Anyone who has ever spoken with Liz Kovach, president of the Western Retail Lumber Association, learns quickly that she is not one for understatement. During the WRLA’s Building and Hardware Showcase, held Jan. 13 and 14 in Winnipeg, she was asked for her take on the show. (Some language has been amended for our more Delicate Readers.—Editor)

The show was only a few hours old, but it was already generating an energy that Kovach was feeding off. “It’s freaking awesome, is what it is,” she enthused.

The event, one of the last general buying shows left in Canada (the other is the Atlantic Building Supply Dealers Association’s Building Supply Expo in Halifax, taking place March 8 and 9 this year), brought together a range of the industry’s leading suppliers, who played host to dealers of all sizes from Canada’s western provinces.

Based on show traffic, which was considered stronger than last year’s event by many exhibiting vendors who were interviewed by Hardlines, plus the overall buzz that prevailed, the show was a success. “The vibe was amazing—a great vibe for the show floor. There’s certainly a lot of stuff going on,” Kovach said.

Kovach and her team were hoping for 500 dealers to attend. But the event quickly surpassed that. “We had more than 550 at registration on day one,” said Kovach. The increased dealer attendance translated into purchases and opportunities for relationship building, which made the show a hit for most vendors.

One important aspect of this show was its Showcase Workshop Series, featuring seminars to help dealers run their businesses better and provide a platform for vendors to feature their latest innovations. Again, Kovach was nothing short of enthusiastic, calling the series “awesome.”

“It’s important to showcase the R&D and innovation of the vendors,” she said. “We really want to support that.” Next year’s show will again be in Winnipeg, from Jan. 18 to 19, 2024.

Goodfellow ramps up promotions—and fun—as it turns 125 this year

Goodfellow Inc. is celebrating its 125th anniversary this year. The LBM and flooring distributor kicked off the milestone with a party for 125 minutes at its booth during the WRLA’s Building & Hardware Showcase, which was held recently in Winnipeg.

“We had parties across the country for our staff and this was the launch at the show, and it will continue all year," said Mary Lohmus, Goodfellow’s executive vice president for Ontario and western Canada.

And watch for additional promotions and anniversary-related messaging throughout 2023, she says. “We have a new logo and more birthday parties—including another celebration during the Atlantic Building Supply Dealers Association’s Building Supply Expo in Halifax, March 8 and 9.”

“Watch for branch and equipment enhancements happening all year long, including the arrival of electronic delivery and material handling equipment, year-long messaging on our website and social media, and a big extravaganza planned across our entire network in August.”

Goodfellow got its start in Montreal in 1898 under George Goodfellow, a lumber broker. The company went public in 1984, but has remained under the control of the Goodfellow family. Since 2017, Patrick Goodfellow—great-grandson of the founder—has headed up the company, which now operates out of Delson, on the south shore of Montreal. Today, the company has 12 sales offices serving dealers across the country, with annual sales of more than $600 million.

But the wholesale supply side for dealers is only part of it. The company also has a large manufacturing business. “We produce a huge variety of engineered wood products,” Lohmus says. These range from glue-laminated timbers, crossarms for the power industry, stop logs for the water and power generation industries, and timber construction mats for temporary roads, to name just a few.

A recent project was with Vélodrome Sylvan Adams at the Centre Multisports Desjardins, an indoor bicycle track in Bromont, Que. During Covid, Goodfellow supplied the immense spruce glulam beams that hold up the roof, along with spruce glulam used for the spectator stands.

Other projects through the years have included a new mast for one of Canada’s most historic sailing ships, Bluenose II. “These types of custom projects are typically quite complex, and are driven by a group of highly-trained people within our organization,” Lohmus adds.

RONA affiliate dealer Moffatt & Powell adds 10th store in Ontario

A major RONA dealer in southwestern Ontario has added a 10th location to its store network. The former RONA Davies Hardware store in Grand Bend is the latest to come under the umbrella of the Moffatt & Powell enterprise, which dates to 1956. The company is planning a 10,000-square-foot expansion for the store’s outdoor lumber yard and an inventory increase of over 1,000 SKUs, mostly in the LBM category.

Owners D’Arcy Quinn and Nancy Powell Quinn, (left and centre) joined with Kevin Davies (right), whose family had owned the Grand Bend store, in the venture. “The acquisition coincides with Moffatt & Powell acquiring the neighbouring vacant property to the store, which will allow for an immediate expansion of the lumber yard and a future store expansion,” says Powell Quinn.

She and D’Arcy have known Davies for more than a decade; he has maintained a stake in the store and its management. “Kevin and his team will remain active in managing the day-to-day operations of the store and he retains a vested partner position in the Grand Bend location,” she adds.

The newly expanded store will be rebranded Moffatt & Powell RONA Grand Bend over the coming months. In the process, the expanded space will accommodate a wider range of products than before, reflecting the merchandise mix of the chain’s other stores. The store will also offer Moffatt & Powell’s design services and will serve customers through Moffatt & Powell’s delivery fleet.

The venerable Zellers name is being re-introduced to Canadians both online and in stores. Twenty-five Hudson’s Bay stores across the country will introduce a store-within-a-store concept featuring the Zellers discount brand. The retail concept will be supported by a new e-commerce site, Zellers.ca.

The product offering will replicate the discount department store vibe of the former Zellers retail chain, which was bought by Hudson’s Bay Company in 1978. HBC promises customers “a thoughtful selection of design-led products across home décor, toys, baby, apparel, and pets, housed within Zellers’ signature red and white that will guide customers along in their retail journey.”

The Zellers shops within the Hudson’s Bay stores will be between 8,000 and 10,000 square feet, depending on the location. HBC is encouraging customers to sign up at Zellers.ca in order to receive updates about its e-commerce platform as the Zellers program takes shape. The plan is to launch in-store and online simultaneously.

While no date has been confirmed for the Zellers launch, the 25 Bay store locations have been selected for these locations—BC: Abbotsford, Kamloops, Surrey, Vancouver; AB: Calgary, Edmonton, Medicine Hat; SK: Saskatoon; MB: Winnipeg; ON: Burlington, Cambridge, Kingston, London, Mississauga, Ottawa (Cambridge Centre and Rideau Centre), Scarborough, St. Catharines; QC: Anjou, Gatineau, Québec, Rosemère, Sherbrooke; NS: Dartmouth, Sydney.

HBC has been testing the new bricks-and-mortar model with pop-ups Hudson’s Bay stores in Burlington, Ont., and in Montreal.

The reintroduction of Zellers comes as runaway inflation drives more and more traffic to discount chains. So HBC’s debut of its new/old concept in certain markets could be a way to shore up The Bay’s traditional department store model.

The head of the Sexton Family of Companies, which includes the Sexton Group, has been honoured by the Western Retail Lumber Association. Steve Buckle was awarded the Outstanding Achievement Award during the WRLA’s annual Lumber and Hardware Showcase, held in Winnipeg Jan. 13 and 14.

Iain Nairn will retire this month as head of The Bay, the online marketplace business of Hudson’s Bay Company. HBC president Sophia Hwang-Judiesch will assume his responsibilities in addition to her current role. HBC spun the online business off from its bricks-and-mortar division in 2021. Nairn, who had been named HBC’s president in January 2020, was chosen to helm The Bay marketplace. Also at HBC, Wayne Drummond was promoted from chief merchant to president of the Hudson’s Bay network of stores.

DID YOU KNOW…?

… the latest edition of Hardlines HR Advisor hit inboxes last week? In our latest issue, we look at lessons in leadership from Steve Buckle of the Sexton Family of Companies, and John Herbert, internationally known retail leader and head of the Global Home Improvement Network. Also in this issue: the power of upskilling and reskilling and the importance of employment contracts. (If you’re not already receiving HR Advisor, click here to sign up for free!)

Home Hardware Stores Ltd. has made it onto this year’s Forbes list of Canada’s Best Employers. The ranking is developed annually by Forbes and Statista Inc. Evaluations were based on direct and indirect recommendations from employees who rated their willingness to recommend their employer to friends and family. These evaluations included participants’ opinions on a series of work-related topics such as working conditions, salary potential, and company image.

Peavey Industries has announced the construction of a new Peavey Mart store, this time in Steinbach, Man. It joins existing stores in Winnipeg, Brandon, Swan River, and Winkler. The Steinbach location will be at #41 Hwy 52 West and will be 28,800 square feet in size. It will also feature a 14,400-square-foot greenhouse and is expected to employ up to 40 people. A soft opening is anticipated for spring 2024.

The Canadian Tire store in Vernon, B.C., which closed after it was extensively damaged by a fire in November, reopened last week for online shopping. “While inventory in some departments may be limited, we will continue to add items daily,” the store reported via social media. “We are working hard to re-open in-store shopping as soon as possible to serve the community of Vernon.”

The Home Depot is increasing its commitment to rooftop solar panels on its stores, reports the website of the Environment America Research & Policy Centre. The lobby group says that the chain will install the panels on 25 store locations in California, “bringing the total number of The Home Depot stores that have gone solar to 98.” The Home Depot has nearly 2,000 stores in the U.S. The environmental group says that Home Depot “ranks third behind Walmart and Target when it comes to rooftop solar potential … Going solar is part of the Home Depot’s plan to power its facilities with 100 percent renewable energy by 2030,” the website reports.

Home Hardware Stores Ltd. partnered for a second year with shopping rewards app FlipGive to support 500 youth sports teams across Canada. The Play More Matching Grant distributed $75,000 in funding to teams in 2022. “It’s never been more expensive to keep your kids in sports and the impact of double-digit inflation is putting an even tighter squeeze on families,” FlipGive CEO Amy Halpenny said in a release.

SUPPLIER NEWS

Richelieu Hardware reported Q4 sales of $457.5 million, up 14.9 percent from $398.2 million a year earlier. In Canada, sales amounted to $273.5 million, a 5.2 percent increase from the comparable period of 2021. Earnings of $44.9 million were up 0.8 percent. For the fiscal year 2022, sales rose 25.2 percent to $1.8 billion, while earnings grew 18.8 percent to $168.4 million.

ECONOMIC INDICATORS

Retail sales decreased 0.1 percent to $61.8 billion in November. Sales declined in six of 11 subsectors, led by a 3.8 percent drop in building materials and garden categories. That was the subsector’s largest decrease in seven months. Overall, sales were down in eight provinces, with B.C. posting the largest increase at 0.9 percent. (StatCan)

Sales of existing U.S. homes fell by 1.5 percent in December. The annualized pace of 4.02 million units was the lowest level of sales since November 2010. The decline was the eleventh in as many months, the longest downward streak since 1999. (National Association of Realtors)

NOTED

Hardlines will head to New Orleans for Orgill’s 2023 Spring Dealer Market, Feb. 9 to 11. And we’re very excited to host our Canada Night reception once again. Every dealer and their team is invited—and the beer is on us! It’s being held at Mulate’s Original Cajun Restaurant on Feb. 9 from 6 pm to 9 pm. Want to join us? RSVP here. (Sorry, this fab event is only open to dealers and our vendor sponsors!)

OVERHEARD…

“It’s an honour for Home Hardware Stores Ltd. to be named on this prestigious list of Canadian companies for the third consecutive year. Home Hardware’s incredible journey of growth is driven by the dedication and hard work of our team members in support of our dealer-owners, who in turn provide customers with the high-quality service they expect from us.”
—Kevin Macnab, president and CEO of Home Hardware Stores, acknowledging the retailer’s recognition on the Forbes list of Canada’s Best Employers.

The past three years have forced all of us to face incredible challenges, while also providing unprecedented opportunities. Our industry rose to those challenges with untiring courage and maximized the opportunities with resoluteness and generosity.

The home improvement industry is one of the major drivers of the Canadian economy. Representing almost $59 billion in sales at retail, it accounts for almost nine percent of this country’s retail sales. Our industry is also an essential service, whether one is fixing a leaky toilet or building an entire house. (All figures and data here are drawn from either our Hardlines Retail Report or our Hardlines Market Share Report. — Editor)

There are nearly 5,000 stores in our industry. More than 1,000 of them are hardware stores and some 3,100 are building centres and home centres. At least 300 of them are large-format outlets, or big boxes, which despite their small numbers are retail powerhouses, representing almost 30 percent of all sales in the sector.

More than 500 of those almost 5,000 stores are Canadian Tire stores, which is almost a retail category of its own. Counting just the Tire’s sales of products that fall within the traditional hardware and home improvement sector (excluding sporting goods, automotive sales and services, and financial services), those stores manage to account for 13.5 percent of the sales generated by this industry.

The Big Four represent almost two-thirds of all sales generated in our sector. They are (in order of home improvement revenue) The Home Depot Canada, Home Hardware Stores, Lowe’s Canada, and Canadian Tire. Positions one and three are American-owned; positions two and four are Canadian-owned. Only Home Hardware is dealer-owned, although Lowe’s Canada serves some 210 dealer-owned RONA stores as well.

But despite the power of corporate owners, this industry rests largely in the hands of independent merchants. They are small businesses, typically family-owned and operated, comprising the backbone of the Canadian economy.

At the same time, the large chains are powered by the dedication and vision of the people working in those corporate stores. Whether overseeing a dozen people at a local, rural hardware store or a team of 200 at a big box, the managers of these operations exemplify a passion and leadership that could fill a dozen business books.

Today’s home improvement dealers and managers include some of the finest retailers in the country. And these stores are more than sellers of merchandise. They are hubs for their communities. Throughout Covid, the support they provided to those communities was nothing short of inspiring.

Hardlines is honoured to share these stories and is committed to uncovering and telling the stories that make this industry amazing throughout 2023 and beyond. We look forward to you accompanying us as we do.

Canadian Tire adjusts assortments as consumers tighten their belts

Canadian Tire has changed its product mix as the impacts of rising interest rates and inflation affect consumer behaviour.

Those changes were recognized as far back as last fall and were already making their mark on the company’s results by early November, when the company released its third-quarter results.

According to Greg Hicks, president and CEO of Canadian Tire Corp., the chain has been moving away from many higher-priced leisure products in the direction of its “essential” assortments, in the light of an anticipated recession.

“First, at CTR, there is evidence of more performance separation for essential and non-essential categories. Consumer demand is shifting to our essential product categories such as tires, automotive parts, plumbing, and pet,” Hicks explained on a call to analysts at the time. That shift was most pronounced among customers who were not using CTC’s Triangle Rewards program, “who have decreased their spend in non-essential categories such as outdoor cooking, exercise equipment, electronics, and furniture.”

In addition, Hicks noted that people were coming to Canadian Tire to shop for deals. “Customers at CTC are looking for discounted value as our percentage of baskets in which all items in the basket are discounted is on the rise.” 

The result? CTC has reduced inventories of big-ticket items such as barbecues and bicycles, and other “amusement” products within Canadian Tire’s non-essential basket

“Those are the types of categories that have been experiencing some declines,” said TJ Flood, president of Canadian Tire Retail. “They are down about 30 percent.” He added that one essential category, automotive, “more than offsets that.”

Commenting specifically on CTC’s pet category increases, Hicks cited an aggressive rollout of its Petco store-within-a-store program to 31 additional Canadian Tire stores during Q3, driving sales within the category by 19 percent in those stores, “as well as a 34 percent increase in customers shopping pet with us for the first time.” He said more than 80 percent of Canadian Tire stores will have the Petco department by the end of January.

“The essential product portfolio is a big part of our overall business,” Hicks said. “And you can expect us to adjust our resource allocation strategies to put more focus on this segment of our business going forward.”

Evolving Home Hardware involves culture and consistency, says CEO

Providing tools for independents to compete against large corporate chains is at the heart of efforts by Home Hardware president and CEO, Kevin Macnab, to update and change the systems and processes at the company. We continue here our conversation with Macnab that was conducted during the company’s dealer market last fall. (Part one of this interview appeared in last week’s edition.—Editor)

Macnab talked at length about the importance of finding the right mix of consistency and localization. “We need the dealers to help localize those assortments. So yes, we can build systems that will help us. But we’re very unique in our individual markets. So it’s really the dealers that feed back and say, ‘Actually, in this particular market, I know the data might say X, but can you take a look at my store, because really Y sells better?’”

The company will continue to move toward a more standardized offering overall, with core assortments in all the stores. Macnab noted that the information flow back and forth between the dealers and head office will help refine those assortments—and it’s paying off at the cash register.

“The localization is based on dealer knowledge.” Some standardization of systems is necessary, he admits, “because many corporations—I’ve done this myself—look to localize [assortments] using systems. And that’s good to a certain extent. But then the dealers know in some of the markets, things that we just won’t, unless we walk the store. If any of us walks the store, we know, ‘Yeah, that’s not going to quite work in that market.’”

At the end of the day, if the customers are happy, the dealers are happy, said Macnab. He referred to the many new category planograms that were being introduced at the Home Hardware Market. These programs are popular with the dealers, he said, because they are driving results.

“We can already see the benefit, because we’re using a lot more data now to make the choices on what we believe the end consumer is looking for. And then what we’re looking for the dealers to do is help localize it and present it in-store.”

Macnab talked about how important it’s been to build an effective management team at Home Hardware. That has meant continuing to tap into and build on the existing corporate culture.

“We’re bringing people who fit the culture. It’s a wonderful culture, a wonderful, warm supportive culture for the dealers.” He paused here to emphasize the point: “Culture means organization. Culture means everything. It’s all critical to success, organizational culture. You cannot execute successful strategies without the right organizational culture.”

That culture, he pointed out, must include the dealers and the corporate team, and here he offers his own language. “But more importantly, for us, and this is how I am looking at things, is at a more enterprise level. Okay, that’s a bit of a different terminology for the group, because we have a lot of dealer-owners in all the communities across Canada and we have a separate corporation.”

But despite these two factions, there must be an overriding approach or vision that binds them. “That’s the enterprise culture. That’s what drives us.”

Once considered a value-add or a way to stand out from competitors, loyalty programs have become increasingly central to retailers’ marketing strategies. As online sales have grown, so has the importance of keeping customers aligned virtually—and loyalty programs offer the means to do that.

In fact, long-standing loyalty partnerships were the norm for decades, and those relationships remain strong for many groups. For example, Kent and TIMBER MART continue their longstanding partnerships with the Air Miles rewards program.

But in recent years, loyalties (pardon the pun—Editor) have shifted. Lowe’s Canada took on Air Miles in 2015, a year before it acquired RONA, which already had the program. But Lowe’s Canada terminated the relationship at the end of 2021. The company said it was ending the partnership to focus on daily low prices, personalized offers, and its newly formed VIPpro program—a rewards program driven by an app available to contractor customers of Lowe’s, RONA, and Réno-Dépôt.

Last year, Home Hardware broke ties with Aeroplan and soon after announced a partnership with the Scene+ rewards program. Starting this summer, cardholders will be able to redeem points at Home Hardware stores. Home Hardware is in good company. Empire Co., parent of grocery chain Sobeys, also dropped Air Miles and actually acquired a stake in the Scene+ rewards program.

But the real advantage of a loyalty program is in the data, something that companies like Canadian Tire are counting on to drive its awareness of who its customers are and what they want.

A good loyalty program has to be integral to a retailer’s message. Canadian Tire’s overwhelming success with the Triangle Rewards program reflects that. The Triangle name was a way to do two things. First, it provides an online update and alternative to the storied Canadian Tire money. Second, it is a way to offer a unified loyalty points program across all of Canadian Tire’s retail banners, including PartSource, Helly Hansen, and Marks. Today, the retailer claims that 70 percent of Canadian households are Triangle members.

“In Q3, we effectively engaged our loyalty customers and loyalty sales grew to $2.7 billion, an increase of four percent,” said CTC president and CEO Greg Hicks following the release of the company’s quarterly results. “Overall, loyalty sales outpaced non-member sales in the quarter, a trend we expect to continue. So we are increasingly laser-focused on driving member engagement.”

W. W. Grainger has named Nancy Berardinelli-Krantz as SVP and chief legal officer, effective Jan. 30. She is currently SVP and deputy chief legal officer at Eaton Corp. Berardinelli-Krantz will succeed John Howard, who is retiring in July after 23 years of service.

Mike Meckley is starting a new position as U.S. national sales manager – national accounts, paint, plumbing and MRO at Henkel. He was formerly national sales manager for Canada.

Rolando Hernandez is now product development manager for Quality Craft, reporting to Dennis Hale, president. He was most recently with Home Products International.

Kevin Bradley has been promoted to the role of sales account executive at Uscan Industrial Fasteners, a division of Richelieu. He was formerly Uscan’s national sales manager.

DID YOU KNOW…?

… that our latest instalment of the Hardlines Podcast Series is now live? In this episode, we meet Derek Smith, VP of the Ace Canada division at Peavey Industries. He talks about the challenges of taking over the Ace business, especially as Covid hit, developing a wholesale hardware business, and forging a partnership to get building materials to the Ace dealers. Sign up now to get updates about the latest podcasts in your inbox!

Castle Building Centres Group is marking 60 years in business in 2023. The group got its start in 1963 when six Ontario independent lumber dealers formed BOLD Lumber (Buying Organization of Lumber Dealers). It adopted its current name in 1982. Today it boasts more than 300 locations and has a presence in every province as well as Nunavut. Its 2021 sales by all members, according to the 2022 Hardlines Retail Report, amounted to an estimated $1.9 billion. (Castle has marked its anniversary with a special video tribute: click here to view.)

Vancouver-based online LBM seller BuildDirect.com Technologies Inc. has closed a second round, or tranche, of sales of shares. The sale involved the issuing of a total of 1,121,622 common shares at a price of $0.37 each, for total gross proceeds of $415,000. BuildDirect says it intends to use the money from the sale “to continue to advance BuildDirect’s strategy and for general working capital purposes.” The issuing of shares was a non-brokered, private placement and subject to a hold period that ends May 4.

Gypsum Management & Supply has announced the acquisition of Tanner Bolt and Nut, founded in 1979 and based in Brooklyn, N.Y. Tanner president Jeffrey Tannenbaum and his team will continue to oversee the business, retaining the Tanner brand name. At the same time, GMS announced new greenfield locations in New York; Greenville, N.C.; and Chester, Va. It has also opened new stores under the AMES banner in Fresno, Calif., Palm Bay, Fla.; and Concord, N.C.

Gypsum Management & Supply has announced the acquisition of Tanner Bolt and Nut, founded in 1979 and based in Brooklyn, N.Y. Tanner president Jeffrey Tannenbaum and his team will continue to oversee the business, retaining the Tanner brand name. At the same time, GMS announced new greenfield locations in New York; Greenville, N.C.; and Chester, Va. It has also opened new stores under the AMES banner in Fresno, Calif., Palm Bay, Fla.; and Concord, N.C.

ECONOMIC INDICATORS

Investment in U.S. construction unexpectedly edged up by 0.2 percent in November, following an equivalent decline in October. The increase, however, was driven by activity in the non-residential sector, as residential construction spending was down 0.5 percent. That included a 2.9 percent drop in single-family projects, which outweighed gains in the multi-family sector. (U.S. Commerce Dept.)

NOTED

Small business owners are increasingly turning to data tools to grow their enterprises, the Globe and Mail reports. Those resources include My Main Street, a federally funded partnership between the Canadian Urban Institute and the Economic Developers Council of Ontario. It provides market research, data analysis, and funding assistance to small businesses. The Canadian Chamber of Commerce has its own program, the Business Data Lab, launched last year in conjunction with Statistics Canada. Patrick Gill, the lab’s senior director, said it aims to “democratize” data, giving small businesses access to the same tools major corporations enjoy.

OVERHEARD…

“Different from last quarter, the migration into our better, best price range of the architecture has slowed. It’s still up, but it has slowed. So, that has put some upward influence on our AUR … And so we certainly saw more COGS impact in terms of negotiating through line reviews and schedules, etc., with factories …  We have headwinds for sure, relative to the U.S. dollar, but there are tailwinds relative to the RMB depreciating … So, those would be kind of a number of the variables that we look at in determining what the right ECL is for the quarter.”
—The executive team at Canadian Tire Corp., TJ Flood, Greg Hicks, and Gregory Craig respectively, on a call with analysts following the release of the company’s Q3 results, explaining, well, their love of acronyms.

The past year was one of unique challenges and opportunities, and for many those forces were felt at both a professional and personal level. Here is a roundup of news stories that highlighted the business side of 2023.

One company managed to bookend the news cycle for the year. Early in January, Lowe’s Canada announced the appointment of Tony Cioffi (shown here at the 2022 Hardlines Conference) as president. It was a return to the role for Cioffi, who had served as interim president following the departure of Sylvain Prud’homme in the fall of 2019.

Fast-forward to November, when Lowe’s announced it was selling its entire Canadian business to Sycamore Partners, a New York-based private equity firm. Lowe’s Canada had performed solidly, but shareholders always struggled to understand how its distinctive multi-banner strategy fit into the wider Lowe’s business. Lowe’s Cos. CEO Marvin Ellison pitched the sale as a way of “simplifying” the company’s business model.

Lowe’s rival The Home Depot also announced a new leader early in the year. Ted Decker’s appointment as CEO, effective March 1, was made public toward the end of January. Decker, who took over from Craig Menear, had been with the business for more than 20 years. He had succeeded Menear as president in the fall of 2020, while also being named to the newly created role of COO. Menear stays on as chairman of the board.

The year also saw ownership changes on the buying group front. In June, TORBSA announced it was merging into AD Canada (Affiliated Distributors). The deal created a new division: AD Canada – Building Supplies, headed up by TORBSA president Paul Williams.

In October, Sexton Group’s parent company sold a majority stake to a private investor group. The group, led by PFM Capital, acquired 51 percent of the Sexton Family of Companies (SFOC). Under the agreement, SFOC chair Brian Kusisto retained a seat on the board, while Sexton Investments kept a minority interest in the business.

Home Hardware made headlines throughout the year with a series of senior appointments and promotions. In the spring, it named Carol Crystal as VP, merchandise LBM. Crystal had joined the company as director, merchandise hardlines, in the summer of 2020 after a career that included positions at Hudson’s Bay Co. and Lowe’s Canada.

That promotion was followed by a plethora of appointments in the fall. Marianne Thompson was promoted to the newly created role of chief commercial officer, while retaining her existing duties as chief merchandising officer.

The same month, the company announced a major spate of new VPs and directors, including both external hires and internal promotions. It wooed Bernie Gauthier from Taiga Building Products to serve as its VP of retail operations. John Pierce, hitherto VP of store operations at Loblaw Cos., was recruited as Home’s VP, retail business development.

At the same time, Chris Marinis was promoted to the role of VP, information technology; Melanie Beatty to director, e-commerce; Kristi Stemmler to director, brand management; and Chris Parsons to senior director, omni-channel marketing.

Personnel changes were also in the news at BMR. In June, Charles Grégoire-Béliveau was promoted to the post of vice president, merchandising. He joined BMR in 2016 as director, purchasing, for corporate stores before being named senior director, merchandising, in 2020.

At the same time, Antonio Di Pasquale was named chief operations officer. Having joined BMR Group in 2020 as vice president, supply chain and operational excellence, he now has oversight of all of BMR’s operations. Meanwhile, Jonathan Gendreau stepped down as VP of business development, marketing, and customer experience.

TIMBER MART started off the year by announcing additions to its trading team. Nathaniel Boyd was promoted from sales development agent to commodity trader early in January. At the same time, Milynn Bruneau joined the group as a commodity trader for Ontario. In March, TIMBER MART named CGC veteran David Rapini as VP of its commercial division, succeeding Mark Finucane on his retirement.

On the vendor side, there were two key mergers in 2022. At the end of April, Gillfor Distribution Inc. announced its acquisition of AFA Forest Products, solidifying its national reach. At the time, Gillfor explained the two businesses would operate “in parallel until a full operational assessment is completed and a seamless integration can be executed.”

A few weeks later, CertainTeed parent Saint-Gobain announced it had reached a $928 million deal to purchase Kaycan, a Montreal-based manufacturer and distributor of siding products. At the time of the announcement, Saint-Gobain pledged to retain Kaycan’s “locally well-established Canadian distribution.”

Going into 2023, your team at Hardlines will continue to keep you abreast of all the latest developments in the industry. And we love your feedback! If there’s an area of interest that you would like to see covered more, or you have some news to share, reach out to our editors, Steve Payne and Geoff McLarney.

Up close and personal with Home Hardware CEO Kevin Macnab

With just over four years under his belt at Home Hardware Stores Ltd., Kevin Macnab has been the author of big changes at the St. Jacobs, Ont.-based retail company. Despite the changes behind the scenes, Macnab has managed to stay out of the limelight, leaving much of the front-line activity to his executive team. Hardlines had the opportunity to sit with him during the company’s dealer market last fall.

Despite his low profile, Macnab’s own retail roots run very deep. Born in England, he completed a business degree there and worked for some of that country’s top brands. “I trained at Price Waterhouse, London,” he explains, “and then I went to Marks & Spencer.”

Those were the beginnings of a career in retail that started in 1987 and spanned 28 countries around the world, mainly at Toys “R” Us, where Macnab served in numerous countries before his last role there as president, international. This range of experience has given him what he calls “a view of world retailing.”

For Macnab, Home Hardware stands out as another leading retailer. “Home Hardware is just such a great, iconic Canadian brand. It’s such a great opportunity, it’s such a great company. The dealer-owned model,” he says, “is what makes the difference.”

In his efforts to update the company, he keeps the dealer-owner at the forefront. The transformation the company is undergoing can be done, he says, effectively within the dealer-owned model. “Our objective is to improve the programs and services they have so that they can offer better programs and services to their customer, all within a dealer-owned model of choice.”

A key challenge to that transformation is how to evolve and grow without undermining the strong corporate culture that makes Home Hardware unique. Here, Macnab relies on his expansive retail background. “I look at it as a business person and see that one of the key differentiators, if not the key differentiator, is the dealer model—because there’s an entrepreneur in every community across Canada who is a part owner of the company.”

Those dealers are typically an integral part of their respective communities and give back to those communities. “So it’s very community-based, and what we do—which was the original [vision] pictured by the founders to build this brand, and the incredible job they did building the brand—was to bring dealers together.” By combining forces, they can compete against the large retail chains.

Macnab invokes his evolving executive team as he stresses the importance of ensuring the company stays focused on dealers’ needs. “What I’m seeking to do with the team is just strengthen those programs and services, and still do it within a dealer choice model,” he says. “Because if we bring the majority of dealers along, we have a lot of volume and the dealer can choose: is it a better program or service or not? And if it is, they’ll choose it.”

Data is now more critical than ever to that effort. Macnab notes that sharing sales data from the stores helps Home Hardware in its transformation from a wholesale model—focused mainly on getting product to the stores—to a retail model that focuses on assortments that meet end customers’ needs.“We’re starting to gather that data so that we can look at it and make better decisions, more informed decisions about what programs and services really work. So it’s not just about the corporate shipments. It’s getting data on what is selling at point-of-sale. It’s really just sharing information.”

Top retailers make environmental accountability part of their business plans

Top retail companies are responding to the pressures of climate change and activist shareholders to make their companies more environmentally responsible. Those changes are becoming more and more integral to the business plans of every responsible business. And retail home improvement is no exception.

Lowe’s Cos. has announced a new goal to reach net-zero emissions across its value chain by 2050. To reach that goal, it will need to eliminate at least 90 percent of its greenhouse gas emissions and offset whatever remains, effectively driving its emissions footprint to zero, the company says. “Lowe’s takes pride in making homes better for all, and part of doing that is reducing our impact on the environment,” said Marvin Ellison, chairman and CEO, in a release.

This new goal signals a shift from a focus on operational emissions to “scope 3” emissions, which include all other indirect emissions in a company’s value chain. For Lowe’s, most scope 3 emissions are tied to the life cycle of the products the retailer sells. This includes the emissions associated with the manufacture and transportation of the products in their stores, continuing to how those products are used in customers’ homes.

The concept of assessing a product’s footprint based on its entire life cycle was pioneered over a decade ago at RONA under then-CEO Robert Dutton.

The Home Depot announced that 100 megawatts of solar energy purchased from National Grid Renewables at its solar and storage project in Denton County, Tex., will generate the approximate equivalent of nearly eight percent of The Home Depot’s total electricity usage.

Home Depot has pledged to produce or procure 100 percent renewable electricity equivalent to the electricity needs for all its facilities by 2030, expanding the company’s previous commitment of 335 megawatts of renewable or alternative energy by 2025.

“Solar energy is the most abundant energy resource on earth,” said Ron Jarvis, chief sustainability officer for The Home Depot. “With this purchase, we are getting a step closer to our goal to produce or procure 100 percent renewable electricity equivalent to the needs of our facilities. We anticipate about three-quarters of our alternative and renewable energy capacity will come from solar energy by the end of 2023.”

Since 2010, the company says it has cut electricity consumption in its U.S. stores in half. It currently operates rooftop solar farms on more than 80 stores and electricity-generating fuel cells in more than 200 stores.

BMR Group has appointed Marek Jankowski as VP, information technology. He reports to André Lavoie, EVP, shared services. With nearly 25 years of experience in IT, Jankowski joins BMR Group after having worked for over 10 years with TC Media and TC Transcontinental.

Larry Gregoris has been named senior national sales manager, pro channel, for Rust-Oleum Canada. He was most recently with The Hillman Group. Gregoris reports to Lawrence Genga, who has an updated title himself. He is now Rust-Oleum Canada’s director of sales, distribution, and pro channel.

At Kohltech Windows & Entrance Systems, Andy Moss has been appointed sales manager, to manage the growing Atlantic Canada sales team and market. A 21-year veteran at Kohltech, he was previously territory manager for Newfoundland.

Jerome Paul is the new warehouse and logistics manager for DAP Canada, reporting to general manager Frank Profiti. He was most recently with Ab InBev-Labatt Breweries.

Simon Masella has been appointed sales and brand manager for King Canada Inc. He was most recently a regional manager with Stihl.

Orgill has appointed Laura Freeman to fill the newly created position of EVP, human resources, and chief human resources officer. Also at Orgill, Chris Freader has been promoted to SVP, retail services. He was most recently VP, retail services. Myron Boswell is retiring as VP of dealer sales, Northeast. Todd Nowels is moving from management of the Southeast region to succeed Boswell.

At Walmart Canada, Gonzalo Gebara has been named president and CEO, effective Jan. 30, and pending authorization to work in Canada. He joined Walmart in 2000 and was most recently CEO of Walmart Chile.

DID YOU KNOW…?

… the latest edition of Hardlines HR Advisor is now out? In our latest issue, we talk about hiring gaps, the career advantages of self-checkouts, and “quiet quitting.” If you’re not already receiving HR Advisor, click here to sign up for free!

Two Gravenhurst, Ont., families will get affordable homes this year thanks to a $70,000 donation from Chamberlain TIMBER MART and Home Building to Habitat for Humanity Ontario Gateway North. That support builds on gifts from the Rotary Club of Gravenhurst and Residents Against Muskoka Poverty. Ground-breaking on the pair of semi-detached, 869-square-foot homes is slated for June.

Lowe’s Canada held its second Vendor Forum event just before Christmas. Over 1,000 participants from close to 600 partner companies attended to hear about the company’s strategies and priorities for 2023 and to meet leaders from its banners. The event was also an occasion to recognize outstanding vendors, with honours doled out to Napoleon, EBSU, and Hoft.

Fredericton Direct Charge Co-op is the newest independent to join Castle Building Centres. Located in Fredericton, N.B., the consumer co-operative building materials business currently operates with over 10,000 member owners. That signing falls on the heels of the addition of Margaree Castle in Northeast Margaree, N.S. Under owners Nolan Brown and David MacLean, a grand opening is planned for the spring.

For its fiscal year ended Oct. 31, Costco reported net sales of $222.7 billion, an increase of 16 percent, with comparable sales up 14 percent. Net income for the year was $5.8 billion, an increase of 17 percent. Revenue from membership fees increased nine percent to $4.2 billion.

Gypsum Management & Supply reported Q2 sales of $1.43 billion, a 24.4 percent increase from the prior year’s quarter. Excluding the impact of an additional selling day, GMS’s net sales were up 22.5 percent. Earnings of $103.2 million represented a 38.7 percent increase. GMS has a growing portfolio of home improvement companies in Canada, including WSB Titan in Woodbridge, Ont., and Rigney Building Supplies in Kingston, Ont.

IN MEMORIAM: Bob Sutherland

Robert Dundas “Bob” Sutherland died unexpectedly last month while recovering from heart surgery. Through his business Solutions Training, Sutherland traversed the country instructing front-line staff from all banners on the use of plumbing and electrical wares. Sutherland began working in high school for the Dominion grocery chain, which sent him to Cornell University on a scholarship. He later worked in sales for Rutherford cigarettes, always keeping a few in his shirt pockets for potential customers even after quitting himself. Sutherland is survived by Ilse, his wife of more than 50 years; children Morrell and Richard (Maricel) Rutherford; and three grandchildren.

SUPPLIER NEWS

Trusscore has entered a recycling partnership with Return Polymers Inc. Through its Full-Circle Recycling program, Return Polymers will collect, grind, and recycle Trusscore PVC material to make new PVC products. Return Polymers has recycling facilities in Michigan and Ohio.

ECONOMIC INDICATORS

A slight decrease in inflation in November made little impact on Canadian households as food and shelter prices continue to rise. The Consumer Price Index was up 6.8 percent from a year earlier, slightly less than October’s 6.9 percent annual rate. The annual food inflation rate rose to 11.4 percent from 11 percent. The inflation rate peaked in June at 8.1 percent. (StatCan)

Sales of existing homes fell by 3.3 percent between October and November. The actual (not seasonally adjusted) number of transactions in November came in 38.9 percent below the near-record high for the same month last year and stood about 13 percent below the pre-Covid 10-year average for November sales. (Canadian Real Estate Association)

Investment in building construction remained stable in October, edging up 0.2 percent to $20.9 billion, with Ontario accounting for nearly all the gains. Residential construction spending was down slightly by 0.1 percent. Single-family home investment decreased 2.3 percent to $8.2 billion. (StatCan)

The annualized pace of housing starts in November edged down by 0.2 percent to 264,159 units. The rate of urban starts was also flat, with 242,644 units recorded in November. Multi-unit urban starts increased by two percent to 190,415 units, while single-detached urban starts fell seven percent to 52,229 units. (CMHC)

NOTED

Since its inception in 1922, Canadian Tire Corp. has grown to 13 businesses with 1,700 retail stores and gas outlets from coast to coast. The company claims that 1.8 million Canadians have worked at a Canadian Tire, Mark’s, or SportChek store over that time.

Whether it’s e-commerce, supply chain woes, self-checkouts, or drone deliveries, the retail home improvement industry will feel the impact of a number of important trends heading into 2023.

Some of those trends were presented by Hardlines’ own Michael McLarney at the 2022 Hardlines Conference, which was held in the fall. Drawing from the most recent Hardlines Retail Report, McLarney outlined some of the forces affecting dealers and suppliers.

#1. E-Commerce. This is the obvious one, said McLarney, but it’s impact must not be underestimated. He cited some of the incredible e-commerce gains retailers have made. Canadian Tire saw online sales increase 280 percent during Covid. Its online sales penetration through the middle of 2022 was around eight percent. Likewise, Home Depot saw online sales penetration reach more than 13 percent.

However, McLarney pointed out, independents are not capitalizing on their digital potential. Drawing on data from a Hardlines survey earlier in the year, McLarney shared that online sales by independents represent as little as one or two percent of sales, with many citing zero online sales. While some significant exceptions have emerged during Covid, those independent dealers doing double-digit sales in e-commerce are rare indeed.

McLarney challenged the industry to improve its online presence for independents, while stressing the need to maintain a physical retail space that provides a destination and solution centre for customers. In the end, he said, “It’s not how you tie in your e-commerce with your retail, it’s the other way around.”

#2. Improving the supply chain. Many retail groups have invested heavily in improvements to their own supply chains, including DC systems and processes. For example, at the time of the Hardlines conference, Home Hardware had just put the finishing touches on its new warehouse management system. The new system gives Home the ability to ship 150 dealer orders daily and 1,500 orders weekly through three distribution centres across Canada. And the retailer can now ship customer orders to the store or to their home.

Other groups made investments in their DCs, including Lee Valley Tools, at its main DC in Ottawa, while Federated Co-operatives Ltd. built a new LBM DC near Regina early in 2022.

Some major retailers made hacks of their own to get through, investing directly in the supply chain themselves. Canadian Tire invested in part ownership of a port in British Columbia, while Home Depot leased ships of its own to improve its supply of product from overseas.

#3. The last mile. The costliest and most logistically challenging part of the route from the DC to the customer’s front door is that so-called last mile, McLarney said. Smart retailers are making alliances with service companies that specialize in getting products to the customer’s door in innovative ways.

FedEx is using bicycle couriers to make deliveries in Calgary, Ottawa, Windsor, Toronto, and Vancouver. In the U.S., Walmart is using drones in 34 cities, while Amazon has been testing robots that travel along sidewalks to get parcels to customers.

#4. Loyalty programs. Once considered a value-add, loyalty programs are increasingly central to retailers’ marketing strategies. As online sales have grown, so has the importance of keeping customers aligned virtually.

Canadian Tire’s loyalty program, called Triangle Rewards, provides an umbrella for all of Canadian Tire’s banners, including Marks and PartSource. The retailer claims to have 70 percent of Canadian households as Triangle members. And Home Hardware made the news this fall when it switched to Scene+ after terminating its relationship with Aeroplan.

McLarney observed that a good loyalty program has to be integral to a retailer’s message. He referred back to Canadian Tire’s overwhelming success with the Triangle Rewards program. “Like e-commerce and customer service, a loyalty program can’t be a tack-on piece of your brand. It has to be a living part of it.”

#5. The contractor customer. “Many years ago the head of a buying group asked me why Hardlines reports on Home Depot so much. I told him it was to keep his dealers informed about all the ways the giant retailer is going after their contractor business,” McLarney said. “Pros account for only four percent of Home Depot’s customers, yet they make up 45 percent of its sales.”

Meanwhile, Lowe’s Canada has aggressive contractor programs of its own, such as its VIPpro program that offers special pricing and hours, supported by an app that lets pros keep track of their orders and billing with Lowe’s.

Home Hardware also has a dedicated pro program, while banners like Kent, Peavey, UFA, and Federated Co-operatives have all been making changes to better accommodate their contractor customers.

#6. Private brands. Proprietary labels have been the cornerstone of good retail for decades. But their importance has sharpened through Covid. At Canadian Tire, private labels account for almost 45 percent of sales. The company plans to launch 12,000 new private-label products across all its banners by 2025.

Home Hardware relaunched its Benchmark label during Covid and has added more brands for everything from lifestyle and kitchenware products to power tool lines for pros. But most hardware and home improvement retail groups are making similar investments in their own brands.

#7. Human resources. “HR issues have loomed large during Covid. Your people are your biggest variable cost and the biggest investment you can make,” McLarney said. The critical importance of taking care of workers has been highlighted exponentially over the past two years. Hiring and wages remain major concerns, he observed, “while issues concerning worker well-being have come to the forefront during Covid.” Hardlines even launched a newsletter of its own to address HR issues within the industry.

(This info was pulled from our 2022 Hardlines Retail Report, a massive study of Canada’s retail home improvement industry. It gives proprietary data on the size and annual growth of the industry, along with analysis of the top players in the industry. A must-have for any marketer preparing for 2023! Click here now for more info!)

Independent dealers now testing self-checkouts in select stores

JL’s Home Hardware is a three-store operation in Guelph, Ont., about an hour west of Toronto. Those stores, a building centre and two hardware stores, are the first Home Hardware stores to get self-checkout technology. But dealer-owner Andre Belisle said that the store is not going to replace humans with machines.

“The self-checkouts are already tested and fully operational as an added service and option for customers who wish to use it,” Belisle said. “Our full-service checkout option will always remain. Our intention is to improve our service for our customers and that includes providing options for any customer’s preference.” The stores are continuing with full-service checkouts while the new format is tested.

Acceo, a retail technology provider based in Montreal, installed the self-checkout units at JL’s, as well as at RONA Matériaux Magog Orford, a building centre in in Magog, Que. While many Lowe’s Canada and RONA corporate stores have received self-checkouts from another supplier, this is the first RONA independent dealer to get the technology.

The installations both went smoothly, according to Marc Leblanc, Acceo’s senior vice president of home and building supply industry ERP.

Lowe’s seasonal and pro sales continue to buoy its quarterly results

Lowe’s growth in the third quarter of 2022, which ended Oct. 31, highlighted the strength of various segments of the business, including the inherent strength of the pro customer and the continued acceleration of online sales.

Sales were fed by both DIY and contractor customers, with comps up overall three percent for the quarter. According to Bill Boltz, Lowe’s EVP merchandising, the company expects that DIY momentum to continue through the fourth quarter as well. Pro business continued to surge, with comp pro sales up 36 percent over two years of Covid. He shared the details on a call with analysts following the release of the company’s Q3 results.

Comp sales of hardlines products at Lowe’s were down somewhat as the company saw spending return to more normal patterns. However, this does not mean homeowners were shifting their discretionary spending. In fact, selling events around holidays have remained strong, driven by product innovation in those categories. For example, consumers were spending $300 and up on specialty Halloween decorations. And Christmas is rolling out with more expensive trees as consumers show a willingness to trade up.

Strong sellers in the quarter were appliances, paint, kitchen and bath, and flooring. A deal with Sherwin Williams in the U.S. will result in the rollout of a new colour wall across all Lowe’s stores south of the border through 2023.

Lowe’s latest business outlook pegs total annual sales for the full 2022 fiscal year (which includes a 53rd week) at between $97 billion and $98 billion, compared with $96.2 billion in 2021. Comp store sales are expected to be flat to negative one percent.

The Western Retail Lumber Association has named Steve Buckle, CEO of the Sexton Family of Companies, as the recipient of its 2022 Industry Achievement Award. The award will be presented on Jan. 19 during the WRLA Building & Hardware Showcase in Winnipeg.

LM2 Marketing has announced the appointment of Mike Hachey as its newest partner and account manager, starting this week. Hachey brings 30 years of industry experience to the role including a series of merchandising leadership positions. At the same time, the company said that VP and account manager Richard Lépine will retire after 47 years in the hardware trade, while staying on in a consulting capacity.

At BMR Group, Caroline Dionne has been named VP, finance. A graduate of HEC Montréal, she continues to report to André Lavoie, EVP, shared services. Dionne joined the company in 2021 as senior director, corporate accounting, and was appointed senior director, finance, in August 2022.

At Home Hardware Stores Ltd., Chief Information Officer Gino Gualtieri has left the company. He’s been replaced by Chris Marinis, who has been promoted to the role of vice-president, information technology. He brings over 25 years of IT experience in the retail and transportation industry to this new role.

Michael Morris has been promoted to the position of SVP of sales at Derby Building Products. Morris started with Derby in January 2018 as a regional sales manager and was promoted to VP of sales in September 2019.

DID YOU KNOW…?

… the latest edition of Hardlines Dealer News is emailing to subscribers on Wednesday? Topics covered include the Canada Revenue Agency demanding to know from Kent Building Supplies which contractors spent more than $20,000 with them this year! Hardlines Dealer Newsis monthly and it’s free: click here to subscribe now!

AD Building Supplies – Canada (formerly TORBSA) is welcoming Velcan Forest Products as a new member, effective Jan. 1. Velcan has manufactured and supplied framing materials and prefabricated wood components for the building industry for some 30 years. It has two Ontario locations, in Ottawa and Oshawa.

Ed Bulley, owner of Ed’s Building Supplies in Fort Nelson, B.C., is the newest RONA affiliate dealer. Serving the area since 1955, the store will undergo a 10,000-square-foot expansion. The total retail space will be 17,000 square feet, with an 11,750-square-foot roofed lumber space and a 20,000-square-foot outdoor lumber yard. Over 400 SKUs will be added across different categories, such as lighting, flooring, and appliances.

Canac, the independent home improvement chain based in the Quebec City area, has received approval from the city of Magog, Que., for development of another store. It’s expected to open in 2024. Canac has more than 30 locations throughout Quebec.

The newest location for Wolseley Canada had its grand opening last week in Oakville, Ont. The 21,000-square-foot facility offers a full range of Wolseley Canada’s roster of plumbing and HVAC products. Vanessa Sawicki-Dunn is the manager of the Oakville branch. Burlington, Ont.-based Wolseley Canada has 220 locations.

Ace Canada has a new location in Arthur, Ont., as owners Doug and Barry Eidt opened their third Ace store this month. Under manager Brent Bowen, the 4,800-square-foot store includes a small farming section alongside pet categories and traditional hardware offerings. The Arthur location joins the Eidts’ Ace stores in nearby Mitchell and Exeter.

Lowe’s Canada’s PROvember campaign raised nearly $40,000. The campaign, held in most Lowe’s, RONA, and Réno-Dépôt stores, gave pro customers the opportunity to make a donation at checkout to support men’s health organization Movember Canada, which focuses on mental health, prostate cancer, and testicular cancer.

Home Hardware dealer-owner Kimberly Seguin-Gauthier is relocating her store in Essex, Ont., to a new, larger location. The store will involve a $13 million investment in the new site on 12 acres of land. According to AM 800, the local radio station, Seguin-Gauthier said she has plans to develop the surrounding parking area on the property with additional businesses.

Lowe’s Cos. has developed the next steps in its “Total Home” strategy. The retailer has plans for growth across five focus areas: deepening pro penetration, accelerating its online business, expanding installation services, driving localization, and elevating its product assortment. The moves are designed to enhance Lowe’s omnichannel capabilities and position it as a one-stop home improvement shopping destination. 

NOTED

Some 7-Eleven stores are testing licensed dining areas (Wow—your gobsmacked Editor). Seven locations in Alberta are expanding their “restaurants into licensed locations with dine-in seating areas” (according to the press release). The release assures us that 7-Eleven’s “adult customers can now enjoy freshly prepared meals from 7-Eleven Canada.” Those culinary delights [sic] include “7-Eleven’s Crispy Classic Chicken wings, ‘hot from the oven’ pizza, as well as Alberta craft beers.” Remember, you read it in Hardlines! 

OVERHEARD…

“Technology is a huge accelerator. We can’t react to change anymore; we have to get ahead of the curve. And if you want to know what’s next, get to that young generation to teach you.”
—Tony Cioffi, president of Lowe’s Canada. He spoke at the 26th annual Hardlines Conference earlier this fall.

The Canadian Labour Congress (CLC) and the United Steelworkers union (USW) have filed a complaint with a federal watchdog about the alleged treatment of garment workers in factories in Bangladesh that make clothes for Mark’s, a division of Canadian Tire Corp.

The Nov. 21 complaint to the Canadian Ombudsperson for Responsible Enterprise, in Ottawa, claims that the garment workers are paid “poverty wages.” The factories in question employ thousands of workers. The complaint states those workers should be making up to five times more in salary to represent a living wage.

In a joint press conference by the USW and the CLC, Marty Warren, Canadian national director of the USW, said the organizations have brought evidence that reveals that “Mark’s and Canadian Tire Corp. have failed to ensure the workers in its supplier factories are paid living wages. The complaint alleges that this is a contravention of the international human rights standard.”

Warren added that the two associations have made “repeated attempts to engage with Canadian Tire to acknowledge that they have failed to take meaningful action to address human rights harms it causes and contributes to in the supply chain.” He said the company has the resources and influence to assure that rights be respected. “They need to be pushed to live up to their core responsibilities.”

In the same press conference, Kalpona Akter, executive director of the Bangladesh Centre for Workers Solidarity, said garment typically workers live in overcrowded housing conditions. They are working six days a week and up to 12 hours a day, Akter said, making much less than a dollar per hour. “Any garment worker will tell you that isn’t enough.”

Canadian Tire responded to a query from Hardlines with a statement saying the company adheres to the law. “Canadian Tire Corp. works to ensure that its suppliers comply with all local laws; this includes compensation. As part of our activities to ensure compliance, CTC regularly tracks wage rates and works with reputable third parties to audit factories that manufacture our owned brand products.”

But the disparity underlines the need for western companies to understand their supply chains beyond just price and top-line safety concerns. Doug Stephens, retail consultant, speaker, and author, zeroed in on this concern in his presentation at last month’s Hardlines Conference in Niagara-on-the-Lake, Ont. Most firms, Stephens said, have a pretty good mental map of their first-tier vendors. But “by the time you get to their second-tier vendors, it gets a bit murky. By the time you get to their vendors’ vendors’ vendors, it’s a black box.”

This disconnect within the supply chain goes beyond simply price, Stephens said, and has been an issue for decades. An article in Harper’s magazine more than 20 years ago followed a pair of IKEA buyers on their visit to a Chinese furniture factory. The buyers insisted on a price cut of 50 cents off the price of the product being manufactured. But the factory owner complained that such a cut would force him to eliminate the lunch program that enabled him to feed his workers each day.

The lines blur when suppliers try to pass the responsibility for accountability down the line of the supply chain. But the model of shifting risk needs to be replaced with risk sharing, Stephens insisted during his presentation. “Shared risk needs to become a core business objective,” he said, in order to avoid “data silos or deserts.”

Stephens pointed out that intelligence will be key to rebuilding supply chains more comprehensively. “Surprisingly, most supply chains today operate on a few microscopic pieces of info: what is our sales velocity, what is our on-hand, what is in transit, what’s our turnaround?”

Dealer recruitment, product reviews are all part of the mix at BMR, says VP

Delegates at last month’s Hardlines Conference got a tour of the latest initiatives and innovations at BMR Group, thanks to a presentation by Charles Grégoire-Béliveau, VP merchandising. Self-quarantined due to Covid protocols, he appeared on a video screen from his home in Quebec, offering what he referred to as “BMR 2.0.”

Based in Boucherville, Que., BMR is a buying group with full distribution facilities for both hardware and LBM. A subsidiary of Sollio Cooperative Group (formerly La Coop fédérée), it has more than 275 stores in Quebec, the Atlantic Provinces, and Ontario.

Grégoire-Béliveau explained to conference delegates that the company is continuing to sign new dealers in Ontario and the Atlantic Provinces, all the while pursuing expansion in its home province. It offers four store formats: the “full featured” BMR store, BMR Pro for contractor-oriented dealers, a convenience format called BMR Express, and AgriZone, which exists as either a standalone or a store-within-a-store, specializing in the farm market, including the maple-sugar industry.

“We are building BMR 2.0 and our vision is to be the leading independent retailer [in our industry] in Canada.”

The company has done a thorough review of its product assortment over the past 14 months, Grégoire-Béliveau revealed. “We are going to be investing in specific categories: building materials, plumbing—where the number one project is kitchen and bath, flooring, and seasonal.”

In addition to listing these categories as opportunities, Grégoire-Béliveau didn’t shy away from mentioning “a number of challenges” that the industry faces. He cited inflation, consumer-spending patterns having changed so much after the pandemic, the difficulty of attracting labour, the housing market slowdown, and interest rate increases.

Retailers now stretch Black Friday sales online and in-store over several days

Black Friday, the shopping holiday that follows American Thanksgiving every third week of November, used to be a one-day shopping blowout, similar to Boxing Day in Canada. With the advent of internet sales, Black Friday was soon followed by Cyber Monday, an opportunity for retailers to continue offering sales, this time online.

Now, thanks to the borderless nature of online selling, Black Friday has become an international phenomenon—and a protracted sales opportunity. Home Depot Canada’s Black Friday started last week and is advertised to continue until Dec. 4.

At Lowe’s Canada, big sales started last Thursday, with Cyber Monday featuring more sales, though mostly through online orders. The Lowe’s Canada website promises great deals in categories that include appliances, snowblowers, tools, flooring, and lighting.

In a throwback to the mania of bricks-and-mortar holiday sales, Canadian Tire’s latest flyer promises “Doorcrashers” with discounts of up to 70 percent. Not to be outdone, it also offers “Red Thursday” specials, to entice Canadian shoppers to open their wallets a day early. The retailer’s Black Friday event runs to Nov. 30, offering everything from tech gadgets to outdoor sportswear.

A check of Home Hardware’s website shows that its sale will also run to the end of the month. Early Black Friday specials from Home Hardware include deals on heavy appliances, snowblowers, and, of course, Christmas decorations.

As Canadians begin travelling to shows again, the National Hardware Show at the end of January will be a big draw for many. The show is co-locating with the NAHB International Builders’ Show and NKBA’s Kitchen & Bath Industry Show at the Las Vegas Convention Center.

The Canadian Home Products Trade Association (CHPTA) is taking advantage of this triple show to host a booth of its own. The CHPTA will have a 10-by-20-foot space on the show floor. Members can share some of the space in the group stand, either with a table-top or with a company’s own floor merchandisers. Chairs and a meeting table will also be available.

In addition, a representative from each participating company will be required to spend a certain amount of time in the booth during show hours.

“It’s something we’re piloting,” says Sam Moncada, president of the CHPTA. “And going forward we’d like to have more Canadian participation.” He says there’s room for a total of 10 companies to participate, adding that three have signed up already. If the response to the group stand is greater than expected, the association has the option to secure more space for a bigger booth.

“We want to give all Canadians who want exposure in Vegas the chance to get that in an affordable way,” says Moncada.

Participation in the group stand will cost each participant CD$1,500. That price includes two tickets to CHPTA’s “Canada Night” event, which will take place on Jan. 31 from 6 p.m. to 8 p.m. In addition, participating members have the option of buying a listing in the NHS show directory for an extra cost of US$350.

The booth will be available to all members, Moncada says, by offering space for them to gather. Many of his members will be walking the show, and this gives them a location to host meetings of their own on the show floor.

“I think there’s value for our members. When an exhibitor can spend $20,000 or $30,000 for their own booth, this provides more value and demonstrates that the association can collaborate to help them.”

(Interested companies can contact CHPTA’s Michael Jorgenson at 416-282-0022, ext. 134; or mjorgenson@chpta.ca.)

Edyta Drutis has been promoted to vice president, brand and marketing for Blanco North America. In this role, she will lead integrated marketing, branding and communications efforts for the company across the U.S. and Canada. She started at Blanco Canada in 2014 as marketing manager. Most recently, she served as the director of brand and communications for Blanco North America.

At Intertape Polymer Group, Peter Durette has been appointed CEO and a member of the board of directors. Prior to joining IPG, Durette served as president of the Corrugated Packaging business at WestRock Corp. He is replacing Gregory Yull, who spent 30 years with IPG, including 12 years as CEO and president. Yull will continue on as a board advisor to help with the transition. Clearlake Capital Group, LP acquired IPG in June 2022 in a take-private acquisition.

DID YOU KNOW…?

… that the latest edition of Hardlines HR Advisor went out to subscribers last week? In this issue, Sexton Group’s Eric Palmer shares his insights into investing in your people; and Taiga’s Zaida Fazlic talk about finding your own leadership style. If you’re not already receiving HR Advisor, click here to sign up for free!

Home Hardware is testing self-checkouts at JL’s Home Hardware, a three-store operation in the town of Guelph, Ont., about an hour west of Toronto. Those stores, a building centre and two hardware stores, are the platform for the new self-checkout technology, initiated with tech partner Acceo. Staff at the stores monitor and assist at the self-checkouts while continuing to operate their full-service checkouts.

The Canadian Tire store in Vernon, B.C., was hit by a fire recently and the RCMP is investigating the suspicious circumstances of the blaze. No one was injured, but it did cause extensive damage. The fire appears to have been started outside in the store’s garden centre. It quickly spread and did damage to an adjacent exterior wall.

Steve’s Hardware and Variety Store in Montreal’s West Island is the process of closing. The store has operated since 1983 in the Pointe-Claire Plaza. Steve Naday and his wife Toni have decided to retire, and have spent the past month selling off inventory to patrons who had benefited from the store’s expertise for almost 40 years.

The importance of small-town retail is borne out by the fate of a hardlines retailer in the Prairies. Last Mountain Coop has been closed since August, disrupting residents in the town of Nokomis, Sask. It closed its doors because of staff shortages, but it’s the town’s only gas station and farm and ag centre and locals are feeling the pinch. The store, a member of Federated Co-operatives, has been actively trying to hire new team members and hopes to open in the near future.

Three out of four locations of Money’s Worth Renovation Center are closing, the regional business website Huddle reports. The budget chain’s Bible Hill, N.S., store will be the last one standing with the closure of the stores in Dieppe, N.B.; Amherst, N.S.; and Summerside, P.E.I.

RONA Fort Erie in Fort Erie, Ont., last week presented $46,600 to Community Outreach Program Erie (COPE). In support of the Lowe’s Canada Heroes Campaign, the store team under manager Jeff Hill held a benefit performance called “Fort Erie Rocks!” on Sept. 17. It featured Juno-winning rock band Honeymoon Suite.

Canac, the independent home improvement chain based in the Quebec City area, has received approval from the city of Magog, Que., for development of a new store. Canac applied for the approval a year ago, and the new location is expected to open in 2024. Canac has more than 30 stores throughout Quebec.

Employees at Lowe’s Canada’s offices and distribution centre in Boucherville, Que., have found their access to work severely limited by ongoing closures of the Louis-Hippolyte Tunnel-Bridge that joins the south shore with the island of Montreal. However, since the end of October employees have been provided flexible work options. The work considerations apply to all workers, regardless of whether they rely on the Tunnel-Bridge to get to work. Closures are expected to continue until the end of 2025.

SUPPLIER NEWS

Aluminum railing system maker Regal ideas Inc. was at this year’s DeckExpo in Las Vegas. The company was awarded “Best in Show” in the Outdoor Living category for its innovation and Crystal Rail system. Along with its newest products, Regal ideas also launched its 2023 Look Book, aimed at inspiring homeowners and designers. The look book can be found here.

ECONOMIC INDICATORS

In the ninth straight month of falling sales, existing home sales in the U.S. dropped 5.9 percent in October to a seasonally adjusted annual rate of 4.43 million. That’s the lowest that sales have dropped to since December 2011, with the exception of a very brief fall at the beginning of the pandemic. However, prices continue to rise, along with interest rates, keeping housing affordability low. (National Association of Realtors)

OVERHEARD…

“In truth, our supply chains today are not sophisticated and they’re not advanced. We haven’t learned much about supply chains in at least 160 years.”
—Doug Stephens, aka the “Retail Prophet,” speaker, consultant, and author. He spoke at the 27th annual Hardlines Conference last month in Niagara-on-the-Lake, Ont.