inc., the company will be known as Saint-Gobain Technical Fabrics Canada (SGTF Canada). However the Bay Mills, Bayex and FibaTape brand names will continue to be used.

Premdor Inc.’s sales for the quarter ended September 30 were $319.0 million, a 9% increase over $292.8 million reported in the same period in 1999. For the nine-month period year-to-date, sales were $975.7 million, up 14% over $854.6 million a year earlier. Net income for the quarter was $4.5 million, compared with $12.3 million.

GSW Inc. has commenced an action against General Electric Co. and General Electric Canada Inc. GSW is trying to get the courts to order GE to buy out GSW’s 49% share of Camco Inc. on the grounds of shareholder oppression.

Home Depot in the U.S. is trying out a pilot program to offer installed HVAC services in agreement with The Trane Co. The program, which ties in with Home Depot’s acquisition last year of Apex Supply Co. The program involves seven stores in eastern Tennessee, which are showcasing a full range of residential heating and air conditioning products. Sales leads are forwarded to a call centre at Apex Supply, where they are passed along to the Trane dealer for that territory. The customer pays Home Depot, which retains a fee for providing the lead.

The pressure on retailers to expand and re-invent themselves has resulted in a bumper crop of old units and excess real estate. They typically dispose of that space by re-leasing it to other chains. Wal-Mart in the U.S., for example, has been expanding its Supercenter concept, making many of its older, strictly discount units redundant. Wal-Mart handled handled 25-30 million sq.ft. of surplus in 1999, most of which was re-leased to supermarkets and drugstores. In the mid-’90s, the company took it real estate business in-house, forming the Wal-Mart Realty division.

Home Depot in the U.S. is trying out a pilot program to offer installed HVAC services in agreement with The Trane Co. The program, which ties in with Home Depot’s acquisition last year of Apex Supply, involves seven stores in eastern Tennessee, which are showcasing a full range of residential heating and air conditioning products. Sales leads are forwarded to a call centre at Apex Supply, where they are passed along to the Trane dealer for that territory. The customer pays Home Depot, which retains a fee for providing the lead.

The pressure on retailers to expand and re-invent themselves has resulted in a bumper crop of old units and excess real estate. They are typically disposed of by re-leasing to other chains. Wal-Mart in the U.S., for example, has been expanding its Supercenter concept, making many of its older, strictly discount units redundant. Wal-Mart handled 25-30 million sq.ft. of surplus in 1999, most of which was re-leased to supermarkets and drugstores. In the mid-’90s, the company took it real estate business in-house, forming the Wal-Mart Realty division.

CANADIAN STOCK WATCH

COMPANY	52-WEEK HIGH	52-WEEK LOW	CLOSE (FRI.)

Canadian Tire	37.35	15.10	17.50
Canfor	19.80	8.10	9.70
Goodfellow	12.55	8.50	8.50
Home Depot	70.00	34.68	41 ^1/4
Hudsons Bay	21.65	12.50	13.80
Lowe’s Cos.	67.25	34.25	41 ^1/4
Sears Canada	42.50	26.00	26.00
Taiga Forest	14.20	6.80	8.95
West Fraser	39.50	25.80	25.00

“Punctuality is the virtue of the bored.” – Evelyn Waugh (British author)

PEOPLE ON THE MOVE

Leo Charriere, who has replaced former president and CEO David Grubbe at TruServ Canada, has been given the title of COO. However, the role is a temporary one, says a company spokesperson, as Charriere is being groomed to assume eventually the title of president and CEO. (204-453-9511)

At Newell Rubbermaid Inc., CEO John McDonough has resigned. Chairman William Sovey will take over as CEO. Daniel Ferguson, who had been chairman from 1992 to 1997, will resume that post.

NOTED …

We’ve looked over the delegate responses to our 5th annual Hardlines Conference and they were largely positive. Even the negative stuff was very, very helpful. Your comments and critisicms have been heard and – YES – next year it will be at a airport hotel, it will be on time, we’ll leave tables for you to sit and take notes at, we’ll allow extra time for networking, and we’ll bring in more fantastic speakers than ever before! Watch these pages over the coming weeks as we announce the date and lineup for the 2001 Conference.

MARKET INDICATORS

The consumer price index was up 2.7% in September, compared with September ’99, according to Stats Canada. High energy prices accounted for almost half the increase. Not including energy, the CPI was up 1.5% in September.

Wholesale trade fell 0.6% to $32 billion in August, following three consecutive months of increases, according to Stats Canada. Metals, hardware, and plumbing and heating were down 1.2%; lumber and building materials were down 0.6%.

In the U.S., retail same-store sales (stores open at least a year) for October rose 2.9%, according to the Goldman, Sachs retail composite index. This was reportedly one of the smallest increases so far this year and below last year’s October gain of 4.9%. But despite high gas prices, rising interest rates and the uncertainty of the stock market, retailers in the U.S. hold out hope for the Christmas season, which can generate 40% or more of yearly sales. The Consumer and Retailer Mood Survey: Retail Holiday Outlook, conducted by Deloitte & Touche in affiliation with the National Retail Federation, predicts that consumer spending on general merchandise, apparel and home furnishings would rise by a strong 5.5 to 6.5% in November and December.

Are you reading your own copy of Hardlines? Find out about our special company rates!

Hardlines Marketplace

THE HARDLINES MARKETPLACE:

Beverly takes care of the Classifieds so contact her: bev@hardlinesfax.com or call her at 416-489-3396. at 416-489-3396, ext. 2, for more details.

* * * * * * *

HARDLINES™ the electronic newsletter. www.hardlinesfax.com phone: 416-489-3396; fax: 416-489-6154. E-mail: buzz@hardlinesfax.com

Michael McLarney, Editor & Publisher (extension 1):
mike@hardlinesfax.com

Beverly Allen, Marketing Manager (extension 2):
bev@hardlinesfax.com

Nancy Wright, Administrative Assistant:
nancy@hardlinesfax.com

Hardlines is published weekly (except monthly in December and August) by McLARNEYCOM 542 Mount Pleasant Rd., Suite 302, Toronto, Ontario, Canada M4S 2M7 © 2000 by Michael McLarney. Reproduction in whole or in part is very uncool and strictly forbidden and really and truly against the law. Call for information on a site license for your company. Subscription: $185+$12.95 GST = $197.95 (or $27.75 HST = $212.75) per year (GST #13987 0398 RT). (Please make cheque payable to McLarneyCom.)

Check out our incredible Classifieds section!

Bev takes care of the Classifieds so contact her: bev@hardlinesfax.com or call her at 416-489-3396.

BAD WEATHER STALLS CANADIAN TIRE PROFITS IN THIRD QUARTER

In the first nine months, CTR’s revenue was $2.964 billion, up 6.9% from $2.774 billion a year earlier, reflecting a 6.9% increase in shipments to its dealers.

The higher distribution expenses are related to increased wages and the soft performance of of seasonal merchandise in the Spring and Summer.

* * * * * *

RONA PUTS REGIONAL STORES IN MONTREAL’S BIG BOX MARKET

* * * * * *

COMPANIES IN THE NEWS

Wal-Mart Canada will open its fourth store in Scarborough, ON in Summer 2001. The new 160,000-sq.ft. store will be located in the Scarborough Town Centre at Highway 401 and McCowan Road.

Home Depot in the U.S. is trying out a pilot program to offer installed HVAC services in agreement with The Trane Co. The program, which ties in with Home Depot’s acquisition last year of Apex Supply, involves seven stores in eastern Tennessee, which are showcasing a full range of residential heating and air conditioning products. Sales leads are forwarded to a call centre at Apex Supply, where they are passed along to the Trane dealer for that territory. The customer pays Home Depot, which retains a fee for providing the lead.

CANADIAN STOCK WATCH

COMPANY	52-WEEK HIGH	52-WEEK LOW	CLOSE (FRI.)

Canadian Tire	37.35	15.10	17.50
Canfor	19.80	8.10	9.70
Goodfellow	12.55	8.50	8.50
Home Depot	70.00	34.68	41 ^1/4
Hudsons Bay	21.65	12.50	13.80
Lowe’s Cos.	67.25	34.25	41 ^1/4
Sears Canada	42.50	26.00	26.00
Taiga Forest	14.20	6.80	8.95
West Fraser	39.50	25.80	25.00

“Punctuality is the virtue of the bored.” – Evelyn Waugh (British author)

PEOPLE ON THE MOVE

At Newell Rubbermaid Inc., CEO John McDonough has resigned. Chairman William Sovey will take over as CEO. Daniel Ferguson, who had been chairman from 1992 to 1997, will resume that post.

NOTED …

MARKET INDICATORS

Are you reading your own copy of Hardlines? Find out about our special company rates!

Hardlines Marketplace

THE HARDLINES MARKETPLACE:

Beverly takes care of the Classifieds so contact her: bev@hardlinesfax.com or call her at 416-489-3396. at 416-489-3396, ext. 2, for more details.

* * * * * * *

HARDLINES™ the electronic newsletter. www.hardlinesfax.com phone: 416-489-3396; fax: 416-489-6154. E-mail: buzz@hardlinesfax.com

Michael McLarney, Editor & Publisher (extension 1):
mike@hardlinesfax.com

Beverly Allen, Marketing Manager (extension 2):
bev@hardlinesfax.com

Nancy Wright, Administrative Assistant:
nancy@hardlinesfax.com

Hardlines is published weekly (except monthly in December and August) by McLARNEYCOM 542 Mount Pleasant Rd., Suite 302, Toronto, Ontario, Canada M4S 2M7 © 2000 by Michael McLarney. Reproduction in whole or in part is very uncool and strictly forbidden and really and truly against the law. Call for information on a site license for your company. Subscription: $185+$12.95 GST = $197.95 (or $27.75 HST = $212.75) per year (GST #13987 0398 RT). (Please make cheque payable to McLarneyCom.)

Oct30_00

HARDLINES™
Five years serving Canada’s home improvement industry
October 30, 2000 – Volume vi, #41
Michael McLarney, Editor & Publisher
Ph: 416-489-3396 Fx: 416-489-6154
E-mail: buzz@hardlinesfax.com

Check out our incredible Classifieds section!

* * * * * *
* Cashway to become dealer-owned, Homer gets deep-sixed
* Fire at Copp’s Buildall may cost $1 million
* Réno-Dépôt will build 14th big box in Spring 2001
* First Ace/Growmark combo show launches two-way supply deal
* Housing starts projected to increase 3.2% this year
* * * * * *

Bev takes care of the Classifieds so contact her: bev@hardlinesfax.com or call her at 416-489-3396.

ACE AND GROWMARK SOLIDIFY CONTRA SUPPLY DEAL AT FIRST JOINT SHOW

Ace Hardware Canada hosted its first-ever dealer market last fall. But for this year’s event, it teamed up with wholesaler Growmark Inc. It’s just one more strategy, insists Ace, to reaffirm its commitment to this country.

The union between the two companies goes deeper than just this market. Two years ago, Ace struck a deal to supply hardware to Growmark’s 160 co-op farm and hardware dealers throughout Ontario.

Since then, Growmark has developed three merchandising “modules” for its own dealers – turnkey programs in workwear, pet food and lawn and garden. These modules, originally made available just to Castle Building Centres’ dealers, will be available throughout the country via Ace’s distribution infrastructure. The reciprocal supply arrangement is intended to keep Ace delivery trucks full both to and from the Growmark warehouse.

Wolf Gruber, president of Ace Hardware Canada, is excited by the potential of the new programs for his dealers. “We were looking to get into pet food and supplies, while the greenhouse program will make more impact on the important female customer,” he says. “Certainly, there is a need to offer our customers a way to differentiate themselves.”

Homecare Building Centres had a number of its dealers at the show and many expressed interest in the new programs. “They were really good and I think a bit of an eye-opener for a number of our dealers,” says Anna Mammone, hardware buyer for Homecare. She particularly saw a fit for the garden and workwear modules for many of Homecare’s dealers.

Ace’s biggest customer, and its means of entry into Canada, was Beaver Lumber. But as those stores, acquired last year by Home Hardware, stop being supplied by Ace by March 31, 2001, strategic alliances have been important to Ace’s sustained viability in this country. Gruber insists that new business is growing at a healthy rate. “Our non-Beaver business year to date is up 35% and our Ace dealer business is up 43%,” he points out.

* * * * * *

RONA PLANS CASHWAY CONVERSIONS, TERMINATES HOMER LUMBER EXPERIMENT

Rona Retail Canada Inc. is carefully moving ahead with its strategy to convert all its Cashway stores to dealer-owned status. Except for six joint-venture operations, the stores are all company owned. The 66-store chain was acquired at the beginning of this year for $50 million.

“We’re working with the dealers and developing different models in which they can become dealer-owners,” says Rick Blickstead, president and COO of Rona Retail.

Rona is looking for investment both from existing store staff and from outside investors. “We want to proceed as quickly as possible,” Blickstead adds. The conversion is being overseen by Jim Pybus, president of Rona Cashway Building Centres Ltd. Pybus is also in charge of the overall integration of Cashway and Rona, which includes supplying the Cashway stores from Rona’s warehouse in Boucherville, QC effective last spring.

The amalgamation of the two chains has meant the end of Cashway’s Homer Lumber banner. This experimental program, which was rolled out to about four stores, mainly in the Niagara region of Southern Ontario, specialized in special buys and value pricing. Those stores have been changed to Rona Cashway.

* * * * * *

$1 MILLION FIRE RIPS THROUGH COPP’S IN LONDON, ON

Fire ravaged one of the five stores in the Copp’s Buildall chain in London, ON earlier this month, causing an estimated $1 million in damage. The fire, at the company’s Adelaide St. location, burned one warehouse to the ground, destroying inventory that included hardwood lumber, insulation and drywall. A second warehouse suffered water and smoke damage; a foot of water left a large part of the stock there unusable. Nobody was injured in the blaze.

The fire was caused by an arsonist, a 40-year-old man who was caught about a week later, although not before more fires were started elsewhere in the city.

According to Jim Stewart, vice-president, finance at Copp’s, the company suffered another fire back in 1981 at its Hyde Park location. An electrical short caused a fire that burned that store to the ground.

COMPANIES IN THE NEWS

Réno-Dépôt Inc. will begin construction in Sherbrooke, QC in Spring 2001 of its 14th big box store, which will open later the same year. The 125,000-sq.ft. store will cost $21 million and be located at the corner of Portland Street and Highway 410. It will include a 20,000-sq.ft. gardening centre and at least 60,000 SKUs. The store will have a staff of 300. Other sites slated for big box development by Réno-Dépôt include Laval and Beauport. The company currently operates 11 big boxes in Québec: Brossard, Anjou, Laval, Pointe-Claire, Québec City, St-Hubert, Rosemere, LaSalle, Hull, Montréal (Marché Central) and Montréal (Notre-Dame-de-Grâce). As of Fall 2000, it will also be operating three Building Boxes in Ontario: Cambridge, Brampton and Scarborough.

TruServ Canada has made a supply agreement with Castle Building Centres to make available TruServ’s full range of programs and products. Under the terms of the agreement, Castle dealers will have access to TruServ products, including hardware and building materials, as well as seasonal, workwear, crafts, automotive, cleaning supplies, and pet food and supplies. There are currently 37 jointly bannered Castle/True Serv dealers in Canada.

In its third quarter, Ainsworth Lumber Co. saw sales decrease 18.1% from the previous quarter, due to a slow-down in U.S. housing demand. However, year to date, sales only decreased 1.7%, to $325.0 million from $330.8 million during the same period in 1999. The net loss for the 2000 third quarter was $0.2 million, compared with a net profit of $13.8 million in the same period a year earlier. For the nine month period, net earnings reached $19.7 million, compared with $20.2 million.

With last year’s purchase of Eaton’s, Sear’s Canada bought more than just a chain of ailing department stores. It also secured one of the most powerful retail brands in the country. The relaunch of Eaton’s this upcoming Christmas season will also mean the rollout of two brand extensions that made the Eaton’s name great. The Eaton’s catalogue got mailed last week to more than 4 million existing Sears customers and the company has just announced it will rejoin the Santa Claus Parade in Toronto. The parade once belonged to Eaton’s, the way the Christmas parade in New York was a Macy’s event, but the retailer, which founded the parade in 1905. bailed in 1982, leaving the city to pick up the slack.

Unican Security Systems Ltd. had sales for the first quarter ended September 30 of $118.0 million, up a 6.6% from $110.7 million for the same period last year. Earnings before interest, taxes, depreciation and amortization (EBITDA) reached $22.3 million, or 18.9% of sales, compared with $20.8 million or 18.8% of sales for the same period last year, up 7.2%. Net earnings for the first quarter were $8.0 million, up 14.3% over last year.

Emco Ltd. has arranged with Bank of America Canada to provide it with a long term financing arrangement that will replace its current credit line. The new credit will provide up to $325 million to finance Emco’s ongoing working capital and capital expenditure needs. In addition, the arrangement creates a reserve of funds to be used to repurchase the remaining balance of Emco’s subordinated debentures, due April 30, 2002.

CANADIAN STOCK WATCH

COMPANY	52-WEEK HIGH	52-WEEK LOW	CLOSE (FRI.)

Canadian Tire	37.35	15.10	17.70
Canfor	19.80	8.10	8.70
Goodfellow	12.55	8.50	8.50
Home Depot	70.00	34.68	39 ^3/8
Hudsons Bay	21.65	12.50	13.50
Lowe’s Cos.	67.25	34.25	41 ^7/8
Sears Canada	42.50	30.75	24.00
Taiga Forest	14.20	6.80	8.70
West Fraser	39.50	25.90	25.80

“An idea is the most exciting thing there is.” – John Russell (British critic)

NOTED …

Submissions are now being sought for Hardware Merchandising’s Outstanding Retailer Awards, which recognize excellence in home improvement retailing in Canada. This will be the 10th edition of the awards, which will be presented at the Canadian Hardware & Building Materials Show in Toronto in February. Awards will be presented in the following categories: hardware store under 5,000 sq. ft.; hardware store over 5,000 sq. ft.; building supply/home centre; and large surface home centre/warehouse (over 50,000 sq. ft. retail). Also: two new categories have been added: contractor specialist retailer and paint specialist retailer. Retailers who wish to enter the awards can contact 416-596-5258 or email rgersbeck@rmpublishing.com.

PEOPLE ON THE MOVE

– – – – – – – –

MARKET INDICATORS

Housing starts in Canada should reach 154,800 units this year, up 3.2% 149,968 from 1999, according to CMHC’s fourth quarter Housing Outlook Report. They are expected to rise again in 2001 to 160,900. After reaching their highest level since 1989 last year, starts in Ontario will continue to increase, albeit more moderately, thanks mainly to job creation and rising net migration. Starts in Toronto will increase to 37,500 this year, representing over half the homes built in the province. Growth in Ottawa will lead all major centres in Canada.

Construction in the Atlantic region this year will benefit from strength in several sectors, including tourism and energy production. Next year, starts will drop in Nova Scotia and New Brunswick as economic growth and job creation eases. Rising housing starts in Québec will be tied to solid economic growth, increasing employment, and rising consumer confidence. Starts will be up in both Québec City and Montréal this year.

In Alberta, growth in the energy and manufacturing sectors will maintain residential construction at early 1980s levels. In the Prairies as a whole, however, a drop in multiple starts in all three provinces will mean a slight decline in starts this year. With consumer confidence remaining weak and people moving to other provinces, starts in British Columbia will slip again this year, then will rise again in 2001.

After a dramatic increase in August, Stats Canada reports a modest decline in September wholesalers’ sales.Sales were down by $11 million from September 1999. Year-to-date sales for 9 months are up 3% to $2.2 billion from 1999. Sales declined across Canada, except for modest increases in British Columbia and Atlantic Canada. Comparing August with September by product group: Plumbing declined by $6 million , PVF was down slightly, waterworks down $5 million, hydronics up $500,000, And HVAC up by $1.5 million.

Are you reading your own copy of Hardlines? Find out about our special company rates!

Hardlines Marketplace

Got new products? Looking for new staff or lines? Hardlines Marketplace is read each week by North America’s key decision makers in home improvement retailing and manufacturing. If you want to build your sales team or find new agents or new lines, this is the place! Only $16 per line. Call Beverly at 416-489-3396, ext. 2, for more details.

* * * * * * *

HARDLINES™ the electronic newsletter. www.hardlinesfax.com phone: 416-489-3396; fax: 416-489-6154. E-mail: buzz@hardlinesfax.com

Michael McLarney, Editor & Publisher (extension 1):
mike@hardlinesfax.com

Beverly Allen, Marketing Manager (extension 2):
bev@hardlinesfax.com

Nancy Wright, Administrative Assistant:
nancy@hardlinesfax.com

Hardlines is published weekly (except monthly in December and August) by McLARNEYCOM 542 Mount Pleasant Rd., Suite 302, Toronto, Ontario, Canada M4S 2M7 © 2000 by Michael McLarney. Reproduction in whole or in part is very uncool and strictly forbidden and really and truly against the law. Call for information on a site license for your company. Subscription: $185+$12.95 GST = $197.95 (or $27.75 HST = $212.75) per year (GST #13987 0398 RT). (Please make cheque payable to McLarneyCom.)

Check out our incredible Classifieds section!

Bev takes care of the Classifieds so contact her: bev@hardlinesfax.com or call her at 416-489-3396.

ACE AND GROWMARK SOLIDIFY CONTRA SUPPLY DEAL AT FIRST JOINT SHOW

The union between the two companies goes deeper than just this market. Two years ago, Ace struck a deal to supply hardware to Growmark’s 160 co-op farm and hardware dealers throughout Ontario.

* * * * * *

RONA PLANS CASHWAY CONVERSIONS, TERMINATES HOMER LUMBER EXPERIMENT

“We’re working with the dealers and developing different models in which they can become dealer-owners,” says Rick Blickstead, president and COO of Rona Retail.

* * * * * *

$1 MILLION FIRE RIPS THROUGH COPP’S IN LONDON, ON

The fire was caused by an arsonist, a 40-year-old man who was caught about a week later, although not before more fires were started elsewhere in the city.

COMPANIES IN THE NEWS

CANADIAN STOCK WATCH

COMPANY	52-WEEK HIGH	52-WEEK LOW	CLOSE (FRI.)

Canadian Tire	37.35	15.10	17.70
Canfor	19.80	8.10	8.70
Goodfellow	12.55	8.50	8.50
Home Depot	70.00	34.68	39 ^3/8
Hudsons Bay	21.65	12.50	13.50
Lowe’s Cos.	67.25	34.25	41 ^7/8
Sears Canada	42.50	30.75	24.00
Taiga Forest	14.20	6.80	8.70
West Fraser	39.50	25.90	25.80

“An idea is the most exciting thing there is.” – John Russell (British critic)

NOTED …

PEOPLE ON THE MOVE

– – – – – – – –

MARKET INDICATORS

Are you reading your own copy of Hardlines? Find out about our special company rates!

Hardlines Marketplace

Got new products? Looking for new staff or lines? Hardlines Marketplace is read each week by North America’s key decision makers in home improvement retailing and manufacturing. If you want to build your sales team or find new agents or new lines, this is the place! Only $16 per line. Call Beverly at 416-489-3396, ext. 2, for more details.

* * * * * * *

HARDLINES™ the electronic newsletter. www.hardlinesfax.com phone: 416-489-3396; fax: 416-489-6154. E-mail: buzz@hardlinesfax.com

Michael McLarney, Editor & Publisher (extension 1):
mike@hardlinesfax.com

Beverly Allen, Marketing Manager (extension 2):
bev@hardlinesfax.com

Nancy Wright, Administrative Assistant:
nancy@hardlinesfax.com

Hardlines is published weekly (except monthly in December and August) by McLARNEYCOM 542 Mount Pleasant Rd., Suite 302, Toronto, Ontario, Canada M4S 2M7 © 2000 by Michael McLarney. Reproduction in whole or in part is very uncool and strictly forbidden and really and truly against the law. Call for information on a site license for your company. Subscription: $185+$12.95 GST = $197.95 (or $27.75 HST = $212.75) per year (GST #13987 0398 RT). (Please make cheque payable to McLarneyCom.)

Oct16_00

HARDLINES™
Five years serving Canada’s home improvement industry
October 16, 2000 – Volume vi, #39
Michael McLarney, Editor & Publisher
Ph: 416-489-3396 Fx: 416-489-6154
E-mail: buzz@hardlinesfax.com

Check out our incredible Classifieds section!

* * * * * *
* Kent prepares for Home Depot with store expansions
* Rona announces partnership with Watt Group to develop new box stores
* Molluso hints at another Sodisco-Howden acquisition
* Home Depot stock stumbles following Wall Street warning
* * * * * *

Bev takes care of the Classifieds so contact her: bev@hardlinesfax.com or call her at 416-489-3396.

KENT PROACTIVE IN ATLANTIC BIG BOX BATTLE

The arrival of Home Depot to Atlantic Canada has been met with strengthened competition from the incumbent big box there, Kent Building Supplies. Kent’s first big box, erected in Halifax in the early ’90s, underwent expansion and reopened last week, just in time for the opening of Home Depot’s first store in Halifax this coming Thursday, October 19. Home Depot’s second store will open November 2 in Dartmouth, NS.

The Kent store was renovated from 85,000 sq.ft. to 110,000 sq.ft., plus a new larger drive-through and garden centre. In addition, three more acres of land adjoining the store, already owned by Kent, were developed, bringing the property to 13 acres in total.

“We’ve expanded just about everything in the new store,” says Stew Valcour, general manager of Kent. “But we added a larger flooring department, expanded our tool department and expanded our fashion bath department. We’ve also added a library so customers can look up different projects at their leisure.”

Because this store was Kent’s first foray into big box retailing, Valcour admits the company has learned a lot since then. One thing that’s been changed is the lighting. “We’ve re-lamped the whole store so its much brighter,” he says. It even features a Tim Horton’s donut shop.

Services which are exclusive to Kent big boxes include a cut shop, says Valcour. “It’s something Home Depot doesn’t do,” he notes. The one in this store has been expanded with carpenters on staff at all times for custom cutting.

Valcour also believes his stores have a distinct advantage over the new competition in the field of contractor sales, which represents a significant proportion of all Kent’s business, including its big box stores. The Moncton store, does about 20% of its business with the trades.

More emphasis has been put on training facilities, too – for both customers and staff. A permanent facility has been installed at the front of the store, complete with video playback and big-screen television. It’s also cut off from the noise of the store to offer a more quiet environment for customers.

* * * * * *

RONA WILL USE WATT GROUP FOR ONTARIO ROLLOUT

Rona Retail Canada has contracted the Watt Group develop a design and format for its big box stores in Ontario. The stores, which will differ from the traditional big box Rona stores being installed in Québec, will nonetheless be more than 100,000 sq.ft. in size and present a new spin on the category.

“Together with The Watt Group, Rona plans to redefine the home improvement big box shopping experience,” says Rick Blickstead, president and COO of Rona Retail. He refers to the new concept as “home solutions” retailing. The first such store will open in Brampton, ON in March 2001. That market is getting crowded, with Home Depot already there and The Building Box on its way. As a result, Rona is trying to stand out from the pack. “We need to give people in the GTA an alternative,” says Blickstead. “The others are doing the big box formula very well, so we don’t intend on building the same kind of store.

The Watt Group is one of the leading design and branding companies in the world, responsible for packaging up the Home Depot concept back in 1978. Other recipients of The Watt Group’s expertise include Do-it Center, Lansing Buildall’s award winning Kennedy Road store, Ontario Brewers’ Retail’s “The Beer Store,” Loblaws and Mitre 10, a dealer owned hardware chain in Australia.

The Watt Group was also part of our program at last month’s Hardlines Marketing Conference, where their presentation on branding was made to a packed room.

* * * * * *

SODISCO-HOWDEN CONSIDERS ANOTHER ACQUISITION

Focusing on selling smarter instead of worrying about buying smarter is just one of the messages Tony Molluso, outspoken CEO of the Sodisco-Howden Group, is trying to get out to the industry. He talked about supplier partnerships, contractor loyalty, dealer consolidation and future acquisitions at a recent breakfast meeting hosted by the Canadian Hardware and Housewares Manufacturers Association.

Despite its purchase of Smith-Barregar in British Columbia and Weber Supply in Southwestern Ontario, Molluso insists his company will be profitable this year. He also said he’s seriously considering establishing a 75,000-sq.ft. distribution centre in Moncton, NB, “but we will not acquire another company where we have to acquire a distribution centre to go with it.” He did tell Hardlines, however, “We have three balls in the air. One of them has to land,” within the next several weeks.

* * * * * *

HOME DEPOT STOCK FALTERS ON EARNINGS REPORTS

The news that Home Depot’s earnings would be off sent its stock tumbling from 51 to 36 7/16, from a low of 34 7/8 at the end of last week. Home Depot blamed lower-than-expected profits in its third quarter on low prices on lumber and building materials. Profits per share of approximately US$0.28 for the period, an increase of 12% over the third quarter of 1999 – and only half of the company’s targets, were also blamed on “hurricane related activity” and Y2K related sales activity over the second half of 1999 (returns on all those Y2K gas generators finally hitting the bottom line???).

The company still anticipates 23-25% earnings growth for fiscal 2001, which will come, says Home Depot president and CEO Arthur Blank, from its Expo Design Centres (see also People on the move), Villager’s Hardware and other new business strategies such as e-commerce and international expansion.

Lowe’s, by comparison, whose fiscal third quarter ends on October 27, 2000, anticipates a total sales increase of about 18%.

COMPANIES IN THE NEWS

West Fraser Timber Co. will take over Plum Creek Timber Co.’s Southern lumber manufacturing operations in Joyce, LA and Huttig, AK for US$60 million plus working capital. The two mills have the capacity to produce 300 million board feet of lumber per year. As part of the deal, Plum Creek will supply logs to the facilities at market prices. West Fraser says it intends to keep all the operations’ 430 employees and increase overall capacity to 400 million board feet. The sale is expected to close in the fourth quarter of 2000.

Owens Corning in Canada is not yet part of the parent company’s bankruptcy protection filing. The wholly owned Canadian subsidiary continues its day-to-day operations uninterrupted, and all warranties and guarantees on OC products, both here and in the U.S., will continue to be honoured, says a company spokesperson.

Smith & Associates has been appointed as the exclusive rep agency in Canada for Duragloss Car Care Products, Auto Spares Canada and The Carby Corp.

Former Eaton’s staff may have been neglected after the retailer’s closing, but former customers are being wooed once again. In its effort to restore the venerable name in its new chain of upscale urban department stores, Sears mailed out new Eatons credit cards to more than 100,000 former Eaton’s customers, as well as new customers, across Canada who responded to a direct mail campaign back in August.

The Bay has established a charitable program that is intended to raise millions of dollars to support Canadian cancer sufferers and their families. The new program, called Well Into the Future, has been structured in association with the Canadian Cancer Society, Look Good Feel Better, Wellspring and Candlelighters Canada. The Bay, its staff and customers will be able to take part in a kick-off fund-raiser called “Donate a dollar.”

CANADIAN STOCK WATCH

COMPANY	52-WEEK HIGH	52-WEEK LOW	CLOSE (FRI.)

Canadian Tire	37.35	16.80	17.00
Canfor	19.80	9.25	8.70
Goodfellow	12.55	8.75	9.00
Home Depot	70.00	34.68	36 ^5/16
Hudsons Bay	21.65	12.50	12.60
Lowe’s Cos.	67.25	34.25	38 ^13/16
Sears Canada	42.50	30.75	27.00
Taiga Forest	14.20	6.80	8.20
West Fraser	39.50	25.95	25.90

“A fool sees not the same tree as a wise man sees.” – William Blake (1757-1827; wild, whacky artist/poet/visionary – kind of a John Lennon of the early Romantic Period)

PEOPLE ON THE MOVE

Home Depot Inc. has appointed John Herbert, president of German home centre retailer Knauber, as president of its Expo Design Center. He and two other divisional heads will oversee the expansion of the U.S. home decor chain from 20 to 200 stores by 2005. Effective January 1, 2001, Herbert will operate out of Home Depot’s western division in Southern California. Herbert spent almost 17 years at Knauber, a small chain of 10 stores that is a strong regional player in Germany. The DIY-friendly home centre format it encorporated into some of its stores has been hailed by retailers around the world. I recommend that anyone attending the Cologne International Hardware Fair in Germany next March take the short trip to neighbouring Bonn to see its flagship store – it’s truly amazing.

Garry Enright has been promoted to vice-president sales and channel at Schneider Electric. Phil Stevens has replaced him as national retail sales manager. Stevens was formerly in sales on Schneider’s manufacturing side. (416-752-8020)

Last week’s announced restructuring at Canadian Tire Corp. included the departure of Ralph Trott from the company. Trott had originally been hired five years ago as vice-president in charge of new business development. Before that he was CEO of Beaver Lumber.

MARKET INDICATORS

The annual rate of housing starts in Canada rose 7.1% in September to 156,400 units seasonally adjusted, compared with 146,000 in August, according to CMHC. Urban multiples starts were up 20.5% to 63,000 units, compared with 52,300 in August. Urban singles starts decreased 0.4%, from 72,700 units in August to 72,400 in September.

A big boost came from multiple starts in the West. In British Columbia, 13,400 urban starts were recorded last month, up 50.6% from August. Singles were up 5.2% and multiples shot up 135.5%. Vancouver starts were up 47.4% to 8,400. Prairie urban starts rose 13.1% in September to 26,700 units due mainly to a 22.5% increase in multiples and a 7.5% increase in singles.

Ontario urban starts rose 8.4% to 67,300 units in September, primarily due to a 19.6% increase in multiples. Singles starts stayed the same as in August. Toronto starts, at 39,700 units, were up 10.0%.

In Québec, urban starts were down 6.0%, to 21,900 units from 23,300. Multiples rose 4.7% but singles were down 15.1%. Montréal starts, at 16,300 units, increased 4.5% from August. In the Atlantic Region, urban starts were down 14.1% to 6,100 units. Activity increased in New Brunswick and Newfoundland but decreased in Prince Edward Island and Nova Scotia.

Are you reading your own copy of Hardlines? Find out about our special company rates!

Hardlines Marketplace

Got new products? Looking for new staff or lines? Hardlines Marketplace is read each week by North America’s key decision makers in home improvement retailing and manufacturing. If you want to build your sales team or find new agents or new lines, this is the place! Only $16 per line. Call Beverly at 416-489-3396, ext. 2, for more details.

* * * * * * *

HARDLINES™ the electronic newsletter. www.hardlinesfax.com phone: 416-489-3396; fax: 416-489-6154. E-mail: buzz@hardlinesfax.com

Michael McLarney, Editor & Publisher (extension 1):
mike@hardlinesfax.com

Beverly Allen, Marketing Manager (extension 2):
bev@hardlinesfax.com

Nancy Wright, Administrative Assistant:
nancy@hardlinesfax.com

Hardlines is published weekly (except monthly in December and August) by McLARNEYCOM 542 Mount Pleasant Rd., Suite 302, Toronto, Ontario, Canada M4S 2M7 © 2000 by Michael McLarney. Reproduction in whole or in part is very uncool and strictly forbidden and really and truly against the law. Call for information on a site license for your company. Subscription: $185+$12.95 GST = $197.95 (or $27.75 HST = $212.75) per year (GST #13987 0398 RT). (Please make cheque payable to McLarneyCom.)

Check out our incredible Classifieds section!

Bev takes care of the Classifieds so contact her: bev@hardlinesfax.com or call her at 416-489-3396.

KENT PROACTIVE IN ATLANTIC BIG BOX BATTLE

* * * * * *

RONA WILL USE WATT GROUP FOR ONTARIO ROLLOUT

The Watt Group was also part of our program at last month’s Hardlines Marketing Conference, where their presentation on branding was made to a packed room.

* * * * * *

SODISCO-HOWDEN CONSIDERS ANOTHER ACQUISITION

* * * * * *

HOME DEPOT STOCK FALTERS ON EARNINGS REPORTS

Lowe’s, by comparison, whose fiscal third quarter ends on October 27, 2000, anticipates a total sales increase of about 18%.

COMPANIES IN THE NEWS

Smith & Associates has been appointed as the exclusive rep agency in Canada for Duragloss Car Care Products, Auto Spares Canada and The Carby Corp.

CANADIAN STOCK WATCH

COMPANY	52-WEEK HIGH	52-WEEK LOW	CLOSE (FRI.)

Canadian Tire	37.35	16.80	17.00
Canfor	19.80	9.25	8.70
Goodfellow	12.55	8.75	9.00
Home Depot	70.00	34.68	36 ^5/16
Hudsons Bay	21.65	12.50	12.60
Lowe’s Cos.	67.25	34.25	38 ^13/16
Sears Canada	42.50	30.75	27.00
Taiga Forest	14.20	6.80	8.20
West Fraser	39.50	25.95	25.90

“A fool sees not the same tree as a wise man sees.” – William Blake (1757-1827; wild, whacky artist/poet/visionary – kind of a John Lennon of the early Romantic Period)

PEOPLE ON THE MOVE

MARKET INDICATORS

Are you reading your own copy of Hardlines? Find out about our special company rates!

Hardlines Marketplace

Got new products? Looking for new staff or lines? Hardlines Marketplace is read each week by North America’s key decision makers in home improvement retailing and manufacturing. If you want to build your sales team or find new agents or new lines, this is the place! Only $16 per line. Call Beverly at 416-489-3396, ext. 2, for more details.

* * * * * * *

HARDLINES™ the electronic newsletter. www.hardlinesfax.com phone: 416-489-3396; fax: 416-489-6154. E-mail: buzz@hardlinesfax.com

Michael McLarney, Editor & Publisher (extension 1):
mike@hardlinesfax.com

Beverly Allen, Marketing Manager (extension 2):
bev@hardlinesfax.com

Nancy Wright, Administrative Assistant:
nancy@hardlinesfax.com

Hardlines is published weekly (except monthly in December and August) by McLARNEYCOM 542 Mount Pleasant Rd., Suite 302, Toronto, Ontario, Canada M4S 2M7 © 2000 by Michael McLarney. Reproduction in whole or in part is very uncool and strictly forbidden and really and truly against the law. Call for information on a site license for your company. Subscription: $185+$12.95 GST = $197.95 (or $27.75 HST = $212.75) per year (GST #13987 0398 RT). (Please make cheque payable to McLarneyCom.)

Oct9_00

HARDLINES™
Five years serving Canada’s home improvement industry
October 9, 2000 – Volume vi, #38
Michael McLarney, Editor & Publisher
Ph: 416-489-3396 Fx: 416-489-6154
E-mail: buzz@hardlinesfax.com

Check out our incredible Classifieds section!

* * * * * *
* Reorganization at Canadian Tire puts familiar names back in spotlight
* Owens Corning files for bankruptcy protection under weight of asbestos claims
* TruServ in U.S. sells LBM division to BMA
* Patriarch of renowned Toronto hardware store passes away
* * * * * *

THE HARDLINES MARKETPLACE is a great place to announce new lines or acquisitions, services or lines available. And of course the Hardlines Classifieds are an effective, low-cost way to hire new people. Just $16 per line, each Marketplace Ad runs for two weeks in the fax version and three weeks in the email version – and it gets posted on our website. Your ad will be read by more than 3,000 people every single week – and that doesn’t even count the thousands of hits we get on our Website! Bev takes care of the Classifieds so contact her: bev@hardlinesfax.com or call her at 416-489-3396.

CANADIAN TIRE ANNOUNCES KEY EXECUTIVE APPOINTMENTS, CORPORATE REALIGNMENT

Canadian Tire Corp. has been restructured into three business units: Canadian Tire Retail; Canadian Tire Financial Services; and New Business Development. The shuffle was made under the leadership of recently appointed president and CEO Wayne Sales.

The retail unit includes strategic growth and development of the store network, petroleum outlets and its eventual online consumer business (reportedly to roll out by the end of this year). Mark Foote has been appointed president of the retail division, reporting directly to Sales. He was most recently senior vice-president, marketing at CTC.

Also within Canadian Tire Retail, Pat Sinnott has been appointed senior vice-president, supply chain, reporting to Foote.

Canadian Tire Financial Services will handle the growth and operation of CTC’s financial services, including developing new financial products and services that will leverage the Canadian Tire brand. Tom Gauld continues in his role as president.

New Business Development will operate as a stand-alone entity, responsible for developing new business ideas outside of Canadian Tire Retail and Canadian Tire Financial Services. This business unit is intended to play a key role in CTC’s overall longer-term growth strategy. The head for this division has not yet been appointed.

(See “People on the move” for more CTC appointments.)

* * * * * *

OWENS CORNING FILES CHAPTER 11 BANKRUPTCY PROTECTION

Faced with insurmountable lawsuit claims, Owens Corning filed for bankruptcy protection last Thursday. As a result of class action suits filed by more than 440,000 people who claimed to have been stricken with cancer or asbestosis as a result of exposure to asbestos, the company faces payouts exceeding US$5 billion. Payments in 2000 alone will reach US$600 million, more than OC’s expected sales from building products this year. Another US$2 billion in payouts is expected still to come.

Owens Corning, which along with two dozen other companies, including Johns Manville, have faced lawsuits from people who claimed that asbestos, used in insulation for everything from schools to submarines until the late 1960s, made them sick. It filed voluntarily under Chapter 11, which provides protection from creditors while the company reorganizes. The company stopped selling asbestos products in 1972.

COMPANIES IN THE NEWS

Builder Marts of America has bought up the lumber and building materials division of TruServ Corp., a move which represents about one-third of TruServ’s wholesale business, according to a report in National Home Centre News. BMA is part of Guardian Building Products, which also owns Cameron Ashley Building Products.

Weyerhaeuser’s Chemainus sawmill on Vancouver Island has been certified to the ISO 14001 Environmental Management System (EMS) Standard. The standard is registered through an independent audit by the Quality Management Institute, a division of CSA. Weyerhaeuser intends to complete EMS implementation for all its timberlands by 2002.

Premdor Inc. has announced it will buy up Masonite Corp. from International Paper at a cost of US$523 million. Masonite, whose net asset value is about $558 million, had net sales US$301 million in 1999. Masonite is a major manufacturer of moulded door facings and produces a variety of industrial softboard and other wood composite products.

TruServ Corp. has announced it will close its Indianapolis regional distribution centre sometime during the first quarter of 2001. Stores currently served by the warehouse will be supplied from TruServ’s Atlanta, Harvard IL, Kansas City and Cleveland. The closure, part of TruServ’s efforts to streamline its operations, will affect 135 staff working at the facility.

CORRECTION: Last week’s article should have said eight Wal-Marts in the U.S. will start selling GE major appliances next month, not Sears. Sears, of course, has been selling white goods, including GE, for many years in the U.S.

CANADIAN STOCK WATCH

COMPANY	52-WEEK HIGH	52-WEEK LOW	CLOSE (FRI.)

Canadian Tire	37.35	18.00	18.50
Canfor	19.80	9.25	9.45
Goodfellow	12.55	8.75	9.75
Home Depot	70.00	44.12	51 ¹¹⁶
Hudsons Bay	21.65	12.50	15.00
Lowe’s Cos.	67.25	38.00	40 ^13/16
Sears Canada	42.50	30.75	33.30
Taiga Forest	14.20	6.80	8.00
West Fraser	39.50	27.00	27.30

“Who ever loved that loved not at first sight?” – Christopher Marlowe (1565-1593)

PEOPLE ON THE MOVE

The following senior executive appointments have been made at Canadian Tire Corp.: Huw Thomas has been appointed executive vice-president & CFO, reporting to CEO Wayne Sales. He was most recently vice-president, finance for CTC’s retail operations … Janice Wismer has been appointed vice-president, human resources, reporting directly to Sales, and an officer of the company. She has spent the last five years at CTC within HR … The newly created position of vice-president, customer values, reporting directly to Sales, has yet to be filled. The position will entail … well, I’ll tell you next week what it’s about. (416-480-3000)

Harold Sheepwash, Jr. has been appointed general manager of Weyerhaeuser Building Materials’s Québec operation. He is located at the Montréal customer service centre and will be in charge of Québec City’s customer service centre, as well. A 30-year veteran of the industry, Sheepwash was most recently general manager of industrial and engineered wood products for Goodfellow Inc. (514-366-9576)

Terry Barber, formerly customer financial services manager at Cameron Ashley Building Products in Calgary, has added marketing to her duties. Her new title is director, marketing and financial services. (403-203-5076)

Catherine Shah, vice-president human resources at Home Depot Canada, has taken a leave of absence from the company for an undisclosed period of time. (416-609-0852)

Pat Farrah has been moved out of his position as as executive vice-president, merchandising at The Home Depot in Atlanta. He has been replaced by Mark Baker, who was named executive vice-president – chief merchandising officer. Baker was formerly executive vice-president and COO – Home Depot U.S. stores. Farrah has been shuffled to an advisory role within the executive management team, where he will serve as a company “ambassador.” (770-433-8211)

IN MEMORIAM
John Dudley, owner of Dudley Hardware in Toronto, passed away August 29 at the age of 72. He started working in the store, which was founded by his dad back in the 1930s, when he was a young boy. Through the years, the store has remained a true independent, despite brief alliances with White’s Hardware and Cochrane Dunlop’s Dominion banner. To this day it preserves its old fashioned shelving and wooden floors, and doesn’t even have a fax machine. However, it is a fixture in downtown Toronto’s gay community. John is succeeded by his wife, Shirley, and their two children David and Linda, and five grandchildren.

MARKET INDICATORS

Mortgage rates are expected to lower next year, says CMHC. Evidence that the economies of both the U.S. and Canada are starting to slow will likely push rates down, according to CMHC’s latest issue of Mortgage Market Trends.

Are you reading your own copy of Hardlines? Find out about our special company rates!

Hardlines Marketplace

Got new products? Looking for new staff or lines? Hardlines Marketplace is read each week by North America’s key decision makers in home improvement retailing and manufacturing. If you want to build your sales team or find new agents or new lines, this is the place! Only $16 per line. Call Beverly at 416-489-3396, ext. 2, for more details.

* * * * * * *

HARDLINES™ the electronic newsletter. www.hardlinesfax.com phone: 416-489-3396; fax: 416-489-6154. E-mail: buzz@hardlinesfax.com

Michael McLarney, Editor & Publisher (extension 1):
mike@hardlinesfax.com

Beverly Allen, Marketing Manager (extension 2):
bev@hardlinesfax.com

Nancy Wright, Administrative Assistant:
nancy@hardlinesfax.com

Hardlines is published weekly (except monthly in December and August) by McLARNEYCOM 542 Mount Pleasant Rd., Suite 302, Toronto, Ontario, Canada M4S 2M7 © 2000 by Michael McLarney. Reproduction in whole or in part is very uncool and strictly forbidden and really and truly against the law. Call for information on a site license for your company. Subscription: $185+$12.95 GST = $197.95 (or $27.75 HST = $212.75) per year (GST #13987 0398 RT). (Please make cheque payable to McLarneyCom.)

Check out our incredible Classifieds section!

CANADIAN TIRE ANNOUNCES KEY EXECUTIVE APPOINTMENTS, CORPORATE REALIGNMENT

Also within Canadian Tire Retail, Pat Sinnott has been appointed senior vice-president, supply chain, reporting to Foote.

(See “People on the move” for more CTC appointments.)

* * * * * *

OWENS CORNING FILES CHAPTER 11 BANKRUPTCY PROTECTION

COMPANIES IN THE NEWS

CANADIAN STOCK WATCH

COMPANY	52-WEEK HIGH	52-WEEK LOW	CLOSE (FRI.)

Canadian Tire	37.35	18.00	18.50
Canfor	19.80	9.25	9.45
Goodfellow	12.55	8.75	9.75
Home Depot	70.00	44.12	51 ¹¹⁶
Hudsons Bay	21.65	12.50	15.00
Lowe’s Cos.	67.25	38.00	40 ^13/16
Sears Canada	42.50	30.75	33.30
Taiga Forest	14.20	6.80	8.00
West Fraser	39.50	27.00	27.30

“Who ever loved that loved not at first sight?” – Christopher Marlowe (1565-1593)

PEOPLE ON THE MOVE

Catherine Shah, vice-president human resources at Home Depot Canada, has taken a leave of absence from the company for an undisclosed period of time. (416-609-0852)

MARKET INDICATORS

Are you reading your own copy of Hardlines? Find out about our special company rates!

Hardlines Marketplace

Got new products? Looking for new staff or lines? Hardlines Marketplace is read each week by North America’s key decision makers in home improvement retailing and manufacturing. If you want to build your sales team or find new agents or new lines, this is the place! Only $16 per line. Call Beverly at 416-489-3396, ext. 2, for more details.

* * * * * * *

HARDLINES™ the electronic newsletter. www.hardlinesfax.com phone: 416-489-3396; fax: 416-489-6154. E-mail: buzz@hardlinesfax.com

Michael McLarney, Editor & Publisher (extension 1):
mike@hardlinesfax.com

Beverly Allen, Marketing Manager (extension 2):
bev@hardlinesfax.com

Nancy Wright, Administrative Assistant:
nancy@hardlinesfax.com

Hardlines is published weekly (except monthly in December and August) by McLARNEYCOM 542 Mount Pleasant Rd., Suite 302, Toronto, Ontario, Canada M4S 2M7 © 2000 by Michael McLarney. Reproduction in whole or in part is very uncool and strictly forbidden and really and truly against the law. Call for information on a site license for your company. Subscription: $185+$12.95 GST = $197.95 (or $27.75 HST = $212.75) per year (GST #13987 0398 RT). (Please make cheque payable to McLarneyCom.)

Oct2_00

HARDLINES™
Five years serving Canada’s home improvement industry
October 2, 2000 – Volume vi, #37
Michael McLarney, Editor & Publisher
Ph: 416-489-3396 Fx: 416-489-6154
E-mail: buzz@hardlinesfax.com

Check out our incredible Classifieds section!

* * * * * *
* IN THIS ISSUE:
* New head buyer at Tim-BR-Marts talks about partnering with vendors, the power of branding
* Ace in U.S. introduces new wrinkles to its vision for its stores
* Wal-Mart is newest entry into large appliances sales
* Sodisco changes name of Québec show
* * * * * *

TIM-BR-MART’S NEW PURCHASING DIRECTOR:

EXCLUSIVE INTERVIEW

Hardlines caught up with Randy Martin at Tim-BR-Marts Ltd. last week. He joined the Vancouver-based buying group recently to oversee purchasing for the group’s 184 dealer/members, who stretch from the Lakehead to Vancouver Island.

With sales by all dealers of $1.2 billion last year, Tim-BR-Marts is one of the largest buying groups in the country. It is also part of Matreco, whose combined membership represents $2.5 billion in retail sales annually. Martin has been with some of the country’s leading retailers, including Totem Building Supplies and Home Depot Canada.

Q: What do you see as the key objectives of your role as merchandising director for Tim-BR-Marts Ltd.?

A: To continue to market quality products at competitive prices. We need to improve and enhance our advertising initiatives to sell the products and the Tim-BR-Mart brand. We need to consolidate our buying practices across Canada, to try and gain some efficiencies in cost and selection of product.

Q: How is the relationship between buyer and vendor evolving?

A: I think the relationship is evolving into a true partnership once both sides have committed. We both realize we have the same objectives, that is, to sell more product. The retailer is allowing the vendors to become more involved with their products at the store and in the advertising. Let’s face it, the vendor is an expert in his product category and the end user is also their customer.The relationship is no longer one of intimidation. However, it requires a lot of aggressive work on both sides to develop a deal that works for both sides. They realize we have to be profitable and we also realize they need to remain profitable, or they won’t be around to support our product needs in the future.

Q: what are the opportunities for the Tim-BR-Mart brand as it is developed into a national entity?

A: The most obvious is to gain efficiencies in our buying and marketing. We also have an opportunity in the long term to become as recognizable as some other branded retailers in our various markets. We have the vision for the future that a customer can confidently go into a Tim-BR-Mart store anywhere in Canada and expect to see similar products, services, signage and store image. We will have developed a kind of retailer that can be recognized and trusted to be able to deliver the products and services that our customer associates the with the Tim-BR-Mart brand, that is, quality home improvement products.

Q: Many groups are pushing their own private label programs. What is the potential for the Tim-BR-Mart brand?

A: I like the nationally branded products that have advertising campaigns behind them. These nationally branded products already have a following. There are some categories of product that do not require a strong brand, and these categories have an opportunity to be private or proprietary brands, as long as the product is top quality – the best value on the market. The old philosophy for private branding was to have the cheapest priced product, but that has changed. If you are going to own annd develop a brand of product, you want a very good value/quaity product.

Q: How are Tim-BR-Mart dealers trying to differentiate from the big boxes? What are their competitive strengths?

A: Tim-BR-Mart dealers have a lot of advantages over the box stores. The box stores are able to put together a great selection at a good price, but have difficulty properly executing the services side of the business – installations, deliveries, special orders, consistent service, in house charge accounts, blueprint take-offs, building packages, etc. These are all areas that a smaller independent store can excel at, particularly the consistent knowledgeable service. We can offer pricing that is very competitive when compared with the box stores – as they also need to make a profit.

* * * * * *

NEW ACE DÉCOR TRIES LIFESTYLE APPROACH

A new signage and décor program for Ace Hardware stores was unveiled at the company’s latest dealer show last week in St. Louis, MO. The white and red look has been modified to feature wood grain with black and red accents combined with signage that tries to convey a lifestyle approach to shopping. Signage will be smaller and attached to aisles, rather than hanging from the ceiling, conveying a less cluttered look. Endcaps will feature large photos of people undertaking home improvement activities.

Products will be grouped by project, rather than strictly by category.

The program is part of Ace’s Vision 21 strategic plan for its stores. While stores in the U.S. will start adopting the new look by next spring, Ace Hardware Canada will continue to use the Ace 2000 program. Almost 100 such stores are in place here.

* * * * * *

WAL-MART TO START SELLING WHITE GOODS

Large appliances have become the hot new category for retailers. Sears in the U.S. is that country’s largest seller of white goods, followed by Lowe’s. Home Depot is getting into the game and now Wal-Mart has thrown its hat into the ring. Starting this month, four Sears stores in the U.S. will sell General Electric appliances. Another eight will start selling them by year’s end. Wal-Mart will showcase up to 40 GE models and make another 150 models available in its electronic kiosks.

COMPANIES IN THE NEWS

Sodisco-Howden Group has renamed its Québec dealer show PROexpo from SODexpo. The change follows the conversion of its dealers in that province to the Pro name, a change that was rolled out across Canada early last year. The show will be held in Québec City from November 4-6.

For the three-month period ended July 31, 2000, Matco Ravary Inc. had sales of $20 million, up from $19 million in the third quarter of last year. This marked a 5.4% increase, due primarily to internal growth and, for the last four weeks, to sales generated by the company’s Centre de rénovation le Géant, which it acquired in June 1999. The company posted net earnings of $832,645, down from $989,420 a year earlier. The decline was attributed primarily to higher transportation costs, as well as to the increase in interest and depreciation expenses resulting from last year’s expansion.

Canada’s largest Sears department store opened last week at Edmonton’s Southgate Centre mall. The former Eaton’s location was acquired by Sears in January 2000 and has since been transformed into a new-format Sears department store measuring 265,000-sq.ft. on three floors. The new store will replace the Heritage Mall Sears, which is half the size and will remain open until the end of the year.

The Nu-Gro Corp. has announced its intention to purchase Pursell Vigoro Canada from Alabama-based Pursell Industries. The deal will add about $20 million to Nu-Gro’s sales and is expected to close sometime this fall.

A joint venture by North Central Plastics and Daniel Loewith has resulted in the creation of Red Snap’R of Canada. The new company will market North Central’s line of Red Snap’R fencing and fencing accessories for the farm and hardware markets.

Home Depot Inc. was believed to be among the companies rumoured last week to be interested in bidding for Kingfisher Plc, according to a Reuters report. However, the company declined to comment on the rumour (Hardlines does not care to report on rumours either, but I figured you should know what’s buzzing across the Atlantic). Other groups thought to be attempting a buyout or merger include French retail group Pinault Printemps-Redoute, which also denied that it was close to any merger or takeover by Kingfisher. Home Depot president Arthur Blank told me in June that the rumours at that time were unfounded. “We have not had any conversations with Castorama,” he told me then. The latest rumours did manage to push Kingfisher shares up about 11%.

CANADIAN STOCK WATCH

COMPANY	52-WEEK HIGH	52-WEEK LOW	CLOSE (FRI.)

Canadian Tire	37.35	18.40	19.10
Canfor	19.80	9.75	10.20
Goodfellow	12.55	8.75	9.60
Home Depot	70.00	39.37	52 ^15/16
Hudsons Bay	21.65	12.50	15.40
Lowe’s Cos.	67.25	40.37	44 ^7/8
Sears Canada	42.50	30.75	34.00
Taiga Forest	14.20	6.80	8.35
West Fraser	39.50	27.00	28.00

“… it has now been demonstrated to us by a few misguided persons just how fragile a democratic society can be.” – Pierre Elliott Trudeau (1919-2000)

PEOPLE ON THE MOVE

George Ireland has been promoted to the position of general manager at Vermont American Canada. He was formerly national sales manager there. (905-564-1155)

Germain Voyer has been appointed general manager, Québec region, for CanWel Distribution Ltd. A 25-year veteran of sales and marketing management, he was most recently eastern general manager for Westroc Inc. (418-878-6030)

OSRAM Sylvania has made some changes in the structure of its sales organization: Michael Gentile has been promoted to vice-president sales, with responsibility for both industrial/commercial and consumer markets, as well as automotive sales and sales operations. He was formerly vice-president, sales and marketing for consumer markets … Paul Bristol, formerly vice-president, industrial/commercial sales and marketing, has been promoted to vice-president, sales and business development. (905-673-6171)

OVERHEARD…

“The Canadian division will be a lot different in a very short time.” – Eric Petersen, vice-president merchandising at Home Depot Canada, on the changes in store for the company. He was speaking at the Third Annual Hardlines Marketing Conference, held recently in Toronto.

NOTED…

Centre magazine is rounding up nominations for its third annual “Outstanding Buyers Awards.” It is also introducing a “Vendor of the Year Award.” So make my friend Elena Opasini’s job easier: submit your vote by going to www.centremagazine.com; or call her at 416-442-2108 for a nomination form.

Are you reading your own copy of Hardlines? Find out about our special company rates!

MARKET INDICATORS

The new housing price rose 0.2% from June to July, says Stats Canada. The highest monthly increase was in Ottawa-Hull (+1.9%), while increases also occurred in St. John’s (+0.6%) and Kitchener-Waterloo (+0.5%). Prices nationally in July were 2.4% higher than they were in July 1999.

The composite index slowed to 0.4% in August from July, according to Stats Canada. Business spending was a big source of growth, while household demand for new housing slowed. Even Ontario was down a bit, following a boost in housing a month earlier after strikes there were settled. While furniture and appliance sales were up 0.2%, sales of other durable goods remained flat.

The consumer price index was down 0.2% in August from July, however, year over year, the CPI was up 2.5%. Energy prices remained the largest contributor to the increase.

WHY HARDLINES SUPPORTS THE WOMEN’S CONSUMER PRODUCTS NETWORK

Given the growing number of women in this industry, we are delighted there is finally a forum for them to meet and exchange ideas and insights. Anyone in hardware/housewares/packaged goods or related industries would benefit from checking out this organization.

September 21: “Fully Alive From 9 to 5!” Featuring author Louise LeBrun. Details coming soon. Meanwhile, check out her website at: www.partnersinrenewal.com

For more information, please call: (905) 212-3826; fax: (905) 274-7646; email:wcpn99@yahoo.com, website:www.wcpncanada.org

(Hardlines is proud to be a sponsor of the WCPN)

Hardlines Marketplace

Got new products? Looking for new staff or lines? Hardlines Marketplace is read each week by North America’s key decision makers in home improvement retailing and manufacturing. If you want to build your sales team or find new agents or new lines, this is the place! Only $16 per line. Call Beverly at 416-489-3396, ext. 2, for more details.

* * * * * * *

HARDLINES™ the electronic newsletter. www.hardlinesfax.com phone: 416-489-3396; fax: 416-489-6154. E-mail: buzz@hardlinesfax.com

Michael McLarney, Editor & Publisher (extension 1):
mike@hardlinesfax.com

Beverly Allen, Marketing Manager (extension 2):
bev@hardlinesfax.com

Nancy Wright, Administrative Assistant:
nancy@hardlinesfax.com

Hardlines is published weekly (except monthly in December and August) by McLARNEYCOM 542 Mount Pleasant Rd., Suite 302, Toronto, Ontario, Canada M4S 2M7 © 2000 by Michael McLarney. Reproduction in whole or in part is very uncool and strictly forbidden and really and truly against the law. Call for information on a site license for your company. Subscription: $185+$12.95 GST = $197.95 (or $27.75 HST = $212.75) per year (GST #13987 0398 RT). (Please make cheque payable to McLarneyCom.)

Check out our incredible Classifieds section!

TIM-BR-MART’S NEW PURCHASING DIRECTOR:

EXCLUSIVE INTERVIEW

Q: What do you see as the key objectives of your role as merchandising director for Tim-BR-Marts Ltd.?

Q: How is the relationship between buyer and vendor evolving?

Q: what are the opportunities for the Tim-BR-Mart brand as it is developed into a national entity?

Q: Many groups are pushing their own private label programs. What is the potential for the Tim-BR-Mart brand?

Q: How are Tim-BR-Mart dealers trying to differentiate from the big boxes? What are their competitive strengths?

* * * * * *

NEW ACE DÉCOR TRIES LIFESTYLE APPROACH

Products will be grouped by project, rather than strictly by category.

* * * * * *

WAL-MART TO START SELLING WHITE GOODS

COMPANIES IN THE NEWS

CANADIAN STOCK WATCH

COMPANY	52-WEEK HIGH	52-WEEK LOW	CLOSE (FRI.)

Canadian Tire	37.35	18.40	19.10
Canfor	19.80	9.75	10.20
Goodfellow	12.55	8.75	9.60
Home Depot	70.00	39.37	52 ^15/16
Hudsons Bay	21.65	12.50	15.40
Lowe’s Cos.	67.25	40.37	44 ^7/8
Sears Canada	42.50	30.75	34.00
Taiga Forest	14.20	6.80	8.35
West Fraser	39.50	27.00	28.00

“… it has now been demonstrated to us by a few misguided persons just how fragile a democratic society can be.” – Pierre Elliott Trudeau (1919-2000)

PEOPLE ON THE MOVE

George Ireland has been promoted to the position of general manager at Vermont American Canada. He was formerly national sales manager there. (905-564-1155)

OVERHEARD…

NOTED…

Are you reading your own copy of Hardlines? Find out about our special company rates!

MARKET INDICATORS

The consumer price index was down 0.2% in August from July, however, year over year, the CPI was up 2.5%. Energy prices remained the largest contributor to the increase.

WHY HARDLINES SUPPORTS THE WOMEN’S CONSUMER PRODUCTS NETWORK

September 21: “Fully Alive From 9 to 5!” Featuring author Louise LeBrun. Details coming soon. Meanwhile, check out her website at: www.partnersinrenewal.com

For more information, please call: (905) 212-3826; fax: (905) 274-7646; email:wcpn99@yahoo.com, website:www.wcpncanada.org

(Hardlines is proud to be a sponsor of the WCPN)

Hardlines Marketplace

Got new products? Looking for new staff or lines? Hardlines Marketplace is read each week by North America’s key decision makers in home improvement retailing and manufacturing. If you want to build your sales team or find new agents or new lines, this is the place! Only $16 per line. Call Beverly at 416-489-3396, ext. 2, for more details.

* * * * * * *

HARDLINES™ the electronic newsletter. www.hardlinesfax.com phone: 416-489-3396; fax: 416-489-6154. E-mail: buzz@hardlinesfax.com

Michael McLarney, Editor & Publisher (extension 1):
mike@hardlinesfax.com

Beverly Allen, Marketing Manager (extension 2):
bev@hardlinesfax.com

Nancy Wright, Administrative Assistant:
nancy@hardlinesfax.com

Hardlines is published weekly (except monthly in December and August) by McLARNEYCOM 542 Mount Pleasant Rd., Suite 302, Toronto, Ontario, Canada M4S 2M7 © 2000 by Michael McLarney. Reproduction in whole or in part is very uncool and strictly forbidden and really and truly against the law. Call for information on a site license for your company. Subscription: $185+$12.95 GST = $197.95 (or $27.75 HST = $212.75) per year (GST #13987 0398 RT). (Please make cheque payable to McLarneyCom.)

Sept25_00

HARDLINES™
Five years serving Canada’s home improvement industry
September 25, 2000 – Volume vi, #36
Michael McLarney, Editor & Publisher
Ph: 416-489-3396 Fx: 416-489-6154
E-mail: buzz@hardlinesfax.com

Check out our incredible Classifieds section!

* * * * * *
* IN THIS ISSUE:
* Who’s the biggest: our latest study ranks the top retailers
* Home Depot pushes globalized buying, environmental practices
* Beaver dealers visit Home Hardware
* GTA shootout: Revy vs. Home Depot
* Housing prices inch up
* Depot says R&D is up to vendor
* * * * * *

HHOME DEPOT: GLOBALIZATION AND ENVIRONMENT

Improved service levels and greater environmental accountability were just two of the messages Home Depot delivered recently. Eric Petersen, vice-president of Home Depot Canada, exhorted vendors to function more globally. He spoke, along with his president, Annette Verschuren, at the Hardlines Marketing Conference in Toronto on September 14.

Verschuren gave an overview of the company’s growth and promotional plans. “We did 53 million transactions in 59 stores,” she said of the company’s performance in 1999. Home Depot’s specialty concepts, EXPO and Villager’s Hardware, will be coming to Canada sooner than later. EXPO is currently being given an expansion push that will add stores to the northeastern U.S. Canada, specifically Toronto, is slated to be part of that expansion.

Home Depot has expanded into other niches through acquisition. The Floor Store, a 45,000-sq.ft. outlet, opened recently in Dallas, TX. Another is California Lighting, another chain bought by Home Depot. “We’re good at buying expertise and then spreading that expertise throughout the company,” said Verschuren.

Petersen, who recently joined the Canadian team from Home Depot’s northwest division, sent a strong message to vendors that service levels have to come up, especially given the globalization of negotiations. He cited Canadian companies such as MAAX and Premdor for providing that service with a global vision.

He also advised that Home Depot will be working to streamline the distribution channel even more: “We will be taking the broker side of the equation out of the picture,” he said.

* * * * * *

WHO’S THE BIGGEST? RETAIL SALES RANKED

A new ranking of the top home improvement sales in Canada puts Home Hardware Stores at number one, with Home Depot Canada in second place.

Including last year’s acquisition of Beaver Lumber, Home Hardware’s sales totalled $2.899 billion in 1999. Home Depot’s were an estimated $2.3 billion. The top spot has traditionally been the domain of Canadian Tire, whose total gross operating revenue last year actually reached $4.728 billion. However, hardware and home improvement sales (not including sporting goods and automotive) by all dealers were an estimated $1.710 billion, putting Canadian Tire’s sales in this category in the number four spot.

Other companies in the top 10 included RONA , Sodisco-Howden and Revy.

The ranking is included in the Hardlines Industry Report: Home Improvement Retailing in Canada, a major study that we’ll have ready in a couple of weeks.

* * * * * *

BEAVER DEALERS SHOP LBM AT HOME HARDWARE MARKET

Beaver Lumber dealers were invited for the first time to this weekend’s Home Hardware fall market. They were able to place orders for lumber and building materials through Beaver’s Markham, ON office, but hardware orders out of St. Jacob’s must wait until Beaver’s supply deal with Ace Hardware comes to an end on March 31, 2001.

Home’s installed sales program, “Home Installs”, was also given a nationwide rollout at this market. The program had been introduced on a trial basis at Home’s spring 2000 market, with about 10 stores in Ontario trying it out.

* * * * * *

R&D: WHO’S JOB IS IT – THE VENDOR’S OR THE RETAILER’S?

The speakers at our recent Hardlines Marketing Conference had differing views about who should be investing in new product development. According to Eric Petersen, vice-president of merchandising at Home Depot Canada, that duty falls squarely on the shoulders of the vendor. Not so, said Will Raap.

Raap is president of Gardener’s Supply, a Vermont-based mail-order company that spends a lot of time talking to – and listening to – its customers. The results of that feedback go into developing new, proprietary products – products that sell. He showed examples that have appeared in his catalogue that are ennvironmentally sound and often wonderful in their simplicity.

However, Petersen said the job of listening to customers was up to the vendors. “Who better to understand our customer’s needs than you, the vendors?”

COMPANIES IN THE NEWS

Sears Canada will open a Sears Furniture and Appliances store in Moncton, NB at the Wheeler Park Power Centre in the spring of 2001. The 43,000-sq.ft. outlet will be devoted to furniture, rugs, accent-decor items and major home appliances and will employ about 40. This will be the second such store in the Atlantic region, following Halifax.

Revy Home and Garden appears to be getting more aggressive in the Toronto market at last. Last weekend’s full-page newspaper ad features the red Revy apron beside an orange apron labelled “The other guys” in Home Depot’s characteristic typeface.The Revy apron is labelled “Proudly Canadian” while the orange one is called “Hardly Canadian.”

The Bay’s national flagship location in Toronto will be commemorated tomorrow as an historic landmark by the Ontario Heritage Foundation. Built by Edmund Burke at the turn of the century, the store, on Queen Street at Yonge, it was the city’s first fireproof building.

Lowe’s Cos. Inc. broke ground last Tuesday in Findlay, OH on a US$80 million regional distribution centre. It will supply products to approximately 100 stores throughout the Lower Great Lakes region and employ more than 500 people. The 1.25 million-sq.ft. facility is being built on about 110 acres near Interstate 75. It is scheduled to open in October 2001.

National Manufacturing of Canada Inc. is relocating its sales and marketing offices from Markham, ON to its eastern distribution centre in Cobourg, ON: 711 Ontario Street, P.O. Box 640, Cobourg, ON K9A 4L3.

The sale of Westburne Inc. to Rexel S.A. has been approved at a price of $22.75 per share, for a total of $987 million. Westburne had sales of $2.47 billion in 1999, while Rexel, a French distributor of electrical supplies, has sales of $8.5 billion.

CORRECTION: ITM has not joined Alliance International LLC, as reported last week. However, thanks to its relationship with Alliance member RONA inc., the company has been invited to participate in some trial collective negotiations with the Alliance to test a more global buying model, starting with batteries.

CANADIAN STOCK WATCH

COMPANY	52-WEEK HIGH	52-WEEK LOW	CLOSE (FRI.)

Canadian Tire	37.35	18.40	19.90
Canfor	19.80	10.35	10.20
Goodfellow	12.55	8.75	9.60
Home Depot	70.00	39.37	55 ^15/16
Hudsons Bay	21.65	12.50	15.60
Lowe’s Cos.	67.25	40.37	50 ^3/4
Sears Canada	42.50	30.75	33.90
Taiga Forest	14.20	6.80	8.35
West Fraser	39.50	27.00	28.50

“What is now proved was once only imagined.” – William Blake (1757-1827)

PEOPLE ON THE MOVE

At this weekend’s Home Hardware fall market, Ray Gabel, vice-president, merchandise and marketing – hardlines, received an Estwing Gold Hammer Award from the Canadian Retail Hardware Association for 50 years of service in the hardware industry – all of them with Home Hardware. (519-664-2252)

OVERHEARD…

“Our challenge for our customers is finding new ways to live in concert with nature.” – Will Raap, president of Gardener’s Supply. He kicked off the Hardlines Marketing Conference recently with his very personal approach to retail: trying to make a difference in the lives of one’s customers by encouraging them, through their gardening, to get more in touch with nature and the world around them.

MARKET INDICATORS

The consumer price index was down 0.2% in August from July, however, year over year, the CPI was up 2.5%. Energy prices remained the largest contributor to the increase.

WHY HARDLINES SUPPORTS THE WOMEN’S CONSUMER PRODUCTS NETWORK

September 21: “Fully Alive From 9 to 5!” Featuring author Louise LeBrun. Details coming soon. Meanwhile, check out her website at: www.partnersinrenewal.com

For more information, please call: (905) 212-3826; fax: (905) 274-7646; email:wcpn99@yahoo.com, website:www.wcpncanada.org

(Hardlines is proud to be a sponsor of the WCPN)

Hardlines Marketplace

Got new products? Looking for new staff or lines? Hardlines Marketplace is read each week by North America’s key decision makers in home improvement retailing and manufacturing. If you want to build your sales team or find new agents or new lines, this is the place! Only $16 per line. Call Beverly at 416-489-3396, ext. 2, for more details.

* * * * * * *

HARDLINES™ the electronic newsletter. www.hardlinesfax.com phone: 416-489-3396; fax: 416-489-6154. E-mail: buzz@hardlinesfax.com

Michael McLarney, Editor & Publisher (extension 1):
mike@hardlinesfax.com

Beverly Allen, Marketing Manager (extension 2):
bev@hardlinesfax.com

Nancy Wright, Administrative Assistant:
nancy@hardlinesfax.com

Hardlines is published weekly (except monthly in December and August) by McLARNEYCOM 542 Mount Pleasant Rd., Suite 302, Toronto, Ontario, Canada M4S 2M7 © 2000 by Michael McLarney. Reproduction in whole or in part is very uncool and strictly forbidden and really and truly against the law. Call for information on a site license for your company. Subscription: $185+$12.95 GST = $197.95 (or $27.75 HST = $212.75) per year (GST #13987 0398 RT). (Please make cheque payable to McLarneyCom.)

Check out our incredible Classifieds section!

HHOME DEPOT: GLOBALIZATION AND ENVIRONMENT

He also advised that Home Depot will be working to streamline the distribution channel even more: “We will be taking the broker side of the equation out of the picture,” he said.

* * * * * *

WHO’S THE BIGGEST? RETAIL SALES RANKED

A new ranking of the top home improvement sales in Canada puts Home Hardware Stores at number one, with Home Depot Canada in second place.

Other companies in the top 10 included RONA , Sodisco-Howden and Revy.

The ranking is included in the Hardlines Industry Report: Home Improvement Retailing in Canada, a major study that we’ll have ready in a couple of weeks.

* * * * * *

BEAVER DEALERS SHOP LBM AT HOME HARDWARE MARKET

* * * * * *

R&D: WHO’S JOB IS IT – THE VENDOR’S OR THE RETAILER’S?

However, Petersen said the job of listening to customers was up to the vendors. “Who better to understand our customer’s needs than you, the vendors?”

COMPANIES IN THE NEWS

CANADIAN STOCK WATCH

COMPANY	52-WEEK HIGH	52-WEEK LOW	CLOSE (FRI.)

Canadian Tire	37.35	18.40	19.90
Canfor	19.80	10.35	10.20
Goodfellow	12.55	8.75	9.60
Home Depot	70.00	39.37	55 ^15/16
Hudsons Bay	21.65	12.50	15.60
Lowe’s Cos.	67.25	40.37	50 ^3/4
Sears Canada	42.50	30.75	33.90
Taiga Forest	14.20	6.80	8.35
West Fraser	39.50	27.00	28.50

“What is now proved was once only imagined.” – William Blake (1757-1827)

PEOPLE ON THE MOVE

OVERHEARD…

MARKET INDICATORS

The consumer price index was down 0.2% in August from July, however, year over year, the CPI was up 2.5%. Energy prices remained the largest contributor to the increase.

WHY HARDLINES SUPPORTS THE WOMEN’S CONSUMER PRODUCTS NETWORK

September 21: “Fully Alive From 9 to 5!” Featuring author Louise LeBrun. Details coming soon. Meanwhile, check out her website at: www.partnersinrenewal.com

For more information, please call: (905) 212-3826; fax: (905) 274-7646; email:wcpn99@yahoo.com, website:www.wcpncanada.org

(Hardlines is proud to be a sponsor of the WCPN)

Hardlines Marketplace

Got new products? Looking for new staff or lines? Hardlines Marketplace is read each week by North America’s key decision makers in home improvement retailing and manufacturing. If you want to build your sales team or find new agents or new lines, this is the place! Only $16 per line. Call Beverly at 416-489-3396, ext. 2, for more details.

* * * * * * *

HARDLINES™ the electronic newsletter. www.hardlinesfax.com phone: 416-489-3396; fax: 416-489-6154. E-mail: buzz@hardlinesfax.com

Michael McLarney, Editor & Publisher (extension 1):
mike@hardlinesfax.com

Beverly Allen, Marketing Manager (extension 2):
bev@hardlinesfax.com

Nancy Wright, Administrative Assistant:
nancy@hardlinesfax.com

Hardlines is published weekly (except monthly in December and August) by McLARNEYCOM 542 Mount Pleasant Rd., Suite 302, Toronto, Ontario, Canada M4S 2M7 © 2000 by Michael McLarney. Reproduction in whole or in part is very uncool and strictly forbidden and really and truly against the law. Call for information on a site license for your company. Subscription: $185+$12.95 GST = $197.95 (or $27.75 HST = $212.75) per year (GST #13987 0398 RT). (Please make cheque payable to McLarneyCom.)

Archives

Nov. 23, 2000

Nov20_00

Nov. 15, 2000

Nov13_00

Nov6_00

Oct30_00

Oct16_00

Oct9_00

Oct2_00

Sept25_00

NEWS

ABOUT US

EVENTS

REPORTS

CLASSIFIEDS

CONSULTING

ADVERTISE

FOLLOW