“That puts retail giants such as Home Depot, Rona and Canadian Tire in a favorable position for long-term growth, especially as consolidation finds almost half the industry in the hands of these four,” he continues.

“Canada’s Top Four” appears in the latest issue of Hardlines Quarterly Report, the sister publication to Hardlines. Call us for info on how to subscribe!

Rona bid aggressively to get the sponsorship from Home Depot, in a deal valued at $68 million. Besides providing support for a distinctly Canadian event, to complement its all Canadian marketing efforts, the sponsorship is expected to give Rona a big lift in awareness in Western Canada. “It’s important to establish us in the West, where we are really focusing on our growth,” says Sylvain Morissette, spokesperson for Rona. “But it’s an exciting announcement for our entire organization nationally, and for our employees,” he continues.

The Rona deal includes a $7 million investment in additional initiatives to support sports at the community level. These include the Rona Youth Aspiration program and the Own the Podium program. The company has also committed to an aggressive marketing and communications program to help promote awareness of the Olympic Games across Canada.

A comprehensive store package was last done in 1996, with ameliorations made over the years. According to Bill Ferguson, dealer support manager for Home Hardware Stores, the latest changes are designed, in part, to broaden the appeal of Home Hardware stores to women.

Home Expressions is among a number of departments and service areas that have been repositioned. Others include paint & decorating and customer service. To better serve Home’s contractor and heavy DIY customers, specialty departments, such as the Builder Centre and Home Design Projects department, have been enhanced to make it easier for customers to get the advice, ideas and products to tackle successfully complete projects.

“To maintain its position as one of Canada’s leading retailers, Home Hardware needed to further strengthen its brand and re-create the Home shopping experience,” said Peter Heywood, Vice President of Brand Strategy, Watt International. “Through our strategic design expertise, we have helped them build on their already strong, consistent brand to deliver results and keep customers coming back time and time again.”

To meet the demands of this kind of selling formula, potential vendors must come to the table with market intelligence – lots of it – plus appropriate packaging, and the ability to deliver into Canadian Tire’s central distribution centre in Brampton, ON on an efficient basis.

Canadian Tire’s newest store format, called Concept 20/20, offers an updated store layout and expands a number of product categories. One that is getting a big push is Carter’s own bath and décor department. Here, under a newly renamed program called “Bathscapes,” changes have been made to include more high-end products, and even more everyday items, such as towels.

Carter’s department is currently supplied by 25 main vendors, and he wants to reduce that. In the face of consolidation, even existing vendors who want to be part of the growth of Canadian Tire must be able to add value and offer innovation in a product offering. And that product must be offered within a complete selling package. “Offer not just product, but a program,” he advised.

He expects the current rate of growth, which will include more 60,000-sq.ft. outlets, to “continue in the years to come.”

The next openings in Canada will be regular 113,000-sq.ft. outlet in Vaudreuil, QC and a 95,000-sq.ft. store in Woodstock, ON, both in July.

Home Depot, typically unrivalled in its expansion in Canada, appears to be paying more attention than ever to the store opening numbers. Its newest – and only serious – rival is Rona inc., which doubled its planned store expansion for 2005 late last year. It plans five-10 big box openings, and another five-10 traditional building centre openings, in 2005.

Meanwhile, Home Depot, which is already including China when it itemizes its international presence, has yet to build a single store there.

Other possible bidders for B&Q include Kohlberg Kravis Roberts and a private equity firm, Permira, which has invested in other companies in this industry before, including the DIY chain Homebase.

Scarborough’s survey found that nearly two-thirds of all American households had invested in a home improvement project last year, with interior projects leading the charge: the number of households that spent money to improve the interior of their homes – through such activities as painting, wallpapering, carpeting, bathroom remodeling, etc. – was up 30% over 2001. “We see more homeowners taking on involved and expensive projects, such as remodeling,” said Bob Cohen, Scarborough’s president and CEO. “Additionally, the focus on interiors can be attributed, in part, to the insecurity of today’s world. People are taking refuge in their homes more than ever, and
keeping one’s sanctuary fresh and new – even by taking on simple, inexpensive projects – adds to the feelings of peace and warmth people get from their home.”

The Canadian Hardware and Housewares Manufacturers Association will host its annual Maple Leaf Night/Soirée Feuille d’érable on Tuesday, May 17, at the Curve Night Club-Aladdin Resort & Casino. Time: 5:30-8:00 p.m. More than 100 vendors are already signed up to rub shoulders with Canadian Tire, Fedco, Home Hardware, House of Tools, BMR, Sears, TruServ, TSC, Zellers, and more. For more info, contact: CHHMA, 416-282-0022.

Hardlines, in conjunction with the Presidents Council, present “Global Retailers: Best Practices from Around the World,” Wednesday, May 18 at the Las Vegas Convention Center. Time: 3-4:30 p.m. Featuring: a world-class retail panel: John Herbert, general manager of the European association of DIY retailers; Robert Collins, Director of International Sales and Retail Development, Ace Hardware Corp.; Harald Lux, head of Emil Lux in Germany; Jim Lowe, director of strategic research for one of the leading home improvement retailers in England, Focus DIY. Michael McLarney, Editor & Publisher of Hardlines, will serve as moderator.

Hardlines, in partnership with the National Hardware Show, presents an International Reception at the Las Vegas Convention Centre (immediately following the “Global Retailers” panel). Time: 4:30-5:30 p.m. Want to connect with buyers from the U.S., South America and overseas? This will be the absolute best place in Las Vegas to do it! For more info, click here.

If you want to meet some top international buyers one-on-one, you should definitely sign up for “International Buying Day,” organized by the Presidents Council, on Monday, May 16, the day before the show starts officially. The Buying Day is designed to provide an efficient forum for suppliers who want to expand their market share. Because of the individual appointment format, the Buying Day is limited to 40 suppliers, who will have individual meetings with the following participating retailers: B&Q – U.K.; Focus DIY – U.K.; Globus – Germany; Homebase – U.K.; Komeri – Japan; and Sodimac – Chile. Cost is US$2,000 per vendor. click here to receive more details.

TORONTO – “Imagine This Sold,” Canada’s first eBay drop-off store franchise, is the latest in a new retail phenomenon – companies that provide support services to expedite eBay’s online auction activities. Imagine This Sold provides a drop-off point for customers unfamiliar, or uncomfortable, with undertaking the online auction process themselves. Customers merely drop off products at a local outlet, and collect their money when the items are sold online. Imagine This Sold provides a one-stop-service to appraise, write ad copy, professionally photograph, post on eBay, ship and arrange payment for items for sale. The company is implementing an aggressive franchise
expansion campaign to add local eBay drop-off stores to their existing flagship retail location in uptown Toronto. A second Imagine This Sold store has already opened in Dartmouth, NS and stores will open in Barrie, ON and Calgary over the next three months.

JONQUIÈRE, Que. – A Wal-Mart store that was successfully organized by the United Food and Commercial Workers Union was quickly pronounced unprofitable and then scheduled to close down on May 6. But the store was actually closed down a week earlier. The store, which received union accreditation last fall, was to close May 6. However, Wal-Mart workers will be paid a few additional weeks following the shutdown.

SEATTLE & TORONTO – Sears Canada Inc. and Amazon Services Inc., a subsidiary of Amazon.com Inc., will join forces to beef up Sears’ website, www.sears.ca. Under the multi-year agreement, Amazon Services will build a new Sears Canada branded-website using Amazon technology. Merchandising, marketing, fulfillment and customer service will all be offered, while functions such as Search, Navigation, Personalization, and Community features such as Customer Reviews will be key elements of the new site.

INDUSTRY, Calif. – Home Depot has negotiated a five-year, $13 million lease on a 650,000-sq.ft. distribution center being built here. The retailer is earmarking site for its burgeoning Home Depot Supply division, which services primarily commercial accounts. The Whittier (Calif.) Daily News, quoting sources from CB Richard Ellis, which brokered this deal, reports that Home Depot intends to consolidate two smaller DCs, in Fontana and Santa Fe Springs, into the Industry facility, which, when completed in December, will be the largest available commercial warehouse in the San Gabriel Valley.

MOORESVILLE, N.C. – Lowe’s Cos. may be looking for a new agency to handle its advertising. AdWeek quotes a representative from the retail giant’s current account manager, McCann Erickson, that Lowe’s has placed its account in review and has requested information from 14 agencies. Last year, Lowe’s gross advertising expenses rose 8.5% to $740 million, according to the company’s 2004 10-k filing with the Securities and Exchange Commission.

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In Toronto, buyers from Sears Canada, Canadian Tire Corp., and Home Depot Canada represented the major retailers. An overview of one of Canada’s fastest growing independents, London-ON based TSC Stores, was offered by that company’s merchandise director, Bill Wilson. He was followed by David Nisbet, who heads up Mutual Hardware, the national hardware buying group of which TSC is a member. Another Buyers Breakfast was held two days later in Montreal (more on that next week–MM).

But just breaking through requires determination and lots of homework. One of the key tips each retail buyer reiterated was the need for new vendors to be up on their knowledge of the industry overall. “Market intelligence. This is really important,” said Scott Urie, national merchandise manager at Sears for Craftsman, home and electronics, Sears Canada. “It’s important to know the size of the market and how your product fits in.”

He stressed the need to understand the retailer itself. “You have to know about Sears,” he stressed. “Our target customer is women and their families.” Even for vendors selling to Craftsman, a strong brand aimed at the man, he said, “Ask yourself how your product fits in.”

Urie summed up the concerns of many of the buyers represented over both days. “Know your channel, know your product, know your competitor.”

John DeFranco, division product manager for lawn and garden at Home Depot Canada, noted some of the initiatives that his company is moving ahead with, including installed sales and tool rentals, the latter of which will be in all Canadian stores by year’s end. The commercial-industrial side is also growing rapidly. Home Depot Supply is part of the retailer’s strategy to grow its business-to-business channel. The recent acquisition of Litemor, a commercial lighting supplier, reflects Home Depot’s focus on B2B.

DeFranco noted that his category, seasonal, is growing within Home Depot to the point that the company is fast becoming one of the top 10 garden retailers in North America – opening up a huge opportunity for manufacturers in that sector.

Home Depot is at the forefront of a number of technologies to streamline the supply channel. DeFranco said compliance with UCC – the international data bank that synchronizes international product codes – is important for vendors, as is familiarity with EDI and other technologies. “You can impress a buyer in a presentation by showing that you have the electronic and technology issues resolved.”

Do you have to be a major supplier to deal with a major retailer like Home Depot? The answer is probably yes – most of the time – but not always, especially if you offer something unique. “The smaller and medium-sized companies – these are often the ones bringing the innovations.”
(Next week: highlights from our amazing Montreal Buyers Breakfast!)

According to Ray Falkenberg, vice-president business development and marketing for TruServ Canada, the stores are generating “outstanding results,” which, in turn, managed to generate a lot of interest among dealers attending the market.

The purpose of the Best Practice program, says Falkenberg, is to arm independents in smaller communities to combat the arrival of large-surface stores, especially Wal-Mart and Superstore. “We find if you do nothing when these people move to town, your sales go down as much as 40%,” he says. However, the stores that are following TruServ’s best practices are managing to stabilize sales in the face of new big box competitors.

Three stores are currently being put to the test: a True Value in Nepawa, MB; a V&S in Morden, MB; and a Country Depot in Kingston, ON. Changes have been made to store layouts, with wider aisles, power aisles, and brighter signage. Product mixes have been adjusted, with emphasis on seasonal products (the 2004 Christmas season proved very successful, says Falkenberg).

“Dealers have to compete with the big guys,” he says, “getting traffic up and average basket size up are important measures. Dealers also have to learn how to increase the percentage of people walking into the store who actually end up buying.”

Originally launched at Zellers stores in October 2004, the Big Ticket initiative was piloted in Manitoba, Quebec and Ontario. Three different combinations of Big Ticket departments are being introduced: nine stores will sell a small assortment of appliances, 83 will offer an enhanced merchandise selection, including appliances and mattress sets, and five will offer a full selection of appliances, mattress sets and furniture. The merchandise assortment combines private label and brand name appliances, including GE, Frigidaire and White Westinghouse.

“The consumer response to Big Ticket merchandise at Zellers has been strong,” said Gary MacDonald, senior vice-president, Hbc and general manager, stores, for the Zellers division. “We’re experiencing above average sales increases in these departments.”

Home Depot has about 140 stores in these markets. U.S. Remodelers’ product lines will be offered in all of the markets, except for the Dallas stores, which will only offer the U.S. Remodelers kitchen refacing products. U.S. Remodelers will begin offering its products in these markets in the second quarter of 2005.

The member-owned wholesale hardware co-operative reported sales of $2.0 billion in 2004, to its approximately 6,000 independent retailer locations worldwide.

TORONTO — Home Depot Canada, in partnership with the Clean Air Foundation and the Government of Canada’s One-Tonne Challenge, is offering again this year a “Mow Down Pollution” lawn mower recycling and rebate program. Customers can turn in their old stinky lawn mowers for a rebate of up to $100 on the purchase of a reel mower or electric mower. This year, Home Depot will donate $10,000 in lawn and garden care supplies to the municipality whose citizens have turned in the greatest number of old gas lawn mowers to Home Depot between April 28 and May 8, 2005.

SAN FRANCISCO — Building Materials Holding Corp., one of America’s leading pro dealers, saw its net income jump to US$21.1 million in the three months ended March 31, compared with US$4.2 million for the same quarter a year earlier. Revenue during this period increased 37.4% to US$572.9 million, from the company’s BMC Construction subsidiary, which provides turnkey shell construction installation for builders. BMHC’s lumberyard, division, Idaho-based BMC West, reported a 20% sales gain in the first quarter, to US$330.7 million, and a doubling of its operating income to US$28.9 million.

TOWSON, MD — Power tools and faucets drove Black & Decker’s financial performance in the three months ended April 3, during which the company’s net income rose 71.7%, to US$148.7 million, on revenue that increased 39% to US$1.52 billion. During the quarter, the company’s power tools and accessories segment, led by its DeWalt line, increased its sales by 50%. The company reported that industrial cordless power tools sales were “particularly strong.” B&D also benefited from a 25%-plus gain in sales of Price Pfister-branded plumbing products, which helped boost the overall business in its Hardware and Home Improvement segment by 9%.

OAK BROOK, IL — Ace Hardware Corp. has signed a 10-year extension to its business agreement with Ace Israel that will continue supplying the Israeli retailer’s 25 hardware stores and building the Ace brand in that country. The signing took place today at Ace Hardware’s corporate headquarters here. The Ace Israel Group first allied itself with Ace in 1993 and, at that time, operated four stores. The company has since grown the business to include 25 hardware stores in cities such as Tel Aviv, Jerusalem and Haifa. A 26th store is planned to open later this year in Afula.

WASHINGTON — A growing movement to get Wal-Mart’s 1.2 million American workers organized by unions now has the support of political know-how. Paul Blank, one of the leaders of the movement, was formerly national political director for Howard Dean, Governor of Vermont, who ran for leadership of the Democrats. With Blank in charge, the union-organizing movement against Wal-Mart has all the sophistication of a political campaign, with website, volunteer recruitment, etc.

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ST. JACOBS, ON — The big news for dealers at Home Hardware’s latest dealer show was the much-awaited introduction of its newest store signage and merchandising program. The comprehensive package includes modified colours, enhanced end caps and sophisticated in-store signage, all developed for Home Hardware by Watt International (better known to this industry as The Watt Group).

“This is more than just a décor package,” says Bill Ferguson, dealer support manager for Home Hardware Stores. “What we’re trying to do is to meet our customers’ expectations. Customers are more demanding,” he adds, noting that Home stores don’t just compete with other hardware and home improvement retailers. They must earn mind share from other specialty retailers, other forms of entertainment, even Disneyland – anything, in fact, that will make demands on the consumer’s pocketbook.

Starting with the outside of the store, colours have been brightened up, with greys replaced by blacks and reds, and the entrance more clearly marked by bold signage overhead. Inside, the stores will be “warmed up,” says Ferguson, with softer colours, such as sandstone coloured tiles on the floor, and cleaner colours on the walls, to replace the existing reds and whites. Department signs have been re-introduced, as well. Banner kits that hang from the ceiling are part of the new look, but these ones reflect the look of Home’s other printed promotional materials – and they’re easy to replace. Even sharp edges in the store are replaced by curved edges in an effort to appeal more strongly to the female shopper.

Home Hardware wants the shopper to stop and smell the proverbial roses. “I know everybody is in a hurry, but these new elements help to slow people down. It creates an environment that’s warmer, more friendly. But at the same time,” he adds, “we’re trying to create a more effective shopping experience.”

The overarching ambition of the new look is to tie the stores more closely to the promotional – and branding – efforts of other media, such as television ads, flyers and catalogues. “We have to be marketing in the store. It’s not just about merchandising,” says Ferguson. “The store is really part of the message and that’s what we’re trying to get across.”

Homecare and CID represent the Ontario membership of the larger umbrella group, Matreco. At the end of last year, Homecare agreed to join with fellow Matreco member TIM-BR-Marts Ltd. Together, the combined purchases of TIM-BR-Marts reach almost $1.2 billion and are continuing to grow! Great opportunities currently exist for expanding TIM-BR-Marts nationally. During the meetings, leadership of both groups was turned over to Tim Urquhart, president of TIM-BR-Marts Ltd., as Don Nash, formerly president of both CID and Homecare, assumes the role of executive vice-president of TIM-BR-Marts Ltd.

Cost savings are anticipated by combining head office functions, including accounting, buying, flyer advertising and TIM-BR-Mart marketing. Lots of new and enhanced programs are being introduced, arising from the ‘humongous’ buying power and large number of stores.

Jeff Kinnaird is now regional vice-president of operations for Canada West, which includes Northern Ontario.

The move, says Plamondon, will allow Home Depot Canada to strengthen its core functions. It also better reflects the organization of the parent company, based in Atlanta. “The vp structure aligns the Canadian structure more with the U.S. structure,” he says. “It also better reflects the reality of what the marketplace really is, identifying Western and Eastern markets.”

Skrepnek says he’s been in regular contact with other commodity dealers in Southern Ontario who would be more than willing to replace Leon’s in the group’s membership. He adds that the group will add more members from other regions, as well. “We’re still as big as any group in Canada, and frankly, we’ll make some moves over the next six months to fill the gap.

As warm weather arrives in the province, Québec households are expected to step up their renovations on the outside of their homes. In fact, nearly one in four households is planning exterior renovation work in the coming months, says the Rénovex ADMACQ Index. That’s up by 5% over the Index results from January 2005.

For more information on the study, contact: Donald O’Hara at: 450-646-5842, or info@admacq.qc.ca.

The end result, higher sales, will satisfy Canadian Tire’s overriding mission to increase shareholder value.

Canadian Tire also wants to increase the number of products it sources globally, to maintain product margins, increase sales and “improve the customer value proposition by offering greater product innovation.” The giant hard goods distributor opened its first office in Hong Kong last fall.

The company expects to spend $350-$400 million annually to support its continued expansion and the development of its infrastructure.

Much of the expenditure will be fuelled by inheritances that ageing baby boomers are receiving. The total value of that inheritance money is expected to reach $550 billion nationally over the next 10 years, says a report by Ernst & Young.

According to Statistics Canada, renovation spending in Canada will reach a record $38 billion in 2005, climbing to more than $40 billion in 2006. Nearly 40% of all homeowners plan to undertake some kind of home improvement this year, with a minimum expenditure of $1,000.

The most popular renovation projects, which also provide a solid return on investment, asserts the RE/MAX study, include bathrooms, kitchens, exterior projects such as a new roof, paint, windows, and flooring.

U.S. and Canadian producers have battled over lumber turf since the early 1980s. More than 100 bipartisan members of the U.S. Senate and House of Representatives have called on the Bush administration, over the past four years to end its challenge to Canada, and not impose any export taxes, duties, or quotas on lumber that is essential to the domestic housing market and economy.

Women are more likely to dig in the garden than men, however. Fifty-six percent of women said they like planting flowers, versus 34% of men. Male involvement in the yard and garden was reflected in purchasing intentions: 10% of respondents say they’ll buy a new gas grille this year.

NEW YORK — Tembec, the giant Canadian forest products company, has teamed with environmental organization ForestEthics to identify and protect endangered forests in North America’s largest remaining wilderness, the Canadian boreal forests. The two groups will rely on certification by the Forest Stewardship Council to assure buyers that products are free of social and environmental controversy. Tembec has committed to seeking FSC certification for the forests under its care by the end of 2005. The boreal forest of North America is one of the largest intact forest ecosystems left on earth, with 25% of the earth’s remaining intact, road-less forests. This region supports some of the planet’s largest populations of wildlife, including grizzlies, wolves, woodland caribou and lynx.

FORT WAYNE, Ind. — The dealer-owned buying group Do-it Best, will include a first-time exhibit at its annual spring market that combines the Farm & Ranch and pet supplies categories.The exhibit area will have several components, including an outdoor display area for equipment and related products, as well as suggested planograms for different-sized stores and marketing tips. More than 350 clip strip ideas will be on display, featuring items targeted for sale during the months of January through July.
The co-op stated that dealers can aim this merchandise at several target customers: people who actually own farms and ranches; the “hobby farmer,” whose numbers are growing beyond rural markets; and the 70% of Americans who own at least one pet, and who spend $31 billion annually on pet supplies. The program can fit into 20 ft. or up to 400 ft., depending on the dealer’s needs.
The exhibit will be part of Do-it Best’s spring convention, to be held at the May 14 through May 17 at the Indiana Convention Center in Indianapolis.

NEW YORK — Sherwin-Williams had earnings of US$83.3 million for the first quarter, up 62% from US$51.5 million during the same quarter a year earlier. 1Q sales rose to US$1.54 billion, from US$1.32 billion in the same period a year earlier. Sales were up 17% to US$1.54 billion, from US$1.32 billion. Revenue was driven, says the company, by architectural paint sales to contractors and DIYers, but adds that consumer sales growth was weak.

MONTREAL — Hart Stores Inc., the chain of mid-sized department stores, recorded net earnings of $5.1 million for the fiscal year ended January 29, 2005, down from $5.4 million a year earlier. Total revenues for the period increased to a record $133.8 million, from $127.8 million. Subsequent to the fiscal year end, Hart Stores opened three new stores, including a 40,000-sq.ft. outlet in Whitby, Ont., the company’s third store in Ontario and its first in the Greater Toronto Area. Hart Stores Inc. operates a network of 67 mid-sized department stores under the Hart, Bargain Giant and Géant des Aubaines banners.

BRENTWOOD, TN — Tractor Supply Co., the largest retail farm and ranch store chain in the United States, enjoyed first-quarter net sales of US$377.2 million, a 14.1% increase over US$330.6 million last year. Same-store sales increased 4.2% versus last year’s 12.4% gain. Gross profit increased 13.0% to US$112.1 million and gross margin was 29.7%, compared with 30.0% for the comparable quarter in 2004. Net income for the quarter was US$0.7 million, down from $3.4 million for the same quarter in 2004. Tractor Supply opened 13 new stores and relocated another two during the quarter.

GLENVIEW, IL — Illinois Tool Works Inc. has posted a 7.6% increase in quarterly profit, thanks in part to acquisitions and strong demand in its North American specialty systems business. The company, whose products range from fasteners and beverage holders to food service equipment and countertop materials, earned $312.3 million, up from US$290.2 million in the same period a year earlier. Sales were up 13% to US$3.07 billion, from US$2.71 billion.

TORONTO — Norbord Inc., one of the world’s largest producers of OSB, particle board and plywood, comes off a first quarter of strong earnings with the announcement that its board of directors has approved a series of capital initiatives to enhance shareholder value and increase the earnings capacity of the company. The four initiatives include payment of a special dividend to common shareholders, redemption of all outstanding preferred shares, continuation of common share repurchases under a normal course issuer bid, and expansion of the company’s North American OSB capacity.

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“Leon’s distribution operations are well positioned to service a strong market in the Greater Toronto Area and for future growth north and east of GTA,” says Paul Vanderberg, president of Winroc. Operation of Leon’s will continue under existing management staff.

Until then, the bannered dealers can expect all the services and support they’ve received in the past, he says. “Our focus right now is keeping those banners healthy and that services received from Sodisco-Howden stay healthy every day.”

Could a strategy for Sodisco-Howden’s bannered dealers include one of CanWel’s own customers? “We wouldn’t rule out any particular strategy at this time,” says Donaldson.

Possible candidates for that help could well include some of CanWel’s existing LBM customers, which include Rona inc. and Home Hardware Stores Ltd. In fact, the very competitiveness of Sodisco-Howden versus organizations such as these has been considered a big hurdle to the success of the Sodisco-Howden acquisition. Off-loading the entire banner side of Sodisco-Howden’s business could well enable CanWel to overcome that hurdle.

Hardlines called TruServ Canada, itself a dealer-owned hardware distributor, to explore this further. “We’re not in conversation with CanWel at all. We anticipate at some point in the future there will be further acquisitions,” says Bill Morrison, president and CEO of TruServ Canada. “If there’s any appropriate way to support their banners, we’d love to sit down with them. TruServ’s mission is to support independents in the marketplace.”

Even though the Sodisco-Howden offices in Montreal have been downsized (much of that was executive positions, MIS people and members of the marketing team), operations remains firmly in place. “Serge [Tremblay], Sodisco-Howden’s new vp merchandising and marketing, wants to bring a lot of focus to programs such as flyers, catalogues, electronic information, and new product selection and introduction.”

Even news that CanWel is seeking to transform itself into an income trust will not affect the various business units – including the Sodisco-Howden customers themselves. “What they’ll see is a better quality product delivered on time. That’s what it’s all about for Serge’s group.”

The income trust initiative is a way for the company to generate a higher return to its shareholders. Simply put, the trust can’t be taxed federally. The entire profits are returned to the shareholders, who in turn pay the tax themselves. The company was also considered under-represented on the market, so a second share offering was floated last week. The money raised from that offering will be used to pay down debt and for possible future acquisitions.

The latest announcement comes out just as Rona finalizes its acquisition of Totem, a 16-outlet chain that dominates the retail home improvement business in Alberta. That chain was sold off by its owner, Jim Thorogood, for a cool $100 million, adding fiscal 2004 topline sales to Rona’s war chest of about $260 million. The results from operation of Totem will be consolidated into Rona’s financial results as of the beginning of the company’s second quarter.

Since the beginning of 2005, Rona has added 14 affiliated stores – seven in Western Canada, four in Ontario, and three in Quebec – totalling additional retail sales of $101 million.

*Menard’s and Sears numbers are estimates. Sears’ figures represent Sears Hardware and Orchard Supply Hardware operations, but not hardware sales from the company’s full-line department stores, which total an estimated US$8.5 billion.

**Includes US$753 million in revenue from BMC Construction, which provides turnkey installation to builders.

About 90 Sears Hardware and 6 Orchard Supply Hardware stores are also stocking appliances.

Dealers from Newfoundland are an important part of the show’s attendance – and represent some major buying influences, such as Chester Dawe and Notre Dame Agencies. In fact, 35-40% of the bookings placed at the show came from Newfoundland, says Sherwood. “We really rely on the Newfies to bring us through,” he admits.

They built their businesses by the force of their personalities, independence and unique merchandising philosophies. Many, of course, kept changing and modernizing as needed over the years, but most continued to build their business by emphasizing their own individuality, with a heavy emphasis on personal service.

For the past few years, Ace has been encouraging its dealers to open new stores by offering up to US$215,000 in merchandise credits to fill a new store and present its vision of the proper merchandise mix, store layout, computer systems, pricing and employee training. This was the heart of its Vision 21 modernization program inaugurated several years ago.

CLEVELAND – Sales by Sherwin Williams for the quarter grew by 17% to US$219 million. Based on strong results, the company has raised its full-year earnings view and expects fiscal 2005 earnings at US$3.10 to US$3.20 a share, up from its prior outlook of US$3 to US$3.10 a share. In February, Sherwin-Williams announced it expected sales to grow in the low-double-digit percentage range.

MOORESVILLE, N.C. – Lowe’s Cos., the second largest home improvement retailer in the world, has signed with the Charlotte Bobcats, at the same time terminating its relationship with the Carolina Panthers, a deal formerly worth US$1.5 million annually for the Panthers. The Bobcats had originally been in negotiations with Lowe’s rival, Home Depot. The new partnership will be worth from US$1.5-US$2 million a year.

BEIJING – Anti-pyramid selling laws have been relaxed in China, allowing Avon to set up its direct sales operations there. Avon’s entry into the market is considered a test by the Chinese government to determine a suitable direct selling model suitable for the nation’s growing ranks of consumers.

ATLANTA – The value of Black & Decker shares went up 9% last week on news that the power tool maker has raised its earnings forecasts for the first quarter and full year. Strong sales of power tools, especially in North America, are driving the optimism.
The company was given a further leg up by savings from its acquisition last year of the power tool division of Pentair Inc., and the purchase, in 2003, of Baldwin Hardware and Weiser Lock.

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Adding new stores or enhancing existing operations will be a key driver of the effort to increase sales and revenues. From the retail side, here’s what to watch for: up to 285 new and replacement stores planned across all of Canadian Tire’s retail businesses (which includes PartSource and Mark’s Work Wearhouse). This growth will include 100 points of sale for the Canadian Tire banner, most of which will feature the new Concept 20/20 format, including 76 replacement stores and expansion of 24 existing stores. Another 175 existing Canadian Tire stores will be retrofitted to the Concept 20/20 format. Canadian Tire Retail’s incremental store count will increase by 24, from the current 457 to 481 by the end of 2009.

In addition, the PartSource auto chain is slated to nearly triple in size to approximately 130 stores by the end of 2009.

“As we look at the goals that we have set for the next five years, we believe there are further opportunities to unlock value from our existing businesses. We have a strong balance sheet, a unique and successful mix of businesses, and a team that is completely focused on implementing our plans to deliver long-term value for both our customers and our shareholders,” said Wayne Sales, president and CEO.

While Federated Co-op’s 100 home centre dealers proved to be a loyal lot after the strike ended, Leonzio says the experience provided an important boost to TruServ’s awareness of its True Value banner among those dealers. As for the SAAN stores, he says, “We will wait and see until they restructure the company. But the closure of those stores leaves a definite void that can be filled by our V&S banner in those markets.”

The signing of Buckerfield’s, a six-store farm, feed and equipment chain in British Columbia, to the Country Depot program gives TruServ a presence in that province for the first time. The deal comes just as TruServ is about to open its first ground-up Country Depot in Western Canada next month in Okotoks, Alta.

Finally, at the wholesale level, hardware supply agreements with buying groups such as Castle, Torbsa and Sexton Group are resulting in many of the dealer members from those organizations choosing to add the True Value banner. Sexton has been especially responsive, says Leonzio. “We’ve signed 15-20 dealers from the Sexton Group in the last year, and one from Castle.”

The first promotion involves a two-for-one offer on compact fluorescent lighting that will be inserted in the monthly statement of Toronto Hydro customers, starting this month. The coupons are redeemable at any of Home Depot’s 12 stores in Toronto.

Home Depot will also provide energy saving programs through its commercial division, Home Depot Supply, and through its newly acquired commercial lighting division, Litemor.

“Working closely with Toronto Hydro, we’ll help Torontonians reduce their energy bills by making their homes as energy efficient as possible,” said Annette Verschuren, president of Home Depot Canada, in a prepared release. “The goal of our programming goes beyond offering free product. We’re aiming to change the mindset in which Toronto residents consider energy efficiency products and help create a more energy-savvy society.”

Home Depot plans to include other products in its promotions with Toronto Hydro in the coming months, including an appliance program that involves room air conditioners, another compact fluorescent light promotion, and seasonal LED lights at Christmas time.

For the month of March, the seasonally adjusted annual rate of urban starts rose 0.4% to 190,100 units. A 2.2% increase in multiples starts was partially offset by a 1.5% decline in singles to 93,100 seasonally adjusted.

In March, new construction activity was strongest in Western Canada. The seasonally adjusted annual rate of urban starts in British Columbia and the Prairies rose 11.3% and 9.7%, respectively. Housing starts in March fell 10.6% from February in the Atlantic region, 8.7% in Quebec, and 2.2% in Ontario.

Rural starts in March were estimated at a seasonally adjusted annual rate of 28,400 units.

In Atlanta, Home Depot is suing Dale Hunt, the former executive vp-business development for its Georgia Lighting division, who in February opened his own specialty lighting operation, Masterpiece Lighting. Home Depot’s suit claims that Hunt and other former employees of its Georgia Lighting unit, which Home Depot closed last winter, lifted trade secrets. The retailer has also sought a temporary restraining order that would close Hunt’s operation.

Masterpiece Lighting is currently taking special orders, and its showroom is scheduled to open in June. At one point, Hunt offered to buy back Georgia Lighting (where he worked before it was acquired by Home Depot in 1999), but Home Depot decided to fold that operation into its Expo Design Centers division. That’s when Hunt decided to go out on his own.

The lawsuit, according to the Atlanta Journal-Constitution, says Hunt quit Home Depot after refusing to sign a non-compete agreement as part of his severance package. Hunt also forfeited stock options when he quit. However, he maintains he didn’t steal anything form the warehouse giant.

Home Depot declined to comment about either case.

TORONTO – Not to be outdone by the likes of Rona and Home Depot, which have closely allied themselves with home décor shows – and even Donald Trump’s TV ventures – Ikea has launched a show of its own. In what it calls “a bold and innovative move,” Ikea Canada is launching “Space for Living,” a 13-episode design series that will air weekly on HGTV Canada. The half-hour program premiered last Friday at 7:30 p.m. EST and combines travel, home décor, art, design and lifestyle.

QUESNEL, B.C. – West Fraser Timber Co. Ltd. today announced it will spend approximately $105 million to construct a new sawmill and significantly expand its administrative office here. Now in its 50th year of operation, this latest capital investment will involve a new three-line mill to replace an existing sawmill. The new mill’s annual capacity will be 500 million board feet. Construction will start in late April 2005, with production expected to begin in the summer of 2006.

RALEIGH, N.C. — Stock Building Supply, the largest pro dealer in North America, has acquired Davidson Industries, a two-yard operation based in Franklin, Ind., that generated US$65.5 million in revenue last year. Davidson’s operations, which include one of the larger roof and floor truss plants of any independent dealer in the U.S., fit the profile of Stock’s network of yards that primarily serve homebuilders and large contractors.

HOFFMAN ESTATES, Ill. – Sears Holdings Corp. has announced the layoff of at least 500 workers at its headquarters here. Sears Holdings was created when Kmart Holding Corp. bought up Sears Roebuck, creating the third-biggest retailer in the U.S.

ATLANTA – Joseph Galli Jr., the energetic and controversial president and CEO of Newell Rubbermaid, saw his compensation almost double last year, as his salary and bonus reached $2.7 million. That’s up from $1.4 million in 2003. The package included $338,798 in other compensation, including $204,332 for personal use of company transportation, according to a proxy statement. He also got almost $1.3 million worth of restricted stock, a form of incentive pay.

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“We need a partnership with a strong national player, especially in light of consolidation in the industry,” says John Morrissey, vice-president marketing and product development.

At the top of the list will be a proposal from Tim-BR-Marts Ltd., the Western buying group with whom AWARD shares membership within the umbrella buying group Matreco. They also share the TIM-BR Mart brand.

Morrissey admits it’s an obvious contender. “We have a longstanding relationship with Tim-BR-Marts, and we’ve spent a lot of time, blood and sweat to grow the TIM-BR Mart brand in Atlantic Canada.” In fact, while Tim-BR-Marts had always been a group designation, the creation of a cohesive TIM-BR Mart banner for dealers was developed in Atlantic Canada, by AWARD’s agency, Image Design.

Tim Urquhart, general manager of Calgary-based Tim-BR-Marts, is optimistic about working more closely with AWARD. Late last year, he spearheaded the merger of Homecare/TIM-BR Mart Ontario into the Western group. “I would hope that our proposal will be strongly considered,” he says. “We are an independent buying group for independent dealers, rather than a corporate operation – and we share a name. We think we have all the pieces to offer them, to help them to be part of a larger organization.”

But other hardlines distributors will likely line up to make their pitch, as well. Another outcome of the fateful meeting in March was a decision to close the distribution business initiated by AWARD late last year. That business, funded by the AWARD dealers themselves, was a partnership with Groupe BMR, the Quebec-based buying group and wholesale distributor – and another Matreco member.

However, one offer is decidedly corporate. Will the Rona proposal be reconsidered? “We’re not excluding anything,” says Morrissey at AWARD. The outcome of the last meeting was to evaluate the future “with a clean slate,” he adds.

The latest moves by Loblaw anticipate the company’s reorganization of its head offices. The general merchandise buying teams are being relocated from Calgary to new offices in Brampton, just west of Toronto. The head offices in mid-town Toronto are also being relocated. “We’re still on track for fall of this year for the new head office,” says Wilson.

Thorsteinson has been with UFA for three years. During his tenure the Farm Supply Division experienced double-digit growth each year, despite the impact of prolonged drought and the devastation created by mad cow disease. In addition, he oversaw the development of the company’s new flagship Regional Centres. This retail concept, initiated Red Deer and Camrose, offers a larger footprint than a typical UFA store, and is designed to be a destination shop for a wider range of customers. Thorsteinson also introduced a number of initiatives to strengthen the organization’s value proposition, service offering and brand throughout rural Alberta.

UFA has 34 farm and ranch supply stores, 115 cardlock and bulk fuel petroleum outlets, employs 1,100 and has more than 110,000 members in Alberta.

Home Depot and Scotts Co., the dealer’s largest supplier in sales volume, are planning a co-branded TV campaign that features Atlanta Braves’ pitcher John Smoltz. In April, Home Depot also plans to distribute through its nearly 1,900 stores the “2005 Major League Baseball Official Fan Guide,” which includes schedules for all 30 pro teams.

John Costello, Home Depot’s executive vp-merchandising and marketing, said that this marketing campaign could incorporate other vendors’ products, such as Weber grills, Toro outdoor power equipment and Husky tools.

The retailer also has local club sponsorship agreements with the Braves, Red Sox, Cincinnati Reds, Seattle Mariners, Los Angeles Angels, and San Diego Padres.

As for the number of recalls hitting the news, he does not consider it such a major concern, given the sheer volume and range of product coming over. “Quality control should be a small issue for products coming out of China.”

Admittedly, he adds, there was a time when importing any products carried with it the tarnish of lower quality, “but it’s all in how you spec.”

The savings derived from obtaining products in China can be up to 30-40%. With that kind of return, says Mahurin, the co-op can afford to re-invest 10-20% back into the quality of the product, to ensure differentiation and product quality.

Besides sourcing better, True Value is moving product to its dealers more efficiently. At the same show, member dealers were informed that the company’s fill rates improved by one percentage point. Year to date in 2005, those fill rates are at 97% – and as high as 98% on A items.

Annual revenue totaled $2.024 billion in 2004, generating net income of $43.2 million, more than double last year’s profit. At the same time, True Value continued to reduce debt, ending the year with $170.3 million in total debt, a reduction of 11.4% from the end of 2003. During 2004, 355 members left the co-op. That was offset in part by the recruitment of 202 new members.

The two facilities will feed merchandise to hundreds of Depot’s stores in the South. Home Depot currently operates 12 import DCs.

TORONTO — Sears Canada Inc. has announced a change in ownership of its controlling shareholder following the recent merger of parent company Sears, Roebuck and Co. and Kmart Holding Corp., which formed Sears Holdings Corp. Sears, Roebuck, the owner of approximately 54.3% of the issued and outstanding shares of Sears Canada, is now a wholly-owned subsidiary of Sears Holdings. The Sears-Kmart merger was completed on March 24, 2005, resulting in the third-largest retailer in the United States, with approximately US$55 billion in annual revenues and nearly 3,500 retail stores, including 2,350 full-line and off-mall stores, and 1,100 specialty retail stores. Sears Canada has 122 full-line department stores, 218 off-mall stores, 64 home improvement showrooms.

MONTREAL — Richelieu Hardware posted 1Q consolidated sales of $76.1 million, up 17.6% from the equivalent period in 2004. Last year’s acquisition in the U.S. of Allied Hardware and Allied Casework Supply accounted for 6.9% of the increase. Richelieu’s Canadian business, which represented 94.8% of first-quarter consolidated sales at $72.1 million, was up from $61.0 million a year earlier. Total sales in Canada increased by 10.9% to $67.4 million or 88.6% of consolidated sales, compared with $60.8 million or 93.9% of total sales for the same period in 2004. All three major Canadian geographic markets made a solid contribution to this growth, with a stronger performance in Western and Eastern Canada. Sales in the United States totaled $8.7 million, up 120.5% over $3.9 million for the first quarter of 2004. Earnings before income taxes, interest, depreciation, amortization (EBITDA) totaled $8.3 million, up 15.9%.

ST. LOUIS — Huttig Building Products, one of America’s largest millwork distributors, opened its first distribution center in Minnesota last week. The 73,000-sq.ft. facility includes pre-hung interior and exterior door assembly lines, and is stocking a variety of interior and exterior door options as well as mouldings, columns and stairway systems. The DC, Huttig’s 45th in 47 states, supplies pro dealers and homebuilders within a 150-mile radius of Minneapolis.

OAK BROOK, Ill. — Ace Hardware Corp. is now offering “designer” clothing on its website, www.acehardware.com. Carhartt, the maker of rugged outdoor and workwear, will be represented on the site with a full range of coats, jackets, shorts, overalls, vests and jeans. Some Ace stores already carry the Carhartt brand in their stores.

Wal-Mart will move its Asian headquarters from Hong Kong to Shenzhen, China next year. The move is expected to be completed by August, 2006. It’s the location of Wal-Mart’s partner in China, Shenzhen International Investment Commercial Property Com.

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This year, we’re proud to add the buying perspective of one of the country’s fastest growing privately held chains: TSC Stores, based in London, Ont. Bill Wilson, merchandise director for TSC, will be on hand, accompanied by David Nisbet, president of Mutual Hardware Inc., the hardware buying group of which TSC is a member.

Depot’s annual shareholders meeting will be held at 10 a.m. on May 26 at The Philharmonic Center for the Arts in Naples, Fla., when shareholders will vote on a number of proposals, including a new omnibus stock incentive plan.

MINNEAPOLIS, Minn. — Bernco Inc., a building materials distributor based here, has been acquired by Lanoga Corp., one of the country’s largest pro dealers, based in Washington. Bernco will become a part of the Lanoga’s United Building Centers division. Over its 44-year history, Bernco has grown to become a major regional supplier of windows, doors, and related millwork products, as well as an array of value-added services, including pre-finishing and custom, pre-hung door fabrication. Lanoga is a $2.75 billion provider of building supplies that primarily serves the upper Midwest and western portions of the U.S. through five divisions.

SOUTH PLAINFIELD, N.J. — The fast-growing pro dealer The Strober Organization is scheduled to move into new corporate headquarters here next month. But that’s not the only change this 93-year-old company, which had been based in Brooklyn, N.Y., is making throughout its expanding operations. The pro dealer has begun changing the names of its 91 retail locations in 15 eastern states to Strober Building Supply, a process that is expected to be completed by the end of this year. Many of those yards have been operating under the banners that preceded their companies being acquired by Strober over the past several years.

CLIFTON, N.J. — Jeep, the brand best known for its rugged automobiles, will have its name attached to the launch of a number of home improvement products at the upcoming National Hardware Show, being held May 16-18 in Las Vegas. The launch will include a 12-volt impact wrench and a 9-volt cordless driver, plus an LED flashlight and emergency flasher and utility light. The products have been developed by DuraPRO, based in Torrington, CT, a producer of hand and power tools. Jeep has already licensed a number of other home products, including mountain bikes, electronics and even wheelbarrows. The company expects to increase its tool offerings through the coming year.

RICHMOND HILL, Ont. — Beginning April 1, Black and Decker Canada will launch a fund-raising promotion for cancer research during “Daffodil Month.” The program, called “Charged Up to Make Cancer History,” has B&D donating $5 to the Canadian Cancer Society for every cordless Black and Decker item sold to a maximum of $50,000. This campaign is part of a year-round relationship between the Canadian Cancer Society and Black & Decker.

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“Consumer intentions across the six major markets remain positive, with more than one in ten households thinking about buying a home this year,” said Bertrand Recher, senior economist at CMHC. However, intentions to buy are down slightly from 2002, when 14% of households stated their intention to buy, and down again from 2003, when the level was at 15%.

“This year, the intentions are consistent with continued high levels of housing starts and sales of existing homes,” Recher points out. “Favourable economic conditions, such as low mortgage rates and a tight labour market, are contributing factors to the positive intentions.”

Home buying intentions are strongest in Calgary, Vancouver and Toronto. In Calgary and Vancouver, 15% of households reported that they intend to purchase a home, while in Toronto the share was 13%. Purchase intentions are slightly lower in Ottawa (12%), Halifax (11%), and Montreal (9%).

Home renovations will also remain especially strong this year, the study indicates. Fully 39% of all homeowners are considering undertaking renovations this year, up from 2003, when 37% of homeowners considered renovating.

Renovation intentions are the strongest in Halifax and Ottawa, where 45% and 44% of consumers, respectively, indicated an intention to renovate this year. Intentions to renovate are also high in Calgary and Montreal, where in both cases 40% of households indicated an intention to renovate this year. Renovation intentions are slightly lower in Vancouver (39%) and Toronto (38%).

The WestCoast 2005 trade show had 242 booths and 155 exhibitors. The 2006 show is expected to be even bigger, giving retailers a greater selection of vendors to see under one roof. For more information, contact Diane McConnell, BSDA member services co-ordinator, at 604-513-2205, toll free 888-711-5656; diane@bsdabc.com.

In fact, another study, by the Quebec association for building materials dealers, ADMACQ, revealed recently that fully 51% of Quebec households admitted to having done some kind of renovation work in their homes during 2004 — and 89% of those respondents said they did the work themselves.

The report, “Les Quebecois et la renovation,” features the results of a poll of 3,700 Quebec households that queries them on their renovation spending intentions for building materials. For more info, or to purchase the full report, contact Donald O’Hara at info@admacq.qc.ca or 450-646-5842.

WASHINGTON – After being investigated for employing illegal immigrants, primarily as contract cleaning staff, Wal-Mart will escape criminal sanctions, but has agreed to pay $11 million, in response to a long-running federal investigation that had resulted in 245 arrests of undocumented workers by Immigration and Customs Enforcement agents and federal prosecutors in Pennsylvania. Some individuals who were involved in hiring the illegal contractors have reportedly agreed to plead guilty to federal violations.

NEW YORK – A report that appeared in Women’s Wear Daily last week indicates Sears is trying to sell its Land’s End catalogue division. The move is regarded as a way for Sears to raise cash following its merger with Kmart late last year. Sears wouldn’t comment on the rumor.

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Messe Frankfurt’s key partner in the first H²X/D²X show, which replaced the failed Canadian Hardware and Building Materials Show, is the Paint and Decorating Retailers Association. McKinnon is not even sure of that organization’s future involvement. PDRA includes a strong educational component to its side of the proceedings, and may want to do their own educational program, McKinnon adds.

Kathy Witmeyer, director of membership, education and trade shows at PDRA, confirms that her organization’s involvement with the Canadian show has yet to be confirmed. “We have our board meeting in May to discuss it,” she says. “Right now, everything is up in the air.”

McKinnon says the vertical format of the show, which brings in a variety of related sectors in hardware, décor, wallcoverings and flooring, has been a successful one with its other shows, especially in Europe. But here, he’s facing some challenges. “It’s hard to please all the stakeholders.” But he believes it’s a strong format, nonetheless. “There’s value in having a very vertical platform for a broad range of buyers,” he notes.

Some things that won’t change, however, include Sodisco-Howden’s involvement in the Spancan buying group, wherein Sodisco-Howden acts as the warehouse and hardlines supplier for the Independent Lumber Dealers Co-operative. He also expects the procurement function, which was centralized into Montreal under former CEO Jos Wintermans, to remain there. But more decision-making will likely return to the regional offices, namely London, Ont., and Victoriaville, Que.

In February, the seasonally adjusted annual rate of urban starts increased in four of the five regions across Canada, compared with the previous month. The largest increases were in the Prairies and in British Columbia, where starts in February rose 13.4% and 12.2% respectively. Starts in February also increased compared to January in the Atlantic region (8.4%) and in Ontario (5.5%), but fell 1.8% in Quebec.

Rural starts in February were estimated at a seasonally adjusted annual rate of 28,400 units.

A new addition to the event is the Industry Hall of Fame Dinner. This year’s vendor inductee is Bill Caldwell, founder of the toilet seat company, Moldex (“Born in Barrie, raised everywhere!”). The retail inductee is Jim Thorogood, who recently concluded more than 40 years in the retail building supply industry with the sale to Rona of Totem Building Supplies.

For more information on the AGM, contact: 416-282-0022; www.chhma.ca.

CHARLOTTETOWN — The first Sears department store on Prince Edward Island opens on St. Patrick’s Day. It also represents the first example in Canada of the retailer’s free-standing off-mall format.

TROY, Mich. — Frank’s Nursery & Crafts Inc. has filed a proposed plan of reorganization in the Bankruptcy Court for the Southern District of New York. The filing follows the company’s entry into Chapter 11 bankruptcy protection in September 2004. The retailer has recently completed going-out-of-business sales to wind down its operations. It has also sold or rejected substantially all of its leasehold interests. The bankruptcy reorganization involves Frank’s retaining about 40 properties, which will be developed by the reorganized company.

ST. JOHN’S — Sears Canada will open a new 143,000 sq.ft. Sears department store in the Avalon Mall in St. John’s, Nfld., this fall. The current Sears store located in the Village Mall, just a short distance away, will remain open in the near term.

BOUCHERVILLE — I know, I know. You wish you’d bought the stock too. Rona’s board of directors have approved a two-for-one split of the company’s common shares, subject to the usual regulatory approvals. The split will go into effect March 22, 2005, and the shares will begin trading on a post-split basis as of March 18, 2005. The shares closed at $48.50 on March 10, the day the split was announced. They opened on the Toronto Stock Exchange in December 2003. The board also adopted a shareholders’ rights plan to prepare against any unsolicited takeover bids targeting the company. Designed to give the board of directors enough time to evaluate unsolicited offers, the plan will allow alternative strategies to be implemented in order to maximize value for shareholders and ensure fair treatment of shareholders while giving everyone the opportunity to take advantage of potential purchase offers. The company stresses that the plan was not adopted in reaction to a specific acquisition proposal.

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“Yes, we had presented a case for AWARD to join Tim-BR-Marts,” Urquhart says. “But I don’t know how persuasively that argument might have been put forth.”

Finally, AWARD members reportedly voted to close AWARD Distribution Ltd., a regional distribution centre created to supply the AWARD membership in Atlantic Canada. That facility, financed by the dealers themselves, was allied with, and supplied by, Le Groupe BMR, a wholesale buying group (and Matreco member) with distribution in Longueuil, Que.

While Morrissey would offer no comment on the status of ADL, he did express his optimism about the other issues decided that day. “I think the decision that the membership made was not only a positive step today, but is going to make this group extremely strong in the future.”

To enter your store, or a store from your group, in this year’s Outstanding Retailer Awards, contact Rob Gerlsbeck, Editor of Hardware Merchandising, at rob.gerlsbeck@rci.rogers.com, or 416-764-1662.

For more info on the industry’s top forum for retail and vendor leaders, contact Beverly Allen, Director of Sales & Marketing at HARDLINES: 416-489-3396 or bev@hardlines.ca!

TORONTO — Canadian Tire has teamed up with Sobeys, Starbuck’s and a restaurant chain called Richtree to offer a one-stop convenience retail destination. Called “Q,” the two pilot sites — in Windsor and Milton, Ont. — feature 10 “spacious fuelling stations” in front of a coffee shop, a 4,000-sq.ft. “Sobeys Express” grocery store, and the restaurant.

The final piece to the Q puzzle is a 1,000-sq.ft. Richtree Market Restaurant. Better known for the Moevenpick Marché concept, Richtree will offer a similar presentation that features meals and food items prepared from scratch in full view of the customer.

More than 500 exhibitors filled two floors of one building at the Messe fairgrounds in Cologne, and by Sunday afternoon of day one of the show, the aisles were filled. Many were buyers, from Germany mainly, but also from throughout Western Europe. Although the show was intended to represent suppliers of lawn and garden products — and there were a number of outdoor power equipment, garden tool and patio furniture suppliers — the show was predominantly a hardware show.

However, show organizers don’t want to stop there. Hans Kampen of Koelnmesse wants to see a full range of hardlines, including giftwares and housewares, eventually represented at Asia-Pacific Sourcing. He also hopes to see more North Americans, besides the contingent of eight people from Home Depot that reportedly came this year. Given the crowds walking the inaugural event, his expectations may likely bear fruit.

Companies from countries such as China, Taiwan, Japan and India were keen to meet — and supply — Western customers. They certainly have the capacity, which, by Western standards, is prodigious. For example, Top Electric, a power-tool maker based in Hong Kong, has 1,000 people working in a factory that covers 300,000 sq. meters of space. JK Files & Tools, based in Bombay, has five factories — four in India and one in Indonesia — employing almost 2,500 people. Harshel Jayavant, president of JK, says the show has been a “successful experiment,” and he expects his company to be back in two years. Before that, JK will exhibit at the National Hardware Show in Las Vegas (May 16-18) and again in Cologne for the big Practical World show next year.

“India has all the ingredients of a manufacturing powerhouse,” Jayavant says. “It’s not just because of the cheap labour. We have a skilled workforce — and we have the engineers to drive quality.” He notes that his company was first Indian tool manufacturer to receive ISO certification, back in 1984.

Some of the companies exhibiting here have been in business, like JK, for decades. However, one is brand new, having started only last August. Bennett Chen, of Prime Supply in Taiwan, had yet to speak with a key buyer by half-way through the second day, but his optimism was undeterred. He was eager to explain to anyone who would listen, in either German or English, about a new cutting tool for rubber and plastic hose. Unlike other tools, which, he demonstrated, used a scissor-action to cut through the material, his blade comes straight on in a sliding action, to make the cut. It’s reminiscent of an oversized cigar cutter.

But not everybody walking the show was a potential buyer. Some were European competitors, checking out the competition. I spoke with one gentleman who was scrutinizing a couple of patio chairs. I asked him what he thought. “They are not good,” he said.

His name is Peter, and it turns out he is from the largest maker of garden furniture in Germany. He itemizes for me the weaknesses in the chair’s construction, which include inferior welds and a strut along the back of the chair that wobbles. “Look here,” he says, pointing to the bolts holding the chair, which is designed to rock slightly, to its fixed base. “In America, where people are heavier, these chairs will not last. See where they use two bolts? We use three.”

He believes Asia-Pacific Sourcing has potential as it grows, but he looks forward to finding more representation from lawn and garden suppliers in years to come.

BROKEN ARROW, Okla. — Hope Lumber & Supply, based here, the industry’s 21^st-largest home improvement dealer, acquired Leeds Building Products, a Kennesaw, Ga.-based pro dealer with 10 yards in Georgia, South Carolina and Florida. Those yards, combined with seven former Wickes Lumber yards and six Atlanta-area Leeds yards that Hope had purchased over the past two years, will comprise Hope’s new Eastern division. The acquisition increases Hope’s yard count to 52.

ST. PETERSBURG, Fla. — Roper Brothers Ltd., a five-yard chain headquartered here, acquired certain assets of Valley Lumber & Building Materials, which operates a single yard in Winchester, Va. Valley Lumber’s management, including owners Steve and Teresa Cluss, will stay on to run the business as a division of Roper Brothers. In a prepared statement, Roper Brothers said the combined entity creates a company whose sales exceeded $120 million.

TORONTO — Hudson’s Bay Co., second-oldest company in the world, has secured a lucrative eight-year deal to outfit Canada’s Olympic teams, beginning with the 2010 Vancouver Games. Roots, which has had the contract with the Canadian teams since the 1998 games in Nagano, Japan, didn’t get a chance to bid. Hbc has the contract for the 2006, 2008, 2010 and 2012 Games, and will outfit volunteers at the Vancouver Games in 2010.

OAK BROOK, Ill. — Ace Hardware Corp. has announced plans to build a regional distribution centre in Moxee, Wash., just 10 miles from its existing distribution facility in Yakima. Sitting on 74 acres, the new 788,000-sq.ft. retail support center is expandable to 1.2 million sq.ft. as needed. It will replace a 506,500-sq.ft. facility that has been open since 1984, but has been operating at maximum capacity for some time.

Although retail inflation remains non-existent, a large majority of the respondents expect their margins will improve or stay the same, thanks to the emergence of China as a major source of consumer products, coupled with continuing productivity improvements within the supply chain and in retail operations.

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