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Phone: 416-489-3396 Beverly Allen, Publisher Brady Peever, Client Services Manager John Caulfield, Contributing Editor |
| December 14, 2009, Volume xv, #47 | |
In This Issue:
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“Scrooge was better than his word. He did it all, and infinitely more; and to Tiny Tim, who did not die, he was a second father. He became as good a friend, as good a master, and as good a man, as the good old city knew, or any other good old city, town, or borough, in the good old world.” —Charles Dickens (Victorian British author, in the final passages of “A Christmas Carol”) |
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Best Wishes from the World Headquarters: We want to thank you all, our Faithful Subscribers, for your support through what has been a tough, challenging, exciting year. Have a very merry Christmas, a happy Chanukah, and any other way you will look for peace and contentment with your family and friends over the coming weeks. See you again in the New Year! —Beverly, Brady, Chiaki and Michael Our Holiday publishing Schedule: There will be no issues on Dec. 21 or 28. Then the next issue is Jan. 5, 2010. However, the World Headquarters remains open until Dec. 21. —Michael |
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| CanWel buys rival distributor Broadleaf | ||||||||||||||||||||||||||||
| VANCOUVER — CanWel Building Materials Income Fund will acquire rival building materials distributor Broadleaf Logistics in a deal worth $80 million. CanWel is offering $20 million in cash, 10.25 million CanWel shares and a US$18.5 million secured subordinated promissory note to acquire Broadleaf from Rudy Holding II SARL. The total purchase price is subject to a number of post-closing adjustments based on the relative amounts of net working capital of CanWel and Broadleaf.CanWel had 2008 sales of $803.9 million. Broadleaf has similar sales, supported by 270 employees at 14 distribution centres across the country. Broadleaf will be rolled into CanWel’s own building materials distribution business, and the combined company will be called CanWel-Broadleaf. The new combined business is expected to represent about $1.5 billion in sales, making it the largest LBM distributor in the country.
In anticipation of the deal’s closing later in the spring of 2010, CanWel is also converting from an income trust into a dividend paying corporation called CanWel Holdings Corporation. The change anticipates new regulations coming into effect in January 2011 that will eliminate the tax advantages of income trusts. To help finance the deal and the corporate conversion, CanWel is placing, through GMP, on a bought deal basis, 13,158,000 subscription receipts at $3.80 apiece, for a total of $50 million. The placement will also go to repaying debts and for general corporate purposes. Top. |
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| Lowe’s confirms locations in Western Canada | ||||||||||||||||||||||||||||
| TORONTO — Lowe’s Canada has announced plans for continuing its growth in the Canadian marketplace. Three stores have been confirmed for the Calgary region: a 159,500-square-foot outlet in the East Shepard Industrial Area/McKenzie Town area, one located at CrossIron Mills in the County of Rocky View, and a third in the Sunridge Industrial Area.The company also has plans for British Columbia and Saskatchewan. Most of these new stores will use Lowe’s smaller footprint, 103,000 square feet plus a 30,000-square-foot garden centre.
Lowe’s has plans to open 35 to 45 stores in North America in fiscal 2010; at least nine of those will be Canadian sites. |
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| Lowe’s completes latest round of openings in Canada | ||||||||||||||||||||||||||||
OTTAWA & SUDBURY, Ont. — The latest round of openings by Lowe’s Canada is occurring just before year end, exactly two years after Lowe’s opened its very first stores in this country.The latest opening was in Sudbury, representing the first store in Northern Ontario. It is located across the street from a Home Depot, in a city that already sports a Real Canadian Superstore and a Wal-Mart. The At 103,000 square feet plus a 30,000-square-foot garden centre, it is a little smaller than the regular Lowe’s store, and reflects Lowe’s move to a smaller footprint.
A store in the Ottawa market (Orleans) opens this week, with the grand opening on Dec. 18. Located on Innes Rd., it becomes the chain’s 16th in this country. (Full details of Lowe’s expansion plans are in the latest Big Box Report, coming soon in the next edition of our sister publication, Hardlines Quarterly Report!) |
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| Home Depot announces Martha Stewart paint, Eco lines | ||||||||||||||||||||||||||||
| TORONTO — Home Depot continues to develop new products for the Martha Stewart Living brand. The partnership with Martha Stewart Living Omnimedia, Inc., was announced in mid-September, and promised a line of outdoor furniture, storage products and home décor.The latter has materialized as an exclusive Martha Stewart Living brand of interior and exterior paint. The paint is being manufactured by AkzoNobel and will consist of 280 colours created by Martha Stewart and the MSLO design team. In addition, the interior colours will be available in eight-ounce tint-able testers, and 12 of “Martha’s Picks” will be available pre-tinted.
The Martha Stewart Living Paint will be available at The Home Depot stores across Canada in March 2010. Home Depot will also sell Martha Stewart Clean, a new Eco Options-certified line of cleaning products, developed with and marketed by the Hain Celestial Group, Inc. The retailer is working with MSLO to develop additional products that will be available in 2010, with more details promised in the first part of the New Year. |
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| Richelieu makes two acquisitions | ||||||||||||||||||||||||||||
| MONTREAL — Richelieu Hardware Ltd., the specialty hardware and building products distributor, has acquired two companies. The first is Paint Direct, a Calgary-based distributor of finishing products, stains, lacquers and various other paint products. This acquisition brings Richelieu’s Canadian network to 30 distribution centres.In the United States, Richelieu has acquired Syracuse, N.Y.-based Woodland Specialties, a distributor of hardware products, high-pressure laminates, finishing products and other complementary products targeted mainly at kitchen cabinet makers and the commercial woodworking segment. This acquisition expands Richelieu’s geographic market and increases its U.S. distribution network to 18 centres. The two recently closed acquisitions add annual sales of approximately $6 million to Richelieu’s revenues.
It has also signed an agreement to complete another unnamed acquisition that’s expected close in January 2010. |
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| Lowe’s introduces California energy information centres | ||||||||||||||||||||||||||||
| MOORESVILLE, N.C. — Lowe’s is positioning itself as a “go-to” retail destination for energy conscious Californians with the introduction of Energy Centers in 21 California stores. The Energy Center is designed as a one-stop destination to help customers create an energy plan that fits their budget and home improvement goals.An information kiosk offers a touch-screen display to help customers evaluate energy needs, and the Energy Center features products that offer alternative energy solutions.
The Energy Center outlines three ways for customers to save energy and money: measure how much energy they use or lose with power monitors and other devices; reduce energy consumption by using CFLs and other money-saving products; and generate and use renewable energy with solar panels. Lowe’s claims to be the first major retailer in the U.S. to offer many of these products in one place and to stock and sell grid-connected solar panels in stores. (In Canada, TIM-BR MART dealers have been positioning themselves as energy experts with staff training and a mandate from head office to buy “green.”) |
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| DID YOU KNOW…? |
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That we get a LOT of calls every week from marketers asking for the size of the market, the market share of Lowe’s and Home Hardware and RONA and Home Depot, an explanation of how the buying groups are organized — and how they differ, and what we forecast for business conditions for next year. So we’ve put just about everything we know about the Canadian home improvement market into one monster PowerPoint presentation, The Annual Home Improvement Retail Report. Click here for more info! —Michael |
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| NEWS IN BRIEF |
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QUEBEC CITY — BMR le Groupe honoured Connie and Jean-Guy Lasalle, owners of the centres de rénovation Matériaux JLS in Fort-Coulonge and in Bryson, by awarding them the “Prix Fierté 2009.”
At BMR’s recent dealer show here, Yves Gagnon, president of the wholesaler and buying group (r), presented the couple with the award, recognizing their achievements and involvement within the group. Matériaux JLS joined BMR in 2001. The two home centres total some 12,000 square feet of retail space offering a welcoming shopping environment, well known to its customers for quality service and excellent advice — hence the award. MONTREAL — RDTS, the rep agency and instore detailing service, celebrated its 15th anniversary at the Hyatt Regency here during the recent RONA show.
Almost 200 people were on hand to join RDTS head Robert Di Tomasso, (shown here with his father and mentor, Richard), who has guided the company through a turbulent, dynamic decade and a half to become a national presence that has made technology advances, strategic alliances, and become the first company of its kind in North America to obtain ISO certification. VANCOUVER — Taymor, the builders’ and decorative hardware supplier, was awarded a top prize of a Black ribbon for the Most Creative Tree at the Festival of Trees at the Four Seasons BERLIN — EDRA, the European DIY Retail Association, has become an independent body. In a meeting held here recently, the new association was officially formed. In the past, it had been administered by the DIY associations in France (FMB) and Germany (BHB).
Our old friend, John Herbert (centre), has been appointed general secretary of the Association, which has members from 18 countries that operate in 38 countries. It was also agreed at the inaugural meeting that EDRA will now open its doors to form a Global Home Improvement Network, allowing members outside Europe to become associate members and to benefit from the affiliation of the EDRA network. (For more info, contact: morgan@edra-online.org.) BOUCHERVILLE, Que. — RONA has been rewarded for its wood products procurement policy by the Canadian Boreal Initiative in Ottawa. RONA was one of six winners selected by a committee of the Boreal Leadership Council, which is made up of leading conservation groups, Aboriginal organizations, and businesses committed to taking action to preserve the boreal forest. RONA was recognized for its leadership in developing and implementing an ambitious procurement policy for the wood products sold in its stores. CHICAGO — Industrial supply distributor W.W. Grainger Inc. has purchased a 1 million-square-foot distribution centre in the Chicago suburb of Minooka, Ill. It will relocate an existing distribution facility in Niles, Ill., to the new site by 2012. TORONTO — RONA Inc., in partnership with Maple Leaf Sports & Entertainment and the MLSE Team Up Foundation, has fixed up another sports facility in the GTA. The newly refurbished Ramsden Park Rink is the 10th completed project as part of the MLSE Team Up Foundation Hockey Rink Legacy Program. ISSAQUAH, Wash. — Costco Wholesale Corp. had November net sales of $6.04 billion, an increase of 9% from $5.55 billion. The company reported year-to-date net sales of $18.57 billion, an increase of 6%. MONTREAL — Are we in the wrong business? Dollarama Inc. reported significant increases in sales and net earnings despite the economic downturn. Sales increased 14.8% in the third quarter and 15.0% year-to-date. Same-store sales grew 7.3% in both the third quarter and the
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PEOPLE ON THE MOVE |
| Duncan Fulton has been hired as vice-president, corporate affairs at Canadian Tire Corp. He most recently general manager and senior partner at Fleishman-Hillard Toronto; before that he was advisor and spokesman for Prime Minister Jean Chrétien, press secretary for Premier Dalton McGuinty, and communications assistant for former Premier Frank McKenna in New Brunswick. |
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ECONOMIC INDICATORS |
| Retail sales in November increased 1.3% from October and rose 1.9% from November 2008, to $352.1 billion. Excluding autos, retail sales increased 1.2% from the previous month and rose 1.3% from the prior year, to $292.1 billion. (Commerce Dept.) The value of building permits rose 18.0% in October to $6.1 billion. In the residential sector, the value of permits climbed 3.8% to $3.4 billion, the third consecutive monthly increase. Ontario and Quebec accounted for much of the growth seen at the national level. In the non-residential sector, municipalities issued permits worth $2.7 billion, up 42.4% following a 9.2% decline in September. (Stats Canada)
Housing starts reached 158,500 units seasonally adjusted in November, a 0.07% increase from 157,400 starts in October. Urban starts increased by 0.7% to 141,100 units. Urban multiples were down from 72,500 units in October to 71,300 units. Single urban starts increased by 3.4%. Urban starts increased by 10% in Quebec, by 8.2% in the Prairies and by 6.2% in British Columbia. The rate of urban starts decreased by 8.3% in Ontario and by 9.8% in Atlantic Canada. (CMHC) |
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OVERHEARD… |
| “I think we’ve raised the bar on home improvement in Canada.” — Alan Huggins, president of Lowe’s Canada. He was speaking last week in a TV interview on BNN, following the announced expansion of Lowe’s in Western Canada. |
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Hotel here. This was Taymor’s first time at the event, a fundraiser for the B.C. Children’s Hospital Foundation. The themed Tree featured the “12 days to refresh, redecorate or renovate your home” using decorations made with Taymor products such as a “Lever Lock Tress”, Spring Stop Snowflakes and a Spring Stop Tree. The Festival of Trees provides corporate and individual sponsors an opportunity to showcase community leadership, creative flair and innovative themes while helping raise money for a very good cause.
TORONTO — Canadian Tire is reaffirming its commitment to its Canadian Tire money with a limited edition coin. Available this past weekend, Dec. 5-6 only, the coin represents a dollar in value and will be given to customers who spend $25 or more.According to Canadian Tire Retail president Mike Arnett, the coin in no way represents a replacement of the existing Canadian Tire money. Instead, the company was trying to reinforce its commitment to the loyalty program. Founded in 1958 as a way to boost gasoline sales for Canadian Tire, Arnett claims it’s the oldest loyalty program in the country.
At Roxul Inc., the Milton, Ont.-based insulation manufacturer, Sylvie Pinsonneault has been promoted to the position of Quebec regional manager. she will lead the sales and merchandising activities in Quebec for Roxul.
TORONTO — Ken Jenkins believes that the independent dealer is the heart and soul of the home improvement industry. The president of Castle Building Centres Group talked about the role of the independent at the latest Hardlines Executive Breakfast, speaking before a group of vendors and retail representatives.His role, heading up a group that represents some 226 of those independents, is to support them in what he believes is the group’s key function: buying.
division (which includes hardware and building materials), the sponsorship will extend to about 15 private label products such as mugs and hats, all available at Co-op locations across the West. The most notable product, however, and the one modeled personally by Baergan, is a foam-padded “watermelon” hat, suitable, of course, for wearing at any Roughriders game.
financial flexibility in the wake of a common share issue back in June, the company believes it is ready to commence phase two of its 2008-2011 strategic plan,” says RONA CEO Robert Dutton. These initiatives will focus on the re-acceleration of RONA’s development activities, including the recent launch of its dedicated paint and décor banner, STUDIO by RONA.
will be hosted by actress Mélanie Maynard, broadcaster and co-host of TVA’s Deux filles le matin. Families wanting to participate in Ma Maison RONA can register at any RONA store, at 
In addition, Jim Bradshaw, president and CEO, will retire. He will join the Taiga board as a non-executive director. The CEO position will be taken over by Cam White, who is currently Taiga’s evp, sales and operations and COO. He will assume his new position April 1, 2010.
At Manchester Tank, Laura (Croft) Seibert has accepted the position of sales manager for the company’s propane product line. She will be responsible for promoting Manchester’s propane product line, and for managing and growing her territory, as well as developing new market opportunities. Previously, Seibert spent 10 years with Thompson Tanks as a territory sales representative in the Southeast and Midwest. She also spent eight years with Trinity Industries as a sales representative in the Midwest. (270-365-4465; 
BENTONVILLE, Ark. 
TORONTO — Canadian Tire has managed to grow its sales when others saw theirs fall, and a key to their success has been ongoing process of upgrading its stores. Reg McLay, senior vice-president, Marketing and Sourcing Services for Canadian Tire Retail, told his story last week to more than 150 retail and supplier executives. They had gathered here at the 15th Annual Hardlines Conference.
During slowdown of the past year, Canadian Tire proved “recession-resistant,” as the company looked for more ways to get repeat traffic into its stores through increased sales of consumables, including household maintenance and cleaning products and, to a limited degree, food.
That was the central message of one keynote speaker at the latest Hardlines Conference. Robert Sarner is the director of communication and public affairs for Roots Canada — one of the country’s best known brands. Sarner, speaking to an audience of more than 150 retail and supplier executives last week, demonstrated how Roots stays in touch with its customers through a regular magazine that appears in select retail stores, including its own outlets, and online at its own website.
SURREY, B.C. — IRLY Building Centres has signed a new member, Townsite Maintenance Centre in Bella Coola, B.C. It’s owned by James Hiltz, who purchased the then 12-year-old business in 1985. It was 5,000 square feet in size until 1989, when a fire destroyed the building. Another 1,000 square feet were added to the building when it was rebuilt, and it now totals 6,000 square feet.
Most recently, Brad Dixon has been promoted to the position of director of business development, purchasing and branding. He was formerly the manager of business development. And, according to Catherine Brownlow, spokesperson for IRLY, more hires are planned. Dixon, a 17-year veteran of IRLY, will, as part of the restructuring, appoint an assistant to the hardware buyers as well as a building materials customer service rep. Previously, IRLY’s customer service reps have assisted with hardware only. “Our hardware buyers are so busy that they need an assistant to do the non-buying functions in their department,” says Brownlow.
KORTRIJK, Belgium — It’s not often you meet a real live prince in the 21st century, but that’s what happened to Canadian entrepreneur Jayne Seagrave of Vancouver Tool Corporation during a recent trade mission to Belgium. Her company was demonstrating its patented range of sealant tools at the HOMING Do-it-Yourself Trade Show when Prince Laurent of Belgium stopped by for a product demonstration.“I knew the Prince was visiting the show and thought he wouldn’t be interested in Canadian-made sealant tools, but he was and he took away samples and literature. I suggested to him that they could be useful to re-apply the sealant in his castle’s bathroom but he told me he didn’t live in a castle.”
VANCOUVER — Tom Donaldson will retire as president and CEO of CanWel Building Materials Income Fund and its subsidiaries effective Jan. 31, 2010. Amar Doman, CanWel’s chairman of the board, will take over the president and CEO role, assuming the duties of the position during the transition period to year’s end.Donaldson, who shepherded the company through its conversion from a corporate structure to an income trust, said, “I have had a wonderful career working with the CanWel team, and I am proud of our achievements in creating what CanWel is today, including our initial listing on the [Toronto Stock Exchange] and subsequent conversion to an income trust.”
Tracy Sianta has joined Hart & Cooley, Inc., a manufacturer of air distribution and vent products for heating, plumbing and air-conditioning systems, as director of marketing. Located in Grand Rapids, Mich., she will report to Curt Monhart, evp of sales and marketing. Most recently she was the director of marketing, sales & business operations for Klise Manufacturing.Deane Collinson has been named CEO of Calgary Co-operative Association Limited, effective Oct. 20. He joins the co-op from Cadillac Fairview Corporation in Toronto where he held the position of executive vice president of operations. Prior to that, he was employed at Loblaw Companies Limited for more than 23 years. Collinson will replace Ken McCullough, who is now vice-president, retail division, at Federated Co-operatives in Saskatoon. McCullough served as CEO of Calgary Co-op from 2004.
