A big part of Federated Co-operatives’ business is its retail home improvement stores. Its hardlines division, Home & Building Solutions, provides significant returns to FCL. Cody Smith is director of HABS. He sat down with Hardlines to talk about the value of the co-op retail system to Canadians in general, and local farm communities in particular.

FCL supports 160 local co-op organizations in 600 communities serving 2.2 million members across western Canada with a vision of “building sustainable communities together.” A big part of the co-op model is its patronage dividends, which are paid back to retail associations—something, Smith says, that sets the co-ops apart from other businesses. “A significant portion of our profits go back to the 160 local co-op associations across western Canada in the form of patronage.” Over the past five years, FCL has returned $2.3 billion in patronage to communities in the west.

In 2022, FCL had $12.5 billion in sales, $411 million in net income, and $348 million in patronage allocation. “Those results put us in the top two orgs in Saskatchewan and in the upper echelons of revenue-generating organizations in Canada,” Smith says.

The co-op’s wholesale numbers break out as follows: energy representing $7.8 billion, food with slightly more than $2 billion, ag at almost $2 billion, and HABS accounting for $410 million.

Smith’s HABS division in turn represents $560 million at retail through 104 home centres—88 of them with lumberyards. The balance of the stores are ag centres that are “hybrids” and carry LBM. HABS also feeds some hardlines into the co-op grocery and c-stores.

Growth for the home improvement business has included adding more focus to LBM sales in recent years, as well as increasing the distribution network. That includes a distribution centre that opened near Calgary in late 2022, and the opening of another DC in Fort Saskatchewan toward the end of 2023.

The newest DC “is going to be mainly for LBM and allied products,” says Smith. “What we’re trying to do there is to meet the retailers where they’re doing business today. They’re heavily invested in the LBM side so we thought we’d better provide access to products. Then we can consolidate some inventories across the system.”

The improved distribution network will support the procurement function so dealers can spend more time with their customers, he notes.

In addition, the business has rolled out an electronic shelf label system and new order management system. “It puts us in the upper echelon and reflects the power of the shop local concept,” Smith says

The co-op dealers are doing more business on the LBM side with their DIY customers, “and some of our retailers are doing a great job on that.” But focusing on the B2B side is increasingly important.

Record-low temperatures in many communities in British Columbia and Alberta have reminded all of us that hardware stores—and building supply stores—are the pillars of the towns they serve when extreme weather hits.

This is certainly the case at Hydway Hardware in Fort Vermilion, Alta., which hit a bone-crunching minus 46 degrees Celsius on Jan. 15. “It seemed like everybody in town had come in to buy heat lamps, antifreeze, and extension cords,” said Darwin Toews, brother of Ray Toews, who is co-owner of the store with his wife, Robyn Currie.

It is notoriously cold in the winter in Fort Vermilion, which is 670 kilometres north of Edmonton—and only about 300 kilometres from the border with the Northwest Territories. The town has a population of just under 800, according to the 2021 census. Canada’s record low for anywhere in its 10 provinces was set in Fort Vermilion on Jan. 11, 1911, when the mercury plunged to minus 61.2 Celsius. Wow.

But when it’s life-threateningly cold, this tight-knit community turns to their hardware store for the essentials of life. “A lot of people live in mobile homes around here—as I do,” said Darwin. “They had frozen pipes. We usually have a lot of snow by this time of the year, and we bank the snow up against the mobile home to keep the area underneath insulated. But this year, we didn’t have enough snow. I’m scared to see what my gas bill will be.”

Hydway Hardware was voted Best Hardware Store at our Outstanding Retailer Awards in 2023. It’s a true independent, relying on Orgill Inc. to supply it with hardware. “I just saw the truck pulling into town a few minutes ago,” Darwin said. “It has a bunch of extra heaters that I ordered. Good timing.”

Registration is now open for the National Hardware Show, taking place from March 26 to 28, 2024, at the Las Vegas Convention Center. It is touted as “the most comprehensive event, [and] education and networking platform serving the hardware and home improvement industry.”

And as in years past, a showing of Canadian exhibitors, buyers, and agents will be on the show floor. The show, which felt the effects of the pandemic over the past three years, has returned to a date in late spring that more closely matches its pre-pandemic timing.

The Canadian Home Products Trade Association (CHPTA) will be back offering a forum for its member vendors to access exhibition space and to connect with buyers. It will have a booth on the show floor to promote the programs and benefits of the association to companies selling hardware and home products or services in Canada. CHPTA member companies that are not able to exhibit on their own will also have an opportunity to display some of their product within the CHPTA booth and have a location to meet with customers.

According to CHPTA president Sam Moncada, a number of spots are still available to members wishing to have a presence in Las Vegas.

Another fixture of CHPTA’s presence at the show is its Canada Night reception. “The CHPTA is looking forward to attending the National Hardware Show in Las Vegas this March including hosting the traditional ‘Canada Night’ reception for Canadian vendors and retailers in town for the show,” says Moncada.

This year’s Canada Night will be held on March 27 at Tom’s Watch Bar within the New York New York Hotel from 6:00 pm to 8:00 pm. “Canada Night has always been an opportunity for the CHPTA to bring the Canadian hardware industry together during this trade show in a relaxed atmosphere to enjoy some ‘Canadian bonding’ and networking over drinks and hors d’oeuvres,” Moncada adds.

Finally, the CHPTA will be arranging for some speaker presentations from some of its affiliate partners at the Shop Global Lounge on the show floor. There, presentations will provide helpful information and data on doing business in Canada in the hardware industry, including how to acquire and use important POS data, consumer purchasing insights, market size, and sales trends.

(Early-bird pricing is available now for the National Hardware Show. Click here to register.)

A slowdown in new housing left its mark on the industry last year. According to the latest figures from the Canada Mortgage and Housing Corp., housing starts in 2023 were down seven percent in population centres of 10,000 and more. For the full year, 223,513 units were recorded, compared to 240,590 in 2022.

The decline was attributed primarily to a 25 percent drop in single-detached starts. In fact, some regional disparities offered a more positive outlook. Despite the national decline, actual year-over-year housing starts were five percent higher in Toronto and 28 percent in Vancouver, driven by strength in multi-unit starts. Montreal starts were down 37 percent due to large declines in both single-detached and multi-unit starts in 2023.

However, things started to look up toward the end of the year. In December, the annualized pace of housing starts nationally rose by 18 percent to 249,255 units, from 210,918 units in the previous month. “The recent monthly multi-unit volatility is not surprising as we’re now starting to see 2023’s challenging borrowing conditions and labour shortages in the housing starts numbers, and we expect to see continued downward pressure in the coming months,” said Bob Dugan, CMHC’s chief economist.

Likewise, existing home sales lost steam in 2023 but picked up in December. According to the Canadian Real Estate Association, home sales on an annual basis totalled 443,511 units, a decline of 11.1 percent from 2022. However, they gained momentum as the year drew to a close. Resales rose 8.7 percent between November and December, putting the last month of 2023 on par with some of relatively stronger months recorded over the spring and summer.

The actual (not seasonally adjusted) number of transactions came in 3.7 percent above December 2022, the largest year-over-year gain since August.

Despite the year-end surge, CREA’s outlook remains moderate for the near future. “Was the December bounce in home sales the start of the expected recovery in Canadian housing markets? Probably not just yet,” said Shaun Cathcart, CREA’s senior economist.

“It was more likely just some of the sellers and buyers that were holding onto unrealistic pricing expectations last fall finally coming together to get deals done before the end of the year. We’re still forecasting a recovery in housing demand in 2024, but we’ll have to wait a few more months to get a sense of what that ultimately looks like.”

At Sexton Group, Suzanne Walsh has been promoted to the position of business development director, effective Jan. 1. Walsh joined the company in August 2017 as Ontario business development manager. In her new role, she will spearhead existing member growth and new member expansion, with Sexton’s business development managers reporting to her.

Michael Magennis at Canadian Tire has a new role. He is now SVP, petroleum and special initiatives. A veteran of Canadian Tire for more than 30 years, he was most recently SVP, general merchandising. Micheline Davies is now Canadian Tire’s chief merchant. She was formerly SVP, automotive.

Mario Boivin is now associate national account manager at Rust-Oleum Canada. He comes over from Sherwin-Williams, where he served as national account manager.

At Lowe’s Cos. in Mooresville, N.C., Margi Vagell has been named EVP, supply chain, effective March 1. She joined the retailer in 2009, serving in various senior leadership positions, including SVP and general merchandising manager, a role she’s held since 2019. Vagell is also vice-chair of the Lowe’s Foundation and serves on the boards of trustees of two universities. She succeeds Don Frieson, who has served as EVP, supply chain since 2018. He will retire on April 1.

DID YOU KNOW…?

… that the latest issue of Hardlines HR Advisor hit inboxes last week? In this edition, we look at one industry veteran’s outreach to high school students and a business coach’s focus on the home improvement industry. (If you’re not already receiving HR Advisor, click here to sign up for free!)

RETAILER NEWS

Philip St-James and his wife Stacy Boulet are the latest dealers to join BMR Group. They own two stores in Quebec’s Eastern Townships, Quincaillerie des Rivières in Waterville, and Centre de rénovation Stanstead, which have been in business for 40 and 70 years, respectively. St-James became co-owner of Quincaillerie des Rivières in 2012, which was owned by his parents. He and Boulet acquired the Stanstead store in 2021.

Castle Building Centres Group has added two stores in early 2024. It has signed Landry Brothers Ltd. in Louisdale, N.S. Founder Paul Landry is passing the reins of the business, which is 60 years old, to his son-in-law Christian Sampson and partners Jonathan Stone and Evan Marchand. And Peacock Lumber, Oshawa, Ont., a Castle member for over 55 years, has opened a second location in Colborne, Ont. The owners are Cara and Glen Peacock. The general manager is Mathew McMullin.

Staples Canada has secured a contract from the Ontario provincial government to provide ServiceOntario centres within some of its stores. The move is not without precedent: some IDA Drugs, Canadian Tire, and Home Hardware stores have had ServiceOntario locations for several years, providing access to drivers’ licences, hunting permits, and health cards. ServiceOntario is in the process of opening new centres in select Staples Canada stores, with additional locations expected to open throughout the year. Several stand-alone locations will be closed as a result.

Costco is testing out a new procedure requiring customers to scan their membership cards at store entrances in a bid to curb unauthorized sharing of cards. The pilot project has begun in Costco’s home state of Washington and builds on previous moves to verify membership at self-checkout in the same way as for those in cashier lanes.

Products from Regal ideas Inc. of Delta, B.C., were represented in an unprecedented nine trophies, including three first place finishes, won by contractors at the North American Deck and Railing Association (NADRA) annual awards event held in early January in Clearwater Beach, Fla.

After holding steady at 3.1 percent in October and November, Canada’s annual inflation rate rose to 3.4 percent in December. The price of gasoline, cars and trucks, rent, and airline tickets helped to drive the uptick in inflation. Grocery prices went up 4.7 percent, year over year. The central bank has increased interest rates 10 times in a row, commencing in 2022, to try to wrestle inflation down. (StatCan)

Only 20 percent of Canadians feel better off financially this year than last year, down from the 25 percent who thought so in Q3. Conversely, the number of Canadians who say they are worse off financially today rose to 44 percent in Q4 from 39 percent in Q3. High interest rates and inflation have played a considerable role in this. Canadians are also now more pessimistic about the overall economy in 2024, with 59 percent believing there will be a recession in the next 12 months. (Dye & Durham’s Canadian Q4 Pulse Report)

Most hardware stores welcome pet dogs, especially given the importance of the pet category to so many retailers. At Canadian Tire, the head office has a long-standing policy of leaving pet dog policies to its individual stores. And the chain’s Petco store-within-a-store has been one of the best performing departments in Canadian Tire since the pandemic.

But dogs can create messes that some customers find, well, offensive. As a result, the Grande Prairie, Alta., Canadian Tire has introduced a No Dogs Allowed policy (except for service animals) in its store. Its Facebook page features a poster that explains the new policy, referring to “an excessive amount of unfortunate incidents with allowing dogs in our store,” saying the reason was to ensure “the safety and convenience of all our customers.”

Comments on the post expressed outrage over dogs that leave messes and act aggressively with other customers.

The challenge of accommodating pets in stores is an ongoing one that has been exacerbated by the rise of service and therapy dogs. Dogs are becoming a common sight in grocery stores and even some restaurants, especially if they have therapy dog status.

But how to deal with unruly pets is not a new phenomenon. In 2011, an infamous incident at an Ottawa Home Depot store created havoc for the retailer’s policy makers—and communications team—following an incident that resulted in injuries to a worker there. A greeter for the Home Depot in East Ottawa was attacked in the store by a nine-pound Shih Tzu dog. Anne Riel’s nose was bitten by the dog when she leaned in to welcome it. Stitches and cosmetic surgery were required to repair the woman’s nose.

Home Depot Canada felt obliged to issue a statement banning dogs from all its stores as a result of the incident. Soon after, a number of competing home improvement retailers, including Orillia Home Hardware Building Centre in Orillia, Ont., erected signs of their own across the front of their stores saying, “Dogs welcome here.” Home Depot Canada would eventually roll back their no-dogs policy.

(Just how dangerous are Shih Tzu dogs? Here at Hardlines, we attempted to recreate the vicious Shih Tzu incident in our state-of-the-art Hardlines forensic retail lab. The video of this heart-pounding re-enactment went viral at the time—at least at Home Depot Canada’s head office. Click here to watch it for yourself.)

In 2011, a Home Depot cashier at a Florida Home Depot store was left with scratches and four bite wounds from a spider monkey. Spanky the monkey would accompany her human owner everywhere, but when left in the owner’s car in the parking lot of the Home Depot, Spanky got upset. The animal managed to escape and attacked the staffer, who was on her break at the time, leaving her with bites on her arms and head, along with scratches on her face.

The Bank of Canada held its benchmark interest rate steady at five percent in its last three decisions of 2023. However, that was up steeply from 0.25 percent in March 2022, when the central bank decided to hike interest rates in an attempt to cool inflation.

In a series of year-end speeches, Tiff Macklem, the governor of the Bank of Canada, acknowledged that the multiple interest rate increases had indeed cut inflation (which was last measured by StatCan at 3.1 percent, year-over-year, in November).

So, when will interest rates fall? Economists are divided on the issue, not surprisingly. Some of them expect the Bank of Canada to lower its benchmark rate early in 2024. Others expect the central bank to wait until later in the year. And some economists thinks interest rates may still go higher.

Banks have already begun to cut five-year fixed-rate mortgage rates, presumably in anticipation of rate cuts to come. And also because some 2.2 million Canadian household mortgages are due for renewal over the next two years, according to the Canada Mortgage and Housing Corp. The competition for better rates will be stiff.

A recent presentation to members of the Canadian Home Products Trade Association offered a more upbeat forecast. Rishi Sondhi, an economist at TD Bank, spoke to the CHPTA before Christmas. He suggested an end to rate increases is in sight. “We think the Bank of Canada is done hiking interest rates.” He forecasted that they’ll begin falling gradually by the middle of 2024 and expected them to reach 4.5 percent by October.

For the last word on this perplexing situation, we turned to our resident economic guru, Peter Norman, vice-president and chief economist at Altus Group—and a regular presenter at the annual Hardlines Conference.

“Recent hold announcements by both the Fed and the Bank of Canada, and a string of softer economic data, have injected a certain amount of optimism into the market that rates will be unwinding in 2024, presaging some relief to the housing market,” Norman told Hardlines, expressing less optimism than some of his fellow economists. “But as long as the Canadian employment numbers remain relatively buoyant and inflationary pressures keep lurking under the surface, the Bank is going to continue to hold for longer than many think.”

In fact, Norman suggests that the worst may be yet to come. “There is still a small chance that we’ll see rates higher before lower. Expect 2024 to be another pretty soft year in the economy and look to 2025 for some resurgence in residential investment.”

Home Depot Canada has undertaken a major investment in its supply chain to better serve its contractor customers in this country. The new facility is designed to get products onto job sites quickly.

Called a Flatbed Distribution Centre (FDC), it’s one of several new types of delivery centres that have been developed by Home Depot in the U.S., in a $1.2 billion investment to build about 150 new facilities across the U.S. that will aim to reach 90 percent of U.S. customers with same-day and next-day delivery.

For large loads to contractors, the retailer has established the FDC concept—including this one, west of Toronto, the first of its kind in Canada.

Located in Mississauga, Ont., in the west end of the Greater Toronto Area, the new 300,000 square-foot FDC is part of a 600,000-square-foot facility DC receiving and fulfilling orders. In a video aimed at stores, Jamal Hamad, senior director of contractor services at Home Depot Canada, says, “We’re going to be able to pick, pack, and ship orders to our pros to be delivered every single day out of this facility, instead of your store.”

Products in the FDC include materials for baths, basements, and deck and fence projects. But in addition to commodities such as drywall and concrete, some 500 SKUs of finishing products are also inventoried in the warehouse. “We’ve got some of the interior projects’ finishing SKUs that will be able to finish the complete project every time a contractor comes into your store.”

The service is initially being promoted using Home Depot’s outside sales teams, Hamad says in the video.

The European DIY Retail Association (EDRA) and Global Home Improvement Network (GHIN) are continuing their efforts to establish standards and goals to help the industry identify and reduce “Scope 3” emissions for its members.

As a result, the combined organization, which represents large home improvement retailers around the world, has announced it’s working with Ricardo, a global strategic, environmental, and engineering consultancy. Jamie Pitcairn, Ricardo’s technical director for corporate sustainability, will lead the initiative.

The EDRA/GHIN Scope 3 Taskforce, launched at the 9th Global DIY-Summit in Berlin last summer, is a collaborative taskforce made up of leading home improvement companies from around the world. It was established to help the sector reduce its Scope 3 greenhouse gas emissions—those that come from retailers’ supply chains and from how their customers use the products they buy in their homes.

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.

“We believe that with Ricardo we have a most trustworthy partner,” said John Herbert, general secretary of EDRA/GHIN. His group, he added, “has already shown a huge amount of motivation and willingness in working together to identify and reduce scope 3 emissions, and through learning from each other and sharing best practice, we can ensure we have the most tangible and wide-reaching impact.”

DID YOU KNOW…?

… that, as a Member-Subscriber of Hardlines Weekly Report, you get one Classified Ad free every year? Hardlines Classified Ads are read by professionals right in the home improvement industry, which means they get results. Click here to get a free quote on your next Hardlines Classified Ad! And if you are looking for your next placement, you can take advantage of our free Resumé Service. Post your resumé on our website at no charge. Click here for more details. Remember, your next ad is on us!

RETAILER NEWS

Sexton Group has added Maison Nordique as its newest member. The family-run business in Abitibi-Témiscamingue, Que., has been manufacturing prefabricated homes in the region for over 50 years. The company specializes in building homes that are designed for the surrounding communities in the northwestern region of the province. Maurice Poirier is Maison Nordique’s general manager and treasurer.

“Christmas trees give us so much joy,” a new Lee Valley Tools video on social media says. “And then we give them to the chipper.” The Ottawa-based specialty retailer wants to change that, so it has launched a social media campaign under the brand’s “Let’s Do Something” mantra. Lee Valley says it wants to “inspire Canadians to embrace crafting and woodworking by creating ‘look what I made moments’ out of their old Christmas trees.” Participants are encouraged to email Lee Valley photos of their projects or post them under the hashtag #LVSecondLife.

Lowe’s has introduced a loyalty program for DIY customers. The program is designed to help them save on items they need for their homes and earn rewards toward future purchases. Called MyLowe’s Rewards, it offers savings as well as exclusive perks for members such as free shipping on standard deliveries. Customers who used a MyLowe’s Rewards credit card will save five percent on eligible purchases.

Ace Hardware, of Oak Brook, Ill., placed first in the home improvement category in Forbes magazine’s 2024 customer service rankings. Forbes evaluated 3,000 companies with a survey of 201,000 people in the U.S. who provided 4.2 million ratings. Survey participants were asked to rate brands on online and in-store customer service, consisting of “people, speed, services, and resolution.” Ace was the 33rd company on the list.

Just what bricks-and-mortar dealers wanted—another extremely wealthy and ubiquitous online competitor. TikTok, the Chinese social media behemoth, is aiming for a tenfold increase in its U.S. e-commerce business in 2024, according to Bloomberg. The news agency claimed, though the numbers were immediately denied by TikTok, that TikTok Shopping is aiming at US$17.5 billion in merchandise sales this year.

Attention Dealers: If you’re attending the Orgill Spring Dealer Market in Orlando, Feb. 22 to 24, 2024, you are invited to be our guests at a special reception for Canadians.
Join Hardlines and our sponsors for Canada Night on Thursday, Feb. 22 at 6 p.m., at The Pub for an informal meet-and-greet over drinks and snacks before you head out for the night in Orlando! Snacks and drink tickets will be provided by Hardlines. For more information and to RSVP, click here!

The Western Retail Lumber Association is holding the 30th anniversary edition of its Building & Hardware Showcase this week. From Jan. 17 to 19, members will gather at the Winnipeg Convention Centre for new product launches and the latest tech, trends, and topics hitting the LBM industry. (Click here for more information and to register!)

West Fraser Timber will close its sawmill in Maxville, Fla., and indefinitely curtail operations at its sawmill in Huttig, Ark., by the end of this month. The decision is the result of high fibre costs and soft lumber markets, says the company. The closure of Maxville Sawmill will impact approximately 80 employees, while the indefinite curtailment of Huttig will impact 140 employees. In aggregate, this will reduce West Fraser’s U.S. lumber capacity by approximately 270 million board feet. West Fraser expects to mitigate the impact on affected employees by providing work opportunities at other company operations.

The total monthly value of building permits in Canada fell by 3.9 percent from October to $10.9 billion in November. Although eight provinces posted monthly gains in residential construction intentions, the total value of residential permits declined 2.8 percent overall to $7 billion. Declines in the multi-unit sector in British Columbia and Quebec more than offset the residential gains in the rest of the country. (StatCan)

RONA shares updated signage for its affiliated dealers at Montreal buying show

RONA dealers got an update on head office’s new programs, its new retail brand, and where independents fit in with the company’s vision at the dealer conference and show, RONA Connexia, in Montreal on Nov. 30 and Dec. 1. The event provided an opportunity for RONA affiliated dealers to meet with members of the RONA team, as well as some of their vendors, and discover what’s new for 2024.

Meetings on day one were held at the Fairmont Queen Elizabeth hotel. Connexia continued the next day at the RONA Planogram Facility in Boucherville with a showcase that highlighted products for the 2024 spring-summer season.

In those meetings, dealers were also introduced to a new identity designed exclusively for RONA’s affiliated dealers, based on a review of the signage outside of the stores and the brand elements inside. This new identity is designed to promote the entrepreneurial side of the dealers while capitalizing on RONA’s brand awareness.

And it’s unique to the independent RONA dealers. It involves a new, clean banner with room to further identify the store’s own name and brand, using its own colours and look. “The new look means the store is branded as a dealer store. We see tremendous value in identifying them as dealer-owned,” says Jean-Sébastien Lamoureux, senior vice-president, RONA affiliated dealers and public affairs. That branding will be extended through the interior of the store, as well.

And the refresh will be implemented at no charge to the dealers. “We’ll be paying for it all,” says Lamoureux. “It is a priority for us.” He notes that a locally-owned store is invaluable for a community and Canadians recognize the importance of that local advantage. “We wanted to capitalize on these assets, while focusing on the impact of each dealer in their communities.”

The roll-out of the rebranding will take place over the coming months, and he calls it “an important commitment by RONA to its dealers. “Next year is our 85th anniversary. RONA was created for and with independent dealers and we wanted to reflect that. We wanted to say the dealers are front and centre for us.”

Canadian Tire Retail expects slightly better 2023 margins despite forecast of tougher Q4

Canadian Tire Corp. went into the fourth quarter with its share of concerns, as the fiscal period will complete a year in which most hardlines retailers are facing challenges.

In a call to analysts following the release of the company’s third-quarter results, executives shared their expectations for the quarter—and the year ahead—as CTC works to reduce inventory costs and get customer traffic back up to pre-inflation levels.

“In fall-winter categories, the combination of higher inventory from last year and the majority of products shipping in Q3 this year compared to Q4 last year means our CTR dealers are very well stocked heading into our biggest selling season, and we expect to ship little fall-winter  product in Q4 unless consumer demand proves stronger than expected,” said Gregory Craig, EVP and CFO at Canadian Tire Corp. He further noted the reluctance of CTR dealers to hang on to extra inventory, due to higher interest rates.

The result: a more modest end to the year than previously hoped. “These factors will make for a tough revenue comp going into Q4 compared to a year ago,” Craig said, “when retail revenue excluding petroleum was up two percent, as dealers were still building Christmas and winter inventory.”

The company has also undertaken staff cuts during the last quarter of 2023. The initiative has been two-pronged, the first of which is targeted headcount reductions to reduce staffing levels by three percent or about 200 people. In addition, the elimination of open job vacancies was expected to take company’s headcount down by another three percent compared to 2022. While these cuts will result in a charge of up to $25 million in Canadian Tire’s fourth quarter, they are expected to result in overall longer-term savings of approximately $50 million.

While CTC is forecasting slightly smaller margin rates across the company, the outlook is more positive for its Canadian Tire Retail business, which includes Canadian Tire-bannered dealers. On the merchandise front, Canadian Tire remains committed to increasing the penetration of its private labels, which have helped squeeze out better margins for those dealers.  According to TJ Flood, president of Canadian Tire Retail, “We are expecting full-year margin rates at CTR to be slightly ahead of last year, and this is despite … what is going to be a tougher Q4 for us in CTR.”

However, the company is well-poised to weather the current softness, Flood added. “When you think about all of the weapons in our arsenal now—the Triangle Rewards program, our owned brands portfolio, our good-better-best range architecture—we provide a lot of choice for consumers, and we’re going to continue to try to expose them to the great value that we provide them as we go forward here.”

ABSDA’s HR conference gives Atlantic dealers valuable hiring, retention guidelinesThe Atlantic Building Supply Dealers Association held its second annual HR Conference last month, bringing together experts on hiring and recruitment with a room full of dealers looking for ways to cope with the ongoing shortage of available workers. More than 100 people from across Atlantic Canada were in attendance.

“It’s a perfect storm of aging demographics and a new generation coming up,” said ABSDA president Denis Melanson in his opening remarks. He added that 34 percent of the population in Atlantic Canada is now 62 years or older, “and we expect to have to hire 4,000 people in the coming years.”

Melanson and his team created the HR Conference last year in response to a survey of members that had addressed a range of hiring issues for dealers. These included recruitment, onboarding, and what kinds of policies are in place to help individuals along in their careers. “It identified some glaring gaps, but in turn it provided some opportunity for us as an association to provide services.”

The morning was devoted to a hands-on workshop conducted by HR expert and workplace issues expert and author Pierre Battah.

His presentation gave each table of delegates a set of tasks and challenges through the morning. At the heart of his talk was the need for communication—not full-on all the time, but tailored to the situation. And that includes addressing conflict within the team, something too many leaders are reluctant to face.

“We can lose people if we’re not prepared to have the difficult conversations,” Battah said. “A lot of what we do as managers is trying to get everyone on the same page.”

Julie Melanson is an HR consultant with JMC HR Consulting in Moncton, N.B. She took to the podium after lunch to share some tips and guidelines for hiring and retaining staff with her “HR tool kit.” She stressed the need to create a positive and welcoming environment for your candidates right from the start, reminding the audience that some people can be extremely nervous during a job interview. “It’s not something we do very often.”

The realities of today’s labour market require employers to consider new Canadians in their hiring. Jordan Remedios, program co-ordinator for the Immigrant Services Association of Nova Scotia, talked to the delegates about how to make your workplace more welcoming to new hires, regardless of where they come from.

Fostering an environment that enables all workers, including new Canadians, to share ideas goes a long way to ensuring one’s workplace will reap the benefits of inter-cultural competency. These can include everything from providing prayer rooms to respecting a variety of holidays. And this can have a positive impact on both staff and customers, Remedios said. “The more we can commit to this, the more we can commit to inclusivity in the workplace.”

A car swerved out of control, crashed, and exploded at the entrance to the Rainbow Bridge last month, quickly becoming an international incident. The bridge spans the Niagara River between New York state and Ontario at Niagara Falls.

Because it’s one of the most travelled routes between the two countries, concerns quickly arose that the explosion was terrorist-related. Coverage of the incident filled TV news stations on both sides of the border. While tragic, the circumstances ultimately proved not to have international security implications.

It turns out the car, a Bentley Flying Spur, was owned by Kurt Villani, who was accompanied by his wife Monica. They lived in Grand Island, on the Niagara River between Buffalo and Niagara Falls, N.Y. They were the owners of Gui’s Lumber, a dealer with seven Ace Hardware stores in western New York.

For reasons that have still to be determined, the car raced out of control on the American side of the border crossing, hit a median, and crashed into a row of security booths and exploded. While the investigation continues into this incident, certain versions of the Bentley Flying Spur have been the subject of recalls, due to reports of gas pedals getting stuck.

At BMR Group, Vincent Chicoine has been appointed vice-president, pro sales, effective Jan. 8. He will report to Antonio Di Pasquale, BMR’s COO. Chicoine spent the past 15 years with IKO Industries, most recently as regional sales manager for eastern Canada.

Michael Gawtrey, Home Hardware’s director of loyalty and CRM, is retiring. He started 35 years ago as a buying assistant at Canadian Tire Retail, later moving to marketing to lead Canadian Tire’s loyalty efforts. This was followed by stints at LoyaltyOne (Air Miles) and Home Depot Canada before Gawtrey joined Home Hardware. There, he worked on Home’s loyalty and CRM programs, including its Pro marketing program and the launch of its loyalty partnership with Scene+.

The Western Retail Lumber Association has named Murray Finkbiner as its 2023 Industry Achievement Award recipient. This award recognizes someone who has contributed to their business, the building supply industry, the WRLA, and the communities in which they live. An active member of the building supply industry since he began working at his father’s lumber yard 51 years ago, he is best known for his tenure at AFA Forest Products. He joined the company in 1988 and took over as AFA’s president and COO in 2014, serving until its acquisition by Gillfor Distribution in 2022.

At Regal ideas, Joe Jacklin has been promoted to national sales director in Canada. Continuing on his launch of the company’s DeckStar Contractor program, he will be responsible for managing the dealer business. Brandon Taylor has joined Regal ideas as territory manager for southwestern Ontario. He comes over from Nuvo Iron and replaces Clifton Phelps, who has retired. Laurence Ballen has joined Regal ideas as territory manager for British Columbia. His background includes retailers such as Sherwin Williams.

DID YOU KNOW…?

… that Hardlines Classified Ads reach thousands of qualified candidates every week? Because they’re read by professionals right in the home improvement industry, they get results. Click here to get a free quote on your next Hardlines Classified Ad! And if you are looking for your next placement, you can take advantage of our free Resumé Service. Post your resumé on our website at no charge. Click here for more details. And as a Subscriber-Member of Hardlines Weekly Report, you get one Classified Ad free every year. It’s on us. Contact Jillian to learn more!

RETAILER NEWS

The Home Depot Canada held its 15th semi-annual Orange Door Project fundraising campaign last month. The campaign combats youth homelessness across Canada by collaborating with local charities to support ongoing initiatives aimed at providing safe, stable housing and life skills development to help youth find a path to housing. Since the program’s inception in 2009, the Foundation has raised over $18 million for youth across Canada, and it hopes to raise $125 million by 2030.

Through the remaining weeks of 2023, RONA continued to convert more of its Lowe’s-bannered stores to the new RONA+ brand. The latest rounds began with 13 stores, all in Alberta, including six in Calgary. The other conversions were in St. Albert, Edmonton North East, Edmonton South Common, Edmonton West, Sherwood Park, Red Deer, and Lethbridge. These were followed by nine more conversions in mid-December at locations around the Greater Toronto Area.

Castle Building Centres has announced its newest member, VP Resources in Invermere, B.C., owned by Bryan and Lauren Kroker. The couple plans to build a brand-new store to showcase a complete LBM and hardware offering for the area’s homebuilder and contractor market.

Quebec hardware chain Gagnon – La Grande Quincaillerie (Gagnon – The Great Hardware Store) held a big celebration in Montreal recently to mark the company’s 50th anniversary. The night included a video history of the company, and a tribute to Yves Gagnon, who had taken over a single store from his father in 1973 and built it into a thriving chain of five home centres. The business is currently run by Yves’ daughter, Geneviève Gagnon.

Patrick Morin, the founder of the retail home improvement chain of the same name, died earlier this month at the age of 96. Morin, along with his wife, Denise Benny, opened their first store in Ste-Marcelline-de-Kildare, in Quebec’s Lanaudière region, in 1960. Over time, the Patrick Morin stores grew to comprise one of the largest privately-held retail home improvement companies in the country, with 22 stores in Quebec. In 2021, Groupe Turcotte, which owns a group of Home Hardware stores in Quebec, bought the family-owned Patrick Morin business with additional investment from Home Hardware’s head office. Morin is survived by his wife and two sisters, along with eight children, 20 grandchildren, and 27 great-grandchildren.

Gillfor Distribution has forged a multi-year national sales and distribution partnership with IKO Industries. With this deal, Gillfor consolidates its shingle and roofing products segment across Canada to work exclusively with IKO to service Gillfor’s independent retail customers.

Alpagroup, a French group and European supplier in the furniture and home improvement industry, has made its official launch in North America, headed by a Canadian, general manager Maxime Lebon. Alpagroup is already a key supplier to many of Europe’s home and home improvement retailers. In North America, Alpagroup is backed by seven divisions that represent a range of products, including flooring, storage, bathroom and outdoor furniture, and custom B2B furniture.

The Lumber and Building Materials Association of Ontario (LBMAO) held its annual general meeting recently, followed by a gala dinner. In its AGM, the board reported that the association ended the year ahead of budget and is looking at developing a program in 2024 of site visits to suppliers’ facilities to increase product awareness among its dealer members. (Any suppliers interested in hosting a factory tour should contact the LBMAO’s president, Trevor Small.)

The total value of building permits increased 2.3 percent from September to $11.2 billion in October, led by gains in the non-residential sector. Residential permits edged up a more modest 0.6 percent to $7.1 billion, following a 2.8 percent increase in September. Gains in Ontario (+7.4 percent), Alberta (+14.8 percent), and Quebec (+7.0 percent) offset declines in the remaining seven provinces. Year-over-year residential construction intentions were up 16.1 percent in October compared with October 2022. (StatCan)

The Western Retail Lumber Association is holding the 30th anniversary edition of its Building & Hardware Showcase from Jan. 17 to 19. Members and suppliers will gather at the Winnipeg Convention Centre for new product launches and the latest tech, trends, and topics hitting the LBM industry. (Click here for more information and to register!)

Acquisitions will be key to BMR’s national ambitions for expansion, says CEO

BMR Group is continuing to pursue growth outside its home province of Quebec, not only in Ontario but with a view to acquisitions nationwide, its CEO says. Hardlines spoke with Alexandre Lefebvre during BMR’s annual buying show, held earlier this month at the Centre des congrès in Quebec City.

“Obviously, we’re a dominant player in Quebec but in the past few years we’ve been able to make inroads, mainly in Ontario. Every year we’ve been fortunate enough to be able to sign fairly big dealers in Ontario, so it’s giving us bigger market share there.”

Lefebvre adds that BMR’s commercial division in the Greater Toronto Area, while “less well known,” is “growing a lot.” That division is part of the Lefebvre & Benoit business that BMR bought into in 2019. Shortly thereafter, Lefebvre moved the top job in BMR.

“More than ever, growing outside Quebec is a priority for us.” It makes sense to pursue that growth “organically, through the Maritimes, Quebec, and Ontario,” but, he added, “the rest of Canada is still very much on the radar. Realistically, it’s going to have to come through acquisitions, so if there’s a good opportunity that presents itself, we’re going to be looking.”

BMR’s management team has ensured the company’s house is in order and ready for growth. “We really solidified our balance sheet, cleared off the debt, so that we’re in a good position to be able to make acquisitions.”

The group offers an assortment of banners under the BMR name, including BMR Express for smaller, convenience-oriented hardware stores and BMR Pro for contractor-oriented dealers. Lefebvre notes that these options can help BMR appeal to dealers in a wide variety of contexts. “We’re a network of independent dealers, so it’s important for us to cater to different markets, different models, different sizes of stores.”

That versatility is further served by BMR’s strength in the agricultural side of the business, as well, which can be a boon for rural communities. “The fact that we have that core, in-house agricultural business gives us that volume, that critical mass to have a strong agricultural offer, which has been really beneficial, not just to the co-ops, but to a lot of the independent dealers as well.”

Mentioning that the company is in the midst of strategic planning, Lefebvre added that “another new vision” for the multi-banner strategy is coming soon.

Kent introduces heavy appliances in select stores in Atlantic Canada

Kent Building Supplies has launched a new and significant addition to its product mix. The Atlantic building supply dealer has begun selling heavy appliances in some of its stores and, effective last week, the new assortments were supposed to be available online as well.

The products are being sold at Kent’s nine big box stores for starters and are expected to roll out to additional stores over time. The company boasts that the major brands, including Samsung, Whirlpool, and GE, are represented in the new offering and the retailer is promoting the fact that it will ship the products directly to customers’ homes.

The launch is getting a push on social media, including Facebook. A contest that invited people to “like” the Kent post made them eligible to win a $2,200 GE stainless steel refrigerator and a $1,000 grocery gift card. While Kent was to have the products available online last week, a search of the website did not turn up any washers, fridges, or stoves. Kent did not respond to queries from Hardlines.

Kent is certainly not alone in taking on appliances. Other hardlines retailers are carrying appliances in Atlantic Canada, including Home Hardware dealers. Both RONA and Home Hardware introduced them about six years ago, following the demise of Sears, which was a major seller of fridges and stoves in Canada. When RONA exited Newfoundland and Labrador at the beginning of 2019, that left further room in the market.

Home improvement retailers advised to guard margins in their Black Friday sales

Canadian retailers from Home Hardware to Hudson’s Bay are taking advantage of the Black Friday sale trend with discount promotions of their own. The day, which follows American Thanksgiving and landed this year last Friday, Nov. 24, is a traditional discount sale day in the U.S. But over the past decade it has become an international phenomenon thanks to the borderless nature of online sales. It long ago surpassed Boxing Day as the biggest shopping event of the year in Canada.

David Ian Gray, a retail strategist and principal at his firm, DIG360, says even home improvement retailers can get some mileage out of Black Friday, and its following Monday online sales day, Cyber Monday (today), but he offers a warning: “With some product exceptions, home improvement and hardlines writ large is not the typical holiday priority for shoppers and these products have different seasons in which to peak.

“With the cost of cutting through the communications noise, especially for independents, there is not much point for many operators fretting about these promotional days.”

However, the big retail banners get involved heavily in the Black Friday phenomenon. Home Hardware, for example, has featured sales on a range of products. A search of its website reveals discounts of 25 percent off DeWalt tools, Philips light bulbs, and BeautiTone paint. The retailer’s own Benchmark power tool line is boasting discounts of up to 55 percent.

Office supply retailer Staples Canada announced a series of sales just two days before Black Friday, which were available only as long as supplies lasted. Customers could get “gate-crasher” specials on products ranging from iPods and printers to luggage and Keurig coffee makers by shopping online beginning at 6 p.m. the night before.

Gray warns hardware and home improvement retailers not to give away too much. “There is a chance to promote traffic with selected features that are relevant to the season, like lights and accessories. But avoid the pressure to crater your margins.”

And more and more retailers are stretching out the Black Friday timeline. This protects them from inventory shortages and can further help protect their staff from being slammed over a day or a few days.

Home Depot Canada has a prominent promotion on its site, inviting shoppers to “save on must-haves for the holiday season” with aggressive pricing on everything from power tools to holiday decorations. Hudson’s Bay began its Black Friday sale on Nov. 17 and runs until Nov. 28. Discounts are being offered on cosmetics, kitchenwares, and clothing. RONA’s website boasts nothing less than “One Month of Black Friday Deals.” Big discounts appear there on power tools, as well, such as 55 percent off Bosch products, plus 50 percent off artificial Christmas trees.

But these extended sales strategies have their downside, says Gray.

“Over the past two years, we’re seeing a stepping back from hype by many mainstream retailers, save for those who strive to ‘own’ Black Friday. There’s also a growing concern the extreme peaks and troughs day-by-day in the season bring extra strain on already tired and stretched front-line and back-office staff. And the peaks create vulnerabilities in the surge of in-store theft.”

Bad Boy Furniture has entered bankruptcy protection in an effort to restructure its business. The Toronto-area furniture and appliance retailer was (in)famous for decades for its TV ads that featured old-time hustle and bravado, with endless variations on the slogan: “Who’s better than Bad Boy? Nooobody!”

Now, faced with high interest rates and a slowed housing market, Bad Boy has filed a notice of intention proposal under the Bankruptcy and Insolvency Act. Faced with $13.7 million in debt, the company has appointed Infinity Asset Solutions to oversee the total liquidation of its entire inventory, valued at $25 million. The decision to hold the liquidation sale is part of Bad Boy Furniture’s strategic restructuring plan, according to a release. The retailer is promoting savings of up to 50 percent on appliances, furniture, electronics and home décor.

The story of Bad Boy began in 1953 with Mel Lastman, a flamboyant Toronto appliance salesman who went on to become mayor of Toronto. That year, his future wife, Marilyn, got Lastman a sales job at an appliance store in Toronto. A year later, he purchased the business. In 1955, he opened his first Bad Boy store. A brilliant self-promoter and outspoken TV personality, he grew the business to 40 locations by 1990.

In 1972, Lastman became mayor of North York, a suburb on the north end of the Greater Toronto Area, a post he held for an impressive 10 terms totaling 25 years. In 1998, he became mayor of Toronto, a role he held until 2003—with somewhat less distinction. (He called in the army to help with snow removal after a major snowstorm in 1999, an incident Torontonians continue to live down to this day.)

In 1991, Lastman’s son Blayne revitalized the image of stores, complete with the striped prison outfit and the infamous “nooobody” slogan. Mel Lastman died in 2021.

DID YOU KNOW…?

… that Hardlines Classified Ads reach thousands of qualified candidates every week? Because they are read by professionals right in the home improvement industry, they get results. Click here to get a free quote on your next Hardlines Classified Ad! And if you are looking for your next placement, you can take advantage of our free Resumé Service. Post your resumé on our website at no charge. Click here for more details. And as a Subscriber-Member of Hardlines Weekly Report, you get one Classified Ad free every year. It’s on us!

RETAILER NEWS

Lowe’s Cos. reported Q3 revenues of $20.74 billion for the quarter, down 11.7 percent from a year earlier. Adjusted earnings of $3.06 per share were down from $3.27. CEO Marvin Ellison pointed to a “greater-than-expected pullback in DIY discretionary spending, particularly in bigger ticket categories.” The pro side, which accounts for 25 percent of Lowe’s business, saw an increase in comp sales, however. Lowe’s has downgraded its forecast for the full year and expects comp sales expected to be down about five percent, compared to its forecast at the end of Q2 of a drop of two to four percent.

Canac is investing $10 million in the expansion and renewal of its store in Quebec City’s Charlesbourg district. The store was lifted onto beams and moved by truck in what marketing director Patrick Delisle called “a manoeuvre you don’t often see.” The retail space is to be expanded by 10,000 square feet. For the time being, the store is open with limited inventory. It will close Dec. 4, with a reopening planned for the spring.

Walmart posted Q3 earnings of $453 million, compared with a $1.79 million loss a year earlier. Revenues of $160.84 billion were up 6.1 percent from $152.81 billion. In Canada, net sales rose by 5.3 percent to $5.8 billion.

The Home Depot has entered into an agreement to acquire International Designs Group (IDG), a distributor of tile, stone, and other architectural specialty products for contractors. IDG owns finishes supplier Construction Resources, which has pro showrooms across the eastern and southeastern U.S. The world’s largest retailer is acquiring IDG from Mill Point Capital LLC, a private equity firm.

Exchange-A-Blade (EAB) has been awarded the Corporate Leadership Award by the Recycling Council of Alberta (RCA). The power tool accessories maker was recognized in the province’s “Rs of Excellence” program, which honours the special contributions by RCA members to “promote, facilitate, and advocate for a circular economy in Alberta through waste reduction and resource conservation.” EAB has been committed to reusing blades and bits through its resharpening and remanufacturing program since 1976, the vision of Rob Forbes, founder and owner of EAB.

West Fraser Timber Co. has completed its acquisition of Spray Lake Sawmills in Cochrane, Alta. The operation produces treated wood products, dimensional lumber, and a variety of wood residuals and bi-products. It has an annual lumber capacity of 155 million board feet.

Investment in building construction increased by 5.3 percent to $18.9 billion in September. Residential construction spending grew by 7.3 percent, reaching $12.9 billion. Manitoba’s 33.6 percent gain was the largest. Single-family home investment increased 6.4 percent to $6.3 billion. (StatCan)

The annualized pace of housing starts rose by one percent to 274,681 units in October, from 270,669 units the previous month. The rate of urban starts increased two percent, with 257,357 units recorded. Total starts were down 43 percent in Montreal and 24 percent in Toronto, while Vancouver recorded an increase of 35 percent, driven by the multi-unit segment. (CMHC)

U.S. housing starts increased by 1.9 percent in October to 1.37 million units. Building permits edged up 1.1 percent to 1.49 million units following a 4.5 percent drop in September. (U.S. Census Bureau)

The latest instalment of the Hardlines podcast series, What’s In Store, is now live. In this episode, Richard Darveau discusses how Quebec association AQMAT keeps the industry informed through its French-language reporting, and its role in launching the Well Made Here campaign in support of Canadian products. (Click here to listen to this and to all our podcasts with this industry’s leaders and top retailers!)

RONA continues its Lowe’s banner conversions, this time in western Canada

The rebranding of Lowe’s stores in Canada continues as RONA inc. works to shed the brand after being sold by Lowe’s Cos. near the beginning of this year. Under the ownership of New York-based private equity firm Sycamore Partners, 62 Lowe’s stores in this country were targeted for rebranding, which involved renaming them with the RONA name—but with a twist.

RONA+ is the new banner. It has been applied to the Lowe’s stores in Ontario, and now the company has taken the changeover outside of that province, announcing the renaming and reopening of RONA+ stores in the following locations:

• Winnipeg East
• Winnipeg South
• Saskatoon
• Regina
• Nanaimo (shown here)
• Victoria – Tillicum
• Victoria – Langford

Members of RONA’s leadership team joined the store teams as well as elected officials.

The conversion of the former Lowe’s store to the RONA+ banner is part of a wider plan aimed at redefining how Canadians shop for home improvement and represents a significant local investment. Through this process, the company is looking to build on the strong legacy of the RONA brand and build momentum for the Canadian-operated household name.

The latest banner changes add to the list of some 25 stores, all in Ontario, that have already been converted. In addition, the brand consolidation has resulted in the closing of one Lowe’s store, in Vaughan Ont., as well as two RONA stores: a Home & Garden big box in London, Ont., and another store in Belleville, Ont.

According to Jean-Sébastien Lamoureux, SVP for RONA affiliates, wholesale, and public affairs, the company plans to have more than half of the Lowe’s stores converted to the RONA+ banner by the end of the year.

Canadian Tire Retail faces slightly lower traffic and negative comps in Q3

Canadian Tire Corp. reported a Q3 net loss of $66.4 million, compared with earnings of $184.9 million a year earlier. That loss includes $328 million in costs related to CTC’s buyback from Scotiabank of a minority stake in its Canadian Tire Financial Services business. Revenues for the period rose 0.5 percent to $4.25 billion, while consolidated comparable sales were down 1.6 percent as a result of softening customer demand, especially in Ontario and British Columbia.

Canadian Tire stores saw sales drop by nine percent, while comp sales fell by 0.6 percent. Store traffic was also down, though modestly, from last year’s third quarter. However, post-Covid, the company continues to identify its business according to essential and discretionary categories. Essential categories at CTR were up around 4 percent, led by strength in automotive, while discretionary categories were down by about the same amount.

Softness in home projects drove a decline in CTR’s Fixing category, while higher sales of pet and household cleaning were the drivers behind a modest increase in the Living category.

There were a couple of other bright spots as well. “Comp traffic at CTR was down by only half a percentage point, and basket size remained relatively steady,” said Greg Hicks, president and CEO of Canadian Tire Corp., on a call to analysts. And performance by CTC’s private labels continued to grow as they appeal to budget-conscious shoppers. “From a sales perspective, we had strong performance in two of our most profitable owned brands, Motomaster and Pro Series, with sales up 10 percent and 26 percent respectively in the quarter,” Hicks added.

In announcing the results, the company also said it is eliminating three percent of its work force before year’s end, with some cuts already in place. The redundancies affect the equivalent of 200 full-time corporate positions. It is also cancelling “the majority of current vacancies” in its ranks, which amounts to an additional three percent reduction in its human resources.

AQMAT Gala draws record crowd to honour Quebec industry

AQMAT, the Quebec hardware and building materials association, held its 11th Recognition Gala this month at the Fairmont Queen Elizabeth hotel in Montreal. Awards recognized 54 employees, products, and companies in front of a record audience of 530 guests. AQMAT president Richard Darveau was joined by actor Jeff Boudreault of TV’s District 31 as co-host.

The event is a must-attend for the entire Quebec industry, drawing independent dealers and their staff, plus wholesalers, buying groups, and executive head offices from both the retail and vendor sides.

The gala will take a break next year as AQMAT collaborates with the 28th annual Hardlines Conference to create a pan-Canadian event in La Malbaie, Que. Then, the Recognition Gala will move back to the Fairmont Château Frontenac in Quebec City, where it will be held March 27, 2025.

With seating capacity of only 400, the Quebec City venue will be smaller than this year’s Montreal event, which may compel the association to limit attendance from each company, said AQMAT CEO Crystelle Cormier. “To give more people a chance to participate, we are considering limiting the number of places per company.”

(Click here to see a list of all the winners at the Recognition Gala.)

BMR Group held its 2023 Buying Show this month at Quebec City’s Centre des congrès. A record-setting 1,500 dealers, vendors, and partners converged on the historic city to share hot products and services, as well as to showcase private-label brands. Vendors who spoke to Hardlines expressed positivity and enthusiasm about the pace of sales this year.

The event concluded with a gala evening held right in the Centre des congrès and hosted by strongman and brand ambassador Hugo Girard along with comedian Korine Côté. The duo’s seamlessly bilingual repartee accompanied a five-course gourmet dinner.

Addressing the 1,000-strong audience, CEO Alexandre Lefebvre boasted that “again this year we have not lost a single BMR dealer to our competitors.” He added, “BMR is growing at a faster pace than anyone else in our industry. We have an NHL-level team—and I’m not talking about the Ottawa Senators!”

Vendor awards were presented in the categories of LBM (Duchesne et fils), hardware (Ipex), forest products (Tolko), and agriculture/horticulture (Garant). Among BMR’s member retailers, Marianne and Mathieu Moisan of BMR Paulin Moisan, based in Saint-Raymond, Que., were honoured with the Ambassador Award. It was just the latest recognition for these two cousins, who were already named Young Retailers of the Year at Hardlines’ 2022 Outstanding Retailer Awards.

Finally, new dealers who joined BMR over the past year were inducted with a fun NHL-style “draft” announcement. They are H. Dagenais et fils inc. (Saint-Sauveur, Que.), Centre de rénovation Senneterre (Senneterre, Que.), Group Anctil (Magog and Saint-Denis-de-Brompton, Que.), and Leis Lumber Co. Ltd. (Goderich, Ont.). A professionally produced short film took the gathered company behind the scenes of the newly recruited stores, allowing the dealers to speak directly to the audience.

At Grainger, Cecelia Myers has been named VP, group product manager. Myers was most recently VP, digital, at CDW. Previously, she held a series of positions at Groupon and co-founded CakeStyle, an online women’s styling business.

DID YOU KNOW…?

… that Hardlines Classified Ads reach thousands of qualified candidates every week? Because they are read by professionals right in the home improvement industry, they get results. Click here to get a free quote on your next Hardlines Classified Ad! And if you are looking for your next placement, you can take advantage of our free Resumé Service. Post your resumé on our website at no charge. Click here for more details. And as a Premium Member-Subscriber to the Hardlines Weekly Report, you get one Classified Ad free every year. It’s on us!

RETAILER NEWS

RONA inc. has laid off 25 workers at its Boucherville, Que., warehouse, Le Journal de Montréal reports. A spokesperson for the company cited “a surplus of personnel” in explaining the move. In total, some 1,550 employees work at the Boucherville operations, which include RONA’s head office and the distribution centre.

The Home Depot reported third-quarter sales of $37.7 billion, a decrease of three percent from the third quarter of fiscal 2022. Comparable sales for the third quarter of fiscal 2023 decreased 3.1 percent, and comparable sales in the U.S. decreased 3.5 percent. However, in local currency, Canada posted comps above the company average. Net earnings were $3.8 billion, compared with $4.3 billion in Q3 2022.

Canadian Tire Corp. has unveiled Canada’s Christmas Lists, a new gift registry platform that allows customers to build, share, and shop personalized Christmas lists. Shoppers can add their most-wanted items to their list and share with friends and family using a personalized URL. The digitally secure registry, powered by MyRegistry.com, will remain available beyond Christmas for birthdays, weddings, and other special occasions.

Amazon had remained union-free until 84 Amazon delivery drivers in Palmdale, Calif., formed a union in June. They were employees of a firm called Battle Tested Strategies (BTS), one of 3,000 “delivery service partners” (DSPs) that works with Amazon around the world. Amazon subsequently cancelled their agreement with BTS and the drivers went on strike. The drivers claim they are joint-employees of Amazon. Amazon claims they are not their employees.

Discount retailers TJ Maxx and Marshalls will close additional stores in Illinois, Minnesota, New York, and Pennsylvania by the end of next year. That’s after closures this year in Philadelphia and in Minnesota’s Twin Cities. Parent company TJX said it had been “assessing and reviewing our real estate strategies, and our decision to close this store reflects that thinking.”

Taiga Building Products reported Q3 sales of $456.6 million, down 14 percent or $76.5 million from $533.1 million a year earlier. The decline was attributed largely to lower selling prices for commodity products. Net earnings for the quarter rose to $21.4 million from $18.6 million in the previous Q3, thanks to income tax recoveries from the prior year.

Sales of existing homes declined by 5.6 percent month-over-month in October. The actual (not seasonally adjusted) number of transactions came in 0.9 percent above October 2022. The number of newly listed homes fell 2.3 percent, the first decline since March. (Canadian Real Estate Assoc.)

The latest issue of Hardlines HR Advisor hit inboxes last week. In this edition, we look at IKEA Canada’s affordability strategy, how to check references when hiring, and navigating inter-generational working relationships. If you’re not already receiving HR Advisor, click here to sign up for free!

IKEA Canada president talks affordability, sustainability, and accessibility

IKEA Canada organized an in-person event last week to present its annual IKEA Canada Summary Report 2023. The report highlights the company’s ongoing growth and its commitment to making affordable, quality home furnishings that are accessible to Canadians.

The presentation was led by Selwyn Crittendon, IKEA Canada’s CEO and chief sustainability officer, who offered some highlights from the report that reflect how the company has grown over the past year. Crittendon told the audience in a downtown Toronto event space that IKEA Canada’s sales increased by 10.9 percent to $2.9 billion in the fiscal year ending Aug. 31, while national store visits increased by 6.3 percent to 28.6 million. During the year, 1.6 million deliveries were made to Canadian households.

“We are a purpose-driven, value-driven brand but we always put our heart and soul into the products and services we deliver.”

He went on to note some other achievements, including plans to invest over $400 million to support the company’s fulfilment networks in the Greater Vancouver and Toronto areas. In addition, IKEA opened a new distribution centre last year in Beauharnois, Que. Crittendon said it’s the first such facility in this country in over three decades.

But the core of his message that morning was about affordability. He noted the rising cost of living for Canadians and emphasized IKEA’s commitment to producing affordable—and sustainable—products to counter those rising costs. “These are the foundations of our company: function, form, quality, sustainability, low price. We will never compromise.”

Accessibility is another important aspect of IKEA’s strategy, Crittendon said. That includes physically, as the retailer plans to add to its growing list of small-format showrooms, called “plan-and-order points,” with more locations nationally to come, in addition to the ones most recently announced, in London, Ont., and Lachenaie, Que., which will open next spring.

But there’s another aspect of accessibility that IKEA has addressed as well, and that has to do with affordability. The retailer has partnered with RBC to offer a financing plan that will let customers pay for their purchases over 12 months with no interest.

Recession? Maybe, but it won’t be deep, RBC economist tells CHPTA members

Hardlines reported last week on the latest StatCan numbers indicating they predict flat GDP growth for the third quarter ending on Sept. 30. The second quarter was a contraction. Are we headed into a recession (two quarters with negative growth)? While some economists are being pessimistic, a report by Rishi Sondhi to a group of members of the Canadian Home Products Trade Association offered a more upbeat forecast.

Sondhi is an economist at TD Bank. In offering an outline of economic conditions in Canada, he started with China, the world’s second-largest economy. That country has been experiencing five percent growth. “That’s slower than previous years, but still is better than the world in general. But that growth rate is expected to keep falling.”

Moving closer to home, Sondhi said the U.S. is going through some diversifying, what he called “reshoring,” as manufacturers bring some production back home from Asia. That, he said, could cause higher production costs and add to inflation. He expects the U.S. economy to slow following strong five percent growth there. A drop in consumer spending that will continue into 2024 will contribute to that deceleration, he pointed out.

Sondhi next addressed the big question of which way interest rates will move. He suggested they have peaked. “We think the Bank of Canada is done hiking interest rates.” He forecasts that they’ll begin falling gradually by the middle of 2024 and expects them to reach 4.5 percent by October of next year.

He observed that economic growth here has already flattened. It may technically be a recession, he said, admitting it’s certainly flat. Add to that the reality of high interest rates, which continue to suppress consumer spending.

“We forecast weak, subdued growth for the Canadian economy, but we’re not expecting a deep recession.”

AD reports solid performance for Canadian members year-to-date

AD (Affiliated Distributors) reported owner-member sales of $57.6 billion through nine months of 2023, an increase of three percent and a record for the Wayne, Penn.-based contractor and industrial products wholesale buying group. Its Canadian members fared well also, including those within AD’s Building Supplies – Canada division.

Eighty companies have joined the group so far this year, half of them through acquisitions by existing members. Another 35 of AD’s existing 866 members were sold to outside entities. Owner-member same-store sales grew six percent through the first nine months of 2023.

The home improvement division, AD Building Supplies – Canada, was formed when the TORBSA buying group merged with AD Canada in June 2022. That division consists mainly of about 45 former TORBSA member locations, plus new members that have joined since the division was established. Hardlines did not get updated Canadian numbers as of press time. However, the building supplies business accounted for an estimated $786 million in sales in 2022, an increase of almost 10 percent over the previous year (Source: 2023 Hardlines Retail Report).

By country, same-store sales in the U.S. were up seven percent, while comps for Canada were up six percent. The AD division with the highest growth was Safety at 13 percent. Electrical, Industrial, and Bearings/Power Transmission all enjoyed growth of nine percent.

A recent webinar hosted by the Retail Council of Canada offered some important insights into the profiles of various consumer groups in Canada and how they spend on home improvement products.

The presentation was given by two individuals from Environics Canada. David Spira is the director of account management and Michael Scida is director of business development at Environics—in addition to being an alumnus of this industry, having served for almost seven years at Lowe’s Canada.

Scida identified roughly 19,000 retailers that cover the space, not including Walmart or Canadian Tire. About 57 percent of those stores are in Quebec and Ontario. The total aggregate spend, says Scida, is $118 billion.

Environics’ data broke the sales down, with furniture accounting for $33 billion, large appliances for $8 billion, and small appliances and home décor equalling $19 billion in sales. Environics estimates the home improvement category, which includes tools, lawn and garden, building materials, and labour, at $69 billion.

(Note: these numbers differ from Hardlines’ own estimate of the size of the industry as defined in our annual Hardlines Retail Report, as we don’t include the specialty stores or labour, but only sales through traditional hardware and building materials channels, including Canadian Tire.)

“The average Canadian household spend is $7,827 per year on all household refresh categories,” said Scida. But that spend is not consistent across the board.

So, which groups are the biggest spenders? Scida explained that his company created a series of profiles for different demographics among Canadian consumers, based on store traffic. The group profiled various consumer groups and put them into four targeted consumer groups. Older families and empty nesters represent 1.1 million households and an average household spend of $13,188. Middle-aged families, representing 2.6 million households, spend $120,183. Large, diverse families represent $746,000 and spend an average of $12,000 per household. The younger mix is the fourth profile, which spends  an average of $9,247 per year on home improvement.

These target groups represent 29 percent of the population, said Scida, but account for fully 41 percent of the spend in the home improvement and home décor categories. For example, the older families and empty nesters, aged 65 and up, account for eight percent of the population but represent 13 percent of the spend.

But without a doubt, one group stood out. Environics has determined that the highest-spending group, and therefore the one making the biggest impact on spending in the home improvement and home décor categories, is the aging baby boomer demographic.
“The older families and empty nesters are really the key target group for household spending on home improvement.”

How do the different groups gather their information about which products to buy? Not surprisingly, the older demographic prefers to do it in person or on their computers. And they overwhelmingly prefer to complete the sale in person. The younger groups don’t see the need to conduct the transaction in person and are much more comfortable doing the deal completely online.

An executive at Home Hardware Stores Ltd. has been recognized as one of Canada’s Top 100 Most Powerful Women by the Women’s Executive Network (WNX). Vanda Boyd is senior director, in-store systems solutions for the St. Jacobs, Ont.-based retailer. Since 2003, the WNX has celebrated Canada’s Top 100 Most Powerful Women by recognizing community advocates, trailblazers, and thought leaders.

At Derby Building Products, Patrick McKernan has been named territory sales manager, home improvement retail, for the mid-Atlantic region. Based in Lafayette Hill, Penn., McKernan will work to expand Derby’s penetration into Home Depot’s U.S. stores with Novik Stone, Derby’s line of stone siding. His previous roles include working at East Coast Roofing Systems, an exterior residential remodeling company. Most recently, McKernan was at Colonial Electric Supply, a family-owned electrical distributor in the U.S.

DID YOU KNOW…?

… that the 2023 Hardlines Retail Report is your best tool for planning your marketing strategy for 2024? This incredible study examines the sales, market shares, and strategies of the country’s top retail banners. It also identifies the key trends these retailers are facing and looks at how all these trends have translated into sales numbers, with breakdowns by banner, province, and store type. As a Premium Member-Subscriber, you save more than 20 percent on your order, and more than 30 percent when you buy the Retail Report bundled with its companion research, our annual Hardlines Market Share Report. You can click here now to order!

RETAILER NEWS

Federated Co-operatives Ltd. has announced that Swan Valley Co-op will purchase two home and building retail sites, in the Manitoba communities of Swan River and The Pas, from the Minsh Group of Companies. Each property includes over 9,000 square feet of retail space, a lumber yard, and storage facilities. The acquisition is expected to close in late November, with Co-op operations beginning on Dec. 1.

RONA inc. is holding the third edition of its PROvember event in most of its Lowe’s, RONA+, RONA, and Réno-Dépôt stores from Nov. 2 to 29. The event, linked to the VIPpro program, will feature in-store “lunch and learns,” special offers, surprises with purchase, and contests for building and home improvement professionals. In addition, participants can choose at checkout to support the RONA Foundation’s Building from the Heart campaign, which aims to renew living environments and make housing accessible for those who need it.

Castle growth continues in Ontario with its newest member location, Windeco Building Supply in London, Ont. The full-service lumber, building materials, and hardware retailer is getting set to open its doors with a full-service retail storefront in addition to its lumberyard. Owners Peng Yi Chen,Ri Kai He, Tong He, and Xian Yi Jiang will target home renovation contractors and DIYers in London and the surrounding area with their new store.

Wolseley Canada has launched its newest store in the Yorkdale area of Toronto. The 16,000-square-foot facility held a grand opening on Nov. 9.

IKEA Canada is expanding its network of plan-and-order points with additions in Ontario and Quebec. They will be located in London, Ont., and Lachenaie, Que., and are slated to open next spring. The spaces allow customers to consult with specialists to plan purchases for complex projects. The retailer has also opened a pick-up location in Thunder Bay, Ont.

Franchise Times has released its annual Top 400 list, which measures the largest franchise systems in the U.S. by global sales. Ace Hardware placed at number five, the same ranking it held in 2022, behind Burger King, KFC, McDonald’s, and 7-Eleven. Ace posted $23.1 billion in annual retail sales last year, a 3.4 percent increase from the prior year. It opened 168 new locations in the U.S. and 232 total new locations worldwide in 2022.

Canfor Corp. reported a third-quarter operating loss of $65 million, including a $49 million loss from its pulp business. The results include a net $20.8 million reversal of a previously recognized inventory write-down. In western Canada, earnings were squeezed by higher spruce-pine-fir prices.

The value of building permits issued decreased 6.5 percent in September to $11.2 billion. Most of the drop was attributed to a monthly decline in the institutional sector. The value of residential permits increased 4.3 percent to $7.2 billion, led by a 37.2 percent increase in construction intentions in British Columbia. Gains in the value of residential permits in Quebec, Nova Scotia, Prince Edward Island, and Newfoundland and Labrador offset declines in the remaining five provinces. (StatCan)

For its fiscal year ended Aug. 31, IKEA Canada enjoyed a healthy increase in sales of almost 11 percent. But food sales increased 27 percent as Canadian shoppers enjoying more than 15.6 million meatballs and three million hot dogs during the year.

RONA returns to the airwaves with new reality TV show in Quebec

RONA inc. has developed a new reality show for Quebec television called Le grand chantier RONA. The retailer’s first TV effort in 14 years, it will begin airing sometime in 2024, and line up with RONA’s 85th anniversary next year.

The show will be hosted by the popular actor and comedian Marie-Lyne Joncas, and RONA claims it will be Quebec’s biggest home improvement competition, with 12 couples competing over 10 weeks to win a brand-new, fully furnished home worth $700,000.

The new program marks a return to French-language television for the Quebec-based retailer. It was created in partnership with French-language TV network Noovo and the production house Zone3. A show called Ma maison RONA ran from 2003 to 2009 and was a hit across the province. The new program is part of a concerted strategy to focus on the RONA brand now that the company is free of its ownership under Lowe’s Cos. (The Lowe’s Canada business was sold off at the beginning of the year to Sycamore Partners, a New York-based private equity firm.) The Lowe’s-bannered stores in the retailer’s network are currently being converted to a new banner called RONA+.

“We’ve been dreaming of this show for three years,” says Catherine Laporte, VP of marketing for RONA inc. “We wanted to regain the brand leadership across Canada and the place to start was in Quebec, in our home province.”

The show will give an important lift to the RONA brand at home, says Laporte, as the company reinforces its brand post-Lowe’s—and prepares to promote its anniversary, which will land in September 2024. “There are some strong players in Quebec, but we have the leadership with 85 years in the province.”

While English-language TV must deal with spillover from U.S. content, which can dominate the airwaves, Quebec enjoys a strong home-grown entertainment industry. Laporte would love to see the show’s concept rolled out eventually to an English-speaking audience, as My RONA Home was in 2009.  “There’s no reason why RONA couldn’t come out with a home improvement reality show for all of Canada,” she says. “It just makes sense, but first we’ll see how it goes in Quebec.”

Veteran of Home Depot’s early days shares stories of the retailer’s growth and vision

The stories around the start of what is today’s the world’s largest home improvement retailer are filled with colourful characters, determination, and breaks—good and bad. Jim Inglis was there for much of it. He joined The Home Depot early in its growth, in 1983, at a time when the big box model was new, unproven, and widely ridiculed by competitors. He ended up becoming EVP of merchandising and EVP of strategic development before leaving the company 13 years later.

Inglis shared some memories of how Home Depot grew with delegates at the 27th Hardlines Conference, held last month in Whistler, B.C.

Home Depot got its start in 1980 and went public in 1983. Amidst the struggles and the victories that underscored the retailer’s growth, one factor was crucial to holding the company together, and that was its clearly defined culture—what he refers to as “bleeding orange.”

According to Inglis, co-founder Arthur Blank was the numbers guy. His partner Bernie Marcus was the culture and people person. And Pat Farrah, who had first initiated the concept in a store in California before Blank and Marcus joined, was the merchandising visionary. These three individuals formed the basis upon which that orange culture was established.

Inglis noted that by 1988 Home Depot had surpassed Lowe’s in sales. Another big competitor at the time was a chain called Scotty’s in Florida. Scotty’s issued its latest catalogue, proudly displaying its competitive pricing on a range of products. Home Depot staff rounded up the catalogues and put them on the end aisles of its stores, then wrote on them with magic markers that Home Depot would sell anything at 20 percent less than the Scotty’s prices. That take-no-prisoners approach was a cornerstone of the Home Depot philosophy. And that was the last time Scotty’s published a catalogue.

Inglis also talked about Home Depot’s entry into Canada. He admitted that the executives in the U.S. figured Canada to be something of a 51st state, similar to California in market size. But initial forays, with stores in British Columbia, did not go smoothly. That all changed when the company hired a Canadian, Annette Verschuren, to head the company. Within a few years, Canada was Home Depot’s fastest growing division. (PHOTO: Josef Povazan)

Is Canada on the brink of a recession? StatCan says ‘yes’

Amid high interest rates and higher costs, Canadians are wondering whether a recession is in fact in the making. Now some hard statistics give weight to a bad-news scenario.

Statistics Canada released its numbers last week for the country’s August gross domestic product levels, which showed a flat economy with no growth, missing analyst estimates for a tiny increase of 0.1 percent. The agency also released its preliminary forecast for September and the third quarter, which points to continued flat growth.

That, technically, would put Canada’s economy into a recession, defined as two quarters of economic contraction. The GDP in the second quarter contracted 0.2 percent. Some economists says that the latest GDP numbers should put an end to interest rate hikes from the Bank of Canada.

Meanwhile, a new study from TD Bank, “Canadian Housing: Navigating Challenges,” offers TD’s analysis of the Canadian housing market. Unsurprisingly, it says that multiple interest rate increases from the Bank of Canada have depressed housing prices and, consequently, listings. However, there was good news in terms of the degree of housing starts currently occurring.

“Even with multi-year highs in borrowing costs and persistent labour shortages, builders have been able to sustain a pace of housing starts that is roughly 20 percent above pre-pandemic levels and near multi-decade highs,” the report says. However, the report gives national numbers, while observing that Quebec housing starts, in particular, are “retrenching.”

Attacks on retailers are getting increasingly more aggressive, and in one case, more outrageous.

Grand Valley Home Hardware, in the township of East Garafaxa, 100 kilometres northwest of Toronto, was broken into twice in the early morning hours of Oct. 22. Security footage from the second break-and-enter incident shows the perpetrators stealing the store’s safe which was on the second floor (see photo, courtesy of Ontario Provincial Police).

The two suspects first arrived at 2:10 a.m. in a dark-coloured SUV and one of the suspects gained access to the building by removing a window in the side door. The suspect who removed the window was captured on a security camera wearing a dark-coloured pullover with hood, a facial covering, and gloves (see above photo at right). Both individuals spent 35 minutes at the store, but it is unknown whether they stole anything on that first visit.

At about 4:10 a.m., the suspects returned to the store in the same vehicle. This time, the second suspect was captured on video. He was wearing a dark jacket with a hood, a surgical mask, orange gloves, blue jeans, and blue running shoes. His partner in crime re-entered the building and dropped the safe from a second-storey window, where the second suspect placed it on a dolly.

Both suspects moved the safe to the vehicle, placed it inside, and then drove off. They had spent a total of just 20 minutes at the store stealing the safe, security videos indicate. Ontario Provincial Police are investigating but had made no arrests by the time of publication.

The Arthurs family has owned Grand Valley Home Hardware since 2016.

The Home Depot has named Ann-Marie Campbell as senior EVP. She will assume responsibility for outside pro sales efforts and installation services, while continuing to oversee U.S. stores and operations—and the Canadian and Mexican business units. A 38-year veteran of the company, Campbell has served as EVP of U.S. stores and international operations since 2020. Hector Padilla has been named EVP of U.S. stores and operations, where he will lead the company’s three U.S. operating divisions, reporting to Campbell. He has been with The Home Depot for some 30 years, most recently as EVP, outside sales and service.

DID YOU KNOW…?

… that the 2023 Hardlines Retail Report is your best tool for planning your marketing strategy for 2024? This incredible study examines the sales, market shares, and strategies of the country’s top retail banners. It also identifies key trends and forecasts sales for these retailers, with breakdowns by banner, province, and store type. As a Premium Member-Subscriber, you save more than 20 percent on your order, and more than 30 percent when you buy the Retail Report bundled with its companion research, our annual Hardlines Market Share Report. You can click here now to order!

RETAILER NEWS

Carleton Co-operative in Florenceville-Bristol, N.B, will convert its country store to the Ace Country & Garden banner. Founded in 1946, Carleton Co-op consists of some 3,000 square feet and is served by a staff of about 10. Jim Kennedy is general manager and John Nigro is retail manager. In addition to the country store, the site includes a Foodland grocery store, gas bar, NB Liquor agency, and propane fill station.

Canadian Tire Corp. has repurchased Scotiabank’s 20 percent stake in Canadian Tire Financial Services (CTFS). With the $895 million all-cash transaction, CTC is once again full owner of its financial services arm. CTFS is key to the company’s Triangle Rewards program, accounting for some 75 percent of all Canadian Tire money issued each year.

Amazon, the world’s largest e-retailer, enjoyed profits that more than tripled in the third quarter ending Sept. 30. In spite of rising interest rates, and falling disposable income, consumers continued to spend heavily on online purchases. Revenue in the third quarter was $143.1 billion. Profit in the quarter was $9.9 billion compared to $2.9 billion in the same quarter of 2022. Amazon’s workforce, which reached a record 1.62 million workers worldwide at the beginning of 2022 during the Covid boom, has since been cut significantly and now stands at 1.5 million workers.

W.W. Grainger has reported Q3 earnings of $476 million, with profits reaching $9.43 on a per-share basis. Revenues for the quarter came to $4.21 billion.

U.S. farm and ranch retailer Tractor Supply Co. released its third-quarter results that included a 4.3 percent year-over-year increase in sales to $3.41 billion. It also experienced a 0.4 percent dip in comparable store sales. Core year-round merchandise, including consumable, usable, and edible products “significantly outpaced the chain average.” The company noted lesser demand for seasonal goods and big-ticket items.

Ace Hardware has relocated its corporate headquarters to the former McDonald’s corporate campus in Oak Brook, Ill. The new location houses over 1,100 staff and features open workstations, 150 conference rooms, 12 cafes and pantries, a fitness centre, conference centre, multipurpose room, large cafeteria, dining centre, and a variety of collaboration spaces.

PPG posted record third-quarter net sales of $4.6 billion, up four percent over the same period a year earlier. Net income in the quarter reached $426 million, up 29 percent from Q3 2022, when net income was $329 million.

Investment in U.S. construction was up 0.4 percent in December. Investment in residential construction rose by 0.6 percent, with spending on single-family projects up 1.3 percent. (U.S. Commerce Dept.)

The latest instalment of Hardlines’ podcast series, What’s In Store, is now live. In this episode, Richard Darveau, president of the Quebec industry association AQMAT, discusses the work of his organization, including the story of the Well Made Here program, which identifies and promotes Canadian-made products. (Sign up now to get updates about the latest podcasts in your inbox!)

RONA SVP talks about the power of the independent at Hardlines Conference

RONA inc. remains committed to its affiliate dealers under its new ownership, Jean-Sébastien Lamoureux told delegates at the 27th Hardlines Conference. The event was held earlier this month in Whistler, B.C.

The company’s senior vice-president for affiliate dealers, wholesale, and public affairs combined updates from RONA with advice for the industry at large in his address.

“Following the acquisition by Sycamore Partners, we brought the RONA brand back front and centre,” Lamoureux said of the ongoing conversions of Lowe’s-branded stores to the new RONA+ banner.

During his presentation, Lamoureux noted that only hours before, RONA had announced to its dealer network the locations of the next nine conversions. “By year’s end, more than half Lowe’s stores will have been converted,” he said. “Our new ownership understands the value and potential of our RONA affiliated dealer network.”

Regarding RONA’s commitment to independent dealers, Lamoureux admitted that the model has advantages of its own, which fit into RONA’s overall strategy. Independent dealers are “often in more remote areas where big corporate players don’t set up shop,” he said, adding they also have the personal knowledge of their local markets to customize their mix.

That can give independents an advantage in an environment where consumers are increasingly favouring proximity. “People don’t necessarily want to drive 20 or 30 minutes to get supplies for a project, especially when they realize they need more of a product or are missing something.

“The pandemic encouraged Canadians everywhere to prioritize buying local. I encourage you to capitalize on that.”

It’s not only in rural areas that small independents can thrive, either. “We see a clear need for more urban stores that carry the essentials that homeowners need,” Lamoureux observed. Moreover, e-commerce can enable even the smallest stores to offer a wider variety of products than they could accommodate on-site.

“No matter how you choose to do it, if you’re not online yet, you need to work on getting there as soon as possible,” he underscored. “Dealers who have a good online offering and offer buy-online, pick-up in-store can turn their customers from competitors who either don’t offer online shopping or don’t have a bricks-and-mortar store.”

Ultimately, the strength of the local independent lies in service. “I can’t emphasize enough the importance of training your staff to support the top-notch experience you need to deliver to your customers.” (PHOTO: Josef Povazan)

Kent gets uncharacteristically scary—and funny—for Hallowe’en

While it’s well known as a worthy competitor in Atlantic Canada and well regarded as a reliable retail customer, Kent Building Supplies is not known for its sense of humour. With the exception of some very funny ads that come out of Quebec (that’s another story for another day!—Editor), home improvement retailers in Canada have typically provided a very straightforward and upright promotional face to customers.

But a new ad for the Saint John-based retailer, a division of J.D. Irving Ltd., breaks the mould. The bit ties in with the Hallowe’en season with a fictional depiction of a pair of vampires that are regular customers at Kent.

According to online advertising trade publication The Message, the concept was originally pitched to Kent by Accomplice Content Supply Co., a production and animation agency in Halifax.

The video, which runs for almost three and a half minutes, also has a few 30-second variations. It focuses on various advantages to shopping at Kent, including the hospitality of its employees. Since vampires can’t enter a home without being invited, they wait until a Kent greeter cheerfully waves them inside. While the rest of the staff cautiously admit they welcome the business from these long-time customers, they are admittedly wary. “We just keep distance from them when, um … they haven’t eaten.”

The bit leads to the vampire customers buying some Minwax stain, which they take back to their home and use to coat a coffin.

The vampires, a 300-year-old couple named Zaros and Lenora, are played by Logan Robbins and Aryelle Morrison, two actors based in Atlantic Canada. They likewise share the joy they get in shopping at the store, which sells “high-quality products that will last as long as we do,” says the Zaros character. “Ever since Kent opened 40 years ago, it’s been an after-life changer.”

(Watch the ad in its entirety here. It’s great fun!—Editor)

BMR adds to its dealer development team in response to membership growth

BMR Group has been adding to its business development team over the recent months. The group has brought new staff on board to support the growth it says it has seen from stores joining BMR from competing banners.

Based in Boucherville, Que., on Montreal’s south shore, BMR has about 275 members (source: 2023 Hardlines Market Share Report). While the majority of these stores are in Quebec, the group is committed to growth across the country, focusing in the near term on the Ontario market and parts of the Maritimes.

However, efforts continue in the group’s home province as well. The most recent new member-dealer is Groupe Anctil, which has operated in Quebec’s Eastern Townships for five generations. Today, it operates two renovation centres, in St-Denis-de-Brompton and Magog, and has co-ownership of a prefabricated wood structures plant, also located in Magog. In addition, Groupe Anctil operates a Granby-based company specializing in wastewater, sewage, and water treatment.

A grand reopening, hosted by Quebec strongman and BMR ambassador Hugo Girard, was held earlier this month.

To support this ongoing growth both inside Quebec and beyond, BMR has added some new faces to its dealer development team. Fady Faddoul joined BMR in July as business development advisor. He was previously at Ford Motor Co. Cris Morton has been in a similar role since May. His experience includes 12 years with Unilever and seven years with Church and Dwight Co. Melanie Johnson recently joined BMR as business development advisor for Atlantic Canada.

These individuals join fellow business development advisors Gilles Parenteau, who has been with BMR since 2017, and Patrick Cadieux, who came on board in 2015 after 13 years as a hardware store owner himself. The team is overseen by Simon Gouin, BMR’s senior director of business development for eastern Canada since 2021.

More than any other speaker, Romain Mercier brought the e-commerce angle to the 27th annual Hardlines Conference held two weeks ago in Whistler, B.C.

But for all the digital technology referenced in his talk, Mercier, a founding partner of the PS&Co Data Lab in Vancouver, had a fundamentally human message: “Over the decades, nothing much has changed. Most purchases are emotionally driven. E-commerce is still commerce between people. And people do business with people they trust, with whom they share mutual values. This is not rocket science.”

Mercier led off his presentation with a carrot and a stick. The carrot was that there is going to be—if Ottawa has its way—a home-building boom between now and 2030 like Canada has not seen before. “The federal government has finally realized that to get affordable housing we need to double the amount of housing being constructed in the next seven years,” Mercier said. This obviously provides unparalleled opportunities for our industry.

The stick was that retailers are generally in the stone age when it comes to reaching out to customers, digitally, Mercier suggested. “Retailers don’t know very much about their customers,” he said. “Each customer is a persona, is part of a segment. There’s a tendency for retailers to do one-size-fits-all marketing. When, if you knew more about your customer, you could send something personalized.”

But the big question is, how do we do that?

Mercier is a big believer in collecting data, online, about customers. It’s what he does at PS&Co and what he has done over more than 15 years working for some of the biggest names in online tech. “Most businesses have five or fewer attributes [discrete pieces of information] for each customer. What can you say to your customer with that information? Nothing!”

Mercier closed his presentation with a summary of the funding available from the Canada Digital Adoption Program (CDAP). Ottawa has backed this program, first announced in April 2021, with $1.4 billion in grants to small and medium-sized enterprises, plus up to $2.6 billion in interest-free loans from the Business Development Bank of Canada. (PHOTO: Josef Povazan)

DID YOU KNOW…?

… that you can update your subscriptions, place orders, and book your Classified Ads by contacting the newest addition to our Hardlines Team, Jillian MacLeod. She is the person to get in touch with if you want to update your subscription to Hardlines Weekly Report, or to book a Classified Ad. So reach out to Jillian if you need help!

RETAILER NEWS

IKEA Canada CEO Selwyn Crittendon says the company will dramatically overhaul its omnichannel and fulfilment processes in the coming years. Speaking to Retail Insider about two months into his role, Crittendon said that as stores get turned into fulfilment units, some of them are doing their omnichannel processes entirely on their own, without being connected to a central hub or DC.

Giant Tiger Stores will open its second location in Saint John, N.B., on Nov. 4. The 16,675-square-foot store is located at 88 Consumers Dr. The grand opening will include the usual Giant Tiger private-label Marché giveaways, a gift card to the first 100 customers, and an appearance by the chain’s mascot, Friendly, the Giant Tiger. The company now has over 260 locations across Canada.

The RONA Foundation, which oversees the philanthropic activities of RONA inc., completed a new campaign, Home Sweet Home, which ran from September 1 to October 9. Thanks to the involvement of employees and the generosity of customers, more than $730,000 was raised for revitalizing living environments or easing access to housing for survivors of domestic violence and their children, low-income families, and people with special needs or mental health issues. The 175 organizations were selected separately by each local RONA team.

Discount department store banner Zellers has brought back its mascot, a stuffed teddy bear named Zeddy. The plush toy, which stands about 15 inches tall, is available for purchase in-store since Oct. 27 and online beginning today. The retailer has committed to donate $5 out of every $15 sale to support Campfire Circle, a charitable organization that supports children with cancer or serious illness and their families.

Kent Building Supplies in Antigonish, N.S., is taking an additional order on deck chairs that support adults with intellectual disabilities. Kent partners with CACL Antigonish to the sell the chairs, which are made by staff and clients of the non-profit. The Antigonish store had excess inventory this year. Jeff Teasdale, executive director of CACL, told local radio station CJFX-FM that Kent has been supportive in marketing the product and in employing its clients.

York Supplies, a 75-year-old hardware store in Birmingham, England, fell on hard times post-Brexit and post-Covid. Local residents were invited to invest in the business and form a single-store co-operative, in what the BBC called the “first time in England a hardware shop had been saved in this way.” The equivalent of $588,000 in funding was raised in just six weeks.

An employee at a San Rafael, Calif., Home Depot store was arrested last week after an internal investigation pointed to her as a suspect in the embezzlement of $1.2 million over the past year. The employee is accused of taking various amounts out of the store’s cash registers, ranging from $25,000 in a month up to almost $174,000 in August of this year. The woman worked in finance at the store. Police said that her house contained “an exorbitant amount of luxury clothing and handbags.”

Third-quarter sales for West Fraser Timber Co. reached $1.71 billion, up six percent from $1.61 billion in the second quarter of 2023. Earnings for the quarter were $159 million, compared with a loss of $131 million in the second quarter. The company expects total lumber shipments for the year to be similar to 2022, as it has not experienced the severe transportation challenges faced last year. For its North American engineered wood products segment, demand has remained relatively robust, leading West Fraser to forecast that its 2023 OSB shipments will reach levels as high as 6.4 billion square feet.

Toolquip’s Agency’s John Ross, age 67, died of cancer on Oct. 4. Ross was the owner of Toolquip Agency Ltd., a Toronto-based sales and marketing company. After retiring in 2016, he continued his activities as a volunteer with Canada Dog Guides, Canadian Adaptive Snow Sports, and Para Alpine Ski Racing. Ross is survived by his wife, Brenda Ross, his daughters Lindsay, Lauren, and Meg, sons-in-law Eli Winterfeld and Scott Grundy, and granddaughter Abigail.

Investment in building construction rose by 1.1 percent to $17.9 billion in August. The residential sector was up 1.6 percent to $11.9 billion, while the non-residential sector edged up 0.1 percent to $5.9 billion. Following five months of consecutive declines, investment in residential building construction rose 1.6 percent to $11.9 billion. Single-family home investment rose 2.4 percent to $5.9 billion, with six provinces posting gains. (StatCan)