Home Hardware has unveiled its new ‘Built to Build’ campaign as part of a relaunch for its private brand, Benchmark. Developed in collaboration with Toronto ad agency john st., the campaign will be supported through social and digital channels as well as a 30-second TV spot, in-store signage, and newly designed packaging. In French-language markets, it will be presented with the slogan “Conçus pour bâtir.”

The campaign runs until Dec. 24.

“Home Hardware’s‘Built to Build’ campaign is about connecting with DIYers across Canada and highlighting Benchmark as an innovative and affordable tool brand that can help them tackle the projects they’ve been dreaming of with ease,” said Laura Baker, vice president, marketing, Home Hardware Stores Limited. “We want Canadians to understand they can depend on Benchmark products, and that by using them, they are practically unstoppable.”

The announcement reinforces the full range of products that bear the Benchmark brand for Home Hardware. It also reflects the wider movement among retailers to beef up their private label offerings. (See the next story in this issue.)

Working with Toronto ad shop john st., Home Hardware’s agency of record for the past five years, the fully integrated campaign relies on traditional media, including television, highlighted by a new 30-second TV spot, plus in-store signage and newly designed packaging. The rebranding is also being supported through social and digital channels.

A cornerstone of the Benchmark relaunch is the brand’s new Omega 20-volt battery system. Keeping pace with the thrust of power tool technology, the system is compatible and interchangeable across all of Benchmark’s 20-volt cordless products, which includes power tools and lawn and garden equipment.

“We know that home renovation and repair projects continue to be a focus for our customers and innovative tools that help them get the job done within budget are important to them,” said Baker.

“The Benchmark brand offers a broad assortment of power and hand tools at affordable prices, without sacrificing quality and dependability.”

Canadian Tire enjoyed strong results in its third quarter, and while comp sales for its Canadian Tire Retail (CTR) stores were up just 1.4 percent, that follows on the heels of a whopping 25.1 percent increase during the same quarter of 2020. Much of the chain’s success came from its ability to drive private-label sales while managing its supply chain challenges.

Private brands are hot properties, and Canadian Tire has led the charge with a range of proprietary lines for everything from power tools to home décor. Supported by a strong infrastructure here at home, the company has been able to manage its inventories effectively.

“The non-perishable nature of our products gives us flexibility around lead times and commercial terms,” said CEO Greg Hicks on a call to analysts. “As the owner of significant distribution and storage capacity through our store network, corporate-owned real estate and the REIT, we can easily hold excess inventory in Canada.”

He pointed out that more than one-third of Canadian Tire’s revenue comes from its owned brands. As the supplier for its own products in these areas, the company can keep control of when and where goods are produced. Hicks cited NOMA Christmas lights, Mastercraft tools, and Denver Hayes apparel as examples.

CTR’s performance was helped by growth in their own brands such as Canvas, Master Chef, Raleigh, and Sherwood. Executives on the call noted that the control over these lines gives Canadian Tire a real advantage, despite ongoing sourcing challenges worldwide.

“Our seasonal, living, and automotive divisions had the strongest performance in the quarter,” said Gregory Craig, Canadian Tire’s EVP and CFO. “Garden, backyard living, cleaning, and car care were among CTR’s top-performing categories, and our access to inventory was a key contributor to their performance.”

Craig said Canadian Tire is “the largest importer of record in Canada,” with strong vendor relationships and large investments in shipping and transportation, “particularly on the main routes in and out of Asia and across Canada to our more than 1,700 plus retail locations and distribution centres.”

Earlier this year, Canadian Tire invested in ships of its own to carry CTR products exclusively. “This strategic decision to charter four vessels enabled us to bring in key Christmas and winter categories in time for Q4. We have successfully built inventory to meet anticipated customer demand,” Craig said.

“We’re already working through our volumes and lead times for summer and fall of 2022, placing orders with vendors, looking at our product pipelines, and—while not across the board— anticipating an increase in some input costs.”

The National Hardware Show made its comeback last month as a live event, after moving to a virtual format in 2020. The show, which typically runs in early May, was pushed out to late October this year, to maximize the odds of people attending as North America continues to contend the persistence of the pandemic. While it did not attract too many Canadians, it did reach a critical mass that proved worthwhile for many in attendance.

The 75th edition of the show gathered exhibitors, industry leaders and other attendees for a return to business at the Las Vegas Convention Center’s new West Hall. There were 690 exhibitors, including 259 that attended for the first time. In 2019, the show had about 2,500 exhibitors.

“Despite a smaller footprint, we made important investments this year to ensure NHS remains the top destination for industry members to make meaningful connections and celebrate successes for years to come,” said Beth Casson, event leader for NHS.

One Canadian who was there noted the smaller size. Robert Greene, VP for the Consumer Products Division of Jacobs & Thompson, which has the Polar Bear brand of weatherproofing products, says the show was “just okay,” with traffic low overall.

“We didn’t see any Canadian retailers at the show except for one Home Hardware store that had won the trip.” He was referring to Ian McNaughton of Gravenhurst Home Hardware. McNaughton was an award winner and panellist at the conference portion of the show, held by the North American Hardware and Paint Association.

Another Canadian exhibitor, a Toronto-based garage storage company, was reportedly looking to expand its U.S. presence and was happy with the buyers walking the show and stopping by their booth.

The smaller size of the show did have its upside. Greene says the few connections he made were good ones. “On a brighter note, the customers, suppliers, and representatives that we did interact with were quality contacts that we expect will garner new business within the future.”
 
He adds that his support of this show gave his company the opportunity to negotiate better pricing and a more favourable booth location for next year. The 2022 show will be held April 5 to 7, once again in the West Hall at the Las Vegas Convention Center.

AQMAT held its 10th Congress of Decision-Makers last month under the theme “Se retrouver pour mieux s’allier” (finding one another to better unite ourselves). Dominique Bélanger, chairman of the Quebec industry group’s board, dubbed the occasion “historic.”

“When I look at the importance of the topics on the agenda, I indeed think we are called to reflect, even to speak out on some of the most critical issues facing our hardware stores and the suppliers who allow us to operate, namely the suppliers and buying groups.”

Delegates adopted resolutions dealing with price controls, Sunday closures, and a potential code of best practices for hardware retailers. While supporting a mostly free-market approach, AQMAT and construction industry group APCHQ are exploring algorithm-based technologies that can take out some of the guesswork as supply remains unpredictable.

Participants also heard from Pierre-Alexandre Blouin, head of Quebec’s food retailers’ association. Blouin suggested that AQMAT has an advantage in bringing together all kinds of hardware industry actors. In the food business, by contrast, “to make progress it’s necessary to coordinate ten or so different and sometimes diverging associations.”

AQMAT president Richard Darveau (shown here) noted that new federal cabinet ministers were receiving their mandate letters the same day in Ottawa. Like them, he said, he felt “entrusted with clear and engaging objectives for the collective good of the members of our community.”

DID YOU KNOW…?

… that Hardlines has the tools to help you identify Canada’s top home improvement retailers? If you want to know who the big retail customers are, what their sales are in each province, and the product strategies of the top players, check out the Hardlines Retail Report and the Hardlines Market Share Report. This exclusive info is just not available anywhere else but at Hardlines. We even have special pricing if you buy both reports together. Let us help you get ready for the year ahead!

Lowe’s Cos. announced its Q3 profits rose to $1.9 billion, or $2.73 per share, compared with $692 million a year earlier. Revenues increased to $22.92 billion from $22.31 billion. Same-store sales were up by 2.2 percent in the quarter. Like rival Home Depot, Lowe’s benefited from a strong housing market, even as house prices and building materials costs heat up.

The Home Depot posted Q3 revenues of $36.8 billion, an increase of $3.3 billion or 9.8 percent from 2020. The ongoing trend toward investment in the home seen since the COVID-19 outbreak continued to propel sales, with comp sales increasing by 6.1 percent. Net income rose to $4.13 billion (or $3.92 per share), from $3.43 billion ($3.18) a year earlier.

Digital construction platform Toolbx has expanded to Vancouver. The service offers a single platform from which builders can source materials from any local supplier, to be delivered to the job site within two hours. The expansion comes amid skilled labour shortages in the area, which the Vancouver Regional Construction Association expects to continue over the coming years.

Vancouver-based BuildDirect Technologies has acquired Superb Flooring & Design LLC in a $10 million cash transaction. The Michigan-based flooring retailer serves pro customers across the U.S. Midwest. At the same time, BuildDirect reported Q3 revenues of $22.4 million, up 51 percent from a year ago. Gross profit increased 48 percent to $8.1 million, compared to $5.5 million for the comparable period of 2020.

Walmart Canada and Duo Bank of Canada are launching the Walmart Rewards Mastercard Installment Plan. Customers can split their in-store and online general merchandise purchases into six equal installments billed to their Walmart Rewards Mastercard monthly when the total purchase is $199.99 or more. As part of the launch of the program, the 2.5 percent set-up fee is being waived for a limited time.

SUPPLIER NEWS

CertainTeed Canada, a subsidiary of Saint-Gobain, has announced a new partnership with Hyperframe, which specializes in AI-powered software for the construction industry.

Intertape Polymer Group’s Q3 sales rose 23 percent to $395.6 million. Net earnings fell by five percent to $25.3 million. Net income was $58.7 million, up from $55.6 million a year ago.

ECONOMIC INDICATORS

Sales of existing homes have already set a new annual record in 2021. Sales were up 8.6 percent between September and October 2021, marking the largest month-over-month increase since July 2020. Actual (not seasonally adjusted) monthly activity was down 11.5 percent on a year-over-year basis. (Canadian Real Estate Assoc.)

The seasonally adjusted annual rate of housing starts in Canada was 236,554 units in October, according to the Canada Mortgage and Housing Corp. That was down 5.3 percent from 249,922 units in September. The SAAR of urban starts declined by 3.7 percent to 214,797 units. Single-detached urban starts increased by one percent to 58,016 units. (CMHC) 

U.S. construction starts were at a seasonally adjusted annual rate of 1.52 million in October. That was a decrease of 0.7 percent. Compared to October 2020, however, starts were up by 0.4 percent. The SAAR of building permits for the month was 1.65 million. That was four percent higher than in September and 3.4 percent above the previous October’s pace. (U.S. Census Bureau)

NOTED

A Quebec man whose family is behind a series of trademark applications using the Zellers name says Hudson’s Bay Co. missed out on its chance to retain rights to the name. HBC’s “lawyers didn’t do their work. The trademark was expunged,” Robert Moniz said in a CBC Radio interview. “They had enough time to take over the trademark. They didn’t take it.” Members of the Moniz family are named in a statement of claim filed by HBC, with allegations including trademark infringement and deceptive marketing.

OVERHEARD…

“Our owned brands continue to be a key focus for us, providing several differentiated advantages, one being a healthy margin premium over national brands.”
—TJ Flood, president of Canadian Tire Retail, on the importance of its private labels.

TIMBER MART has appointed Bruno Baldessari as the group’s new vice president of forest products trading, effective Nov. 15. Baldessari will be responsible for leading and managing TIMBER MART’s national lumber trading division.

As a member of TIMBER MART’s senior leadership team, he will report directly to the buying group’s president and CEO, Bernie Owens. That group is one of the largest national member-owned buying groups in Canada, representing hundreds of dealers in every province across the country.

The group is also working on growing its presence in Quebec. Baldessari will make a valuable addition to the TIMBER MART team as it ramps up its efforts in that province. In taking over the lumber trading role, he relieves John Morrissey, the TIMBER MART vice president based in Halifax, who is in charge of the group’s presence in Atlantic Canada.

With responsibility exclusively for lumber trading, Baldessari will work to increase the group’s focus on commodity trading. Morrissey will continue to oversee distribution for TIMBER MART down east.

“Bruno will be accountable for growing the lumber trading unit of our group with new products and services in support of our members’ evolving business needs and long-term success,” Owens said in a release.

Baldessari brings over 30 years of experience in the building materials industry in a variety of senior leadership positions in building materials procurement, marketing, retail operations, and sales. He was most recently at BMR Group, where he spent 15 years, most recently as group VP of merchandising and vendor relations.

Before his stint at BMR, Baldessari worked at RONA and Cameron Ashley Building Products.

Federated Co-operatives Ltd. successfully hosted its second virtual Buymart tradeshow on Oct. 18 and 19. The event hosted over 190 vendors and attracted 600 local Co-op associates, who connected online to discuss product and program opportunities for 2022.

The first day opened with a welcome from Cody Smith, director of the co-op’s Home and Building Solutions business. He congratulated the Co-op Home Centres on their successful sales and operational performance over the past year. Smith then highlighted key initiatives, projects in development, and future opportunities designed to position the Co-op Retail System for continued growth.

Category manager informational sessions were hosted on day one, outlining strategic program opportunities for the upcoming year for Co-op associates. In addition, the retail delegates could connect with vendors at Buymart through chat and video to explore and review product offerings.

Event organizers report that response during the show from vendor partners and the local Co-op associates was enthusiastic; all appreciated the opportunity the virtual Buymart provided to let delegates collaborate and reconnect with peers across the home improvement industry.

The contractor customer is evolving, and Home Depot Canada is adapting its offerings to keep up. That was Jamal Hamad’s message to the delegates at the 2021 Hardlines Conference.

Hamad heads up the retailer’s contractor services and pro rentals division. He spoke to about 150 people, a mixed live and virtual audience, about how the digital revolution continues to drive change as the giant retailer fine-tunes its offering to its trade customers.

“Data has become king. We have always said the customer is king, and they certainly are, but what a difference it has made to really understand what data can do for you!”

Consumer behaviours have also changed, and contractors are no exception. Hamad remarked that, had he been told 15 years ago that pros would be choosing to make certain purchases online, he wouldn’t have believed it.

Today, he said, “we know how our pros shop, what they shop for online versus what they come into the store for.”

“Cultivating our relationships is still a big deal,” Hamad stressed, citing the importance of Home Depot Canada’s inside and outside sales teams in catering to pros. “We’re investing to meet the changing delivery needs of our DIY and pro customers.”

Those investments included the opening of two new direct fulfilment centres in 2020, advances in low-cost, same-day delivery, and a loyalty program dedicated to pro customers. Expanded product offerings, including rentals for a new generation of space-crunched contractors, are also part of the effort.

Critical to Home Depot Canada’s contractor strategy is its Local Pros platform, which Hamad calls “a game changer.” It connects homeowners with participating Home Depot pro customers who can complete their desired projects. The business generated for that pro customer is an added value, “and we don’t charge a damn thing!” he added. “We want to ensure that we reward our pros and thank them every single day for shopping at Home Depot.”

As retailers scramble to meet the challenge of standing out during the Black Friday promotions that dominate in November, Lowe’s Canada has developed a program that targets its growing contractor customer base. Called “PROvember,” the campaign aims to boost sales and strengthen the retailer’s position as a destination for contractors and pros.

Right through to Dec. 1, pro customers will be celebrated and rewarded through a mix of in-store activities and media investments. The company’s corporate Lowe’s, Réno-Dépôt, and RONA stores are involved. In addition, 77 of its RONA affiliated dealers that offer Lowe’s Canada’s existing VIPpro loyalty program are participating.

VIPpro is designed to offer pro customers an improved and integrated purchasing experience with the use of an associated app. With VIPpro, contractors can keep track of their purchases and access discounts of five percent on all purchases and 10 percent on paint. The program, which was introduced in September 2020, has had a series of upgrades and the introduction of a dedicated web portal.

The current PROvember campaign has two themes to benefit contractors. One is featured products and the other is the chance to win prizes. Weekly offers highlight “Pro Worthy” products chosen for their innovative features. A series of games and contests are also being featured in-store.

The pursuit of the contractor customer is supported by a new survey conducted by Lowe’s head office in Mooresville, N.C. Called the Pro Pulse Survey, it reveals that more than 70 percent of pros surveyed expect to be busier than ever this winter. Pros reported an average of nearly 11 projects per month in 2021 and expect that number to increase by 45 percent in 2022, with the number-one project expected to be updates for energy efficiency.

The Western Retail Lumber Association has named Trent Balog, co-CEO of Taiga Building Products, as the winner of the association’s 2021 Industry Achievement Award. The award recognizes someone who has contributed to their business, the building supply industry, the WRLA, and the communities in which they live. Balog has been an active member of the building supply industry for nearly 40 years. He started his career at MacMillan Bloedel, where he worked as a sales rep. He moved to Taiga in 1995. Balog, who retires at the end of the year, will be awarded at the awards night on January 20, 2022, during the WRLA Building & Hardware Showcase in Winnipeg.

DID YOU KNOW…?

… that we have the marketing backup you need to plan for 2022? If you want to know how big your retail customers are, what their sales are in each province, and who the top 20 retail home improvement players are, check out the Hardlines Retail Report and the Hardlines Market Share Report. This exclusive info is just not available anywhere else but at Hardlines. We even have special pricing if you buy both reports together. Let us help you get ready for the year ahead!

BMR Group’s annual trade show, under the theme More heart per square foot, concluded last week. Dealers got to discover product offerings and new additions for the coming year and learn about BMR Group’s vision, all under a mostly virtual format. The webinars were presented in three separate phases: Sept. 20 and 21, Oct. 19 and 19, and Nov. 8 and 9.

Canadian Tire Corp. reported Q3 earnings of $3.97 per share, down from $4.84 a year earlier. Net income attributable to shareholders was C$243.7 million, compared to $296.3 million in 2020. Revenues declined to $3.91 billion from $3.99 billion. Retail sales however rose to $4.6 billion from $4.41 billion. Comp sales in the Canadian Tire Retail division grew by 1.4 percent, following the 25.1 percent surge from the lockdown effect in Q3 of 2020.

Castle’s newest member has been signed in the province of Quebec. Monsieur Debeaunavet is a building centre in Val D’Or. The business was founded two decades ago by Serge Bourgault and includes a garden centre. Bourgault has brought on two partners, Alex Gobeil and David Boutin, to help expand product lines and underwrite future expansion.

Lowe’s Canada held its first Vendor Forum for the Lowe’s, RONA, and Réno-Dépôt banners. It brought together over 600 participants from some 225 partner companies. The event let the Lowe’s Canada buying team share their goals and vision with vendors and discuss next steps to increase collaboration. Three vendor partners were honoured as Vendors of the Year during the event: Chervon in the Hardlines category, Samsung in Home Décor and Appliances, and Waterline in LBM. The Lowe’s Canada Foundation presented both Opération Enfant Soleil and Children’s Miracle Network with a cheque for $360,000, thanks to the generosity of vendor partners.

Toronto-based Bolt Logistics, which specializes in last-mile fulfilment of e-retail orders of large items, has raised $115 million for expansion. Founded in 2017 as Second Closet and renamed last summer, the company more than quadrupled its sales in 2021. It has landed Ikea Canada as both a client and an investor.

Walmart has paired up with Silicon Valley start-up Gatik to fulfil online grocery orders using driverless trucks. Since August, the companies have been operating a pair of autonomous box trucks on a seven-mile loop for 12 hours daily.

SUPPLIER NEWS

The Western Retail Lumber Association is gearing up for its first live show since COVID hit. The WRLA’s Building & Hardware Showcase will be held in Winnipeg at the RBC Convention Centre, from Jan. 19 to 21. Early bird registration is available until Nov 15 (that’s today! —your time-managing editor). The organizers promise two days of new product launches, the latest tech, trends, and hot topics. For more information, contact Myriah at the WRLA today.

Hardwoods Distribution Inc. reported that Q3 sales grew 99.1 percent to $471.7 million, a year-over-year increase of $234.7 million. Sales in Canada rose to $56.7 million from $36.6 million a year ago. Profit per share soared by 327 percent to a record $1.58, from $0.37 in Q2 of 2020.

ECONOMIC INDICATORS

Investment in building construction declined 0.7 percent to $17.5 billion in September, continuing a downward trend that started in May. A decrease in the residential sector, which was down 1.6 percent, was partially offset by a small increase in the non-residential sector. Despite the month-over-month drop, investment in residential construction was still up 21.6 percent over pre-pandemic levels in February 2020. (StatCan)

NOTED

According to the Canada Revenue Agency, businesses are falling behind on remitting sales taxes, the Globe and Mail reports. The agency has calculated that the total GST and HST debt owed the federal government was $14.3 billion in September. That was up by 24 percent from $11.5 billion at the outbreak of the pandemic in March of 2020.

OVERHEARD…

“We welcome Bruno to the TIMBER MART team and look forward to seeing our group and members across Canada benefit from his visionary leadership and years of experience in our industry.”
—Bernie Owens, president and CEO of TIMBER MART, on the group’s recruitment of Bruno Baldessari after many years at BMR Group.

Running up to the holiday season—and in anticipation of the online drawing power of Black Friday—Lowe’s Canada is promoting its stores as the destinations for everything consumers need to fill their homes for the season.

Black Friday is the day after American Thanksgiving, a holiday which, unlike in Canada, always falls on the same day of the year—a Thursday. Like Boxing Day here, it is a huge day for retail sales. Thanks to the internet, which recognizes no borders, those Black Friday sales quickly migrated north of the border. Now, Canadian retailers must offer sales of their own, or get left out.

While Black Friday is just one day—this year it lands on Nov. 26—the sales around it have grown beyond that one day, to a week of specials and now a full month of promotions and deals leading up to the holiday season. For most of these retailers, Black Friday deals were available starting Nov. 4. In the U.S., many retailers, including Amazon, began offering Black Friday specials as early as mid-October. They continue until the end of November.

So the Lowe’s, RONA, and Réno-Dépôt stores in Canada are in good company. Canadian Tire is offering 70 percent off a wide range of products, and Best Buy promises to offer more products and services than in the past through their website and in their stores. The power of Black Friday will dominate promotions for the rest of this month.

Early in October, well ahead of the holiday season, Robin Lee, CEO of Lee Valley Tools sent an email message to customers that made him sound more like the Grinch than a Christmas elf. Worried about product and raw materials shortages, Lee warned the company was expecting major delays in order fulfillment ahead of the holiday rush.

“The message for consumers is buy early, because there is no chance to reorder or to replenish” before Christmas, he said. He also announced Lee Valley’s Christmas catalogue was being sent out “uncomfortably early.”

Stories of supply chain woes have filled the news at an unrelenting rate since then. Not only are retailers focusing on the fun and convenience of shopping, but they’re taking steps to reassure customers that they’ll have the products in stock.

Canadian Tire issued a holiday-themed flyer at the beginning of November that warns customers, not once, but in two places, that shortages could occur. “We are currently experiencing exceptional demand for many popular items,” the blurb reads. It then invites customers to keep track of availability by going online or downloading an app.
 
In a release from Lowe’s Canada last week, Catherine Laporte, vice-president of marketing, said, “We secured large inventories of popular items early so our customers can have access to great products now at a great value to better enjoy their holidays.”

Those assurances extend to the online shopping experience. The company says it has developed several new functionalities to offer an improved omnichannel experience. That includes beefing up its call centres and digital platforms and the introduction of same-day delivery in some markets (see our Oct. 4, 2021, edition for more on this). It’s all to make shopping easier online and in store, but it’s also to confirm that Lowe’s Canada has the products on hand and in time for the holidays.

The Building Supply Industry Association is rolling out a Sector Engagement and Labour Market Study, seeking input from key stakeholders on what key issues are of most concern to the industry today.

The BSIA represents the retail home improvement industry in British Columbia. The association is working with research firm Malatest, which will conduct virtual interviews and focus groups.

The study aims to uncover what dealers and suppliers believe are key issues, including labour needs, and other factors that influence hiring, training, and retention in the sector. “We’re doing it,” says BSIA president Thomas Foreman, “because the industry needs to have a better sense of what the issues are that are challenging us.”

He says HR-related challenges top the list for many in the industry, which faces a shortage of workers and a struggle to retain people. The final study will result in an in-depth understanding of key labour market trends and needs in the sector, including training needs, average compensation, and anticipatedhiring needs over the next five to 10 years. Findings will be shared with participants after the study is completed.

“The study is going to provide us with scientific information, not hearsay or speculation, on what the challenges are,” Foreman adds. “These issues are not exclusive to British Columbia, or just to retailers, but the sector as a whole.”

He recently sat down with the other members of the umbrella group that gathers regional LBM associations, the Building Material Council of Canada (BMCC). Those associations will undertake similar studies in their sectors. “We will share our findings to create a national view, so we can come up with a national solution,” he says.

“To me, this is the most exciting project we have been able to start because the initiatives are critical.”

(Want to participate? Contact BSIA president Thomas Foreman directly.)

During one of the biggest shopping seasons of the year, Ikea Canada is shifting attention to show how sustainable living can be easy and affordable. While other retailers promote their Black Friday specials, Ikea Canada will use this month to raise awareness of green initiatives at its stores.

Through its Green Friday campaign, the retailer will invite Canadians to focus instead on re-using and re-purposing existing products. It is encouraging customers to bring in gently-used Ikea products, through its Sell-Back program, in exchange for an in-store credit. From Nov. 1 to 14, the company is offering a bonus of 1.5 times the sell-back value of used items.

In addition, customers can take advantage of special promotions within the retailer’s "as-is" section, which has been renamed the Circular Hub to further promote the concept of re-use. There, shoppers can buy used and discontinued products that would otherwise end up in the landfill.

The Green Friday campaign is one of a range of initiatives by Ikea to become an eco-responsible and climate-positive business by 2030. This includes using only renewable, recycled, or recyclable materials, eliminating waste, and introducing services that help customers to extend the life of their products.

TIMBER MART has appointed Jean-François Caron as regional director of member services for Quebec. In his new role, he will report directly to TIMBER MART’s VP of member services, Jon Irwin, and work remotely. Caron will be responsible for managing relationships with TIMBER MART members in Quebec, acting as a liaison to the members there. Caron began his career in the building materials industry in 2012 at Chalifour Canada in merchandising. In 2015, he joined TIMBER MART as a merchandising co-ordinator.

DID YOU KNOW…?

… that we have the marketing backup you need to plan for 2022? If you want to know how big your retail customers are, what their sales are in each province, and who the top 20 retail home improvement players are, check out the Hardlines Retail Report and the Hardlines Market Share Report. This exclusive info is just not available anywhere else but at Hardlines. Let us help you get ready for the year ahead!

W. W. Grainger reported Q3 sales of $3.4 billion, up 11.7 percent. Operating earnings of $438 million marked an increase of 17.4 percent. Earnings of $5.65 per share were up 25 percent compared to the third quarter of 2020. The company said strong supply chain and operational performance drove results above its expectations.

IN MEMORIAM: Ron Sherk, Sherk Lumber TIMBER MART

Ron Sherk passed away on Oct. 13. Born in 1931, he was the owner of Sherk Lumber TIMBER MART in Port Colborne, Ont., which claims to be one of the oldest building centres in the country. Started in 1813 by his grandfather, who had already established a sawmill in town, the company has endured for more than 210 years. Sherk worked there himself for more than 70 years. The Sherk family will receive visitors at the Davidson Funeral Home in Port Colborne on Nov. 13 from 11 a.m. to 1 p.m.

SUPPLIER NEWS

The Lumber and Building Materials Association of Ontario (LBMAO) has introduced an app to replace the association’s annual printed directory. The new version provides listings of its retailer members alphabetically and by region. It also provides information on member suppliers and their products. Unlike the printed directory, the app will be updated regularly to reflect changes in membership. It can only be accessed by downloading it from the Android Store or the App Store onto your phone or tablet.

The Western Retail Lumber Association has relaunched its Shop Local campaign.
The campaign consists of eight social media posts and two posters, to which independent businesses can add their logo. Click here for more information.

West Fraser Timber garnered sales of $2.36 billion and earnings of $460 million in Q3 of 2021. Its lumber business generated earnings of $52 million. The company’s quarterly results were impacted by wildfires in its home province of British Columbia.

Higher prices for logs, coupled with a smaller-than-expected drop in demand as U.S. Thanksgiving approaches, are keeping prices for lumber up. And some analysts expect retail prices to stay high well into 2022. Reduced output from mills in western Canada, along with labour troubles at mills in the southern U.S., has aggravated the situation.

Canadian small and mid-sized businesses expect to have to raise prices over the next year as supply chains continue to be squeezed. In a survey by the Canadian Federation of Independent Business, respondents on average anticipated a 3.9 percent hike in prices. Twenty-seven percent of businesses said they expected to implement increases of at least six percent. Another 19 percent estimated that increases would amount to five percent or more.

ECONOMIC INDICATORS

The total value of building permits rose 4.3 percent to $10.1 billion in September, led by Ontario (+6.3 percent). Construction intentions in the residential sector were up 8.2 percent, while the non-residential sector decreased 3.2 percent, despite climbing 55 percent in Alberta. (StatCan)

NOTED

Ontario Premier Doug Ford will raise the province’s minimum wage to $15 an hour effective Jan. 1, 2022. The hourly minimum wage is currently $14.35. While the move is being cheered by some, many employers, especially small businesses and retailers say they were surprised by the move and felt they were not adequately consulted.

OVERHEARD…

"Now we know the ideal home is a greener, spacious, and more comfortable place to live, where we can be close to the people we care about and do the activities that make us feel good.”
—Kathy Davey, head of home furnishing and retail design, IKEA Canada, referred to a study by IKEA that revealed 60 percent of Canadians made a change to their home in the past year, and that one-third increased the importance of green space or private gardens. The survey also found that nearly four out of 10 Canadians experienced a negative impact on their mental health throughout the past year.

This year’s Hardlines Conference featured the inaugural round of the Hardlines Debates. The new event took the form of a dialogue between Hardlines president Michael McLarney and Bill Morrison, a veteran retail consultant who formerly oversaw the Ace banner for Lowe’s Canada.

The conference was held on Oct. 19 and 20 in Niagara-on-the-Lake, Ont. More than 150 people attended, both in person and virtually, for the conference’s 25th edition.

The Hardlines Debates were created to provide a forum for open discussion about some of the key issues confronting home improvement retailing. Morrison and McLarney found much common ground in their forecasts for the industry over the coming years, but Morrison expressed more pessimism about the trials to be endured in the medium term on the road to recovery.

Three questions were considered during the debate. The first was, “Is green growth good for our industry?” Speaking in favour, McLarney noted that this trend was cutting across all industries. “Big corporations are on board” with green renewal, he said, noting that major auto manufacturers have set cut-off dates for the sale of gas-powered cars even as they invest heavily in electric technologies.

Morrison agreed that “our planet needs to be protected: the last time I checked, we only have one.” At the same time, he argued “we need to understand what governments are actually trying to do to us.”

Allowing that there is “tremendous opportunity” for such innovations as solar panels, Morrison expressed his concern that green growth “will be very expensive, very difficult, and may accomplish very little.”

Next, the debaters discussed whether an uptick in inflation was on the horizon. Both McLarney and Morrison agreed that a major hike in interest rates was out of the question politically. As Morrison put it, “you would see mortgages go underwater.”
“Canada has a unique economy that’s somewhat disconnected from the rest of the world and that’s going to have to absorb some inflation.”

The final question was, “Are we entering the roaring ’20s?” McLarney took the “pro” side. “No matter what the macro issues are, people love their homes. They live in their homes—it seems obvious to say—and they want to make them better.”

“I think our industry is going to grow,” Morrison said, “but there is going to be more turbulence.” He pointed to “huge price increases and shortages” continuing in the medium term. “People are stressed, and our business is not immune,” he added.

“I am tremendously confident in our industry, but there are bills coming due.”

Gibson Building Supplies has joined Sexton Group, effective Nov. 1. The independently owned Canadian company offers roofing and exterior building supplies through its seven locations in central and southwestern Ontario.

Gibson has its roots in Chouinard Bros., a roofing company based in Aurora, Ont., that was established in 1972. In 2001, Gibson Building Supplies was created. It specializes in roofing and related materials but also carries some hardware and safety products, including nail guns, hoists, and ladders. To this day, Chouinard Bros. remains a key account for Gibson.

Chouinard and Gibson joined Independent Lumber Dealers Co-operative in 2004, where they remained members for only a few years. A brief stint with TIMBER MART followed, but Gibson has been on its own for roughly the past decade. CEO Michelle Chouinard-Kenney explains why the company hooked up with a buying group after so many years flying solo.

With the company expanding to seven locations, she’s found the customer base has grown beyond the core roofing installer. Some of the stores are serving more general contractors, she says. As a result, “we’re looking to expand our product line and we were looking at who we could align with.” As Gibson looks to diversify, she wanted a partner that aligned with her company’s ethics and philosophy. She found many parallels with Sexton Group, whose values and roots she respects. “It was a good fit.”

Chouinard-Kenney, who grew up in the business at Chouinard Bros., has held the CEO role for the past seven years. She says Gibson Building Supplies will continue to add locations, with one—and maybe two—slated to open in 2022. These will expand the current market area that the stores serve, which stretches from Peterborough to Brantford in central and southern Ontario.

In the middle of negotiation season now, Chouinard-Kenney admits that the shortages facing the industry since 2020 have complicated the process, even as her company is adding new lines. “It’s a moving target for us.” But, she says, the alignment with Sexton is helping with these negotiations.

BMR Group has forged a sponsorship with the Ottawa Senators hockey team for the 2021-22 season. Now the green BMR logo appears right in the ice at the Canadian Tire Centre in Kanata, a suburb on the west side of Ottawa.

Canadian Tire Corp. took over the naming sponsorship of the arena from Scotiabank in 2013.

According to Julie Crevier, a spokesperson for BMR, the partnership with the Ottawa Senators is for the entire 2021-22 regular season, which concludes at the end of April 2022. During that time, the BMR logo will remain on the ice at Canadian Tire Centre, close to the net.

“So when the Sens play locally, the logo will be seen on TV on all main sports channels broadcasting the matches. It is a great way for us to have our brand visible to Ontario communities,” Crevier said.

The promo is the latest move by BMR to build its presence outside its home province of Quebec. In July of this year, Simon Gouin joined the group as senior director, business development, eastern Canada. He oversees the development of the dealer network in Quebec, Ontario, and the Maritimes.

Peavey Industries is coming out of COVID, like so many retailers, looking for a new normal. That includes how it handles its flyer program.

In a new podcast from the Retail Council of Canada, Jest Sidloski, vice president of marketing, customer experience, and e-commerce, shared how the Red Deer-based retailer has re-evaluated paper flyers for its Peavey Mart stores. The new approach reflects the company’s attempt to return to some kind of normalcy with its customers, as well as a new level of digital expertise it has gained through the acquisition of the TSC Stores chain.

To determine the importance of paper flyers post lockdowns, Peavey turned to the people who shop in its stores. The result weighs on the side of the status quo. “We have to take a very cautious approach and ask and listen to our customers,” says Sidloski. “Over and over the majority of Peavey Mart customers say they still prefer the paper flyers.”

However, the company has made changes within that mandate. Sidloski admits in the podcast that Peavey had some catching up to do regarding online selling. But TSC, which was purchased by Peavey in 2016, “had a decade of expertise online,” he says.

In fact, in 2010, TSC launched a distribution arm called TSC Country Pro Services. The wholesale business provided a range of tools and hardware, with a focus on farm and ranch, to dealers throughout Ontario and Manitoba. That involved expanding its warehouse capacity, recruiting a fleet of trucks, and building up an online sales portal.

With the additional support of the TSC digital expertise, Peavey relaunched its website in April of this year, making it easier to select and purchase products. But the paper flyers have remained an important part of the mix.

Sidloski says the printed promos were reduced from 52 times a year to 36, and the page count was reduced as well. They feature what Sidloski calls “bread-and-butter products,” augmented by links to a wider array of items. Digital flyers fill in for the other weeks. “We were able to take that paper flyer and add digital pages to it for online views.”

Daniel Rioux, TIMBER MART’s regional director of member services for Quebec, has retired. Rioux has been in the building material and hardware industry since 1979. In 2008, he joined TIMBER MART and was charged with establishing the group’s office in Quebec. In 2014, he was appointed TIMBER MART’s regional director of member services for Quebec and eastern Ontario. He worked as a liaison with the vendor community and TIMBER MART head office on behalf of the members in that area. In his retirement, Rioux has achieved status as a certified personal coach.

Lindsay Barber, Masco Canada’s director of product management, has been named a winner of the 2021 Canada’s Most Powerful Women: Top 100 Awards released by Women’s Executive Network. The award recognizes 100 outstanding women across Canada who advocate for workforce diversity and inspire tomorrow’s leaders. Lindsay joined Masco Canada in St. Thomas, Ont., in 2002 in the customer service department. In 2019, she was appointed director of product management in charge of Masco’s plumbing portfolio.

The Home Depot has promoted John Deaton to the role of EVP of supply chain and product development. He replaces Mark Holifield, who has moved to another company after 15 years with Home Depot in Atlanta. Deaton began his career with Home Depot in 2007 as VP of supply chain development. In 2011, he was promoted to senior VP of brand and product development. Since 2017, he has been senior VP of supply chain.

DID YOU KNOW…?

… that our recent Hardlines Conference was a huge success? Okay, we’re biased, but it was just so great to see our colleagues from across Canada join together at last! They all helped us celebrate our 25th anniversary (postponed from last year). Thanks to everyone who attended, and to our amazing sponsors, who made it a reality during these difficult times.

This year’s Lowe’s Canada Heroes campaign garnered the greatest participation to date. Eight distribution centres and 71 RONA affiliated dealer stores joined the Lowe’s, RONA, and Réno-Dépôt corporate stores. As a result, more than $1.5 million will be distributed to more than 235 charities and schools.

Home Depot is using Walmart’s GoLocal delivery service. Launched in late August, it is being tested in stores in New Mexico and will be rolled out across the country before the end of the year. GoLocal drivers can be either Walmart staff, gig workers, or even third-party delivery services, offering two-hour and next-day delivery options. Products being delivered in this fashion include paint, fasteners, and hardware items that can easily fit in a car.

Lowe’s Cos. is launching an advertising venture, One Roof Media Network, to sell ads on its website and app. It will also make its first-party data available for use in targeted ads elsewhere. Lowe’s said its website has a “big, aggregated audience” that makes it suitable for tailored ads.

SUPPLIER NEWS

The National Hardware Show returned to the Las Vegas Convention Center from Oct. 21 to 23 for its 75th edition. A new feature this year is the Habitat platform, both online and on site, which explored new ideas and technologies that are impacting the concepts of home and living. The show also unveiled NHS Backyard, an outdoor component with live demonstrations and grilling competitions.

Trex Co. plans to develop a new production site in Little Rock, Ark. The company says building a third U.S. manufacturing facility will help it keep pace with the ongoing high demand for products in outdoor living categories.

MoistureShield, a division of Oldcastle APG, has launched the MoistureShield Valued Partner (MVP) certified contractor program. The three-tiered program offers contractors additional training, support, and rewards, along with a labour warranty program for pros who regularly use MoistureShield products. Benefits include access to the MoistureShield University (MSU) online training resource.

3M Co. says it will raise prices amid inflation and supply chain difficulties. “Inflation has come in faster than anybody thought,” CFO Monish Patolawala told analysts on an earnings call. “We don’t see the raw material or the inflation environment slowing down in any way.” The company will also resort to dual sourcing of raw materials.

DuPont has signed an agreement to acquire MaxLife Industries’ ArmorWall business. The transaction, slated to close in Q4, includes the ArmorWall brand, patented technology, and a manufacturing facility in Salisbury, N.C. The financial terms of the deal were not disclosed.

West Fraser Timber has reached a deal to acquire Georgia Pacific’s oriented strand board mill near Allendale, S.C. The transaction, valued at about $280 million, is expected to close after satisfying U.S. regulatory requirements. The Allendale facility, which began producing OSB in 2007, has been idle since late 2019.

ECONOMIC INDICATORS

Retail sales were up 2.1 percent to $57.2 billion in August. A 2.8 percent hike in LBM and garden supply sales contributed to the increase. The biggest growth was in food and beverage stores, gasoline stations, and clothing and accessories. Sales increased in nine of 11 subsectors, representing 94.6 percent of retail trade. (StatCan)

Sales of new U.S. homes rose by 14 percent to a seasonally adjusted annual rate of 800,000 units in September. That was the highest level since March. (U.S. Commerce Dept.)

Sales of existing U.S. homes in September rose by seven percent to a seasonally adjusted annual rate of 6.29 million units. That was the biggest increase in a year, surpassing analyst expectations of 6.09 million units. Home resales declined by 2.3 percent on a year-over-year basis. (National Association of Realtors)

NOTED

Walmart claims that about 90 percent of Americans live within 16 kilometres of one of its stores. It has about 4,700 stores in the U.S.

OVERHEARD…

“We’ve once again reached a new campaign milestone in terms of the number of participating locations this year, as a record number of distribution centres and affiliated RONA dealers joined forces with our corporate stores network. We couldn’t be prouder of our 2021 results and how our teams came together under challenging conditions to support worthy causes across the country.”
—Jean-Sébastien Lamoureux, senior VP, public affairs, asset protection, and sustainable development, on the success of this year’s Lowe’s Canada Heroes campaign, which raised $1.5 million for causes across the country.

Suppliers and retailers from across Canada gathered last week to honour the retail home improvement industry’s best hardware and building supply retailers. The occasion was the 2021 Outstanding Retailer Awards Gala Dinner, which marked the end of day one of the 25th Annual Hardlines Conference at the Queen’s Landing hotel in Niagara-on-the-Lake, Ont.

Attendance at this year’s Hardlines Conference and Awards Gala was limited by COVID safety protocols, so additional delegates were able to join the events virtually for the first time. Whether in person or remotely, leaders from the retail chains, co-ops, and buying groups from across the country were present to honour their members and fellow retailers.

Dealers were awarded in eight categories covering the range of hardware and home improvement retailing formats. This year’s winners are:

• Best Hardware Store, any size – Gravenhurst Home Hardware, Gravenhurst, Ont. Ian and Tara McNaughton, owners. Sponsored by the North American Hardware and Paint Association (NHPA).
• Best Building Supply or Home Centre under 15,000 square feet – Bulkley Valley Home Centre, Telkwa, B.C. Lenard Vriend, Travis Nanninga, Rodney Leffers, and Darin Super, owners. Sponsored by Taiga Building Products.
• Best Building Supply or Home Centre over 15,000 square feet – GrandErie Home Hardware Building Centre, Dunnville, Ont. Ken Zantingh, Henry DeKlerk, Bert Mulder, Wes Zantingh, and Nathan Mulder, owners. Sponsored by JRTech Solutions.
• Best Contractor Specialist – RONA Cowansville, Cowansville, Que. Luc Lamarche, store manager. Sponsored by Johns Manville Canada.
• Best Large Surface Retailer – RONA Kelowna, Kelowna, B.C. Matt Wachter, store manager. Sponsored by Techniseal.
• Best Young Retailer – Jillian Sexton, co-owner of Sherwood TIMBER MART, Charlottetown, P.E.I. Sponsored by BMF.
• Marc Robichaud Community Leader – Gibsons Building Supplies. Julie Reeves, CEO. Sponsored by Trex.
• Retail Spirit – Annapolis Home Hardware Building Centre, Annapolis Royal, N.S. Rob and Joanne Lawrie, owners. Sponsored by the National Hardware Show (NHS).

The winners are carefully chosen from a field of high-quality nominees submitted from every part of Canada. The winners stood out within this elite group thanks to their ability to exceed in the areas of good business practice, customer relations, innovation, and niche marketing.

“Over the past year and a half, we have seen the entire retail home improvement industry rise to meet the challenges of COVID, serving customers and taking care of customers under extremely distressing conditions,” said Michael McLarney, president of Hardlines.

Retail is undergoing a massive sea change, analyst Doug Stephens told the 25th Hardlines Conference last week.

The founder of Retail Prophet is a keen observer of retail trends and he kicked off the conference sharing his insights with told the combined in-person and virtual audience.

“Some say this is all just acceleration of trends that would happen anyway. I don’t believe that. I believe COVID has become like a wormhole in time. We’ve been ripped out of the industrial era and put firmly into the digital era,” he said, referring to the changes that have occurred over the past two years.

This shift, said Stephens, is affecting everything from store format to logistics to staffing. “For e-retailers, this has been 19 months of steroid drip.” At the same time, the push to get products to the consumer’s door has become paramount. “We’re also seeing a delivery arms race.”

Stephens pointed to one online company whose digital expertise is cutting edge—and represents a trend to watch. JD.com employs something called “anticipatory shipping.” When the Chinese online merchant sees a spike in clicks on a given item, it can calculate the approximate proportion of those views that will result in sales and start to move product accordingly. He warned that this kind of deep understanding of data will continue to grow.

“The endgame is that Amazon could eventually start shipping products to customers before they order them,” said Stephens.

More and more, those products will be hardlines and—yes—building materials, he further warned. The notion that LBM is just too big or bulky for the digital supply chain is fast being disproved by a range of players.

“It’s easy to pick on Amazon: they’re the piñata but everyone is coming for home improvement.” This, he stressed, will place a huge competitive challenge in front of traditional dealers.

The solution, he says, is to become indispensable. “What’s your purpose to consumers? If your brand is the answer, what is the question?”

Stephens outlined a grid with four fields: product, culture, expertise, and entertainment. “What quadrant are you going to dominate? That’s the only way to beat Amazon: to go so far down your rabbit-hole that no one can get to you.”

Dealers, vendors, agents, and executives from across Canada descended on the Queen’s Landing hotel in Niagara-on-the-Lake, Ont., last week for the 25th Hardlines Conference. Postponed from 2020 due to the pandemic, it was, for many attendees, the first in-person event for the industry in Canada.

Doug Stephens, founder of Retail Prophet, opened the first morning’s program (see story in this issue). Hardlines president Michael McLarney and retail consultant Bill Morrison then took the stage for the inaugural Hardlines Debate.

The pair found much common ground in their forecasts for the industry over the coming years, but Morrison expressed more pessimism about the trials to be endured in the medium term on the road to recovery. “I am tremendously confident in this industry,” he said. “But there are bills coming due, and I think we can expect a very different approach to how the economy will look.”

Economist Peter Norman had previously addressed the Hardlines Conference in 2019, just a few short months before the pandemic put the brakes on everything. “Unfortunately, you can scrap everything I told you in 2019,” he acknowledged at the outset. “Recovery has been very strong but uneven. It’s the unevenness that brings risks, but also opportunities.”

Other speakers included Jamal Hamad, who heads up the pro business for Home Depot Canada, and Marc MacDonald, head of HR for Lowe’s Canada.

Rob Faries, owner of three Ace stores in the neighbouring communities of Moose Factory and Moosonee, Ont., opened the second morning’s program. A Cree descended from a “company servant family” formed by the offspring of Hudson’s Bay traders and local indigenous women, he recalled the stir his father Donald Faries created when he opened his own business in the 1970s.

“It was a big deal. You don’t compete against the Hudson’s Bay Company. But he did, and it was noted.”

Faries faces unique challenges in getting product to his stores in the far north due to their distance from transportation hubs. In the spring and fall, inventory has to be brought in by way of pricey helicopter shipments.

Donald passed away just weeks before the conference, and the audience was moved as Rob recalled his father’s pride knowing that Rob would be addressing this year’s delegates.

Peavey Industries CEO Doug Anderson (shown here) then took the stage, recounting how the company pivoted to bring the Ace banner on board during the pandemic. He also discussed the integration of the TSC stores into the Peavey banner.

Finally, Home Hardware’s Kevin Macnab gave an overview of Home Hardware’s development over the past few years and its current transformation under his leadership. He spoke of the company’s focus on growth in Quebec, demonstrated by its acquisition of Patrick Morin, and its shift “from a wholesale model to a dealer-owned integrated model.”

“We are taking a more strategic approach with our suppliers,” he added. “We recognize that we are always stronger when working together and firmly believe that solid partnerships and collaboration are the key to success.”

At the end of the second morning, attendees were sent home with box lunches and an invitation to join the next Hardlines Conference on Oct. 18 and 19, 2022.

More than 500 participants from nearly 200 RONA affiliated stores took part last week in the second virtual RONA Buying Show organized by Lowe’s Canada.

For seven weeks, dealers will be able to discover new products and meet online experts. To give dealers more flexibility and a chance to make the most of the platform, and to allow them to focus on running their stores, the show has been divided into three events, each of them lasting either two or three weeks. Each event focuses on specific product categories: home décor, lumber and building materials, and seasonal and horticulture.

The online event kicked off with video presentations from the Lowe’s Canada executive team, speaking directly with the dealers. Participants also had access to thematic conferences, presentations, and workshops. Exhibitors can use the show’s platform to upload pre-recorded videos and promotional material to explain product features. The virtual show includes promotional offers and the ability for dealers to plan virtual meetings with members of their dealer support team.

As part of the event, the 2021 RONA Builder of Success awards were presented to outstanding dealers. RONA Val-des-Monts (Val-des-Monts, Que.) and owner Claude Bélec were recognized in the Community category. Michael and Stephen Allen of RONA North Vancouver and RONA Powell River received the Young Entrepreneur award. André Dagenais, owner of RONA H. Dagenais & Fils in Saint-Sauveur and Sainte-Anne-des-Lacs, Que., was recognized for Lifetime Achievement.

Martin Menard has joined Longueuil, Que.-based wholesaler Évolution Distribution as director for floor covering. He was previously with BMR Group for 13 years, followed by a brief stint at Lowe’s Canada.

Vanesa Fung has joined Montreal-based merchandising company RDTS as marketing coordinator. Her main duties are assisting with the development, execution, and monitoring of the website, social media, content marketing campaigns, creating original content, projects across Canada, strategies, and market research. She was previously a social media community manager for Really Local Harvest.

Shaun Guthrie has been appointed senior vice president, information technology, at Peavey Industries, based at the company’s Red Deer head office. He was formerly with the CIO Association of Canada in the role of vice president.

At BuildDirect Technologies Inc., CEO Dan Park will trade that role for the chair of its board, effective Dec. 31. Effective immediately, former Home Depot Canada executive Peg Hunter and Henry Lees-Buckley have also been appointed to the board. The company has engaged Boyden Canada, an executive search firm, to recruit a new CEO.

DID YOU KNOW…?

… that the 2021 Hardlines Market Share Report is now available? It features exclusive information on the market share in every store format, region, and province using sales data for year-end 2020. Sales by province and region of every hardware and home improvement retailer in the country are detailed. Changes from the 2019 to 2020 data are presented in percentages and market shares are broken down by store format. Click here to order yours today!

Lee Valley Tools told customers by email this month that it was dispatching its Christmas catalogue “uncomfortably early.” That’s because it is expecting major delays in order fulfillment ahead of the holiday rush. “The message for consumers is buy early, because there is no chance to reorder or to replenish [before Christmas],” CEO Robin Lee told CBC News. Compounding those problems, Lee said that labour and fuel shortages are driving up product prices.

The Guelph Tool Library in Guelph, Ont., has received a Peavey Industries Community Agriculture Grant valued at $20,000. The funding will support the Guelph Urban Food Initiative, which includes a seed library and community garden. The award was the result of a national contest in support of community agriculture projects across Canada. Peavey distributes a total of $100,000 each year to grants in support of projects in that field.

Lowe’s Canada is launching an exclusive collection of pre-assembled, Canadian-made cabinets. Called Eklipse, the line includes drawers, shelves, hinges, and legs. Since the legs are adjustable, all that remains is to level the pre-assembled boxes and install them. The boxes’ doors and drawers are equipped with Richelieu Hardware’s signature soft closing system.

A Burlington, Ont., Bay store has resurrected the iconic Zellers brand in pop-up form. It’s offering a limited selection of clothing, housewares, and toys. But in a twist, Hudson’s Bay Co. has filed sued against a Quebec family that has applied for trademarks for companies using the Zellers name. In a claim submitted to the Federal Court of Canada, HBC says the Moniz family is infringing on its trademark and deceiving customers. The family has applied for trademarks for businesses with names such as Zellers Inc. and Zellers Convenience Store Inc.

U.S. farm and ranch retailer Tractor Supply Co. saw sales for its third-quarter increase 15.8 percent to $3.02 billion compared with the third quarter of 2020. Comparable store sales increased 13.1 percent, as compared to an increase of 26.8 percent in the prior year’s third quarter. Gross profit increased 14.5 percent to $1.09 billion.

SUPPLIER NEWS

Global water tech firm A. O. Smith Corp. has acquired Giant Factories Inc. The purchase price is approximately US$192 million in cash. The Canadian manufacturer of residential and commercial water heaters employs 300 people, mostly in Canada, and has approximate annual sales of US$105 million. A family-owned business founded in 1945, Giant manufactures water heaters at two facilities in Montreal and sells water heating products across Canada.

Wall and ceiling specialist Trusscore has raised $26 million in Series A funding. Led by Round 13 Capital, the investment will enable Trusscore to grow in research and development and sales and marketing capabilities. It will also drive additional manufacturing capacity to meet growing product demand.

ECONOMIC INDICATORS

The seasonally adjusted annual rate of housing starts was 251,151 units in September. That was a decrease of 4.4 percent from 262,754 units in August. The SAAR of urban starts decreased by 4.5 percent to 223,055 units. Single-detached urban starts decreased by 5.9 percent to 57,194 units. (CMHC)

Sales of existing homes were up 0.9 percent between August and September. That was the first month-over-month increase since March. The actual (not seasonally adjusted) number of transactions in September was down 17.5 percent on a year-over-year basis, from the record for that month set last year. However, it was still the second-highest ever September sales figure by a sizeable margin. (Canadian Real Estate Association)

U.S. housing starts saw an unexpected decrease in September. The seasonally adjusted annual rate fell by 1.6 percent to 1.56 million units. Permits for September dropped by 7.7 percent to a rate of 1.59 million units. (U.S. Commerce Dept.)

NOTED

HomeStars, the online marketplace connecting homeowners with contractors, has released its third annual Reno Report. Through the Angus Reid Forum, the company surveyed Canadian homeowners who have undertaken renovations since the pandemic’s onset. The findings challenged conventional wisdom, as 68 percent of respondents said that COVID-19 did not influence their decision to renovate. Instead, the top reason cited was to improve the overall aesthetics of the home.

OVERHEARD…

“Again this year, through these hardships, we were able to identify retailers and individuals that were truly outstanding through this time. We are proud to share their excellence through these awards.”
—Michael McLarney, president of Hardlines, on the achievements that exemplified this year’s Outstanding Retailer Award winners. They were honoured at the 25th Hardlines Conference, held last week.

Startup hardlines distributor brings new store format to Canada

OMC Tools & Hardware has set up shop as a new tool and hardware distributor in Canada. Omar and Matt Chaaban, two brothers from Lebanon, already have a distribution business there. Now they are introducing their product lines to Canadian dealers.

OMC is a distributor for a giant Chinese manufacturer, Total Tools. But Total offers more than just tools. It also has a store concept of its own. Everything in the store falls under the Total brand.

Total Tools can pull this off because it manufactures its product line, consisting of some 2,000 SKUs, at its facilities in China. Product lines include Total’s signature brand of 20-volt lithium-ion power tools, plus hand tools, power tool accessories, safety tools, and hardware. Total’s facilities are spread over more than one million square feet of manufacturing space.

The proprietary store concept is a logical extension of this product range. Total now has 1,000 “Total One-Stop Tools Station” stores, mainly in developing countries. The strategy is to pursue a marketplace of five billion people that exists in these emerging regions, rather than the one billion represented by developed countries.

Through OMC, Total Tools promises to deliver full support for any dealer who wants to set up a Total One-Stop Tools Station. “The development of concept stores is highly supported,” says Matt Chaaban. “We provide our customers with marketing materials, including flyers, displays, and signage. In addition, we advise our customers on display setup and how to most effectively incorporate our products into their store.”

He adds that the new concept is definitely attracting attention. “We have received a lot of positive feedback on the concept store idea, as well as inquiries on the best way to implement.”

The Total name is common in countries such as Malaysia, Vietnam, Thailand, Syria, Senegal, Albania, and Macedonia. It also has a presence in several markets in South America, such as Peru, El Salvador, and Paraguay. But expansion has seen it enter smaller developed countries, including Italy and now, through OMC, Canada.

The supply chain travails of 2020 have impacted the purchasing practices of dealers and distributors through 2021. Many of them have reported that their experiences have provided valuable lessons about supply and demand.

“The last 18 months told us that we don’t know anything,” said Robert Glecoff, general manager of Gravenhurst Home Building Centre, which has three locations in Ontario’s near north. The good news for his company is that its relationships with key suppliers weren’t damaged, and in some cases were strengthened.

Glecoff is confident enough in the market’s rebound that his company will rely on pre-COVID sales history in its forecasting for future purchases.

Fraser Valley Building Supplies, which has eight locations in British Columbia, has been reducing its SKUs and bulking up on better-selling items. Prices, which fluctuated wildly last year, continue to be unstable now. According to Peter Gilson, the company’s director of supply chain, purchasing decisions are now being based on history “and what’s in the pipeline now.”

“We’re going where our customers are looking, and not going ‘all in’ on too many items,” he added. “We’ll be more cautious on the [market’s] upswing, and cautious after that.”

Dave McNeil, vice president of Taiga Building Products, said the LBM wholesaler has “refined” how it reviews inventory management, “and we’re applying more science to the business, end to end.” He added that his company would continue to build inventories, but also conceded that can be tricky with categories like composite decking, which have so many SKUs.

Marcel Pelland is the general manager of Olympic Building Centre in Winnipeg. He questions whether some distributors overbought, creating further price volatility. However, now Olympic is being more particular about its clientele and what its forecasts are based on. “We expect honest relationships,” said Pelland.

His company will also rely more on purchasing models so it can be “more analytical” in its buying. By doing so, Olympic can better present itself to pro customers as a consistent, reliable source of supply.

(This story is excerpted from a more comprehensive article in the latest issue of our sister publication, Hardlines Home Improvement Quarterly. This print magazine will be mailed to more than 11,000 dealers and store managers across the country next week. Find out more by clicking here!)

Jim Inglis was there from the early days. At the invitation of co-founder Pat Farrah, he met with the executives of The Home Depot at the opening of its ninth store in 1983 and liked what he saw. The combination of a bigger store and lower prices than the home improvement had ever before seen had him hooked.

Inglis served in executive positions with The Home Depot for 13 years. Today, he is the president of Inglis Retailing. He’s also the author of a new book, “Breakthrough Retailing: How a Bleeding Orange Culture Can Change Everything!”

The book recalls Home Depot’s entry into Canada, when, in 1994, the company bought a 75 percent stake in Aikenhead’s. He gets some details correct, such as how many Aikenhead’s stores there were—seven had been completed by that time—but said they were bought from “Busy Beaver.” In fact, Aikenhead’s was owned by Molson Cos., which had also owned Beaver Lumber. Inglis also recalls that Home Depot already had a store open in Vancouver. It was indeed under construction at the time but would open much later.

These small details do not, however, detract from the substance of the book, nor from its overriding business message about what a strong corporate culture can do to accelerate a company’s growth and maintain its focus.

Inglis also shares some of the growing pains that Home Depot experienced when it took over Aikenhead’s, including the challenge of system integration. “We also encountered even stronger resistance to the Home Depot’s Bleeding Orange culture due to Canadian distrust of the U.S. management team. We initially put some of our veteran U.S. managers in the key management positions, including the role of ‘country president.’ The negative response of the Canadian staff soon alerted us to the need to recall these veteran managers.”

Realizing they “could not treat Canada as just another state,” Inglis says the executive team eventually put a Canadian in place to run the business effectively.

The book provides an insider’s glimpse of the world’s largest home improvement retailer, including how the company lost focus under Bob Nardelli, who served as CEO from 2000 to 2007. Nardelli replaced the entrepreneurial focus on customer service with relentless cost-cutting. Only with the appointment of Frank Blake as his successor did the retailer return to its “bleeding orange” roots.

Retailers should be ready to capture more smart home sales

New data from the Home Improvement Research Institute (HIRI) in the U.S. shows that the smart home technology industry is growing rapidly, clocking in at $58.5 billion in sales last year and expected to exceed $175 billion by 2025. From Wi-Fi-enabled speakers to video doorbells and lightbulbs controlled by smartphones, smart technology brings new levels of safety and customization to DIYers.

HIRI reviewed Omdia’s 2021 State of the Smart Home Report to understand key trends shaping the industry and what retailers should know to guide their inventory in the years to come.

Retail accounted for roughly 88 percent of all smart home device shipments in the U.S. in 2020, proving bricks-and-mortar and e-commerce operators are the trusted partners for customers looking to outfit their homes with new tech enhancements.

“We estimated the number of apartments in the U.S. with smart devices will increase from about 930,000 in 2020 to 11.9 million in 2025,” says Blake Kozak, senior principal analyst for Omdia.

Single-family home builders are expected to start offering smart home devices as standard features of their homes—and not just as expensive upgrades. As the industry evolves and new standards emerge, retailers can expect more products to work together to streamline sales, installation, and usage. This will only increase their accessibility to homeowners.

The continuing effects of the pandemic could also force an eventual rise in smart home adoption. As new variants of the virus have emerged, people are again spending time at home and exploring how smart technology can make their spaces more comfortable and safer.

For retailers, the category is expected to keep growing. Kozak says the smart home industry will see a record number of new product announcements this year and next, which should prompt many retailers to re-evaluate their smart home inventory. New products will focus on security, voice commands, radar insights, and energy and water management to serve customers better.

DID YOU KNOW…?

… that the 25th Hardlines Conference is being held Oct. 19 and 20? We’re at capacity for the live event, but this year we’re offering virtual access to both the Hardlines Conference and the Outstanding Retailer Awards gala dinner, including a special rate for retailers. Virtual conference tickets can be purchased here for $195 plus tax. Retailers and store managers get a special rate, so email Michelle Porter to get your savings. The virtual conference ticket includes a live stream of the Outstanding Retailer Awards Gala. We hope you can join us!

Peavey Industries is opening two new Peavey Mart stores this month. Earlier this month, a new store opened in Brooks, Alta., and another location is opening in Prince Albert, Sask. Grand opening celebrations are planned for both stores from Oct. 29 to 31. The openings continue Peavey’s momentum in the Prairie provinces. Its Airdrie, Alta., store opened in June.

Quebec’s financial regulator has found that two investors profited from advance knowledge of the 2016 sale of RONA to Lowe’s. Alain Poudrette was fined $430,990 and Rénald Moreau $16,563. In anticipation of the sale, the pair bought up bulk quantities of shares in RONA, selling them at considerable profits when the deal became public. In both cases, the amounts of the penalties, therefore, represent approximately 1.5 times the earnings pocketed through insider trading.

Ikea Canada is expanding its Design Studio network this month with three Ontario locations in Brampton, St. Catharines, and London. The Design Studio allows customers to design and order complex home furnishing systems for the kitchen, bath, bedroom, and living room. They have the choice of scheduling one-on-one planning sessions with an Ikea design expert or using a self-service planning station in a dedicated studio space. The first Design Studio opened in Oshawa, Ont., on Sept. 1. The Brampton Design Studio opened on Oct. 14.

Home Depot is the first retailer to take advantage of Walmart’s GoLocal business. The program, announced in August, makes Walmart’s fleet of gig-working drivers available to other companies. Walmart and Home Depot did not disclose the terms of the deal, but the partnership will begin at select stores in Texas, Arkansas, and New Mexico. It will then expand to other U.S. locations before the end of the year.

Amazon Canada will expand in Quebec with a new facility in the east end of Montreal, Le Journal de Montréal reports. Developer Broccolini, a regular real estate partner of the e-retail giant, has purchased a 2.5 million-square-foot site straddling Montreal’s Anjou district and the separate city of Montréal-Est.

Ace Hardware was named number four in this year’s Franchise Times Top 400 List, moving up from third place last year. The annual ranking orders the largest U.S.-based franchise systems by total global sales in the previous year. Ace’s 2020 sales grew by more than 21 percent, or $3.5 billion, the best dollar amount sales increase across all franchises.

SUPPLIER NEWS

Richelieu Hardware Ltd. reported its Q3 profits rose by almost 40 percent from the prior quarter. Profit attributable to shareholders was $38.7 million, compared to $28.7 million in Q3 of 2020. Sales rose to $373.3 million, from $311.2 million. Sales to Canadian hardware dealers and reno centres spiked by more than 16 percent.

West Fraser has made a deal to acquire the Angelina Forest Products lumber mill in Lufkin, Tex., for roughly $300 million, pending the completion of U.S. regulatory reviews. The facility, which produces southern yellow pine lumber products, commenced operations in late 2019 and is expected to reach full production capacity of approximately 305 million board feet over the next three to four years.

ECONOMIC INDICATORS

Investment in building construction decreased  two percent to $17.7 billion in August, a fourth consecutive monthly decline. Residential construction was down 2.9 percent for the month, while investment in non-residential construction edged up 0.6 percent. Investment in single-family homes was down 2.6 percent to $7 billion. Despite a fourth consecutive monthly decrease, single unit construction was 25.6 percent higher than a year earlier. Multi-unit construction investment declined in all provinces, down 3.3 percent nationally to $6 billion in August. (StatCan)

U.S. investment in construction was unchanged in August, following a 0.3 percent uptick in July. Year-over-year, however, spending was up by 8.9 percent. Construction of single-family homes dropped by 0.7 percent, hit by high materials costs and labour shortages. (U.S. Commerce Dept.)

NOTED

In our latest podcast, we talk with Beth Casson, VP and event leader of the National Hardware Show. In conversation with Hardlines publisher David Chestnut, she discusses how the NHS has weathered the challenges of the pandemic and its plans for the next in-person show. Click here to listen to the episode and to subscribe to the series!

The value of the pro business to The Home Depot continues to grow. During the second quarter, sales to contractor customers grew significantly over the previous year, reported Ted Decker, president and COO of Home Depot, during a call to analysts. Pros bought big in categories such as lumber, vinyl plank flooring, gypsum, and pipe and fittings.

“During the second quarter, pro sales growth outpaced DIY growth for the second quarter in a row,” Decker added. “And larger pros and pro transactions are outpacing the business with smaller contractors.”

Ten out of 24 of Home Depot’s merchandising departments posted positive comps during the quarter. But leading the pack were categories that tend to be more pro-oriented: lumber, kitchens, and baths. At the same time, DIY-driven categories, which exploded in 2020, saw negative comps this past quarter. They included paint, hardware, and garden.

The housing market continued to remain strong through the summer, which Home Depot execs took as positive for ensuring continued strong sales to larger pros. Remodelling projects that reflected contractor activity generated strong sales in “kitchen and bath categories, like our in-stock kitchens, tubs and showers and vanities, all of which posted one- and two-year comps above the company average,” Decker said.

(We’ll get an update on Home Depot Canada’s relationship with its pro customers at the upcoming Hardlines Conference from Jamal Hamad, the retailer’s senior director of contractor services. While space at this COVID-restricted event is now at capacity, you can join us remotely. Click here to register for virtual access to the conference!)

The labour shortage across North America has businesses looking for ways to attract people more effectively. At the same time, existing staff may pose a “retention risk” if they’re looking elsewhere for a better opportunity, says one expert.

These are the hard realities of today’s COVID-era job market—and some of the issues being addressed in the latest issue of our sister publication, Hardlines HR Advisor.

The single biggest draw for any employee is, of course, salary. That’s why some of the world’s top retailers are taking steps to raise wages, according to our latest issue.

Here in Canada, Amazon Canada has boosted base pay to attract workers as it seeks to hire 15,000 this fall. At the same time, the company is increasing the starting wage for its front-line, hourly employees in Canada to between $17 and $21.65 an hour. Starting wage is currently about $16 an hour.

Besides pay, working conditions figure as an important way to find and retain good people. If your organization can offer employees the option of working remotely, even part of the time, and you don’t find innovative ways to make this happen, you can expect turnover.

“Remote work is one of a number of substantiated trends from COVID that isn’t going away,” says coach and author Sarah McVanel (shown here). She is the founder of Greatness Magnified, an organization that specializes in providing training programs and certifications for employees at large. 

“Many people in our current knowledge workforce not only can work remotely, but they may do their best work without the distractions, commute times, and stress of a typical five-day workweek,” McVanel adds.

(HR Advisor is the newest publication from Hardlines. It focuses on issues of hiring, retention, workplace culture, and leadership in the retail home improvement industry. To get your free subscription, click here.)

The focus by consumers on smaller events and holidays has been a boon to hardware dealers. The “micro-seasonal” sales trend is growing and includes personal milestones like birthdays and graduations. Halloween is at the forefront, providing all kinds of opportunities for product sales and related merchandising.

In the U.S., the National Retail Federation expects Halloween spending to reach US$10 billion this year, while the Canadian market has been estimated at $1 billion. The NRF projects that consumers will spend $102.74 per person for Halloween, up from $92.12 in 2020. 

While they may take a back seat to the Christmas holiday season, the importance of these secondary celebrations has been picked up by other retailers. Walmart Canada offers a prominent party section in its stores. In 2019, Canadian Tire Corp. acquired the Party City chain, consisting of 65 stores.

This season, Lowe’s Canada is offering lots of fall and harvest-time products, such as harvest lanterns and battery-powered pumpkins. It’s also making hay about its range of spooky home décor products, including pumpkins, ghosts, giant spiders, and skeletons.

Speaking of skeletons, the now-famous 12-foot skeleton that Home Depot carried for the second year running has become a sales—and social media—phenomenon. Even at $398, it’s sold out in stores across Canada. The product is part of Home Depot’s own Home Accents Holiday brand of holiday-themed décor and accessories. Besides scary lawn ornaments, the line includes Christmas decorations, ornaments, and trees, underscoring the importance of both the traditional seasonal and the newer micro-seasonal events for home improvement retailers.

Four retail groups keep accounting for more and more share of the retail home improvement industry. According to the 2021 Hardlines Retail Report, just four companies account for two-thirds of all home improvement retail sales in Canada.

In 2019, they comprised 63.2 percent of the industry. In 2020, that had grown slightly to 63.6 percent.

The Home Depot Canada continues to lead the industry, with estimated sales now exceeding $10 billion. Not only is it the largest home improvement retailer in Canada, but its parent company, The Home Depot, is also the largest in the world.

Still firmly in the number-two spot, Lowe’s Canada continues to grow both with new stores and through expansion and repositioning of existing stores.

Home Hardware, with nearly 1,100 stores, remains a strong brand and an attractive model for dealers. It continues to add to its ranks while expanding the square footage of existing dealers.

Canadian Tire has undertaken a great deal of restructuring of its retail business, focusing on acquisitions and expanding its private labels. These include brands focused on “fixing” and home enhancement and lifestyle. The retailer’s online sales increased by more than 250 percent in 2020, which has been taken into account in calculating its hardware and housewares sales for the past year.

The report analyzes these four leading groups in depth to explain strategies, competitive advantages, and expansion plans. It further identifies and ranks the top 20 retail players in retail home improvement.

The 2021 Hardlines Retail Report is our annual in-depth look at the size of the retail market for hardware and home improvement sales in Canada. It examines the growth within the industry from several angles: store type (hardware, building centre, big box) and regional (by province). It’s filled with proprietary research on the industry’s biggest retail groups that is not available anywhere else.

(The 2020 Hardlines Retail Report fills more than 185 PowerPoint slides and is packed with dozens of charts, graphs, and photographs. For more information and to order the 2021 Hardlines Retail Report, click here.)

DID YOU KNOW…?

… that the 25th Hardlines Conference is being held Oct. 19 and 20? We’re at capacity for the live event, but this year we’re offering virtual access to both the Hardlines Conference and the Outstanding Retailer Awards gala dinner, including a special rate for retailers. Virtual conference tickets can be purchased here for $195 plus tax. Retailers and store managers get a special rate, so email Michelle Porter to get your savings. The virtual conference ticket includes a live stream of the Outstanding Retailer Awards Gala. We hope you can join us!

Home Hardware staff and volunteers harvested hundreds of pounds of fresh produce this year from the Home Hardware Community Garden in St. Jacobs, Ont. Donations went to area food banks and meals on wheels programs. This is Home Hardware’s sixth consecutive year harvesting fresh fruits and vegetables for community members in need. Since 2016, Home Hardware has donated more than 17,000 pounds of produce to local charities.

Lowe’s Canada and fire safety products maker First Alert are partnering with firefighters and public educators to mark Fire Prevention Month in October. Select Lowe’s, RONA, and Réno-Dépôt stores across the country will host a variety of fire safety events. These will feature fire trucks and educational materials for people of all ages to learn about the importance of home safety.

JDS Building Supply in Saskatoon is the newest shareholder member of the TORBSA buying group. JDS was founded in 2018 by Justin Scheuer and serves the commercial and residential stucco and exteriors markets. Its customer base is drawn from across Saskatoon and surrounding areas. This is TORBSA’s second member in the province, after CTI Building Supply, which specializes in modular homes and is also in Saskatoon.

Home Hardware’s BeautiTone paint brand has announced its 2022 Colour of the Year. Called “Warm Hugs,” it’s a mid-tone shade of red-pink with an influence of orange that, the company says, “offers hope and comfort in one exquisite hue.” It’s part of BeautiTone’s 2022 Colour Trends Palette, available at all Home Hardware-bannered stores across Canada.

Ace Hardware held an in-person convention from Sept. 21 to 23 in Orlando, Fla., that brought together more than 10,000 total attendees. In all, there were over 3,300 Ace stores in attendance from every U.S. state and more than 1,200 vendor exhibits.

Princess Auto is slated to take over the space vacated by a Lowe’s store in Sault Ste. Marie, Ont. The original building is currently being torn down, according to Sootoday.com, to make way for the new store.

ECONOMIC INDICATORS

The total value of building permits in Canada decreased 2.1 percent to $9.7 billion in August. Although most provinces reported increases, notable declines in Ontario and British Columbia pulled the national results lower compared with July. Residential permits fell by 8.3 percent to $6.4 billion, the lowest level since March. Single-family intentions rose slightly by 1.2 percent, led by a 15.7 percent gain in Quebec. (StatCan)

Retail sales fell 0.6 percent to $55.8 billion in July, the third decrease in four months. The decline was primarily driven by lower sales at building material and garden equipment and supplies dealers, which were down 7.3 percent. (StatCan)

Sales of new U.S. single-family homes rose by 1.5 percent in August to an annualized rate of 740,000 units. That pace was the highest in four months. (U.S. Commerce Dept.)

NOTED

When The Home Depot in Atlanta reported its second-quarter results, it revealed that big-ticket comp transactions, identified as those over $1,000, were up a healthy 24 percent compared to the same quarter a year earlier.

The biggest challenge during the latter part of the summer is trying to work up excitement amongst you, our Faithful Readers, for the upcoming Hardlines Conference. But like so much that has happened this year, our experience these past weeks has been quite different than usual.

This year, we’ve had to turn people away as we prepare to hold a live conference in Niagara-on-the-Lake on Oct. 19 and the morning of Oct. 20. The Queen’s Landing Hotel has limited seating capacity and we have the unique problem of being filled right up. But for those of you who can’t join us in person, we are offering virtual access to both the Hardlines Conference and the Outstanding Retailer Awards gala dinner, including a special rate for retailers.

This will be our 25th-anniversary event, postponed from last year, so we hope you can join us, even if it’s from the comfort of your own home or office. Some more good reasons to attend include the fact that it’s Canada’s only national event that welcomes all the banners and retail groups, and at the end of day one, we will host the Outstanding Retailer Awards gala, recognizing the finest retailers in the country.

We have an incredible lineup of presenters, including Kevin Macnab, president and CEO, Home Hardware Stores; Doug Anderson, president and CEO, Peavey Industries; Marc MacDonald, SVP of HR at Lowe’s Canada; and Jamal Hamad, senior director, contractor services at Home Depot Canada. Doug Stephens, the renowned “Retail Prophet,” will kick off the conference on the morning of Oct. 19.

Besides getting the big-picture outlook, we will have a presentation from retail’s front lines, courtesy of Rob Faries, of GG’s Ace Hardware in Moosonee, Ont. And we’ll welcome the return of Peter Norman, chief economist and VP at Altus Group, to share his economic and housing insights. To make sure we’ve covered all the angles, we’ve invited Bill Morrison, former VP at Ace Canada and Lowe’s Canada, to debate the issues facing the industry with Hardlines’ own Michael McLarney.

Virtual conference tickets are now on sale and can be purchased here for $195 plus tax. Retailers and store managers get a special rate, so email Michelle Porter to get your savings. The virtual conference ticket also includes a live stream of the 2021 Outstanding Retailer Awards.

We hope you can join us, either in person or virtually, to help us celebrate our 25th Hardlines Conference!

A new tool distribution business has landed in Canada. Omar and Matt Chaaban, two brothers from Lebanon, already have a distribution business there. Now they’ve arrived here and established OMC Tools & Hardware, based in Mississauga, Ont.

The company’s product line, consisting of some 2,000 SKUs, is unique because all the products are from one company, Total Tools. This Chinese company produces its brand of power tools, hand tools, accessories, safety tools, and hardware, all from facilities spread over more than one million square feet of manufacturing.

Hardlines attended OMC’s introductory event recently (and our first industry event since the pandemic started!). A gathering of retail and industrial dealers and buyers was on hand to get details of the story behind Total Tools. They also got a glimpse into the size and reach of the company that OMC has partnered with. The Chaaban brothers’ presentation was tied in live with Total’s head office in China, where product managers and engineers presented in real time to the Canadian audience from a giant screen at the front of the room.

Total’s marketing strategy is to focus largely on developing countries, including Malaysia, Vietnam, Thailand, Syria, Senegal, Albania, and Macedonia. It also has a presence in several markets in South America, such as Peru, El Salvador, and Paraguay. The goal is to provide products that are high-quality but affordable, so middle- and low-income customers can afford them. In these developing countries, said one brand manager who spoke from China, “we are absolutely the number one brand here.”

But Total has its eye on other markets, such as Italy. With the arrival of the Chaaban brothers, Canada gets added to that list.

The presentation included a couple of surprises. The first was the launch of a 20-volt lithium-ion power tool line. The Total power tool line is positioned as higher quality at a reasonable price point, positioned just below premium pro brands like DeWalt and Milwaukee, while putting itself ahead of more entry-level brands suited for DIYers.

Second, the evening’s event featured the introduction of a completely new store concept. Because of its extensive product line, Total has a store program whose products fill the entire store. There are 1,000 “Total One-Stop Tools Station” stores in 180 countries worldwide. (Hardlines will feature more on the Total store program in an upcoming issue.)

Lowe’s Canada is raising its game to get product to its customers with a new same-day delivery service. The retailer’s pro and DIY customers can receive orders on the same day if they submit them before 2 p.m. on weekdays and before noon on Saturdays.

The new service puts Lowe’s delivery services on par with grocery retailers and contends with Amazon, which provides next-day deliveries for its elite Prime customers. The company also joins the ranks of other hardlines retailers, especially Home Depot Canada, which has introduced an express same-day delivery option in 2019 that includes three-hour delivery and is currently available across more than 90 percent of its stores.

“Online shopping is deeply rooted in our shopping habits, and we are pleased to expand our delivery service offering to better meet the needs of our customers who are looking to avoid delays and get their orders quickly,” said Véronique Paris, vice president, supply chain, distribution, and logistics at Lowe’s Canada, in a release.

“We are constantly seeking to be agile in order to offer our customers more options for picking up their orders,” Paris continued. “The addition of this new service is a good example of these efforts. In fact, once the initial rollout phase is completed, we will be able to offer same-day delivery in additional Lowe’s, RONA, and Réno-Dépôt stores nationwide.”

Through a third-party provider, Lowe’s Canada is making the service available initially in over 140 of its Lowe’s, RONA, and Réno-Dépôt corporate stores, concentrated in major urban hubs in British Columbia, Alberta, Ontario, and Quebec. To take advantage of this service, the delivery address must be within the delivery zone of the participating store, and the articles selected when ordering online must be eligible for same-day delivery. The cost for deliveries ranges from $35 to $75.

(Click here to see all locations that offer the new same-day service in Canada.)

Home Hardware hosted its 2021 Virtual Fall Market from Sept. 27 to Oct. 4 as the company waits out the impacts of COVID. This is the fourth time the company has used an online platform, a format that began with its spring 2020 event.  

“While we look forward to the day when we can safely return to a physical market, we are pleased to host Home Hardware’s 2021 Virtual Fall Market,” said CEO and president Kevin Macnab in a release. “We continue to optimize our virtual platform and provide dealers with an interactive experience where they can learn about the great deals and buying opportunities that will position them for success.”

The company could not confirm when it will return to a live event.

In the meantime, the virtual event served to provide the member-dealers with as many of the amenities of a face-to-face market as possible. These included updates from the merchandise team on hardlines and LBM products, category webinars to review new and innovative products, and a video chat feature.

In addition, BeautiTone officially unveiled its 2022 Colour of the Year from the 2022 Colour Trends Palette. The launch tied in with a rebranding of Home Hardware’s proprietary paint line, one that included dropping the hyphen in the BeautiTone name. 

The retailer also used the event to celebrate the achievements of its dealers. The Proud of My Home Achievement Awards were presented during a celebration on Sept. 27. Fulton’s Home Hardware Building Centre in Airdrie, Alta., was the recipient of the annual Walter J. Hachborn Store of the Year Award. It was presented to Mike and Colleen Fulton, dealer-owners of the winning business, for epitomizing the qualities of value, service, and dependability espoused by co-founder Home Hardware Walter Hachborn. Other categories included Best Home Hardware, Best Home Building Centre, and Best Home Hardware Building Centre, each presented to four regional winners.

Glen Knowles has joined LavaGrip Traction Aid Ltd. as vice president, sales and marketing. Based in Langley, B.C., LavaGrip owns a volcanic mine in Quesnel, B.C., that produces an organic, non-corrosive traction aid for ice management. Knowles will be responsible for the leadership of LavaGrip’s sales and marketing teams. His background includes serving as vice president sales and marketing at Sherwin Williams Consumer Brands Group.
glen.knowles@LavaGrip.com

DID YOU KNOW…?

… The 2021 Hardlines Market Share Report is now available! It features exclusive information on the market share in every store format, region, and province using sales data for year-end 2020. Sales by province and region of every hardware and home improvement retailer in the country are detailed. Changes from the 2019 to 2020 data are presented in percentages and market shares are broken down by store format. Click here to order yours today!

The Home Depot Canada Foundation has launched a program to combat youth homelessness. Called TradeWorx, the initiative will provide career education and skilled trades training. Through its initial $1 million investment, 100 Canadian youth will receive the training and social support necessary to work in the skilled trades. “TradeWorx builds upon our work with community partners that provide emergency housing and social supports for youth, by connecting them with the training needed to establish lasting careers and acquire stable housing,” said Pamela O’Rourke, board chair, The Home Depot Canada Foundation, and VP merchandising, The Home Depot Canada.

BeautiTone, Home Hardware’s proprietary paint brand, has undergone a rebranding. The new look aims to create a stronger emotional attachment and a more youthful and contemporary image for the brand. Developed in collaboration with john st., “Rethink Colour” is an integrated campaign that features TV, digital advertising, social media, and in-store elements. In Quebec, the campaign is called “Révélez vos couleurs.” A cornerstone of the campaign is this 30-second video.

Costco Wholesale Corp. reported a rise in fourth-quarter net income to $1.67 billion, or $3.76 per share, from $1.39 billion ($3.13) a year ago. Revenues increased to $62.68 billion from $53.38 billion. Comp sales were up by 9.4 percent.

The Home Depot will invest $10 million in venture capital funds that promote U.S. diversity, technology, and entrepreneurship. The investments are part of the company’s efforts to build opportunities for minority-owned companies and Historically Black Colleges and Universities (HBCUs).

Staples Canada is teaming up with comedian Howie Mandel and TV personality Pierre-Yves Lord for a new campaign. In 15- and 30-second spots devised to highlight the retailer’s position as what it calls “the working and learning company,” the pair channel the inner voice of customers’ curiosity. Click here to watch the promotions.

SUPPLIER NEWS

EAB Tool Inc. (Exchange-A-Blade) held a 45th-anniversary celebration this month at its Delta, B.C., manufacturing hub. The focus of the festivities, which took place with limited attendance, was on the toolmaker’s commitment to sustainability. “Our customers, locally and internationally, have appreciated the savings our exchange system offers and supported our green initiatives since our inception,” founder and owner Rob Forbes said at the event.

The National Hardware Show (NHS) has announced the debut of its new platform, Habitat, for its 75th edition show. It will offer future outlooks and product innovation showcases both online and on-site at the show. This year’s edition of the NHS takes place at the Las Vegas Convention Center’s new West Hall from Oct. 21 to 23.

ECONOMIC INDICATORS

Retail sales fell 0.6 percent to $55.8 billion in July, the third decrease in four months. The decline was primarily driven by lower sales at building material and garden equipment and supplies dealers, which were down 7.3 percent, and food and beverage stores. (StatCan)

Sales of new U.S. single-family homes rose by 1.5 percent in August to an annualized rate of 740,000 units. That pace was the highest in four months. (U.S. Commerce Dept.)

OVERHEARD…

“Habitat is the intersection of merchandise and mission—a platform for industry members to discover new product innovations and source inspiration from one another. From environmental innovations to cultural and social shifts, Habitat will keep a trained eye on new ideas and technologies that are evolving how we will live at home.”
—Beth Casson, event leader for the National Hardware Show, on innovations being put in place as the show returns with a live event in Las Vegas from Oct. 21 to 24.

Many dealers are concerned that the wild ride home improvement has enjoyed during COVID may fall off as restrictions ease and lockdowns end. Increased spending on many non-essential retail products was tracked by StatCan as restrictions related to the third wave of the COVID-19 pandemic began to ease across the country back in June.

Despite concerns, Canadians continued to spend on tools and projects related to home improvement in June, with sales of hardware, tools, and renovation and lawn and garden products increasing 5.9 percent from the same month a year earlier. The largest contributor to sales growth in this category was lumber and other renovation materials and supplies, which were up 12.1 percent, followed by floor coverings and tiles—up almost 30 percent.

But can the trend continue? By the end of the summer, and facing a fourth wave, some groups were already seeing slowdowns.

Eric Palmer, vice president and general manager of Sexton Group, reports that his dealers noted sales slowing as the summer was wound down. Product shortages, especially feeding into dealers’ contractor business, created added uncertainty. But Palmer says his members remain largely positive about the continued health of the economy.

Indications of sales starting to slow

Other groups are detecting similar slowdowns. “August was soft as sales were down and, additionally, dealers were significantly lowering their white wood and panel inventories due to lumber wholesale price depreciation,” says Bernie Owens, president and CEO of TIMBER MART. “September has been better than August,” he adds, but any big rush that was anticipated after Labour Day did not materialize.

Cody Smith, director of Home and Building Solutions (HABS) at Federated Co-operatives Ltd., concurs. He has observed that sales overall have been sliding over the past two months, “especially as we compare them with the previous year. We don’t have any hard data to verify why sales are lower comparatively.”

Smith remains uncertain about the rest of the year. “With restrictions easing, we would speculate that disposable income is being spent elsewhere in the economy.  The other factor is the decline in lumber pricing.”

Owens is a bit more optimistic but has some reservations of his own. “Looking ahead, most dealers are hopeful the fall will be busy, but there is still some doubt being felt as we’ve entered a fourth wave of COVID-19. Dealers are not sure if semi-lockdowns will affect jobs and consumer traffic coming into their stores.”

Their concerns, he adds, extend to how preliminary countervailing and anti-dumping rates in the U.S. on Canadian softwood will impact lumber pricing, and “if container shipping rates will prevent the dealers from receiving goods from overseas or whether COVID outbreaks at production plants will further strain supply.”

Expect homeowners to stay put and renovate

Palmer at Sexton recognizes that, as LBM prices have eased, so has demand. But he expects low interest rates and the high cost of housing will keep people home and renovating, often with higher-end projects, rather than moving.

Looking further out, Owens anticipates a similar scenario based on how consumer spending habits have been affected by COVID. “These uncertainties are underscored by a shift in consumer mentality, whereby people seem to be placing a greater value on home improvement and renovation projects—both inside and outside the home.

“Due to this shift, we believe that we’ll continue to see strength in renovation demand well into 2022, which is positive for our industry and our dealers.” He adds that TIMBER MART will continue to direct members’ purchase volumes through his group’s programs and leverage vendor relationships and distribution networks to remain stocked and competitive.
(Photo: Rebekah Littlejohn)

Peavey Industries held its latest Ace Canada virtual trade show last week. The event ran from Sept. 22 to 23.

While relying on a virtual platform, the event did have live interaction, says Jest Sidloski, vice president, marketing, e-commerce, and customer experience at Peavey. The virtual event was available to dealers ahead of the actual trade show, “and the platform will remain up past the two live days.”

Peavey, which took over the licence for Ace in Canada from Lowe’s Canada in March 2020, serves about 100 Ace-bannered dealers across the country from its distribution centres in Red Deer, Alta., and London, Ont. Sidloski says he expected fully 95 percent of those dealers would participate.

The event offered more than show specials. Dealers could get updates on Ace’s private-label programs, while vendors could offer information videos as well as additional content and training through their virtual “booths.”

“Aside from vendor interaction, Peavey Industries corporate will also have departments throughout the show to speak to any questions dealers may have concerning anything from marketing to accounting,” Sidloski adds.

(Get the full story on Peavey’s expansion of the Ace banner from Peavey president and CEO Doug Anderson, who will present live at the upcoming Hardlines Conference. In addition, we’ll have a presentation from an Ace dealer. Rob Faries is the general manager of GG’s Ace Hardware & Building Centre, with locations in Moosonee and Moose Factory, Ont. A double-whammy of Ace insights! While space at this COVID-restricted event is now at capacity, you can join us remotely. Click here to register for virtual access to the conference!)

Home Hardware Stores Ltd. has again joined Tree Canada to plant hundreds of trees and shrubs at different locations across Canada. The campaign ties in with National Tree Day, which fell this year on Sept. 22.

Tree Canada is a national non-profit organization dedicated to planting and caring for trees in both rural and urban environments. Since 1992, Home Hardware dealers have planted over 28,000 trees, valued at over $1.6 million, in green spaces from coast to coast.

The initiative has endured for almost three decades because it resonates with the dealers. “As a supplier of lumber and building materials, this is an important initiative that we support corporately, and our dealers continue to be passionate about,” said a spokesperson for Home Hardware Stores.

“Our stores and their local communities face a variety of challenges, whether it be natural disasters or environmental events, leading to the loss of trees. Tree plants are a great opportunity to engage the local community, regreen or beautify areas in need, and, above all, create a long-lasting, positive environmental impact.”

This year, on the 10th anniversary of National Tree Day, 32 Home Hardware locations are participating in tree planting initiatives within their communities. For example, staff from Geerlinks Home Hardware Building Centre in St. Thomas, Ont. (shown here), partnered with nearby Mitchell Hepburn Public School to encourage the next generation to become better aware of the environment.

Similarly, Harris Home Hardware in London, Ont., planted 80 trees at a nearby park. The site was selected because it’s close to a newly developed residential area in need of more greenery.

National Tree Day is part of National Forest Week, an awareness campaign to remind Canadians of the health and environmental benefits of trees. The day is celebrated across the country with tree dedications, plantings, workshops, and outdoor education walks.

“We continue to see steady growth in the program amongst our stores, as we expand to new communities and work together toward our shared goal of growing better places to live in,” added the spokesperson.

Pascal Houle has formally transitioned into his new role as CEO of Sollio Cooperative Group. Houle spent six years as CEO of BMR Group and also served as executive VP of parent company Sollio. He was named COO of Sollio in early 2021, and less than two months later was announced as the successor of outgoing Sollio CEO Gaétan Desroches.

Kohltech Windows & Entrance Systems has announced two new appointments to its sales team. The Nova Scotia-based firm named Jeff Barsalou to lead its U.S. sales team as business development manager. He will be responsible for the oversight and growth of Kohltech throughout the U.S. John Ballard has been named to lead the central Canada sales team. He will also play a key role in guiding the new North Bay manufacturing plant’s product strategy.

DID YOU KNOW…?

… The 2021 Hardlines Market Share Report is now available! It features exclusive information on the market share in every store format, region, and province using sales data for year-end 2020. Sales by province and region of every hardware and home improvement retailer in the country are detailed. Changes from the 2019 to 2020 data are presented in percentages and market shares are broken down by store format. Click here to order yours today!

Tractor Supply Co. will become the exclusive retail carrier of Porter-Cable’s power tools and accessories in the U.S. The agreement between retailer and manufacturer will include the launch of new cordless products over the coming year. “By pairing the Porter-Cable brand with Tractor Supply, the largest rural lifestyle retailer in the United States, we are able to get our tools into more hands than ever before,” said Tabata Gomez, chief marketing officer for Stanley Black & Decker’s Global Tools & Storage division, Porter-Cable’s parent.

SUPPLIER NEWS

JRTech Solutions has signed a three-year agreement with Castle Building Centres Group, making it Castle’s exclusive provider of electronic shelf labels (ESLs). Long a fixture in the Quebec market, where several BMR dealers have the program, JRTech recently added Laferté Renovation Center, an I.L.D.C. member based in St-Hyacinthe, Que., and has been expanding into other parts of Canada.

A fire broke out recently at a log yard owned by West Fraser Timber in Chetwynd, B.C. Employees at the adjoining mill spotted the blaze in the early afternoon. There were no injuries and the company said that the fire was contained to the yard and posed no threat to the mill. According to the local RCMP detachment, no foul play is suspected.

Three men have died due to their injuries after an explosion at a wood manufacturing plant in Beauceville, Que. Among the eight people injured, six had to be transferred to a trauma care unit some 80 miles away. Of those, the other three remain in critical condition, according to Quebec’s provincial police. Séchoirs de Beauce specializes in processing and drying “jointed and laminated wood into door and window components,” the company’s website says.

ECONOMIC INDICATORS

The seasonally adjusted annual rate of housing starts was 260,239 units in August. That was a 3.9 percent drop from 270,744 units in July. The SAAR of urban starts decreased by 4.7 percent for the month to 235,782 units. Single-detached urban starts fell by two percent to 62,662 units. Rural starts were estimated at a rate of 24,457 units. (CMHC)

Sales of existing U.S. homes declined in August amid ongoing tight supply. All regions contributed to the two percent drop, which brought resales for the month to an annualized rate of 5.88 million units. In the single-family category, sales were down by 1.9 percent. Year over year, home resales fell by 1.5 percent. (U.S. Commerce Dept.)

U.S. retail sales rose unexpectedly by 0.7 percent in August. LBM and garden equipment sales rose 0.9 percent from July and 6.3 percent from August 2020. Excluding automobiles, August sales were up 1.8 percent. (U.S. Commerce Dept.)

Housing starts in the U.S. rose by 3.9 percent in August to a seasonally adjusted annual rate of 1.615 million units, from July’s pace of 1.554 million units. (U.S. Commerce Dept.)

NOTED

The latest issue of Hardlines HR Advisor is now available. In this edition, read about how wages are on the rise, the value of remote work, and navigating the fourth wave of the pandemic. If you did not get your copy emailed to you, you can sign up at no cost right here.

OVERHEARD…

“After thoroughly reviewing several electronic shelf label solutions and providers, JRTech Solutions’ system stood out as the perfect fit for our member stores.”
—Ken Jenkins, president of Castle Building Centres, on the group’s adoption of new electronic bin label technology by JRTech.

We are keenly anticipating the upcoming Hardlines Conference. It will be our 25th anniversary, postponed from last year. We are restricted however as to how many people we’ll be able to let in the room, so we have not released any tickets for sale.

The conference—Canada’s only national event that welcomes all the banners and retail groups—will be held Oct. 19 and 20 at the Queen’s Landing hotel in Niagara-on-the-Lake, Ont., a destination resort just over an hour from Toronto. At the end of day one of the conference, we will host the Outstanding Retailer Awards Gala, recognizing the finest retailers in the country.

However, after we factor in attendance by speakers, sponsors, and ORA winners, the live event is at full capacity. So this year, we’ve added a virtual component to the conference. We invite you to join us remotely, as the presenters will be incredible. They are:

• Kevin Macnab, president and CEO, Home Hardware Stores
• Doug Anderson, president and CEO, Peavey Industries
• Doug Stephens, Retail Prophet
• Marc MacDonald, SVP of HR at Lowe’s Canada
• Jamal Hamad, senior director, contractor services at Home Depot Canada
• Rob Faries, GG’s Ace Hardware
• Peter Norman, economist and VP at Altus Group
• Bill Morrison, former VP of Ace Canada and Lowe’s Canada

Virtual conference tickets are now on sale and can be purchased here for $195.00 plus tax. Dealers can email Michelle Porter for a special rate. The virtual conference ticket also includes a live stream of the 2021 Outstanding Retailer Awards.

I hope you can join us, either in person or virtually, to help us celebrate our 25th Hardlines Conference!

When Home Depot first came to Canada in 1995, the company promised to install up to 50 of its innovative big box stores in this country over time. At the time, people in the retail home improvement industry couldn’t imagine more than a dozen markets that might sustain the large-surface format. Yet a quarter-century later, Canada is home to more than 300 home improvement big boxes—and well over half of them are Home Depot stores.

Collectively, those big boxes account for almost $15 billion in retail sales in 2020. But despite their size and their retail clout, they’re only part of a larger retail landscape, which consists of almost 5,000 stores in Canada.

These are just some of the findings in the latest edition of the Hardlines Market Share Report, which was released last week. The report features the market share of every hardware and home improvement banner in the country, with sales and market shares.

The Market Share Report tracks who the market leaders are in each province. For example, in Quebec, Lowe’s Canada’s banners lead the way, followed by Canadian Tire, Home Depot Canada, Home Hardware, and BMR Group. In Manitoba, Home Depot Canada tops the list, followed by Home Hardware, Lowe’s Canada, Canadian Tire, and TIMBER MART.

Sales are also measured by province, showing year-over-year increases and market shares by each region. Available now, it comes in a handy PowerPoint format for access to charts and tables to let users build custom reports for buyers or sales teams.

(The Hardlines Market Share Report features exclusive information on the market share in every store format, region, and province using sales data for year-end 2020. Sales by province and region of every hardware and home improvement retailer in the country are detailed. Click here to order yours today!)

After reaching record highs during the pandemic, lumber prices have been easing since before Labour Day. I In the spring—prices hit US$1,600 per 1,000 board feet, triple the pre-pandemic cost, but since thenthe value of lumber has been dropping at a fast rate, which has left dealers stuck with over-priced inventory that they’ve had to sell at a loss.

“It’s been a challenge on the retail side,” Liz Kovach, president of the Western Retail Lumber Association, said in an interview with the Canadian Press. “We’ve seen a lot of blowout price sales, just so that [dealers] can move the materials.”

Lumber production was already slowing early in the summer. According to StatCan, it decreased 7.4 percent from June to 4.49 million cubic metres in July. Sawmills shipped 4.55 million cubic metres of lumber in July, down 4.2 percent from June and down 0.7 percent from a year prior. But at their peak, the Canadian Home Builders Association had estimated that the higher prices were adding as much as $30,000 to the cost of a new home.

According to a report by Madison’s Lumber Reporter, many buyers believe the market has hit bottom, and there are even signs of prices creeping back up. In the meantime, buyers are still trying to keep inventories low while not being caught out of stock.

Dollarama latest to face supply issues, retailers worry about holiday shortages

A shortage of shipping containers has put pressure on Dollarama’s finances, CEO and president Neil Rossy has acknowledged. That concern comes even as the company reports healthy second-quarter results. But it’s also putting pressure on pricing.

Dollarama reported that Q2 sales rose by 1.6 percent to $1.03 billion, compared to the comparable period in fiscal 2020. Comp sales fell by 5.1 percent., however, mainly because of Ontario’s ban on non-essential sales during the first several weeks of the quarter as well as the strength of last year’s quarter.

Continued growth is being restricted, however, by shortages on the shelves as international shipping remains backed up. This could have an impact on results for years to come. “The pressure on container shipping costs continues to build and, as a result, will be felt more in fiscal 2023 as we renew [shipping] contracts,” Rossy told analysts on a conference call.

His concerns for the future include tight supply for retailers in general as the holiday season approaches. Several forecasts, including by MasterCard and Deloitte, expect U.S. retail sales to grow by at least seven percent during the holidays.

But shortages of everything from raw materials to products and staff could complicate things. COVID outbreaks in Vietnamese factories are forcing closures there, compounding the uncertainty.

TIMBER MART has appointed Kevin Guest as regional director of member services for Atlantic Canada, effective Sept. 27. Guest began his career in the building materials industry in 1983 at Builders Market, then moved to Reynolds Metals. In 1989, he joined Alcan Building Products as a sales representative and has worked with a variety of suppliers since then. Guest will work out of TIMBER MART’s Dartmouth, N.S., office, reporting directly to Jon Irwin, VP of member services. He replaces Dave Dingwell, who passed away in the spring.

Laura Baker has been appointed VP, marketing, at Home Hardware Stores Ltd. Baker is a retail marketing expert with over 20 years of experience growing brands like Tim Hortons and Sleep Country. In her new role, she will be responsible for Home Hardware’s brand identity and marketing strategy. She reports to Home Hardware president Kevin Macnab.

Bruno Baldessari, formerly VP of merchandising and vendor relations at BMR Group, has left the company. He had been there for 15 years in a variety of roles. BMR did not confirm whether a replacement has been named yet.

DID YOU KNOW…?

… The 2021 Hardlines Market Share Report is now available! It features exclusive information on the market share in every store format, region, and province using sales data for year-end 2020. Sales by province and region of every hardware and home improvement retailer in the country are detailed. Changes from the 2019 to 2020 data are presented in percentages and market shares are broken down by store format. Click here to order yours today!

The Retail Council of Canada recognized 16 companies at its 2021 Excellence in Retailing Gala last week. There was an unprecedented number of ties this year, including the categories for Omni-Channel (Lowe’s Canada and Mastermind Toys), Retail Marketing (Lee Valley Tools and Sephora Canada), and Talent Development (The Home Depot Canada and Michael Hill Jeweller). Federated Co-operatives took the honours for Environmental Leadership, while Canadian Tire Corp. earned the nod for Pop-Up Experience and Design.

Ace Hardware Corp. is slated to open 60 more stores in the U.S. by year’s end. Those stores will join the 110 new locations already opened so far in 2021. “Our proposition for consumers is that Ace is the most helpful store on the planet; for prospective new store owners, our proposition is that Ace is the most financially and emotionally rewarding opportunity available,” CEO and president John Venhuizen said in a release.

Walmart Canada is donating $100,000 to Food Banks of Canada to provide newly arrived families from Afghanistan with some 200,000 meals. The company is also making in-kind donations of household items, toys, and craft supplies to help children weather quarantine. Walmart Foundation in turn is contributing $100,000 to the company’s efforts. Newcomers are also being invited to apply for jobs at Walmart stores and DCs across Canada.

Home Depot announced back in the middle of August that it had already sold out of an early release of Halloween products, though its full assortments are going on sale closer to the holiday. Still, the early run on plastic pumpkins and the now-infamous 12-foot skeleton took the company by surprise.

ECONOMIC INDICATORS

Canadian sales of existing homes were more or less flat between July and August. On a month-to-month basis, sales edged down by 0.5 percent. The actual (not seasonally adjusted) activity was down 14 percent on a year-over-year basis. The month was nevertheless the second-best August on record. (Canadian Real Estate Association)

Investment in building construction was down 1.7 percent to $18.1 billion in July. Residential construction spending was down 2.6 percent, a third consecutive monthly decline after a sustained period of strong growth from May 2020 to April 2021. Declines in all provinces brought investment in single-family homes down four percent to $7.2 billion. (StatCan)

NOTED

In the latest episode of our podcast series, What’s in Store, we talk with Eric Palmer, VP and GM of the Sexton Group. In conversation with Hardlines’ Michael McLarney, Eric shares his dealers’ outlook on how people are spending their money as more sectors open up. Will travel, destinations, and events cut into the discretionary dollars that people have been spending on their homes? (Click here to listen to the episode and to subscribe to the series!)

OVERHEARD…

“We look forward to seeing our members in Atlantic Canada strengthen their relationships with Kevin and benefit from his deep knowledge of both the supplier and retail side of the business.”
—Jon Irwin, VP of member services for the TIMBER MART buying group, on the hiring of Kevin Guest as member services director for Atlantic Canada.