Retail brands continue to find ways to focus on projects, initiatives, and causes that tie in with their communities while providing a focus for the philanthropic efforts of both customers and staff.

Take RONA inc. The giant home improvement retailer has recently redefined the mission of its charitable arm, the RONA Foundation. In the past, the foundation had worked to raise funds to contribute to the improvement of the lives of children and their families around the world–especially those living with disease, in poverty, or with disabilities.

Now, the foundation is continuing in a similar vein, but bringing the objectives closer to home. Its new mission is to improve the quality of life of Canadians in need by revitalizing their living environments or making it easier to access housing. In particular, the RONA Foundation aims to help victims of domestic violence and their children, low-income families, and people with disabilities or mental health issues.

The RONA Foundation plays “an essential role in the vision we have for the future of RONA,” says Catherine Laporte, vice-president of marketing at RONA. “Housing is a basic need for individuals and families. We decided to focus our philanthropic efforts on this cause because we believe that by helping people in need to have access to a safe home and a healthy living environment, we can improve their quality of life and offer them a better future,” she adds. Given RONA’s role in the construction and home improvement sector, “It’s a natural choice for us to opt for this mission, which is perfectly aligned with our business operations.”

At The Home Depot Canada, doing good is also an important part of the corporate identity. The Home Depot Canada Foundation, through its Orange Door Project, is committed to battling youth homelessness. It provides funds to organizations working with youth at risk of—or experiencing—homelessness. By 2030, the company intends to have invested $125 million toward this cause.

Recently, Home Depot Canada launched a new summer hat, the sales of which are going to the foundation’s TradeWorx program. TradeWorx offers at-risk youth access to resources and training for a career in the trades.

But a good cause is part of the DNA of most retailers. At Home Hardware, dealer-owners worked with Tree Canada over the past 30 years to plant more than 30,000 trees in communities across the country. That’s in addition to the many causes the retailer takes up both nationally and at the store level.

Timberkids Charitable Foundation gives TIMBER MART dealers a platform to help give back to their local communities. Every year, TIMBER MART members from across Canada make numerous donations to help their local children’s charities and Timberkids matches them. It’s an investment, the company says, in improving the lives of children and the well-being of future generations of Canadians.

Hudson’s Bay Co. has a deep history in Canada, including with Indigenous peoples. So the recent alignment of its Hudson’s Bay Foundation with NIB Trust Fund (NIBTF) makes sense. The fund focuses on the challenges faced by First Nations communities. As part of this partnership, the Hudson’s Bay Foundation has committed $1.2 million to NIBTF over three years to address the impacts of the Indian Residential School system and support Indigenous communities, working toward further reconciliation.

Examples will abound in this industry alone of retailers doing good. At a local level, most stores find ways to give back to their communities and their customers in their own way. These efforts become a way to rally the community, inspire staff, and provide a balance of commerce and caring for store owners.

Cologne Hardware Fair is a compelling draw for Canadians. So why don’t they go?

Eisenwarenmesse – International Hardware Fair, is returning to Cologne, Germany, in 2024. The biennial event will be held from March 3 to 6, 2024, and it has already experienced strong response from the hardware industry, as major companies from Germany and 45 countries around the world have so far confirmed their participation at the world’s largest hardware show, with confidence among exhibitors returning after many took a pause in 2022.

But only a handful of them will be from Canada.

“The high demand confirms the importance of the Eisenwarenmesse – International Hardware Fair as the most important global platform for the presentation of new products, services, and technologies, as well as for maintaining business relationships from the hardware segment,” said Matthias Becker, the show’s director. “We are very optimistic that we will achieve the planned exhibition area of 165,000 square metres [1.8 million square feet] in a total of six exhibition halls.”

Hardlines has attended this show for decades. We are always amazed, and somewhat confounded, by the lack of North American, and especially Canadian, participants. The show has proved an effective springboard for many Canadian vendors to reach foreign markets (not just the U.S.!). While the major retailers send the occasional team, regional retailers and the buying groups consistently overlook this show—at their peril. We encourage Canadians to consider this as part of their search for new products or customers.

This year, dealers and suppliers alike have even more reason to consider Germany next spring. Hardlines, with the Building Supply Industry Association of B.C., has organized a Rhine cruise from Cologne to Amsterdam aboard the Avalon Passion. It departs Cologne on March 6 and arrives in Amsterdam on March 13. (Contact Thomas Foreman, president of the BSIA of B.C., as soon as possible to guarantee your spot.)

Besides the new products on the show floor, the International Hardware Fair continues to build its range of educational services and workshops to make for a more rounded experience. “DIY Boulevard” provides a showcase for dozens of companies to present their products in an environment resembling the checkout setup in stores. Seminars historically have provided platforms for some of the newest ideas and leading retail trends. And networking opportunities can connect delegates with some of Europe’s top DIY retailers.

(For more information on next year’s show, click here.)

We sneak a peak at Home Depot Canada’s latest stylings for the Christmas season

Home Depot Canada held a product preview recently to showcase its assortments and design trends for the Christmas holiday season. Home Depot is growing this category and working on building awareness among its customers that it’s a destination for more than tools and building materials.

The retailer will launch its Christmas collection in the first week of October, as its Halloween push starts to wind down. The majority of the holiday seasonal assortment will be available online only, so Home Depot’s intention is to drive customers to its website as well as to its stores.

While repair and reno projects ensure strong sales through the first half of the year, seasonal sales shore up its business in the second half of the year. “Christmas is very important for us. Christmas and Halloween both drive traffic into our stores,” says Konstance Sevastos (shown here), divisional product merchant for the Christmas and Halloween categories.

She talks about how easy it is to get customers into the store during the first half of the year: spring and early summer are important home improvement times for consumers and contractors alike. But getting people to think of Home Depot as a destination for décor, especially seasonal items and accessories with real design elements, is a newer proposition.

“The back half of the year is different; these products bring people into stores in the back half.” She says people readily consider Home Depot as a destination for products like power tools and lumber. “But we’re trying to get customers the knowledge that we have other collections.”

“People don’t realize it’s all available from Home Depot,” says Cindy Jardim, who oversees trend and design for the retailer. “It’s not what people expect from us.”

EDRA/GHIN, the combined global trade body for home improvement retailers, has launched a collaborative taskforce to help the sector reduce its greenhouse gas emissions.

The initiative specifically targets “Scope 3” emissions, which address the lifecycle impact of retailers’ products on the environment. Factors involved range from the efficiency of the retailers’ supply chains right through to how their customers use—and dispose of—the products they buy for their homes.

The following leading home improvement retailers from across the world have agreed to act as the founder members of the taskforce: Adeo (Europe, South America, South Africa); Bunnings (Australia & New Zealand); Cainz (Japan); The Home Depot (North America); Hornbach (Europe); Kesko (Scandinavia); Kingfisher plc (UK & Europe); OBI (Europe); and Sodimac (South America).

For retailers, Scope 3 greenhouse gas emissions make up more than 90 percent of their overall emissions. Given the scale of their impact, they are the most important, but also the most difficult to address, as they fall outside of retailers’ direct operational control.

A range of methods is used to measure and report on companies’ Scope 3 carbon footprints. This causes confusion and inefficiencies for retailers trying to lower their emissions across their value chains and creates an additional burden on their suppliers.

The EDRA/GHIN Scope 3 taskforce will aim to address this challenge by finding a common ground for consistent methodologies in how carbon data is treated through the supply chain. Best practices can be developed in both the reporting but also the acceleration of the home improvement industry’s efforts to reduce Scope 3 emissions. These learnings will also be shared with a wider learning group for all EDRA/GHIN members to benefit from.

In related news, The Home Depot has announced its intention to cut emissions in its outdoor power equipment lines. The retailer expects that by the end of 2028, more than 85 percent of its sales in both Canada and the U.S. of push lawn mowers and handheld outdoor equipment will run on rechargeable battery technology instead of gas. The company anticipates that this transition will reduce over 2,000,000 metric tons of greenhouse gases annually from the exhaust of residential lawn equipment.

“Climate change is a threat none of us can afford to ignore,” said John Herbert, general secretary of EDRA/GHIN. “For home improvement retailers, this is a positive move where we can help them find ways to come together to address one of the fundamental environmental issues for our planet, while developing their business.”

EDRA/GHIN represents 224 retail companies in 78 countries, and the initiative is seen as an important way to unite the industry around this issue. The program was announced at the recent Global DIY-Summit, held earlier this month in Berlin.

(Any home improvement retailer that would like more information and to join GHIN, the global network, please contact info@edra-ghin.org.)

Dale Elliott has departed from his role as CEO at BSH Home Appliances (Canada). Elliott spent 16 years there. His career includes stints with National Hardware, Dremel, Emerson Electric, and Philips.

DID YOU KNOW…?

…that the Q4 edition of our sister publication, Hardlines Home Improvement Quarterly, will feature a special showcase for new products? HHIQ is a traditional print magazine that is mailed to 11,000 dealers and managers across Canada. If you have up to three new products (print-quality photos and maximum 100-word descriptions), please contact our Editor, Steve Payne by July 21. This is a free service—so tell your marketing manager about this and take advantage of the free exposure you’ll get to the entire dealer community!

RETAILER NEWS

A boa constrictor was found in a shrub last week at a Canadian Tire garden centre. Officials at the store in Richmond Square, Calgary, said the non-venomous snake was spotted by an employee. Store employee Jen Bishop, who is knowledgeable about snakes, the Calgary Herald reports, made a makeshift home for the snake where it could warm up until a proper home can be found for it.

Canac is investing $200 million in its expansion efforts over the next five years, including the opening of two new stores per year. This fall, it will open a fulfilment centre opposite Quebec City, on the south shore of the St. Lawrence River.

A man has been arrested after allegedly stealing a forklift from a Lowe’s store in Waldorf, Md., driving it to a nearby Home Depot parking lot, and fatally running down a woman there. The 20-year-old man faces an array of charges that include first- and second-degree murder. The deceased was 73 years old.

One of the most unusual charity events in the home improvement industry was held this past weekend. The Canadian Tire Welland Floatfest saw more than 1,800 people take to the Welland Recreational Canal in flotation devices. The popular annual event is in support of local charities and food banks. Canadian Tire has an almost 90-year history in Welland, Ont., and established its credit card division, Canadian Tire Acceptance (now Canadian Tire Financial Services), in the city in 1961.

As loyalty programs become a more and more integral part of retailers’ strategies, some customers who are non-members of these programs are complaining of a double standard at supermarket checkouts. “Those who follow the system get one price and those who don’t have the skills for the system get another,” retired civil servant Hélène Manuri told TVA Nouvelles, citing older and less tech-savvy customers in particular.

Affiliated Distributors has added The Baron Group, a U.S. co-operative buying group serving independent groundwater systems distributors, into its network. The deal brings independent distributors with almost 100 locations, including one Canadian member, Winnipeg’s Baker Manufacturing, into AD’s pipe, valves, and fittings division.

SUPPLIER NEWS

The past month has seen a spike in lumber prices, partly driven by uncertainty stemming from wildfires in Canada. At the same time, strong U.S. housing starts have driven up demand. Cash prices are up 22 percent from where they were on June 1. Last week, they reached US$420 per 1,000 board feet of Western spruce, pine, and fir (SPF) two-by-fours, according to a report by Fastmarkets. That was up from $343 on June 1 but 74 percent below May 2021’s record high of $1,630.

Construction spending in the U.S. during May was estimated at a seasonally adjusted annual rate of $1.93 trillion. That’s up 0.9 percent from April. During the first five months of the year, construction spending amounted to $740.8 billion, 2.9 percent above the same period in 2022. (U.S. Commerce Dept.)

NOTED

Canada’s Competition Bureau is calling on the federal government to support new players who could disrupt grocery retail. The market for that segment, it says, is concentrated too heavily among a few huge domestic interests like Loblaw and Empire Co. The report concluded that “more competition” is critical to “help bring grocery prices in check” and proposes encouraging independent and foreign retailers to set up shop in Canada.

Since being sold off by Lowe’s Cos. in a deal that closed early in February, RONA inc. has been developing a strategy to manage the future of its 60-plus Lowe’s-bannered stores in Canada. Now, five months in, the retailer has announced its transition plan.

RONA is beginning the Lowe’s stores’ conversion to the RONA banner, but with a twist. The stores will bear a new RONA designation, RONA+. The conversions will start at the end of July and will take place over several months. The first 10 Lowe’s stores to be converted, all located in Ontario, are in Ancaster, Brantford, Cambridge, Hamilton, Kitchener, Niagara Falls, Sarnia, Waterloo, and the banner’s two stores in Windsor.

“This is an important step in our vision for the future of RONA,” said Catherine Laporte, vice-president of marketing at RONA. “With these conversions, we are making a significant investment and renewing our commitment to the RONA brand.” Laporte called the new signage “the first step in a wider plan aimed at redefining how Canadians shop for home improvement, creating new opportunities to improve how we serve them.”

Once considered the retailer’s lead brand while under the ownership of Lowe’s Cos., the Lowe’s stores made some inroads with Canadian consumers, but never achieved the critical mass of its competitor, Home Depot Canada. Of the roughly 440 stores in RONA’s stable of corporate and dealer-owned locations, 61 are Lowe’s big boxes, although none are in RONA’s home province of Quebec, where RONA’s own big box stores are firmly established.

By comparison, Home Depot has 182 stores in Canada, including 22 in Quebec.

As the Lowe’s stores are converted, they will remain open, while guarantees offered by Lowe’s will be honoured, gift cards will still be accepted, and the Lowe’s private brands will remain in the stores’ offering. RONA says it will also continue to maintain its commitment to Canadian vendors and to its affiliated dealer network, who are a key component of the company’s vision.

Vaughn Crofford, former head of vendors’ association CHHMA, dies at 73

Vaughn Crofford, former president of the Canadian Hardware and Housewares Manufacturers Association, has died. After a brief illness, he succumbed to cancer at Lakeridge Health in Ajax, Ont., on June 25.

Born in 1949 in Craik, Sask., Crofford began his career in the late 1960s working part-time at the Federated Co-op in Salmon Arm, B.C., before becoming a full-time clerk in Calgary in 1968. As he once told a CHHMA gathering, “If you grew up anywhere on the Prairies, you know what co-op is all about.”

Crofford rose through a series of management roles in British Columbia and Alberta over the course of 16 years, then moved to Federated Co-operatives’ Saskatoon head office as part of a management team charged with turning around the hardware department. Crofford served as FCL’s director of marketing until 1994, when he made the leap to Ontario—and to the vendor side of the industry—as president of CHHMA, which would become the Canadian Home Products Trade Association in 2021.

During his tenure, the vendor community had to navigate the rise of the large retailers and the power they bring to the negotiating table. He was also front and centre as the industry confronted changing environmental standards. Crofford was a key player in establishing the Canadian Electrical Stewardship Association, which recycles appliances and power tools in British Columbia. “If the important thing is that we reduce the landfill and leave our world a cleaner place, then focus on that and say, ‘how do we get there?’” he once said. “If it’s by adding 10 cents onto the price of a can of paint, then let’s do it.”

Hardlines editor Steve Payne recalls Crofford as a “very collegial and community-minded individual,” who always took time to share his thoughts with the trade media. “He was one of the first people I met when I started at Hardware Merchandising magazine in 1995. He’d patiently explain the industry to me and never failed, at the same time, to tell me an entertaining story.”

Crofford and his life partner, former CHHMA operations director Maureen Hizaka, retired from the organization in 2018. Prior to his retirement, the CHHMA recognized Crofford’s more than 50 years in the industry by inducting him into its Hall of Fame.

In addition to Hizaka, he is survived by his daughters Susan (Ryan) and Sandra (Jamie) and grandson Austin Vaughn Kerr.

We go behind the scenes of Hardlines’ Retail Report in our latest podcast

The Hardlines Annual Retail Report will be published later this month, giving readers access to an exclusive and comprehensive overview of the state of the industry in Canada. In anticipation of the report’s launch, Hardlines president Michael McLarney has shared a preview of its insights in a new podcast.

The industry has evolved in the years since the first editions of the Retail Report were published. With the consolidation of smaller groups and chains, there are simply fewer players to keep track of in absolute terms.

“We’ve seen so many players come and go,” McLarney says, “but that just means the remaining players are more complex, more multifaceted, and with further reach.” Fewer regional banners, for instance, has translated into more data to crunch at the national level.

Hardware, home improvement, and building materials make up a sizeable—and growing—chunk of retail sales in Canada. The Retail Report puts the annual sales total at more than $61 billion. “That’s almost 10 percent of all retail trade in Canada.”

It’s a figure that “shows tremendous growth through [the pandemic]. That’s something we’ve all known anecdotally but Hardlines is the only organization that actually measures that.”

The report, however, goes beyond the scale of the industry as a whole. “We’re also drilling down to understand a whole series of things about the industry … not just sales in total but how much comes from big boxes” and other formats, McLarney adds. That includes a breakdown of online sales, a new metric for the report.

To get all this data, Hardlines carefully examines the records of publicly traded companies, while a survey of dealers helps to fill out the picture for the independents. “It’s a lot of work: we do a lot of number crunching. We have a spreadsheet the size of a JumboTron scoreboard at a Blue Jays’ game.”

“What we do is completely exclusive; no one else has this information,” the Hardlines founder stresses. When major newspapers report on industry stats, “they’re quoting our numbers.”

(You can sign up now for free and get an email alert when new podcast episodes are released!)

The North American Hardware and Paint Association will host its 2023 NHPA Independents Conference, Aug. 2 and 3 in Dallas. The industry-wide event brings together retailers, wholesaler representatives, vendors, and other channel supporters.

Over the course of two days, the conference will share retailer success stories, provide opportunities to share experiences and best practices, and help members of the independent channel expand their networks.

“We are counting down the days until we can gather with exceptional members of the channel who are committed to the continued growth and evolution of the independent home improvement industry,” says NHPA president and CEO Bob Cutter. “We are honoured to be the place where the industry’s most innovative, progressive minds come together to learn from each other and choose to excel.”

In addition to opportunities to network with peers and partners, the conference also features keynote addresses from former executives of Amazon and Google. Panels of leading retailers will discuss how they have used technology to solve some of their toughest operational challenges.

“We have business problems, and we have to leverage technology to combat those problems because consumers are engaging with businesses through technology,” says keynote speaker Chris Hood, former head of business innovation and strategy for Google. “It’s no longer about trying to adapt. It’s about accelerating your digital outcomes so you can keep up with consumer demands.”

“We are very excited to be supporting the NHPA Independents Conference,” says Boyden Moore, president and CEO of Orgill, a key sponsor of the event. “This conference serves as a hub of innovation and idea generation for independent dealers of all shapes, sizes, and distribution affiliations. We look forward to the opportunity to connect across the channel at this year’s event.”

(A limited number of tickets remain for the industry event of the year. For the best rate, go to www.YourNHPA.org/conference to purchase an individual ticket or a table of six or eight.)

ATTENTION VENDORS: SEND US YOUR NEW PRODUCTS!

“Hardlines and its sister publications are an excellent way to get the word out on new products. While we can’t guarantee we will feature your product releases, we can guarantee one thing: if you don’t send them to us, we can’t choose your products for our editorial content! This fall, we will publish a special 2024 Products Issue of Hardlines Home Improvement Quarterly, our 11,000+ circulation trade magazine for retailers. Send your products to our editors Geoff McLarney or Steve Payne.

DID YOU KNOW…?

… that the latest episode of the Hardlines podcast series, What’s In Store, is now live? In this instalment, Hardlines’ own Michael McLarney discusses the forthcoming edition of our Annual Retail Report. Learn how Hardlines measures the size of the industry, what we count, what trends and challenges dealers are facing, and where their sales are headed. Sign up now for free and get updates about our latest podcasts in your inbox!

RETAILER NEWS

The Home Depot Canada Foundation is releasing a new summer hat, with proceeds going to the foundation’s TradeWorx program. TradeWorx offers youth experiencing, or at risk of, homelessness access to resources and training for a career in the trades. (Order one for this good cause here.)

Home Hardware Stores Ltd. has won the top large fleet award from the Private Motor Truck Council of Canada. Judging is based on each fleet’s overall safety regime and over-the-road safety records. Home Hardware currently runs 148 tractors and 605 trailers. The fleet ran 20.8 million kilometres last year. According to trucknews.com, Home Hardware is a 10-time winner of the award.

IKEA Canada has revealed a new mascot on TikTok and is inviting feedback on its name. Social-media followers are asked to choose from Billy, Vän, Hex, or Blue as the moniker for the cartoon-like builder. Several commenters, however, sought a fifth write-in option: Meatball, after the familiar staple of the chains’ restaurants.

Home Depot will pay US$72.5 million to settle a long-standing class action lawsuit from 272,000 employees in California. The grievances, which date back to 2012, include the company making employees wait, unpaid, while stores were locked at the end of shifts, the suit alleges. Employees were told to be off the clock while they collected and put on aprons, the lawsuit also claims. Home Depot, contrary to state law, also allegedly rounded clock-in and clock-out times to the nearest quarter hour. Home Depot denies the claims but will settle.

Overstock.com is the winning bidder for Bed Bath & Beyond’s intellectual property and digital assets. The bankrupt housewares retailer’s stores are not included in the deal, which is valued at US$21.5 million. Its terms still need to be okayed by a New Jersey bankruptcy court. A separate auction for Bed Bath & Beyond’s Buy Baby Buy franchise was slated for last week.

SUPPLIER NEWS

Gesco Industries LP has completed the sale of its assets to Ironbridge Equity Partners. Gesco consists of floor-covering distributor Shnier; Division9, which supplies commercial flooring products to the architecture and design sectors; and Tierra Sol Ceramic Tile. Ironbridge, a Toronto-based private equity firm, previously owned Gesco from 2007 to 2013.

Chervon has reached an agreement with John Deere that will allow its Ego brand of battery-powered lawn care equipment to be carried by John Deere dealers. The complete Ego range of mowers, blowers, trimmers, edgers, chainsaws, and snow blowers will be available at John Deere dealers in the U.S. and Canada starting in the fall.

Ipex has announced the closure of its acquisition of the Valencia Pipe Co.’s plastic pipe and fittings manufacturing division. This deal brings into the Ipex fold two manufacturing facilities (in Walla Walla, Wash., and Kingman, Ariz.) and a distribution centre, also in Kingman.

ECONOMIC INDICATORS

The Consumer Price Index slowed to 3.4 percent in May. That’s down from a year-over-year inflationary increase of 4.4 percent in April. Gasoline prices were the biggest reason for the slower rate of inflation. If gasoline prices were removed from the basket of goods that the CPI uses for its calculations, inflation would have been running at 4.4 percent, as gas prices have dropped more than 18 percent on a year-over-year basis. (StatCan)

According to studies cited by The Home Depot in its efforts to reduce greenhouse gas emissions from its outdoor power equipment, using a gas-powered lawn mower for an hour creates as much air pollution as driving 483 kilometres in an average car. Running a gas leaf blower for an hour creates the same volume of emissions as a 1,770-kilometre drive, roughly the distance from Toronto to Halifax.

With last week’s announcement of cuts to staff and systems at RONA inc., the company continues to make changes. Following the elimination of 500 positions nationwide, including 200 head office positions in Boucherville, Que., and the planned rebranding of its Lowe’s stores (more on that next week—Editor), RONA has a new boss.

The appointment of Andrew Iacobucci (shown here) to the role of CEO was unveiled just one day after the cuts were announced. Prior to joining RONA, Iacobucci was executive vice-president and chief commercial officer at US Foods, a food distribution company based in Rosemont, Ill. Before that, he spent 10 years at Loblaw Cos. Iacobucci’s appointment takes effect in July.

Iacobucci will live in the Boucherville area, where he will work at the head office alongside the other members of RONA’s senior leadership team. He’s been brushing up on his French and, by the time his nomination becomes effective in July, he will have completed a four-week immersion at a language school in Quebec City to better interact with employees and customers.

Iacobucci will replace Garry Senecal, who had a brief tenure as interim CEO. Senecal started work at RONA in March, one month after Sycamore Partners closed the RONA acquisition. He replaced Tony Cioffi, who had been at the helm since January 2022.

Before joining RONA, Senecal was also at Loblaw. He spent almost a decade with the grocery retailer, most recently as president of its market division. (He didn’t even update his LinkedIn profile with details of his contract at RONA! —your observant Editor.) He will stay on until the end of the year to ensure a smooth transition.

Home Depot warns shareholders to reject offer from Canadian investment firm

Home Depot issued a notice last week advising shareholders to reject a “mini-tender” offer from a Canadian investment firm. TRC Capital has tendered an offer that’s almost five percent below Home Depot’s recent trading price, which the retailer considers unacceptable.

TRC Capital’s bid is for less than five percent of Home Depot’s outstanding common stock, thereby avoiding many disclosure and procedural requirements of the SEC in the U.S. and securities regulators in Canada. Bidders making mini-tender offers don’t have to file any documents with the SEC or provide withdrawal rights to investors who tender their shares.

TRC Capital, based in Toronto, has an ongoing strategy of making offers that are 4.5 percent below current trading prices, and below the SEC threshold of five percent of overall shares. It made a bid for Lowe’s Cos. in 2016. TRC has made similar mini-tender bids in recent months for ScotiaBank, PayPal, BMO, Capital One, Procter & Gamble, and Disney.

The strategy can catch shareholders off guard, driving them in some cases to accede to the bid under the belief that they need to sell off. The mini-tender bids can also allow sellers to avoid brokerage fees, which makes the lower offer price more attractive. The company then hopes to trade the shares on an open market for a high price closer to the actual trading price. In some cases, the very act of making the mini-tender can drive the share price up even more.

In fact, TRC’s strategy is so consistent that the companies it has vied for have issued a standard format press release for warning their investors to reject the offers.

New banners fill home décor and housewares space as retail brands depart

The departure of Bed, Bath & Beyond from Canada is just the latest casualty in an ever-evolving retail shuffle in that category. However, as quickly as they disappear, other retailers move in to fill the void. In BB&B’s case, Canadian Tire stepped in to assume a dozen of the leases at various locations across the country. Soon after, another group announced it is taking over at least 21 former Bed, Bath & Beyond locations—and possibly as many as 30—after that chain entered bankruptcy protection.

Putman Investments—already an operator of multiple retail brands—will launch a new retailer called rooms + spaces. Putman Investments is an Ancaster, Ont.-based company that already owns Toys “R” Us, Sunrise Records, FYE (For Your Entertainment), HMV UK, and T. Kettle (formerly Davids Tea).

Homewares brand Fox Home has made its Canadian debut with a 4,000-square-foot retail space in Toronto’s Eaton Centre. Its offerings include kitchen, tabletop, textiles, bathroom, and decoration categories. Seven more stores in Toronto-area malls are planned by the end of the year. Locations at Yorkdale Shopping Centre, Fairview Mall, Square One Shopping Centre, and Sherway Gardens are slated to open by the end of next month.

Burrow is a relatively new company that is digitally native—and going after the home space in a big way with furniture and accessories. Its head office is in New York and its Canadian office is in Vancouver. Stephen Kuhl (shown here), with business partner Kabeer Chopra, established the company in 2017. Their business plan was to design and package furniture that could be delivered by mail and assembled easily.

“What if we could design all the furniture to ship in the mail?” Kuhl tells Hardlines. While he observed that some companies are already doing something similar, he asks: “Then why not design better?”

Burrow relies on good design that is modular even after assembly, he says. A line of outdoor patio furniture features powder-coated stainless steel and aluminum parts. The components can easily be pulled apart for storage. “It’s about as durable as you can make outdoor furniture.”

Greater Montreal-based BMTC Group is streamlining its previous multi-banner approach, consolidating all its furniture and appliance stores, including former Brault & Martineau and EconoMax outlets, under the Tanguay brand. In making the announcement last month, the company also revealed it is opening 11 new Tanguay stores, including locations in Montreal, Gatineau, and Sherbrooke.

Retail hates a vacuum, and the movement among many players, especially post-Covid, is seeing even more players come forward to provide products for the home renovation and decoration markets.

In the bid to make bricks and mortar stand out amidst growing online sales, retailers will have to be willing to adapt with new strategies, says Retail Prophet Doug Stephens.

Stephens was the keynote speaker at the recent STORE conference held by the Retail Council of Canada. He stressed the importance of capturing a customer’s attention as an ongoing and daily challenge. But capturing that attention then means providing a memorable experience, so that the customer will be able to recall the interaction.

That edict is increasingly important, he notes, as so many retailers are getting into new categories. “Every retailer could sell everything,” he says. “For example, Home Depot sells shoes; Loblaws sells tools.” With so much blurring of the lines, having a convenient location and a reasonable price-value equation are not enough. They are no longer the sole metrics that retailers need to abide by.

What is the retail experience supposed to be today? “Most retailers think only of the ‘look’—but the sense of sight accounts for only 20 percent of a customer’s experience,” Stephens says. By focusing strictly on the visual, “you’re leaving about 80 percent on the table.” The customer experience is actually much more holistic than that, and should include smell, sound (music), taste, and touch.

Stephens addressed another important tool that is becoming a crucial part of every marketer’s kit: delivering a message about a company by telling stories effectively. Know who you are and focus on your story. Retailers that can tell good stories can achieve legitimate “earned” media coverage.

“If we want to extricate ourselves from the daily grind of competition, this is the way to do it.” Experience, he says, equals content. But once you start, don’t be afraid to make a meaningful commitment. “And go all in!”

At Lowe’s Cos., Quonta (Que) Vance has been named EVP, pro and home services. He reports to Lowe’s chairman and CEO Marvin Ellison. Vance most recently served as Lowe’s SVP, transportation and final mile. He has more than 25 years of retail experience and leadership roles with store operations, merchandising, and supply chain working with Lowe’s, Home Depot, and Target.

DID YOU KNOW…?

… that this year’s Hardlines Conference will be held in Whistler, B.C.? And that members of the BSIA of British Columbia have access to special pricing for the conference of almost one-third off regular registration? No, we are not making this up! It’s going to be an amazing combined event, as our friends at the BSIABC will host a table-top trade show for its supplier-members. (Click here for more details or contact Michelle Porter at Hardlines.)

RETAILER NEWS

Beachburg TIMBER MART, a building supply store in the Ottawa Valley region of eastern Ontario, has new owners. Run by the Lumax family since it was founded 55 years ago by the late Russell Lumax, the store has transitioned to dealer-owners Matt and Carrie Gagne, both 33, a local couple with a family of four.

Canac will invest $20 million to open a 40,000-square-foot store in Sorel-Tracy, Que., Le Journal de Montréal reports. An August groundbreaking is planned for the new outlet, with a timeline to open next spring. Canac made it known in March that Sorel-Tracy would be the site of its 34th store. The retailer is also set to open a fulfilment centre on Quebec City’s south shore in September, which will position it to make deliveries to the region with fewer bridge crossings.

EPLS Home Hardware Building Centre in Arviat, Nunavut, has moved into a new home thanks to a financing partnership with Royal Bank of Canada. CEO Ryan St. John’s father Don founded the store some 50 years ago, facilitating the provision of building supplies to the fly-in community.

The Home Depot has made some staff cuts, according to 11alive.com, an Atlanta news service. “Due to changes in our business, we eliminated a very small number of non-store roles,” the retailer said in a statement.

Zak’s Home Hardware in Saskatoon celebrated its grand opening at the end of May. Dealer-owner Wyatt Zacharias purchased the former Reid’s Home Hardware, which dates to 1953, earlier this year.

Michelle Gerard and Allen Chen, dealer-owners of Neepawa Home Hardware Building Centre, celebrated the ribbon-cutting of their new store in Neepawa, Man., on May 24, the Brandon Sun reports. The 24,000-square-foot store includes 15,000 square feet of retail space as well as a drive-through and a warehouse.

IKEA Canada has launched “Kreativ,” an AI-generated experience intended to enable customers “to fully integrate design solutions and visualize their own living spaces.” IKEA Kreativ uses 3D mixed-reality technologies to help customers visualize how home furnishings will look and function in their homes. They can browse and preview IKEA products in 3D showrooms. The core technology was developed by Silicon Valley AI company Geomagical Labs, which IKEA Retail acquired in 2020.

SUPPLIER NEWS

EAB received the Washington State Recycling Association’s 2023 Recycler of the Year Award for business. The award was presented at WRSA’s 43rd Annual Conference and Trade Show at the Yakima Convention Center in Yakima, Wash. The WRSA is a non-profit membership organization dedicated to supporting waste reduction, reuse, recycling, and composting in the state.

ECONOMIC INDICATORS

The annualized pace of housing starts declined 23 percent in May to 202,494 units, from 261,357 units in April. The rate of urban starts fell 24 percent, with 182,842 units recorded in May. The Vancouver (-45 percent), Toronto (-28 percent), and Montreal (-35 percent) areas all recorded declines. All three recorded increases in single-detached starts that were offset by large decreases in multi-unit starts. (CMHC)

U.S. housing starts logged a 21.7 percent surge in May. That followed a 2.9 percent decrease in April. Building permits for the month were up 5.2 percent. (U.S. Commerce Dept.)

U.S. retail sales rose unexpectedly in May. Sales were up by 0.3 percent last month following a 0.4 percent increase in April. LBM and garden categories logged an increase of 2.2 percent, attributed to home renovations. (U.S. Commerce Dept.)

Hardlines will be part of a luxury cruise for Canadians in tandem with next year’s International Hardware Fair in Cologne, Germany. In partnership with the Building Supply Industry Association of British Columbia, we’re organizing a business trip to Cologne to attend the largest hardware show in the world, followed by an industry tour of the Rhine River on our own dedicated ship. The seven-day trip begins March 6, 2024. Space is limited and we need to confirm enough people to make the trip work by the end of June, so please contact Thomas Foreman, president of the BSIA of B.C., as soon as possible to guarantee your spot!

RONA inc. announced last week that it had made major changes within the organization to “simplify its organizational structure to strengthen its position on the market and be more efficient.” That included the elimination of 500 positions within the RONA network across Canada and the naming of a new CEO.

“In light of the current economic downturn, RONA, like other organizations that recently announced restructurings, needed to adapt to reflect new market realities,” says the release RONA sent out last week. “The organization firmly believes that its transition plan aimed at positioning RONA as the leader of the Canadian home improvement industry will support its viability and benefit stakeholders in the long run.”

RONA has clarified with Hardlines that the positions that were eliminated included 300 corporate positions throughout the country—200 of them at the Boucherville head office. The balance of the cuts are from RONA offices, DCs, and stores across the country. The positions affected range from upper management, including some merchants, down to front-line workers in the DCs and in the stores.

The company also affirmed that its head office in Boucherville, on the South Shore of Montreal, will remain in place.

At the same time, Andrew Iacobucci has been appointed CEO. Prior to joining RONA, he was EVP and chief commercial officer at US Foods, a food distribution company based in Rosemont, Ill. Before that, he spent 10 years at Loblaw Cos. Garry Senecal, RONA’s interim CEO, will stay on until the end of the year to ensure a smooth transition.

Earlier this year, Lowe’s Cos. completed the sale of its Canadian business, consisting of Lowe’s, RONA, and Réno-Dépôt-bannered stores, to Sycamore Partners, a private equity firm based in New York. Cutting costs outright can be a trademark of takeovers by private equity. However, when asked if the cuts reflected directives from RONA’s new owners, a spokesperson from RONA clarified to Hardlines that the decision came from RONA’s senior leadership team and was in response to current economic factors. RONA is not the only company facing these realities: Bell recently cut 1,300 jobs, closed or sold off nine radio stations, and eliminated most of its remaining international bureaus.

Concerning the job cuts, RONA’s statement said: “Decisions like these are never taken lightly as they impact the organization’s employees and their families. Employees affected by this change will be supported throughout this transition.”

BMR’s union with European buying group will enhance its overseas sourcing

BMR Group, the Boucherville, Que.-based buying group and wholesaler, has joined a major European buying organization. As part of the A.R.E.N.A. Alliance, BMR becomes that group’s Canadian partner.

A.R.E.N.A. is an international alliance of hardware and home improvement retailers (called DIY stores in Europe). The group is focused on sourcing, negotiation, and quality benchmarks for hardware, garden, and home improvement products. It maintains offices in Paris, Shanghai, Ho Chi Minh City, Warsaw, and New Delhi.

Some of Europe’s leading independent DIY retailers make up the A.R.E.N.A. alliance: Groupement Les Mousquetaires (France), hagebau (Germany), Jumbo (Switzerland), Gruppo Bricofer (Italy), Dedeman (Romania), Pevex (Croatia), Maxeda DIY Group (Benelux countries), and now BMR Group in Canada. Collectively, the eight retail companies, which largely represent groups of independent dealers like BMR, account for more than 15.5 billion euros ($22.4 billion) in sales, and are located in 12 European countries plus Canada.

BMR had been in negotiations with A.R.E.N.A. for two years before joining. For the Canadian buying group and wholesaler, the deal responds to the direction in which many of the industry’s players are headed. “When we look at the overall market, we see the biggest players getting bigger,” says Charles Grégoire-Béliveau, vice-president of merchandising at BMR Group. The alliance with A.R.E.N.A. helps level the playing field. “We were looking at joining something bigger so we can compete better in certain categories.”

Grégoire-Béliveau points out that the membership in A.R.E.N.A. will not mean BMR is going to have direct negotiations with the European offices of any of its domestic vendors—though he anticipates picking up important merchandising and packaging ideas. Rather, BMR will continue to support its relationship with ILDC, which works with the Spancan hardware buying group in this country.

The deal will be for products that A.R.E.N.A. sources overseas, such as outdoor living products, which are almost entirely manufactured in the Far East, often for private labels. “So we’ve found a good fit with buying better and sharing best practices among the other dealers,” Grégoire-Béliveau adds. The result, he says, will be broader assortments, better prices, and improved margins. “It’s good news for the dealers.”

Retail experts to share big insights at this year’s Hardlines Conference

Understanding the direction of retail and the patterns of consumer behaviour are key benchmarks for any retail owner or manager who wants to stay current in today’s competitive marketplace. And there’s no better place to tap the industry’s best thought leaders than at the Hardlines Conference.

This year’s Hardlines Conference will feature some of the brightest minds in retail today. And they’ll share their stories and insights at the conference’s new location in Whistler, B.C., on Oct. 17 and 18. The conference is being held in conjunction with the Building Supply Industry Association of British Columbia. The BSIA will host a table-top trade show concurrent with the conference to showcase its supplier members’ products and services. (For information on how to participate as an exhibitor, contact BSIA president Thomas Foreman directly.)

Dan Tratensek, COO and publisher at the North American Hardware and Paint Association, is a familiar face to conference delegates. He’ll bring the latest research on what NHPA members are facing on the frontlines. Another conference regular, Peter Norman, vice-president and chief economist at the Altus Group, will bring his trademark assessment of housing and economic factors to the Hardlines Conference audience, making sense of interest rates and inflation and consumer behaviours.

A big hit at last year’s conference was a newcomer, Zaida Fazlic, vice-president, people and culture, at Taiga Building Products. Fazlic (shown here) has her own profound passion for the importance of leadership in an organization, and the ways that the demands of leadership have changed during Covid. Her thoughtful and personal insights are not to be missed.

These are just a few of the amazing thought leaders who will be featured at the 27th annual Hardlines Conference. For our complete lineup of presenters, click here.

(The 27th Annual Hardlines Conference will be held at the Fairmont Chateau Whistler resort Oct. 17 and 18, 2023. As a Faithful Hardlines Weekly Report Member-Subscriber, you can use the code HARDLINES23 to get 20 percent off registration! Register here today!)

Saint-Gobain has entered into a definitive agreement to buy Building Products of Canada Corp., the privately owned roofing manufacturer. The deal is worth $1.33 billion in cash. BP Canada, with operations in Montreal, Edmonton, and in Pont-Rouge, Que., had EBITDA of $111 million in 2022.

Saint-Gobain already owns CertainTeed, which has a significant roofing division of its own, in North America. Last year, Saint-Gobain made another major acquisition here with the purchase of siding manufacturer Kaycan.

BP Canada is a major producer of asphalt shingle roofing in Canada. It also supplies other wood fibre insulation panels and acoustic panels. The company had its start when it was incorporated as Building Products Ltd. in 1925, the result of a merger of two companies. Bird and Son was founded in 1795 and built what was to become BP’s Pont-Rouge fibreboard plant in 1905. Ruberoid Co. installed a roofing plant in LaSalle, Que., one year later. BP Canada began production in the West when it built a mill in Edmonton in 1951.

In 1964, the company was acquired by Imperial Oil, then purchased again in 1987 by the plumbing products distributor, Emco. In 2003, it established production in St-Joliette, Que.; three years later, Emco was acquired by private equity.

Saint-Gobain is based in France, just outside of Paris. Considered the largest building products company in the world, it has about 168,000 employees in 75 countries, and 2022 sales totaled €51.2 billion ($73.7 billion). This latest acquisition “will reinforce its leadership in light and sustainable construction products in the Canadian market,” according to a release. The deal is expected to close by the end of 2023.

DID YOU KNOW…?

… that the latest edition of Hardlines Dealer News hit inboxes last week? In this issue, we offer some forecasts for how 2023 is going for dealers, examine one Home Hardware dealer’s “love/hate relationship” with e-commerce, and provide a report on UFA’s support of its farm customers. Hardlines Dealer News is monthly and it’s free: click here to subscribe now!

RETAILER NEWS

Atlantic Canada has experienced its worst wildfires season in years. Kent Building Supplies, which has 49 stores in the region, will match every dollar contributed to the Canadian Red Cross Nova Scotia & Atlantic Canada Fires Appeal. The governments of Canada and Nova Scotia are also matching those donations.

Federated Co-operatives Ltd. is investing $1 million in 15 community projects across western Canada through its Community Spaces program. Since 2015, Co-op Community Spaces has provided $12.5 million to 175 projects in three categories: recreation, environmental conservation, and urban agriculture. This year’s projects include playgrounds in Lloydminster and Englefeld, Sask., and West Kelowna, B.C.; and outdoor trails in Hornby Island, B.C., and Ste. Rose, Man.

Aluminium B. Bouchard is the latest dealer to join TIMBER MART. Located in the Greater Montreal Area, the building materials business is owned by Serge Bouchard. Aluminium B. Bouchard encompasses three buildings—a retail store and two LBM storage buildings—which total 13,200 square feet. It employs a team of almost 60 and has been serving the communities of Laval, Montreal, and the surrounding areas since 1976.

Home Depot held its annual Investor and Analyst Conference last week to update its outlook for 2023. The retailer expects sales and comps to decline between two and five percent from fiscal 2022. It further anticipates a diluted earnings-per-share decline of between seven and 13 percent.

Hipperson Home Hardware in Nelson, B.C., is celebrating its 100th anniversary throughout June. Founded by Bill and Becky Hipperson in 1923, Hipperson Hardware joined the Home Hardware banner in 1981. It has passed through five generations and is now operated by dealer-owner Courtney Dooley and her siblings, Brittany Winje and Linden Horswill.

Ace Hardware of Oak Brook, Ill., has acquired a portfolio of HVAC, plumbing, and electrical home services companies from Grove Mountain, an Atlanta-based private equity firm, reports Franchise Times. The 12 firms operate under the Unique Indoor Comfort brand, a company headquartered in King of Prussia, Penn.

Dollarama reported higher first-quarter sales and earnings as inflation pressures continue to drive traffic to discount retailers. The Montreal-based company’s net earnings for the quarter rose to $179.9 million, from $145.5 million a year earlier. Overall sales rose by 20.7 percent to $1.29 billion, while comp sales were up 17 percent.

SUPPLIER NEWS

Techniseal is underscoring the durability of its products, while appealing to commuter frustration about ongoing construction that ties up traffic, in a new publicity campaign. In three billboards, near Montreal’s Jacques-Cartier bridge and Lafontaine tunnel, and on Toronto’s Gardiner Expressway, the manufacturer invokes its motto “Ça dure longtemps”, or “Built to last.” In a pledge that its products will last longer than major construction projects in the respective areas, Techniseal boasts “See you after the work in the tunnel” in Montreal and “See you when the Eglinton LRT is done” in Toronto.

Aliaxis, parent company of Ipex in North America, announced it has registered in Hydro-Québec’s Renewable Energy Certificates Pilot Project. The company intends to seek certificates covering 100 percent renewable electricity consumption for all its Quebec sites for the year 2023.

Jayne Hounslow, age eight, was tragically killed in a hit-and-run incident in Burlington, Ont., on May 3. She was the daughter of Sarah Hounslow, president of Burlington Merchandising & Fixtures, well known to many in the industry, and Sarah’s husband, Nathan. Jayne was also the granddaughter of Rob Wilbrink, former retail executive and the founder of BMF. The Hounslow family have set up an endowment fund in memory of their daughter. It will help remove financial barriers for children wanting to participate in sports, music, and summer camps. To make a contribution, please click this link: Jayne’s Fund.

After posting gains of 15.5 percent in 2020 and 11.3 percent in 2021, the retail home improvement industry in Canada plateaued in 2022. This was to be expected. Those two years under Covid were a great ride for the majority of dealers in the country.

However, the consumer frenzy for hardware and building supply products was dampened in the past year by multiple interest rate increases and declining commodity prices. Plus, the opening up of other places for customers to spend their money, as pandemic restrictions lifted, further slowed sales.

Hardlines estimates the industry grew 4.6 percent in 2022 to $61.14 billion, based on analysis of the growth by the large players, feedback from independent dealers through our annual Business Conditions Survey, and careful analysis of economic conditions and retail growth figures from StatCan. The data will be used in the 2023 Hardlines Retail Report, available in July.

Even after three pandemic years from 2020 to 2022, in which the industry grew 34.4 percent, the industry still managed last year to grow 4.6 percent. However, the Consumer Price Index was up nationally 6.8 percent in 2022, so the industry experienced a 2.2 percent decline in real terms, after inflation.

In 2019, pre-Covid, Hardlines reported an industry size of $45.5 billion. Last year’s gain was a tremendous feat, especially in a year in which commodity prices tumbled. The industry is still being impacted by commodity price declines and this will likely continue throughout the rest of this year.

(The final figures on the size and growth of the Canadian retail home improvement industry will be featured in our 2023 Hardlines Retail Report. This massive report, in a handy PowerPoint format, will be available in July. Click here for more details on this important body of research and to pre-order yours. As a Hardlines Premium Member-Subscriber, you’ll save over $400 on the price!)

Calgary’s Star Building Materials plans massive expansion

Star Building Materials, headquartered in Calgary, has unveiled an ambitious expansion plan that will greatly increase its output and capacity. The $53 million investment is expected to double the dealer’s production of trusses, engineered wood products, prefabricated wall panels, and interior finishing production. It will also add more than 140 new jobs.

Star Building Materials is a division of Qualico, a vertically integrated and fully diversified real estate and commercial construction company. Star has locations in Calgary and Winnipeg as well as a components division in Edmonton that supplies engineered wood products and trusses. It is also a member of Independent Lumber Dealers Co-operative.

Qualico Properties was instrumental in facilitating the acquisition of an 18-acre parcel of land adjacent to the company’s existing 12-acre facility in Balzac, Alta., in the Calgary Metropolitan Region. The expansion program is expected to help alleviate some of the stresses on the construction industry post-Covid as it confronts ongoing labour and material shortages.

“Through the past couple of years, we’ve learned how vital the supply chain is to the construction industry and we feel this expansion will add solutions to these challenges for years to come,” Ken Crockett (shown here), vice-president of Star Building Materials, told Hardlines. “Using new technologies, added automation, and expanding our production capacities will certainly help to alleviate these challenges.”

He says the expansion will double the capacity of Star’s existing operations and represents an overall investment in people, technology, automation, and the building industry.

The planned expansion follows another investment in growth in late 2019, when Star tripled the size of its distribution yard. That involved relocating from the Alyth Road operations site to its new North Star location near Stoney Trail.

Work on the expansion will begin in the fall and the site should be fully operational in late 2024 or early 2025. It will consist of three new buildings for production, adding to the existing two at the Balzac location. The company’s current operations in its Alyth yard located just off Deerfoot Trail will be consolidated at the facility in Balzac.

“Our plan is to have zero disruptions in service to all our clients throughout this process. Customer service is what has built our business and this expansion will only improve our customers’ experience with Star Building Materials.” Crockett adds.

RONA affiliate dealers open first urban store in the West

Amidst all the changes at RONA inc., with new ownership (Sycamore Partners) and a new boss (former Loblaw exec Garry Senecal), the company continues to develop its retail footprint.

One format that has been growing quietly is RONA’s urban store. It’s smaller than RONA’s building centres or big boxes, and the stores are strategically located in urban settings to better serve the surrounding communities. They can be in a shopping centre or in a downtown area.

With their small retail footprint, they also carry a reduced selection of building materials, but with no lumber yard. The stores also offer a small selection of appliances, supported by online ordering.

“In essence, regular RONA hardware stores are in every market throughout Canada, while an urban RONA store is one in the heart of a major city only,” says a spokesperson from RONA inc. A few of the urban stores already exist in Ontario and Quebec—RONA Bélanger in Montreal’s east-end neighborhood of Rosemont is one example.

Now, the retailer has established its first urban format store in western Canada. Two former RONA employees, Al Tsuchiya and Michael Trentalance (shown here), now the owners of the T&T Hardware Group, have joined RONA’s affiliated dealer network, with their store, RONA Walnut Grove in Langley B.C. The 5,500-square-foot location is getting a 2,200-square-foot expansion to offer up to 650 new SKUs of select building materials and plumbing products.

‘‘With the uniqueness of our distribution network and corporate stores within the Canadian markets, we can support this type of store better than anyone in our industry,” says Philippe Element, vice-president, RONA dealer sales and support.

On Gary Rasor’s 80th birthday, his children asked him to retire because there was no financial need for him to work. Rasor refused and told his children that he loved working at Home Depot, where he trained young employees and enjoyed interacting with customers.

Rasor continued to work for more than two years at The Home Depot in Hillsborough, N.C., until he was confronted by a man stealing three pressure washers last October. The man violently pushed Rancor, who crashed to the floor and was taken to the hospital—where he died from his injuries a few days after turning 83.

“He was just going to ask him for a receipt,” Rasor’s son Jeff said of his father and the man who attacked him.

The elder Rasor was attacked in the course of what authorities call organized retail crime—the large-scale theft of high-value items, which are then illegally resold. In an interview airing tonight on Nightline, Jeff Rasor told ABC News’ Erielle Reshef that he wants authorities to crack down on the growing phenomenon.

“There has to be consequences in my mind, and the consequences have to fit the crime,” he said. “I can’t imagine that any piece of equipment in Home Depot is worth a life—and so when you find out it’s $837, it’s just pretty bad.”

Five months after Gary Rasor’s death, another Home Depot employee was killed after confronting a shoplifter in a California store. Blake Mohs, a 26-year-old loss prevention employee, was shot in the chest while trying to stop a theft at a Home Depot in April. Two people have been arrested on murder charges in the case.

The two deaths come as law enforcement officials and advocates warn of an increase in violent and brazen acts during the commission of organized retail crimes. According to a report released by the National Retail Federation in the U.S., stores and retailers reported that the number of organized retail crime incidents increased by an average of 26.5 percent between 2020 and 2021.

More recently, a Florida man has been arrested on charges of being part of an organized theft ring that targeted Home Depot stores throughout Florida. The group would make fraudulent returns of stolen goods. He is allegedly responsible for a loss of $60,000 at stores in Orlando and Miami.

“It’s growing double-digit year over year,” Scott Glenn, Home Depot’s vice-president of asset protection, told ABC News. “We don’t have enough resources to handle it, [so] we have to prioritize the biggest impacts.”

Tony Cioffi, former president of Lowe’s Canada until March of this year—shortly after Sycamore Partners, a New York City-based private equity firm took over—has been appointed VP finance at Belron Inc. in Montreal. Belron is a giant automotive glass replacement firm with 32,000 employees in 34 countries. Its brands include Apple Auto Glass, Speedy Glass, and Lebeau. Cioffi was replaced as head of RONA inc. (formerly Lowe’s Canada) by Garry Senecal, a former Loblaw executive, who serves as RONA’s interim CEO.

DID YOU KNOW…?

… that the latest episode of our Hardlines podcast series features a great conversation with the current owners of BMR Paulin Moisan in Saint-Raymond, Que., cousins Mathieu Moisan and Marianne Moisan? The grandchildren of the store’s founders, they are also winners of our Young Retailer of the Year Award and have a great story to tell. But wait. It’s in French! Yup, this is our first podcast entirely in French, so ecoutez ici!

RETAILER NEWS

Home Hardware Stores Ltd. has signed a three-year extension as the official home improvement retailer of the Toronto Blue Jays. Under the new partnership, the Rogers Centre in Toronto will feature permanent signage promoting Home’s BeautiTone paint brand as the official paint of the Blue Jays. The retailer has been supporting the baseball team since 2005.

The A.R.E.N.A. Alliance has added BMR Group as its Canadian partner for the supply of renovation and home equipment products. A.R.E.N.A. is dedicated to sourcing and negotiation for DIY, garden, and home improvement products. BMR is its eighth national partner, and the first outside Europe.

Red Deer-based Peavey Industries has acquired its freight partner, Guy’s Freightways. The company is a logistics and transport company and a long-term partner of Peavey. Established in 1975 by Bernie Schwartz, Guy’s Freightways began as a single-truck operation delivering to six Peavey Mart stores. Now headed by Todd Schwartz, the company consists of 16 full-time trucks and 43 trailers. As part of Peavey Industries, it will continue to service Peavey’s retail network across Canada.

Home Depot Canada, through its charitable arm, the Home Depot Canada Foundation, has kicked off its Spring Orange Door Project. Until June 25, the fundraising drive will raise money online and through Home Depot stores across Canada on behalf of 126 local charities supporting youth within the local communities. The Home Depot Canada Foundation is committed to preventing and ending youth homelessness in Canada.

Calgary’s Mountain View Building Materials Ltd. has joined Sexton Group. Tracy Seibert and her late husband Doug founded Mountain View in early 2006. Today, the family business is owned and operated by their sons Joel and Brad, recently joined by a third partner, Sheila Carr.

The RONA Foundation, RONA inc.’s philanthropic arm, has contributed over $1 million to Opération Enfant Soleil and Children’s Miracle Network. In Quebec, RONA was once again the official materials supplier for the Maison Enfant Soleil, designed by Bonneville Homes. With the help of 14 suppliers and a corporate contribution, the network sponsorship was valued at $129,645.

Liesemer Home Hardware in Mildmay, Ont., celebrates its 150th anniversary from June 15 to 17. Founded in 1873 by Conrad Liesemer, the hardware store has been family-owned and operated for five generations. It was among the first stores to join Home Hardware back in 1964. The original building with its hardwood floors continues to serve the business after 150 years.

Princess Auto, the Winnipeg-based hardware and automotive products retailer, has opened its 70th location. The newest store is in Abbotsford, B.C. and marks its seventh location in British Columbia.

SUPPLIER NEWS

Taiga Building Products of Burnaby, B.C., has donated $20,000 to the Red Cross to support relief efforts after the recent wildfires in Alberta. “Taiga stands in solidarity with our customers, suppliers, and families directly affected by these devastating forest fires,” said COO Michael Sivucha.

Aliaxis, parent company of Ipex in North America, announced it has registered in Hydro-Québec’s Renewable Energy Certificates Pilot Project. The company intends to seek certificates covering 100 percent renewable electricity consumption for all its Quebec sites for the year 2023.

The value of building permits dropped 18.8 percent to $9.6 billion in April, the lowest level since December 2020. Residential permits declined 6.1 percent to $6.1 billion, the second consecutive monthly drop. Declines were posted for both the single-family and multi-dwelling components. However, much of that decline came from Ontario, down 10.5 percent. Elsewhere, British Columbia was up 2.6 percent and the value of building intentions in Saskatchewan was up a healthy 45.0 percent. Non-residential permits were down 34.6 percent following the strongest month on record in March. (StatCan)

NOTED

To show its support for its trade customers, Quebec retailer Canac, in partnership with its creative agency LG2, has launched an ad campaign that offers a fashion fix for plumbers when they bend and crouch to fix the pipes. With tongue firmly in cheek, the ad presents a new style of jeans that feature a flap to cover the infamous “plumber’s crack.” It’s very funny!

The Alberta forest fires have had a big impact on our industry, especially the forest products companies involved in logging and milling. One such firm is Weyerhaeuser Co. Ltd., which had to take emergency measures at three of its worker communities, in Drayton Valley, Edson, and Grande Prairie, Alta.

When multiple wildfires broke out at the beginning of May, the company completely evacuated about 300 employees plus their families from Drayton Valley and Edson. These employees were among an estimated 16,000 people in the two towns, most of whom were evacuated under an emergency order issued on May 4. By that time, there were 89 active wildfires in the province.

In Drayton Valley, the fires breached the perimeter of town, said David Graham, president of Weyerhaeuser’s Canadian subsidiary. “Our top priority was in protecting our people and the communities.” Houses were destroyed in both Drayton Valley and Edson. Grande Prairie, meanwhile, was threatened by multiple active wildfires during this time—although it was not under an evacuation order.

A core group of Weyerhaeuser employees stayed behind to help make the community safer, “under the protection and orders of the local authorities in command,” Graham told Hardlines. They engaged in creating more firebreaks, clearing land, and supporting the first responder crews.

At time of writing, the citizens of these towns are back home, the fires around these areas are no longer an immediate danger—rain the week before last helped—and the communities are safe again. But Graham is not breathing easier yet. “Fires in our timberlands are being monitored and some are still out of control,” he said.

“Our business is throughout North America. We’ve got fires, hurricanes, floods. We have to respond with vigour. It’s part of what we do. This [the successful evacuations] was a good news story but it’s going to be a long summer.”

With higher Q1 inventory, Canadian Tire waits out Q2 uncertainty

After a tough first quarter, where comp sales for its Canadian Tire stores dropped 4.8 percent, Canadian Tire Corp. moved into the second quarter with slightly better results. By the end of April, those same-store sales were up three percent, even though higher Q1 inventory levels had yet to ease. And given the fluctuations in weather through the spring, reducing inventory levels remained a challenge.

Weather-related factors were responsible for the vast majority of the sales decline, with sales of items like toboggans, heaters, humidifiers, and snow blowers down in the quarter.

Greg Hicks, president and CEO of Canadian Tire Corp., told analysts on the company’s first-quarter earnings call that there have been some high points, including an uptick in Alberta and elsewhere on the Prairies. But between the weather and the slowdown in consumer confidence, Hicks and his team expected a turnaround in Q2 could be elusive.

“Q1 was such a complex quarter to unpack, with all of the weather impacts, and then we do see some consumer softening signals as well, so I think once we get through Q2, we’ll be in much better shape to kind of really understand the consumer landscape,” he said.

One response has been to increase promotional activity, particularly in discretionary categories, which have softened in comparison to essential lines. TJ Flood, president of Canadian Tire Retail, noted that the company was still “heavy on the spring-summer side of inventory”—a concern, he said, shared by other retailers selling seasonal products, “so I think we are going to expect some promotional activity to heat up here.”

He echoed Hicks’s concern that the company’s outlook will be clearer as products move through the system in the spring-summer season. “Once we get through Q2, we’ll probably have a better ability to tease out weather versus consumer sentiment at this point.”

While Canadian Tire’s distribution centres face excess inventory, with the rate of growth in Q1 down from the previous quarter, a lot of the higher cost of that inventory is due to inflation, said Flood. “Forty percent of that on the corporate side of things can be attributed to inflation, so we’re heading in the right direction in terms of the rate of growth and we’re going to be continuing to manage our inventory very surgically.”

On the dealer side, he notes, the situation is even more positive, as “they’re only up slightly [on] year-over-year in inventory, and that’s entirely attributable to inflation, so they’re in much cleaner shape.”

Home Depot in the U.S. now selling tiny homes online and through its stores

Houses that can be erected in as short a time as one day are being sold by Home Depot. The homes, as small as 140 square feet in size (for the “Sedona” model), are sold without extras like windows. Home Depot offers a link to a preferred partner that will build the house for the customer.

The tiny home trend is catching on in Canadian cities as a solution for both decreased housing affordability and increasing density. For example, Ontario has provincial regulations that allow the development of smaller-footprint residences with a minimum of 188 square feet in lanes, backyards, and on cottage properties. There are even several tiny home communities springing up throughout the province.

However, the tiny homes are not available at Home Depot stores in Canada, nor can they be purchased through Homedepot.ca. In the U.S., the tiny home trend offers an alternative to the affordable mobile or trailer home option.

While the price includes delivery, the package consists only of the steel structure and the necessary components to assemble it. It doesn’t include windows, doors, floors, walls, or siding. But Home Depot has its own construction and build team, which helps to determine the materials necessary to build each project, including wiring and plumbing.

In addition, all orders are checked by a certified engineer to ensure each complies with the purchaser’s local building codes. The services allow customers to work with the retailer directly to customize and adapt their tiny home package.

Hudson’s Bay Co. intends to keep expanding its Zellers brand across Canada—through both bricks and mortar and online presences. That will include increasing the store-within-a-store’s footprint in cities across the country. The retailer has significant liquidity to enhance its offerings and has raised additional capital to support that investment.

Now, Zellers is setting its sights on additional locations. The Zellers rebirth started as a series of pop-up boutiques within Hudson’s Bay stores—and more are to come. A pop-up Zellers section will launch this month at The Bay’s flagship Queen Street store in Toronto. An additional 20 pop-ups are expected to open in August.

The pop-ups will effectively measure customer response in each market to determine the best fits for the Zellers store experience. “We have always said that we will listen to Canadians, and they will tell us where to grow,” says HBC president Sophia Hwang-Judiesch. “With these pop-ups, our expansion strategy will be fueled by the interest and feedback from our customers across the country.”

The department store is a retail format that has had difficulty reinventing itself in the e-commerce age. Nor has Covid been kind to the all-in-one retail format. Yet discount mass merchants and dollar stores have flourished during the pandemic. For Hudson’s Bay, reviving the Zellers brand gives the retailer a conduit for low-priced assortments that could well be a strategy to compete with the discounters.

Zellers’ price philosophy is built on everyday low prices for product assortments that are built on three pillars, says the company: quality, design, and value. Those assortments cross a range of key lifestyle categories, including kitchen and bath, accent furniture and home décor, organization and storage, baby and kids’ toys and apparel, pets, and clothing basics.

HBC, the holding company whose holdings include Hudson’s Bay and Zellers, as well as Saks Fifth Avenue and Saks Off 5th, has raised $240 million of additional liquidity to further invest in and grow its operating businesses. The company says it sees “an immense opportunity for growth in its retail markets,” especially as other retailers exit the Canadian market.

IKEA veteran Selwyn Crittendon will take over as CEO and chief sustainability officer of IKEA Canada, effective Aug. 1. Previously country business development and transformation manager at IKEA U.S., he has been with the retailer for more than 20 years, starting out as customer service manager at a Washington, D.C.-area store. In the top job at IKEA Canada, he will oversee its continued efforts to expand its omnichannel strategy.

Executive recruiter DMC Recruitment has promoted Karine Gagnon to the role of manager of lumber and building materials recruitment. She will oversee the development of the team of LBM recruiters. Gagnon was recently named Recruiter of the Year for Quebec by the Association of Canadian Search, Employment, and Staffing Services (ACSESS).

 

DID YOU KNOW…?

… that Hardlines will be part of a luxury cruise for Canadians in tandem with next year’s International Hardware Fair in Cologne, Germany? In partnership with the Building Supply Industry Association of British Columbia, we’re organizing a business trip to Cologne to attend the largest hardware show in the world, followed by an industry tour of the Rhine River on our own dedicated ship. The seven-day trip begins March 6, 2024. Space is limited and we need to confirm enough people to make the trip work by the end of June, so please contact Thomas Foreman, president of the BSIA of B.C., as soon as possible to guarantee your spot!

RETAILER NEWS

Kingdon TIMBER MART in central Ontario held a grand opening for its store in Lakefield, about 20 minutes outside Peterborough. The 50,000-square-foot store replaces an older site nearby and the parking lot had lots of activities for customers and their families. Local food vendors served up treats, while other activities included chainsaw sculpture, product demonstrations, and axe-throwing contests.

BMR Group last week formally launched the BMR Amqui hardware store, which has been under the banner for almost a year. The hardware store was acquired in 2022 by BMR member Unoria Cooperative, owner of a network of 13 hardware stores in the Bas-Saint-Laurent and Gaspésie regions.

TIMBER MART has named the four finalists eligible to win grants for community projects through its Local Leaders Initiative. Dealers can nominate individuals who show leadership and make a positive impact through projects, programs, or initiatives in their communities. Each finalist wins $8,000 for a cause of their choice and the winner, to be announced July 10, will get an additional $10,000 for the cause of their choosing. The finalists are: Frank King of Charlottetown, P.E.I.; Pierre Côté of Sherbrooke, Que.; Karen Watson of Havelock, Ont.; and Joy Neufeld of Steinbach, Man.

Al Tsuchyia and Michael Trentalance, owners of the T & T Hardware Group, have joined RONA’s affiliated dealer network. The pair are former RONA employees. They have announced a 2,200-square-foot expansion of their hardware store, located in a shopping centre in Walnut Grove, B.C. It’s RONA’s first urban store in western Canada.

Retailers across Canada gathered last week in Toronto for the Excellence in Retailing Awards. They were presented during a gala dinner at the end of day one of the Retail Council of Canada’s conference, STORE23. Notable winners were: Canadian Tire Corp. for Environmental Leadership and for In-Store Experience & Design; Giant Tiger Stores for Philanthropic Leadership; Calgary Co-op for Philanthropic Leadership; and Staples Canada for Talent Development. The winner of the RCC’s Award of Distinction went to Greg Hicks, president and CEO of Canadian Tire Corp.

Matériaux Pont-Masson has marked the grand opening of its ninth store, in Val-Morin, Que. The new outlet includes a 13,000-square-foot sales area and a covered warehouse area of 30,000 square feet. The store will offer a range of dedicated services for pro customers, including extended contractor hours and financing.

Giant Tiger will hold a grand opening for its newest location on June 10 in Huntsville, Ont. The 18,600-square-foot store is located at 70 King William St. in the Central Ontario community.

SUPPLIER NEWS

Barbecue maker Napoleon is commissioning newly expanded warehouse operations in Crittenden, Ky. Driven by strong demand in the U.S. market, the added warehouse investment enables better fulfillment and customer service to Napoleon’s customers there, says the company, and marks the beginning of a larger U.S. supply network expansion. In addition, Napoleon was awarded for the 11th consecutive year as one of Canada’s Best Managed Companies by financial consulting firm Deloitte. The annual review recognizes Canadian-owned businesses for their strength in strategy, commitment, capability, financial performance, and leading practices in ESG.

Quebec kitchen and bathroom cabinet maker Ébénisterie St-Urbain (EBSU) is facing the threat of bankruptcy, Le Journal de Montréal reports, thanks to its 2021 acquisition of Woodlore. At the time of the deal, Ontario-based Woodlore concealed from EBSU that it was being sued for breach of contract by a customer accounting for 40 percent of its sales. It lost that customer three months after the acquisition. Compounding EBSU’s woes, RONA, BMR, and Patrick Morin have all reduced their orders from the manufacturer. A RONA spokesperson however told Le Journal that fluctuations in orders are normal and not attributable to EBSU’s situation and RONA’s current order volume with EBSU remains very high.

Ryobi Tools has launched a new merchandising concept at the Home Depot store in Barrie, Ont. The store-within-a-store concept, called the Ryobi Power Centre, has been designed to offer a wide range of power tools, power tool accessories, and outdoor power equipment in an immersive setting to encourage deeper engagement with customers. The concept offers information and education, interactive video displays, and live interactive demos, as well as exclusive in-store events every weekend.

OVERHEARD…

“Prices are up the most in 40 years. So I don’t expect people to be happy about that. At the same time, I think there’s a false narrative out there being propagated that grocers or retailers are taking advantage of the situation, which is completely untrue.” —Michael Medline, president and CEO of Empire Co., whose holdings include the Sobeys grocery chain. He was interviewed in the latest edition of ROB Magazine.

Forecasts by the leading public hardware and home improvement retailers have already sent a message that 2023 is going to be a slow year. Home Depot, Lowe’s, and Canadian Tire all expect sales to dip by as much as five percent. (See last week’s issue for the full story. —your helpful Editor)

The expectations of independent dealers across Canada indicate they are facing the same concerns.

Hardlines surveyed hardware and home improvement dealers earlier this spring and found that most are facing flat sales for 2023. The average for all dealers that responded is -0.7 percent. There were some highs—a few respondents in Ontario expect five or even 10 percent gains this year, and Saskatchewan dealers were most positive overall, on average expecting a two percent gain. In Nova Scotia, some dealers expect gains of seven, eight, and even 10 percent, despite their concerns about sourcing and product shortages.

However, most dealers in the survey anticipate zero growth in 2023. Dealers that expected a real drop in sales were typically forecasting a decline of 10 percent—and a few cited expected downturns of 20 and 25 percent. The dealers predicting the greatest anticipated losses are generally strong independents who had big gains in 2022, following a banner year for the entire industry in 2021. (None of the dealers can be named to respect the confidentiality of the survey.—your faithful fact-checking Editor)

In other words, dealers will have a hard time maintaining the momentum of the past three years. The slowdown began last year: after a strong first quarter, the industry saw sales drop off as interest rates and inflation sped up, coupled with falling LBM prices.

In fact, Hardlines has calculated a modest gain by the industry in 2022, but one that was still below the national inflation rate of 6.8 percent last year.

The flat forecast for the current year is not entirely bad news, then, but can instead be interpreted as a continued correction in the market. This cooling off can have a number of upsides, taking the pressure off hiring demands and easing the strain on the supply chain as product flow and pricing return to a new normal.

Under new owners, affiliate dealers will get a better deal, says RONA SVP

Without the leadership of Lowe’s Cos. in the U.S., the executive team at RONA inc. is wasting no time doing things their own way. The sale of the former Lowe’s Canada to a New York City-based private equity firm was finalized on Feb. 3.

Ads have become more humorous, the RONA brand is getting increased awareness, and the affiliate dealers are getting more attention. Hardlines reached out to Jean-Sébastien Lamoureux, senior vice-president, RONA affiliates, wholesale, and public affairs. “Lowe’s were great partners right across the board, but we’re very excited by what we’ve seen from our new owners, Sycamore Partners,” he says, “and it’s really resonating with the independent dealers.”

Out of a total of 445 stores, RONA has 333 RONA-bannered locations, of which about half are affiliate dealers. “The dealer RONA network is one of the growth vectors for the future. That’s our main theme here. We value the history that the dealer network has with this company.”

Asked about what that growth will look like, Lamoureux underlines three strategies. The company definitely wants to add more dealers and increase the number of independents flying the RONA banner. Lamoureux also wants to broaden the geographic reach of the dealer network. Its greatest concentration—outside of its home province of Quebec—is in British Columbia and Ontario.

And the opportunity for individual dealers that are already part of RONA is big, he adds, with support in place for those dealers to add stores or buy out competitors. “We want to be a partner in their growth, not only organically, but in terms of consolidating their markets.”

Will RONA focus mainly on larger building centres? Lamoureux says no. The company wants to recruit and develop every type of dealer from hardware stores to home centres and lumberyards. Each type of store represents a format that can position a retailer effectively to serve its local market.

“As RONA is getting back to its roots, it’s only natural that the independent dealers play a significant role in the company in the future.”

(Jean-Sébastien Lamoureux will be a keynote presenter at this year’s Hardlines Conference, Oct. 17 and 18 in Whistler, B.C. You’ll want to hear the latest about RONA’s plans for its affiliate dealers right from the source! So click here now to learn more and secure your spot at this incredible event!)

Despite lower Q1 results, Lowe’s makes healthy online sales gains

Lowe’s Cos., which reported first-quarter sales last week that were five percent below last year’s Q1, is feeling the pinch on big-ticket items now that the Covid-driven consumer frenzy for home improvements has abated.

The retailer posted Q1 earnings of $2.26 billion, down from $2.33 billion a year ago. Sales fell by more than five percent to $22.35 billion, compared to $23.66 billion in Q1 of 2022. Comp sales fell by 4.3 percent. The biggest drop was from DIY customers; Lowe’s contractor business was healthier with positive comps in some pro categories.

“Candidly, what we’re seeing is pressure across big-ticket discretionary purchases primarily,” Marvin Ellison, president and CEO of Lowe’s, said on a call with investors and journalists. “We’re seeing some pressure in small-ticket [items], but it’s more pronounced in big-ticket [items] and is almost exclusively discretionary in DIY.”

However, the company continues to make gains in its online sales, as part of its “Total Home” strategy. E-commerce sales were up six percent in the quarter, bringing the retailer’s online sales penetration to almost 10 percent of overall sales.

One of Lowe’s strategies to counter the new consumer thriftiness will be to introduce more private-label Lowe’s products, including a new line of closet organization products and an exclusive line of tintable paints formulated specifically for pros from Sherwin-Williams.

“Our private-brand strategy allows us to deliver value to DIY customers who are looking for high-quality, on-trend products at more affordable price points,” said Bill Boltz, Lowe’s executive vice-president for merchandising.

A brand new retail home furnishings and décor banner is coming to Canada, and it’s taking over at least 21 former Bed, Bath & Beyond locations after that chain entered bankruptcy protection. Putman Investments—already an operator of multiple retail brands—will launch a new retailer called rooms + spaces.

Putman Investments is an Ancaster, Ont.-based company that already owns Toys “R” Us, Sunrise Records, FYE (For Your Entertainment), HMV UK, and T. Kettle (formerly Davids Tea). Hardlines interviewed the 39-year-old investment firm’s founder, Doug Putman, and found him bullish on the future of—not just his rooms + spaces brand—but bricks and mortar retail in Canada in general.

Putman Investments is all family money, Putman said, with sales from the 25 companies it owns approaching $4 billion. In addition to its flagship retailers, the company owns distribution, manufacturing, and real estate. “We take no outside investment, so everything we buy, we own 100 percent.”

“They are just companies that are out of fashion, or not doing well, and they’re just kind of at the end of their life,” Putman said. “People say to me, why did you get into the distressed [retailer] business? The answer was simple, I didn’t have enough money to buy a good business!”

Putman’s first investment was troubled Sunrise Records, which he bought for not much money at all. Now he is a significant global player in the recorded music bricks-and-mortar space (HMV UK is a top 10 retail brand), confounding sceptics who thought that Spotify, iTunes, and other digital music vendors would drive his record shops out of business.

“They are unfashionable businesses, for sure, but they do fantastically well,” Putman says. “We hit it perfectly with vinyl… and with an explosion in pop culture products in general, whether it’s T-shirts or paraphernalia.”

Putman once said that he didn’t want to invest in anything that didn’t have “unlimited upside.” Does rooms + spaces have that upside? To Putman it does: “We’re starting with about 30 stores [Putman is in negotiation to take over more Bed Bath & Beyond leases beyond the already-announced 21 locations] in a market that’s billions of dollars, right? I think we’ve got this potential. Are we going to have a large market share in certain areas? No. But I think we can have a good share.”

Walmart Canada has made changes to its lineup of senior executives. Mohammed Abdool-Samad has joined as CFO. He was group CFO at Walmart’s Massmart business in South Africa. John Bayliss has been named chief administration officer. He was formerly an EVP. Michon Williams has been promoted to chief technology officer from the role of VP technology. Joe Schrauder has joined as VP, operations and chief of staff to the CEO. He is relocating to Canada from Walmart’s Bentonville, Ark., head office, where he was VP, international operations and realty for Walmart International.

DID YOU KNOW…?

… that the 2023 Hardlines Conference will take place Oct. 17 and 18 at the Fairmont Chateau Whistler Resort in Whistler, B.C.? The two-day program includes speakers from leading home improvement organizations such as RONA, Home Depot, Taiga Building Products, Federated Co-op, and Ace Canada. Hardlines Weekly Report subscribers can take advantage of a 20 percent discount on registration, while special pricing is available to dealers!

RETAILER NEWS

Gow’s Home Hardware in Bridgewater, N.S., held a celebration recently for its 175th anniversary. Dealer-owner Amanda Fancy accepted the Outstanding Retailer Award for Best Hardware Store at the 2017 Hardlines Conference. Since then, the store has moved to a new location and added furniture and appliances to its offerings. During the pandemic, the store’s annual sales exceeded $18 million.

A Castle dealer is planning the opening this spring of a new store on Prince Edward Island. Brudenell Building Centre in Montague is the latest expansion for long-time Castle member Mike James. James owns Spring Valley Building Centre in Kensington, near Summerside, and O’Leary Building Centre in O’Leary, on the west side of the island. His new partner is Adam Baird, who will serve as the store’s general manager.

SUPPLIER NEWS

The Retail Council of Canada will hold its flagship event, RCC Store23, on May 30 and 31 at the Toronto Congress Centre, near Pearson International Airport. Speakers include Retail Prophet founder Doug Stephens, Holt Renfrew CEO Sebastian Picardo, and Danyal Syed Ali, head of consumer and customer insights at IKEA Canada. (Check out the complete agenda here or click here to buy tickets.)

Doman Building Materials Group, the owner of CanWel Building Materials, reported a big decline in revenue in the first quarter compared to Q1 of 2022. Revenues were $609.1 million, compared to $851.3 million in the prior year—a 28.5 percent drop. Net earnings for the first quarter were $14.91 million, down 64.5 percent from $42.03 million a year prior. The drop in revenue was “largely due to the impact of construction materials pricing, which peaked in the comparable period in 2022,” said the company in a release.

Aliaxis SA, which operates in North America under the Ipex brand, has reached an agreement to acquire the manufacturing business of U.S.-based Valencia Pipe Co. The $250 million transaction will bring two production facilities and one distribution centre into the Ipex fold, in the states of Arizona and Washington. In a release, Alex Mestres, Aliaxis’ divisional CEO of the Americas, called the acquisition “an excellent opportunity to expand our reach into the western United States.”

ECONOMIC INDICATORS

Retail sales decreased by 1.4 percent to $65.3 billion in March. Sales fell in five out of nine subsectors, representing 55.5 percent of retail trade. The biggest declines were in automotive and fuel categories. Core retail sales for the month rose by 0.3 percent in March, the fourth consecutive increase. The gain was led by higher sales at building material and garden equipment and supplies dealers, which were up 1.6 percent. (StatCan)

NOTED

Martha Billes, daughter of Canadian Tire co-founder A.J. Billes, and her son, Owen Billes, own 61.4 percent of all common shares of Canadian Tire Corp. According to CTC’s 2022 annual report, they “beneficially own, or control, or direct the shares through two privately held companies, Tire ‘N’ Me Pty. Ltd. and Albikin Management Inc. Both Martha and Owen are members of the CTC board. Martha was invested as an Officer of the Order of Canada in 2022.

OVERHEARD…

“Canadian Tire and our associate dealers do not condone the anti-Trudeau protests happening in some of our stores’ parking lots. Use of our logo, and unauthorized rallies in our stores or parking lots, are strictly prohibited.”
—A tweet issued by Canadian Tire on May 17.

Home Depot released its first-quarter results last week and they were sobering. The world’s largest home improvement retailer missed revenue expectations and reduced its 2023 fiscal year forecast, predicting that sales will decline between two and five percent this year. Previously, the company said sales in 2023 would be roughly flat.

Revenue for the quarter was $37.26 billion versus $38.28 billion expected. Comp sales fell 4.5 percent in the quarter. First quarter net income was $3.87 billion, down from $4.23 billion a year earlier.

Home Depot had reported a healthy performance in 2022, with sales up 4.1 percent following two of the best years of growth for the company—and the industry—in decades. But the market was already slowing through 2022, as LBM prices tumbled back down from the historic highs seen during the first two years of the pandemic.

While this industry flourished under Covid, forecasts by all the big retailers have tended to be moderate for the year ahead, as the momentum from home improvement and reno investments begins to tail off. Couple that with the fact that interest rates remain high and inflation rose again in April, to 4.4 percent from March’s 4.3 percent. That inflation is affecting core sectors such as food costs, and people are simply spending their money elsewhere. Home Depot said that customers were buying fewer big-ticket items.

The results fit a trend that independent dealers are already seeing—a slowdown versus a year of growth in 2022. It was a tough act to follow.

While Lowe’s results won’t come out until tomorrow, its year-end forecast for 2023 was already stated as flat or down one to two percent. Like its chief rival’s, this outlook may prove optimistic.

Canadian Tire Corp. shared similar pain in its Q1 results call, as overall net income fell 3.4 percent year over year. Comp sales for its Canadian Tire stores were down 4.8 percent. According to Greg Hicks, president and CEO of CTC, in a call to analysts, the outlook is more cautious moving through 2023.

“Given the macro backdrop combined with what we are seeing in the performance of our business, we are expecting a more constrained demand environment as we look forward, especially in the first six months of this year,” Hicks said. (Surely the most genteel way of saying, ‘People are buying less’ that we’ve heard in a long time!—Editor)

Like Home Depot, Canadian Tire has seen a shift in spending patterns by its customers. Discretionary spending has slowed, including for larger-ticket items, while its so-called “essentials” category has been moving a lot more product, especially automotive products and pet supplies.

(Next week, we will report on the business forecasts of independent dealers in Canada, using the data from our latest Hardlines Dealer Survey.)

Loblaw is the latest big retailer to enter appliance sales

Real Canadian Superstore, the big box format for the Loblaw chain, is now carrying heavy appliances in a pilot at its store in Milton, Ont. The retailer is teaming up with Canadian Appliance Source with a store-within-a-store model.

The pilot features more than a dozen brands, including LG, Kitchen Aid, Samsung, Bosch, and Frigidaire. At 1,900 square feet, the store-within-a-store concept will be operated by CAS appliance experts and offer the same service, terms, and conditions as standalone CAS stores. Customers will also be able to redeem PC Optimum points on major appliance purchases in this area of the store.

CAS was started in 2008 and now has almost 40 locations. They are concentrated in major cities like Toronto, Vancouver, and Montreal, but the retailer has locations across the Prairies and in Nova Scotia.

The appliance market is a strong one for home improvement retailers, albeit a relatively new one. The market for appliance sales opened up more than a decade ago when Sears, the leading appliance seller in North America, began its decline. Sears carried a range of brands, including its own Kenmore label. At its peak, it owned almost half the appliance market in the U.S., but even by 2003, Lowe’s was in second place with almost 14 percent of the market, while Home Depot was growing that category and had just over five percent of appliance sale share.

Lowe’s brought appliance sales with it to Canadian Lowe’s stores when it took over RONA inc. in 2016.

At one point, Sears Canada had 140 locations plus about 900 catalogue and online pick-up locations. When it closed its doors, Home Depot was quick to follow the Lowe’s lead in filling in the gap. Sears Canada closed its last store in January 2018, and soon after a new-look RONA store was introduced that featured an expanded appliance selection, following the model of the Lowe’s stores in Canada.

Other retailers followed suit. Home Hardware eventually made the foray into heavy appliances, and the category now constitutes an important part of many Home Hardware stores. Even many of Home’s smaller traditional hardware stores maintain a small showroom and take special orders.

Loblaw has plans grow its presence in appliances as well. The first pilot will be expanded “to a small number of additional [Real Canadian Superstore] locations across the country later this year,” according to a release.

Where is housing going? Mixed messages, but overall positive signs ahead

Sales of existing Canadian homes jumped by 11.3 percent in April compared to the previous month. With prices stalled and supply low, the market appeared to take off following Easter weekend, reports the Canadian Real Estate Association.

Greater Toronto and the B.C. Lower Mainland in particular,were hotspots for growth. However, the rate has not returned to pre-Covid levels. The actual (not seasonally adjusted) number of transactions for the month were still 19.5 percent below April 2022. Still, CREA notes that this was a markedly smaller decline than those seen over the past year.

Demand still outstrips supply, keeping the market tight. The number of new listings that came on the market last month was up only 1.6 percent and represents a 20-year low. However, most of that gain was from the previous month, indicating a trend of picking up speed.

And the price for real estate is not increasing dramatically. The actual (not seasonally adjusted) national average sale price posted a 3.9 percent year-over-year decline in April. Looking ahead, housing intentions for the country, as reported by Canada Mortgage and Housing Corp., showed an increase of 22 percent in April, reaching 261,559 units. In urban markets, housing starts rose by 26 percent, with the greatest gains in the big three markets of Vancouver, Toronto, and Montreal.

The condo market in key markets is also showing healthy activity. Multi-unit urban starts increased by 33 percent to 201,621 units in April. However, that gain comes at the expense of the single-detached market. Urban starts for single-detached homes actually decreased by two percent to 39,964 units.

CMHC, in its Housing Market Outlook – Spring 2023 edition, anticipates that lack of consumer confidence will hold prices and markets down, at least through the rest of the year. “Weaker economic growth and higher mortgage rates continue to slow the economy in 2023. As a result, we expect a price decline between 2022 and 2023, but the average price will not revert to pre-pandemic levels. However, we expect this decline to bottom out sometime in 2023,” says the report.

The Prairies are expected to lead the growth, while Ontario, British Columbia, and Quebec are expected to see large declines in 2023 housing starts, despite the April surge in condo starts.

New home activity is strengthening, but those gains are being made primarily with condo markets in major cities. Commercial-side dealers may benefit. For dealers relying on single-detached houses, the market continues to be slow. Nevertheless, the reno and décor market that is typically a beneficiary of home resales could show more signs of life moving into the middle of the year.

A warehouse robotics firm has filed a statement of claim against Canadian Tire over the latter’s mid-March fire at one of its largest distribution centres in Brampton, Ont.

Calgary-based Attabotics specializes in inventory storage and supply chain systems, helping companies compete against the likes of Amazon.

The start-up was working with Canadian Tire to develop robots (Not exactly as shown—Editor) that “move and pick in three dimensions,” according to the company’s website, to reduce the inefficiencies of “legacy” row-and-aisle warehouse systems. The company claims the fire at the Brampton CTC facility caused damages to Attabotics.

The damages, according to the claim, include “loss of reputation, business opportunities, goodwill, market share, and/or loss of profit.” The fire occurred because of Canadian Tire’s “wrongful conduct, statutory breaches, breaches of contract, gross negligence, willful misconduct, negligence, and recklessness,” the claim alleges.

Attabotics is a startup that raised $71.7 million in new funding at the end of last year to help it develop its business. Funding came through Export Development Canada, with involvement from the Ontario Teachers’ Pension Plan Board, taking the company’s total funding to $165.1 million.

DID YOU KNOW…?

…that entries for our 2023 Outstanding Retailer Awards (ORAs) are due to be emailed to Hardlines in just four weeks? Yes, the deadline is Friday, June 16. Entering the ORAs is easy. Just go to hardlines.ca and click on the ORAs link. You’ll find everything you need to send us your entry. This prestigious award could be presented to you on the evening of Oct. 17, 2023, in Whistler, B.C., at the Hardlines Conference. If you win, you will be there as our honoured guest, accommodations and transportation included. Enter now! The publicity benefits of being named an ORA winner are huge!

RETAILER NEWS

Home Hardware dealer-owners Blair and Nyssa Kneller have expanded their store, Westlock Home Hardware, in Westlock, Alta., 90 kilometres north of Edmonton, from 8,800 square feet to 15,500 square feet. With the expansion, the Knellers now have an M&M Express meat shop and a large sporting goods department. The store has served the community for 110 years. Blair Kneller became dealer-owner of the store in 2012. In Ontario, Adam Moulton, dealer-owner of five Home Hardware stores, celebrated two grand reopenings recently following store upgrades of his own. He took over both Ingersoll Home Hardware Building Centre and Strathroy Home Hardware Building Centre in 2021.

Walmart has reported that its Q1 earnings came to $1.67 billion, down from $2.05 billion in the same quarter of 2022. Sales were up, however, rising by 7.6 percent to $152.3 billion. In Canada, net sales rose 6.7 percent to $5.5 billion while comp sales were up by the same percentage.

Target reported Q1 earnings of $950 million, or $2.05 per share, down from $1.01 billion a year earlier. Revenues overall edged up by less than one percent to $25.32 billion, beating an expected $25.29 billion. Comp sales for the quarter remained flat.

SUPPLIER NEWS

Rust-Oleum Canada has moved into the wall paint market. The company, best known for its range of specialty paints, stains, and anti-rust coatings, has now introduced Colour Spark, its newest foray into a broader range of coatings. The Colour Spark line consists of 13 pre-tinted shades which can be picked up in stores or ordered online. The self-priming paints come in both interior and exterior formulations and are available in either eggshell or semi-gloss finishes.

Taiga Building Products has become the official Canadian independent retailer distributor for Hoft. Based in Greater Montreal, Hoft manufactures all-aluminum privacy screens, railing, fencepost kits, and accessories. Hoft’s post kits are designed for both pros and DIYers.

Canfor Corp., the Vancouver-based forest products company, had a Q1 loss of $142 million. This compares to a profit of $534 million in the same period last year. The company blamed falling lumber and lumber product prices. Revenue in the quarter was $1.39 billion, down 37 percent from $2.21 billion in the previous Q1.

The Bosch Group ended 2022 with total sales of 88.2 billion euros (CD$129.2 billion), up 12.0 percent over the previous year. in the first quarter of 2023, the company saw a sales increase of 3.5 percent. North America was especially strong, with double-digit growth of 18 percent. In Europe, the company grew by 7.7 percent.

ECONOMIC INDICATORS

Investment in building construction declined 1.3 percent to $20.3 billion in March, with spending on residential builds down 2.1 percent to $14.6 billion. Investment in the single-family sector fell by 1.8 percent to $7.9 billion. Non-residential construction spending continued to climb, up 0.9 percent to $5.7 billion. (StatCan)

U.S. retail sales edged up by 0.4 percent in April. Sales by LBM and garden supply dealers were up 0.5 percent from March but remained 3.7 percent below last April. March’s data was revised slightly downward to a decline of 0.7 percent from the estimated 0.6 percent. (U.S. Commerce Dept.)

NOTED

Canadian Tire continues to invest in attracting members to its Triangle Rewards program, a loyalty program that rewards shoppers across all of Canadian Tire’s brands, including Mark’s, SportCheck, Party City, and PartSource. The program boasts 11.4 million active members. Canadian Tire’s new Triangle Select subscription membership program, launched in January 2023, now has more than 22,000 members.

OVERHEARD…

“We wanted to reinvent and simplify the painting experience to make it easier and less confusing for homeowners, renters, DIYers, and pros by creating a high-performance, pre-tinted paint line and easy online and in-store experience.”
—Maurice Lobreau, Rust-Oleum Canada’s vice-president and general manager, on the company’s launch of a line of wall paint, a significant departure from its focus on specialty paints and coatings.

The statistics don’t lie: revenue earned from retail e-commerce is estimated to exceed one trillion dollars in 2023 in the U.S. alone. According to both the U.S. Census Bureau and financial services provider Fundera, 16 percent of all retail purchases are made on e-commerce sites, which will translate into global online sales totaling $6.3 trillion this year.

But for independent hardware stores and building centres in this country, the reality is quite different. No question, during Covid dealers figured ways to accommodate their customers with virtual service, including curbside pickup. But that interaction was not always digitally driven. Especially in smaller communities, the telephone is often the preferred way to connect. Our latest survey of dealer business conditions bears this out.

Canadian hardware and building supply dealers that sell online averaged, in both cases, 0.9 percent. But the overall industry average of online sales for independents, not including Lowe’s and Home Depot stores, is barely 0.1 percent, because the majority of dealers cite no online sales.

There are exceptions to this data. Brent Perry of Alf Curtis Home Improvements, a Castle dealer with three stores based in Peterborough, Ont., admits his online sales aren’t much higher than those of his fellow dealers. But he says it’s not about how much you’re selling online; it’s about being there, about having a presence.

And his presence has been assisted by Orgill, the giant Memphis-based hardware distributor, which has introduced a suite of new e-commerce options for its dealer customers. Dubbed Impact eCommerce, the service was presented at the latest Orgill Spring Dealer Market, held earlier this year. The platform enables dealers to sell products online with a truly transactional site.

 Dave Audette admits he has a “love/hate relationship” with his store’s online business. He and his wife Jessica are the owners of Lorette Home Hardware, about 20 minutes south of Winnipeg. At seven percent of overall sales, their store’s online business far exceeds the national average for independent dealers.

Dave notes that in the past week the store received 31 e-commerce sales. They ranged from bone meal fertilizer and fasteners to a gazebo, one order for a barbecue and a lawn mower, and some gardening kits. Other items that sell really well online, he adds, include showers, especially by Maax and Mirolin. In fact, they sell twice as much online as in-store.

Cologne Hardware Fair in 2024: combine it with a Rhine cruise!

We’re pretty excited about this one, to put it mildly.

In partnership with the Building Supply Industry Association of British Columbia, Hardlines is pleased to announce a very special addition for Canadians to next year’s International Hardware Fair in Cologne, Germany. We are organizing a business trip to Cologne to attend the largest hardware show in the world, followed by an industry tour of the Rhine River in our own dedicated ship.

Dealers and suppliers can take the trip of a lifetime following the International Hardware Fair. Hardlines, with the Building Supply Industry Association of B.C., Expedia Cruises in Surrey, B.C., and the Asia Pacific Wine and Spirit Institute, presents this unique trip from Cologne to Amsterdam. And you’ll be in great company.

This seven-day trip, which begins March 6, is designed for industry leaders—dealers, buyers, and suppliers alike—who see the benefit of attending unique events and trade shows.

The International Hardware Fair is reason enough for any buyer, dealer, agent, or supplier to get overseas next spring. This show is not only a source for cutting-edge new products, but it’s a wellspring of merchandising and packaging innovations as well. It runs from March 3 to 6, 2024. From there, our group will move right over to board our own cruise ship, the Avalon Passion. It departs Cologne on March 6 and arrives in Amsterdam March 13.

Don’t miss this once-in-a-lifetime trip along the Rhine aboard the beautiful Avalon Passion, sailing from Cologne to Amsterdam. And you’ll be making global home improvement industry connections along the way!

Join Dr. Clinton Lee, the executive director at the Asia Pacific Wine and Spirit Institute, who is an international wine and spirit educator. His CV includes being a keynote speaker and the author of “Master the art of Manners.” Dr. Lee has travelled to over 100 countries and has delivered masterclasses on five continents. He is an acknowledged global etiquette master and social media influencer with over two million followers. Our guests will join him on board to learn about wine, scotch, and fine cigars.

Dean McIntosh is a Canadian Red Seal Chef and Butcher, travelling the world and sharing his extraordinary global experiences with a range of foods and cultures. With Dean, guests will be able to prepare regional cultural dishes right on board.

The boat is limited to 100 people, so spots are limited. And we have to confirm enough people to make the trip work by the end of June, so please contact Thomas Foreman, president of the BSIA of B.C., as soon as possible to guarantee your spot on this once-in-a-lifetime adventure!

Fake news or savvy marketing: How old is Canadian Tire anyway?

Canadian Tire Corp. made a big splash in Canada last year celebrating its centennial year in business. The company was founded by John William Billes and Alfred Jackson Billes on Sept. 15, 1922, when the brothers pooled their savings and bought Hamilton Tire and Garage Ltd., an east end Toronto auto shop, for $1,800.

But obsessive industry-watchers like Hardlines (Editor: Don’t we have anything better to do?) will note that the first Canadian Tire store, named as such, didn’t open until the following year, 1923, at Yonge and Gould in downtown Toronto.

What, then, to make of Canadian Tire’s 1953 Spring and Summer Catalogue, published at this time of year, 70 years ago? Such historic catalogues are framed and displayed in many Canadian Tire stores across Canada. At the bottom of this one (pictured), the Tire implied that it had been in business a decade longer than it actually had. The banner at the bottom reads: “40th Year of Service: 1913-1953.” But in 1913, A.J. was just 11 years old and his elder brother was only 16. In 1913, they were still nine years from their historic purchase of their first auto shop.

If you think you know the answer to this apparent trickery on dates—probably the work of A.J., who was one of the savviest marketers in Canadian retail history—send an email to steve@hardlines.ca and we will publish the best answer next week! (Clue: It has to do with the car in the foreground, not “fake news.”—Editor)

Spectrum Brands Holdings has agreed to a stipulation with the U.S. Department of Justice to settle the DOJ’s challenge of Assa Abloy’s acquisition of the company’s Hardware and Home Improvement segment. The DOJ had sued to block the sale, saying it would consolidate the door hardware market unfavourably.

Spectrum’s roster includes Remington, George Foreman, Russell Hobbs (formerly Salton), and Black+Decker home appliances. But it’s HHI family of products is more hardware directed and includes Kwikset, Baldwin, National Hardware, and Pfister.

Spectrum had acquired these hardware, plumbing, and lock lines in 2012 from Stanley Black & Decker. With Russell Hobbs, Spectrum now had the Black & Decker licensing for small appliances, though not for its power tools.

Fast forward now almost a decade to September 8, 2021. That’s when Spectrum Brands announced its intention to sell the HHI business to Assa Abloy in a deal worth $4.3 billion. But one year later, on September 15, 2022, the DOJ filed its suit. The next move was Assa Abloy’s: to satisfy the DOJ, it agreed to sell off some of its businesses. The Emtek and the Smart Residential Business in the U.S. and Canada will be hived off to Fortune Brands, which is already home to brands like Moen and MasterLock.

These moves pave the way for Spectrum Brands to complete the sale of HHI to Assa Abloy. The deal is expected to close by June 30.

Spectrum had been paring down before this deal. In early 2018, it sold off its Rayovac battery division to another competitor, Energizer. Before the end of that year, Spectrum then sold off its global auto care division, which features brands such as Armor All and STP, to Energizer as well.

DID YOU KNOW…?

… that the latest episode of the Hardlines podcast series, What’s In Store, is now online? In this instalment, we talk to Taiga Building Products CEO Russ Permann. Topics covered include how Taiga responded to the extraordinary supply-chain pressures brought on by the pandemic and how commodity pricing is evolving as we enter the new normal. Sign up now for free and get updates about our latest podcasts in your inbox!

RETAILER NEWS

As reported last week, Canadian Tire will take over the leases of 10 Bed, Bath & Beyond locations. Meanwhile, at least 21 more locations (Editor: check out our special report in next week’s Hardlines to see the actual number!) of the bankrupt bed and bath retailer are also being acquired, this time by Doug Putman, owner of Toys “R” Us, Sunrise Records, HMV UK, and other chains. Putman intends to launch a new brand: rooms + spaces. It will be led by Greg Dyer, former GM for Bed, Bath & Beyond.

On May 12, the RONA Foundation celebrated its 25th anniversary. The organization, which oversees all the philanthropic activities of RONA inc., has chosen to redefine its mission. In addition, the organization has launched “Build from the Heart,” a new community initiative that will help eight non-profit organizations across the country.

Canadian Tire Corp. reported a drop in profits and sales during its first quarter, which saw a fire hit a Greater Toronto distribution centre. Net income for the quarter fell to $7.8 million from $182.1 million a year earlier. Revenues of $3.71 billion were down from $3.84 billion. Comp sales declined by 4.8 percent at Canadian Tire stores but grew 4.8 percent at the Mark’s banner and 3.7 percent at SportChek.

Bernard Hamel, owner of Roger Grenier Inc., held grand openings last week for his two stores in Quebec, Warwick Home Hardware Building Centre and Laurier-Station Home Hardware. The Warwick store has over 5,000 square feet of retail space and an additional 1,000 square feet of warehouse, under store manager Alain Corriveau. Laurier-Station Home Hardware boasts 7,000 square feet of retail and 1,000 square feet of warehouse, under store manager Jessica Pelletier.

SUPPLIER NEWS

Taiga Building Products reported Q1 net sales of $408.5 million, down from $612.7 million a year earlier. The 33 percent decline was attributed to lower selling prices for commodities. Net earnings fell to $13.5 million from $39.5 million, primarily due to decreased gross margin.

Trusscore, the vendor of wall and ceiling products, is sponsoring two scholarships at Conestoga College in Cambridge, Ont., worth a total of $2,500 per academic year. The Trusscore-Conestoga partnership is designed to promote and support local skilled trades training and drive the creation of more opportunities in the trades.

“Let’s Go Build” is a recruitment campaign for dealers who are members of the Western Retail Lumber Association. The WRLA’s campaign aims to increase awareness of the opportunities and benefits of a career in the home improvement industry among both traditional and non-traditional audiences. The Let’s Go Build website bridges the gap between employers and employees with a “Build Your Career” page that will list job openings for WRLA’s 1,100-plus members.

The Retail Council of Canada will hold its flagship event, RCCStore23, on May 30 and 31 at the Toronto Congress Centre, near Pearson International Airport. Speakers include Retail Prophet founder Doug Stephens, Holt Renfrew CEO Sebastian Picardo, and Danyal Syed Ali, head of consumer and customer insights at IKEA Canada. Check out the complete agenda here or click here to buy tickets.

ECONOMIC INDICATORS

The value of building permits advanced 11.3 percent in March to $11.8 billion, led by a 32 percent surge in the non-residential sector. Residential permits declined by 0.9 percent to $6.6 billion, with permits for 21,400 new dwellings issued during March. Strong gains in British Columbia and the Atlantic provinces were offset by decreases in Ontario and Saskatchewan. (StatCan)

OVERHEARD…

“To celebrate the foundation’s quarter-century, we have adopted a new mission that is fully aligned with RONA inc.’s activities and that will engage our employees, suppliers, affiliated dealers, and customers.”

—Sébastien Lamoureux, senior vice-president, RONA Affiliates, Wholesale, and Public Affairs at RONA inc. and chair of the board of the RONA Foundation.

Home improvement distribution needs to step up its technology game, says Russ Permann, CEO of Taiga Building Products. In the latest episode of Hardlines’ What’s In Store podcast series, he warns that big global players could decide to invest in Canada, disrupting the market drastically.

Permann says these “disruptors” have deep pockets and the latest technology, which they could use to intervene in building products distribution in Canada. That is, unless the players here embrace tech more fully.

“I look at other supply chains—and other industries—and I see that there’s a lot of room for us to improve as a business,” Permann says. “We have a lot of catching up to do. And you look at building materials: there’s an enormous addressable market around the world, but in North America in particular. There’s a lot of material flowing, [yet] there is a sizeable lack of transparency in our supply chain. If we don’t, as an industry, work to address this gap, there will be others attracted to this market, due to its sheer size.

“And they’ll focus on disrupting the business as it looks today.”

While no one knows the future, Permann admits, it hasn’t escaped his attention that there are parties “that can raise a lot of interested capital” if they wanted to seize a large part of the building materials distribution business in our country and south of the border.

“Outsiders are watching and they’re willing to take a risk to disrupt this business, just because of its sheer size. And the fact that you can see that it’s an industry that hasn’t spent a lot of time focusing on productivity improvements and efficiencies; we still get materials to market in largely the same way. We still build things in largely the same way.”

In this latest Hardlines podcast, Permann says that Taiga has been making significant investments in technology in recent years. It’s invested in its warehouse management systems, starting in 2015, and rolled out tech programs throughout its operations consistently over the ensuing years. “It took us a while, but what it’s done for us is make us much more internally transparent, accurate in our work… and we’ve made enormous progress.”

(You can listen to our complete conversation with Russ Permann in the latest episode of the What’s In Store podcast series! Like all our podcasts, it’s free, so sign up here!)

Retail innovators will share their stories—and vision—at Hardlines Conference

The theory of retail can be complicated, evasive, and elusive. The practice of retail is all that, plus lots of hard work, luck—good and bad—and big heartedness. Three speakers at this year’s Hardlines Conference embrace and embody all those traits. And they’ll share their stories and insights in Whistler, B.C., Oct. 17 and 18.

Geneviève Gagnon (pictured above, right) is the head of three businesses in Quebec. She is CEO of a chain of building centres called Gagnon La Grande Quincaillerie. She also operates a wholesale business, Évolution Distribution. Finally, she runs a truss and wall panel manufacturing division called Évolution Structures.

Gagnon is part of an illustrious hardware family business that she’s been involved in since her childhood. Her father, Yves Gagnon, was the president of BMR Group for many years. As the third generation of her family, Geneviève has been responsible for many big changes to update the business.

On the personal front, Geneviève is deeply involved in her community, contributing to causes including child cancer and palliative care homes. She also manages a family, as the mother of three children.

Move with us now to central British Columbia, to the small community of Mackenzie, a remote town with a population just 3,800 people. There, Marilyne and Sylvain Laferriere (pictured above, left) own and operate Ace Victory Building Centre. We invited the Laferrieres to share their story at our conference, including their wins and their challenges. They were keen to take the podium. But, warned Sylvain, “It won’t all be good news.”

In 2005, motivated by their frustration with a lack of products and services in the area, Sylvain and Marilyne purchased an existing business in town. They renovated the store, added product lines, and Victory Building Centre Ace was born.

Local engagement is essential for the Laferrieres, who love their town. It’s also an important aspect of their business model. These 2019 Outstanding Retailer Award winners will share the ups and downs of delivering on that model during the challenges of staff shortages, combined with rising insurance rates, wages, fuel, and transportation costs.

These are just a few of the amazing retail leaders who will be featured at the 27th annual Hardlines Conference. For our complete lineup of presenters, click here.

(The 27th Annual Hardlines Conference will be held at the Fairmont Chateau Whistler resort Oct. 17 and 18, 2023. As a Faithful Hardlines Member-Subscriber, you can use the code HARDLINES23 to get 20 percent off registration! Register here today!)

WRLA launches giant ad campaign to attract workers to the industry

The number-one topic among dealers and suppliers country-wide is labour and how tough it is to find people. That problem is being acutely felt in western Canada, where the Western Retail Lumber Association has found it’s a persistent problem.

The search for good talent is made even more difficult by the low profile the home improvement industry has with potential new hires. Because the opportunities are not widely known, WRLA is launching a giant ad campaign to promote awareness of the industry and the potential it has for new recruits.

Called “Let’s Go Build,” the campaign will highlight the LBM industry to all of western Canada, using print, digital, and social media. The message of the ads seeks to connect people who are looking for their next career move with the businesses in this industry.

“For years we have talked about how rewarding it is to work in the LBM industry and have often commented on how this may be one of the best kept secrets, which needs to change,” proclaims a message on the WRLA website. “This is where Let’s Go Build comes in. Let’s Go Build is a dedicated campaign designed to raise awareness of our industry and share the incredible diversity of available career options.”

The launch date is May 10. On the same day, the association is hosting an information webinar to outline how its members can participate in the ad program. (Members can join the webinar by clicking here.)

Quebec industry group AQMAT welcomed more than 150 participants in late April to its 2023 Decision Makers Conference. It was held at the Centre de congrès de St-Hyacinthe under the theme of “Finding ways to reduce our uncertainties.”

Hosted by AQMAT CEO Richard Darveau, the event presented the results of a survey of dealers and consumers on how hardware stores can best meet their communities’ needs in a time of staffing crunches and unpredictable costs. Both groups of respondents agreed in preferring to reduce store hours, such as by returning to Sunday closures, rather than sacrificing the availability of employee expertise.

In presenting the results, Stéphane Gendron, vice-president at market research firm CROP, stressed that hardware stores join computer stores at the top of the list of retail sectors in which customers rank knowledgeable staff as a top priority.

Gendron also pointed to a disparity in the perception of customers, most of whom see themselves as able to browse a hardware store autonomously, and dealers, who estimate that a majority of shoppers require assistance. “That’s good news: if we concentrate on the consumer [who needs help], we don’t waste the employee’s efforts.”

The audience was also treated to a panel discussion about a new service Périscope, a data-driven platform AQMAT is developing to help to dealers, buying groups, distributors, and manufacturers to navigate supply-chain and hiring decisions.

Samuel Nadeau, financial director at Couture TIMBER MART, represented the dealer’s perspective. Mélanie Belley, sales director at CanWel, spoke to the manufacturing and distribution side, while Évolution Distribution’s Martin Ménard addressed the concerns of buying groups.

Following the panel, conference guests gave collaborative feedback into the design of the platform’s dashboard. Among the themes emerging from the discussion were the need for training in the use and interpretation of Périscope data. Materials prices and construction starts were ranked as the most critical indicators users would need to consult.

Before departing at day’s end, delegates socialized over mocktails while a Tarot reader was on hand to entertain the delegates.

AQMAT will next gather its members on Nov. 11, 2023 at its 11th Recognition Gala, once again being held at Montreal’s historic Fairmont Queen Elizabeth Hotel.

Patrick Fedor has joined Vicwest Building Products as VP, commercial. Fedor has 20 years of experience as a professional engineer and senior sales leader in the building industry. In his new role, he will oversee and manage company-wide sales and business development. In addition, he will coordinate and lead the technical services group with a key focus on compliance, sustainability, and new product development.

DID YOU KNOW…?

… that sharing this copy of Hardlines with others violates our Fair Play Policy? That’s right, we work hard to protect our copyright and ask that you, our Faithful Readers, respect that. We have great, affordable ways to add more people at your company to your existing subscription for only a few dollars per year. Our Team at the Hardlines World Headquarters is dedicated to bringing you the news that matters, so contact Jillian to add people to your company’s subscription.

RETAILER NEWS

Canadian Tire Corp. has made a deal to acquire the real estate leases of 10 former Bed, Bath & Beyond locations for $1.6 million. CTC will turn six of the sites into Mark’s stores. These will be relocations of existing Mark’s stores in Grande Prairie, Medicine Hat, Red Deer, and Strathcona County, Alta.; Langley, B.C.; and Oakville, Ont. CTC says the new sites represent larger, more convenient locations. The remaining sites will become home to four new Pro Hockey Life stores, a brand that Canadian Tire purchased in 2013. This move will bring the Pro Hockey Life store count up to 20. The 10 leases represent more than 242,000 square feet of combined retail space. Bed, Bath & Beyond declared bankruptcy and closed the last of its 54 stores in Canada.

Leis Lumber Co. Ltd. in Goderich, Ont., is joining the BMR Group family, effective June 10. A family business for almost 20 years, it will operate under the BMR banner with store redevelopment slated for completion by the end of the summer. Leis Lumber boasts a 26,000-square-foot floor space, a large lumber yard, and a fleet of 12 trucks servicing an area spanning three counties.

GMS Inc., the specialty building products distributor and parent company to GMS Canada, has expanded its presence on Vancouver Island with a new acquisition. Jawl Lumber Corp., which operates under the Home Lumber and Building Supplies brand, has one location in Victoria. Founded in 1960 by the Jawl family, it sells lumber, engineered wood, doors and framing packages, siding, and other related building materials. One month earlier, GMS completed the acquisition of Blair Building Materials in Maple, Ont.

W.W. Grainger reported Q1 sales of $4.1 billion, up 12.2 percent from $3.6 billion a year earlier. Diluted earnings of $9.61 per share represented a 36 percent increase from the comparable period of 2022.

IKEA Canada is expanding its electric vehicle charging network in Central Canada. The retailer added 25 EV charging stations at five store locations in Ontario and Quebec. With $300,000 in funding from Natural Resources Canada’s Zero Emissions Vehicle Infrastructure Program (ZEVIP), plus more than $305,000 of its own funds, IKEA installed the stations at stores in Montreal, Boucherville, Quebec City, and Ottawa, as well as at its distribution centre in Beauharnois, Que. IKEA now has EV charging stations at 14 stores across Canada.

AD says member sales in Q1 rose by six percent to $18.3 billion, setting a new record for the quarter. Purchases by member companies from AD suppliers reached $4.63 billion. Net distributions to members grew 11 percent in the quarter to $386.3 million. Same-store member sales increased by 12 percent.

Walmart Canada officially cut the ribbon on its new distribution centre in Moncton, N.B., last week. The facility is the first DC for Walmart in Atlantic Canada. It measures 223,000 square feet and will employ 130 people.

SUPPLIER NEWS

CGC Inc. has announced it will relaunch a gypsum quarry in Little Narrows, N.S. The $104 million investment will allow the quarry to produce up to 2 million tonnes of raw gypsum material per year. “This investment will cement our long-term commitment to the Canadian market and our dedication to providing the best experience for our customers across North America,” said Chris Griffin, CEO of parent company USG Corp. The company has pledged to respect Mi’kmaq treaty rights and share the economic benefits of the re-launch.

NOTED

Dave Campbell, who steered the Ontario Lumber and Building Materials Association as its president for the past 21 years, was honoured last week with a retirement party at the Waterside Inn in Port Credit, Ont. The event was organized by Campbell’s LBMAO colleague Joanne Moquin and emceed by his successor, current association president Trevor Small. Guests included fellow association leaders: Thomas Foreman from the BSIA of British Columbia and Denis Melanson from the ABSDA in Atlantic Canada. Attendees included LBMAO board members past and present, including current chair Rebecca Gravelle of Renfrew Castle in Renfrew, Ont.

OVERHEARD…

“Since entering into this post I’ve met with several actors in the sector. You will always find in me an ally for putting in place the necessary solutions [to overcome the challenges facing the industry].”
—France-Élaine Duranceau, minister responsible for housing in Quebec’s ministry of municipal affairs and housing, speaking at Quebec industry association AQMAT’s recent 2023 Decision Makers Conference.