One of Sodisco-Howden’s key customers remains Tim-BR-Marts Ltd. in Western Canada.

“Our dealers are much happier now with how product is getting into their stores,” Urquhart says. And, he notes, there’s less concern surrounding the future of Sodisco-Howden. “The dealers’ only complaint is over out-of-stocks, but the fill rates have improved dramatically over the past year.”

However, even as Tim-BR-Marts strengthens ties with Sodisco-Howden, its affiliated groups, TIM-BR Mart Ontario, Quebec Groupe BMR and, in Atlantic Canada, AWARD, have established their own distribution network, QMH. AWARD Distribution Ltd. was set up by AWARD, in partnership with BMR under the QMH distribution deal, as an alternative source of supply for AWARD dealers. However, according to Wintermans, Sodisco-Howden’s year-to-date shipments to AWARD dealers are up, and any notion that ADL would replace Sodisco-Howden outright is premature, he suggests, adding that Sodisco-Howden maintains a strong relationship with the AWARD members and that both sides “are talking.”

The reason for that relationship, Wintermans says, is “service related.”

Meanwhile, QMH is shipping hardlines to TIM-BR Mart Ontario on a regular basis. According to Don Nash, QMH is the preferred hardware supplier, “the horse we’re backing,” at TIM-BR Mart Ontario. QMH is now shipping almost $1 million per month in product to Ontario, he notes.

Down east, ADL offers a limited selection of about 6,000 SKUs, versus some 55,000 from Sodisco-Howden, and the mix in the ADL warehouse is reportedly skewed to builders’ hardware.

“It’s in the dealers’ best interest for AWARD and Sodisco-Howden Group to have a strong relationship,” Wintermans concludes.

“As far as I’m concerned, Sodisco-Howden has turned the corner,” Urquhart says.

However, the company still faces some hurdles, including confusion and disgruntlement from some dealers, and an outstanding lawsuit . According to Barbara Wagner, TruServ’s treasurer, the “Kennedy Action,” which involves about 38 former dealers, is still pending and deals partially with stock redemption issues.

That stock redemption, which totals about $36 million, will be paid out to approximately 3,100 former dealers. Payments will be made in instalment notes representing five annual payments. These commence December 31, 2004, effectively making the term of the notes being issued 4.5 years, says Wagner.

Because the TruServ stock is not traded, a dealer can only cash out upon quitting the co-op — or in certain instances when closing one of a group of stores. However, dealers will face a loss on the value of the stock, and that value can only be determined upon leaving.

But the economy on the island has been relatively strong, and that, combined with high commodity prices, has resulted in two consecutive quarters of healthy increases.

Schurman, which has five stores and estimated sales of $34 million, is currently in negotiations to be taken over by J.D. Irving, which also owns Saint John-based Kent Building Supplies. The deal is expected to close on or around August 9.

Damman’s, once a member of the buying group TruServ Corp., filed for bankruptcy protection on January 12, although its business had been eroding for three years. In 2003, it reported a $1.8 million loss on $37.5 million in sales. During its reorganization period, it closed five stores and sold another two pieces of real estate to raise cash to pay off some of its debt.

It emerges from Chapter 11 with a new $8 million credit line from Boston-based LaSalle Retail Finance. As part of its reorganization plan, Damman’s will now receive its inventory from Ace’s distribution network, as opposed to having products it bought through Ace shipped directly to its stores by manufacturers.

Ownership of the post-bankruptcy Damman’s will not change. The Damman family will retain a 44% stake, with 56% owned by employees through a stock program. The company employs 257 workers.

Eight other defendants had previously pleaded guilty. The son could face five years in jail, and the mother four years. Prosecutors also are calling for the defendants to repay $2 million in cash they garnered from the scheme.

NASHVILLE, Tenn. — Tractor Supply Co., the largest retail farm and ranch store chain in the United States, reported net income for the second quarter of $31.4 million, up from $27.4 million for the same period in 2003. Net sales increased 17.0% to $525.9 million, from $449.4 million. Same-store sales increased 10.0%, versus last year’s 1.2% gain. While gains were strong across all categories, same-store sales were especially strong in equine, animal and pet products. Net income for the first six months of fiscal 2004 was $35.2 million, compared with $27.5 million. Net sales increased 18.4% to $856.5 million and same-store sales increased 10.9%, versus last year’s 2.1% gain. During the first six months, Tractor Supply opened 25 new stores and relocated eight. (Tractor Supply’s chairman, Joe Scarlett, will be one of the featured speakers at our Hardlines Conference Series, September 8-9. Book now—Self-promotional Mike)

TORONTO — In what may be the first example of classical arts funding by a big box company, Home Depot Canada has taken a major sponsorship role in the funding and promotion of a new Shakespearean summer theatre. Called Shakespeare Works, it’s being mounted at the eponymously named Home Depot Theatre. The first season features “Romeo and Juliet.”

TORONTO — Sears Canada’s first free-standing, off-mall department store in Canada will also be the first full-line Sears store for the province of Prince Edward Island. The store will be located in the provincial capital of Charlottetown. It’s scheduled to open in the summer of 2005. Besides a standard array of private and national brand merchandise, the new 108,000-sq.ft. store will offer specialty services, provided to licensees, which include a portrait studio, travel office, hair salon, watch repairs, optical, keys and engraved gifts, greeting cards and alterations. In Prince Edward Island, Sears currently has 16 catalogue merchandise pick-up locations and two dealer stores.

CHICAGO — Grainger, the industrial distributor, reported record sales of $1.3 billion in the second quarter, up 7% versus the prior year’s second quarter. Net earnings were up 19% to $66.6 million, also a new quarterly high. Sales for the six months ended June 30 were $2.5 billion, up 7%. Net earnings increased 19% to $129 million, versus $108 million in 2003.

Sears, Roebuck and Co. is looking for a new president of its retail business, following months of disappointing sales at its namesake department stores and will take the search outside the company. The move comes after the retailer parted ways with Mark Cosby, president of the full-line stores, who left last week “to pursue unspecified opportunities.” His position is being eliminated. The new retail president position is broader than Cosby’s role, and will include responsibility for both the existing department stores and the new Sears Grand stores that the retailer is opening away from its traditional mall base. Sears expects to have about 70 off-mall stores by the end of next year, including 12-14 Sears Grand locations and a new, mid-sized format that was announced with Sears’ planned acquisition of up to 61 Kmart and Wal-Mart stores.

It’s the latest attempt by Home Depot to penetrate more urban, downtown areas. Another “urban” store, on the north shore of Vancouver, is set to open September 30 at the toney Park Royal power centre. That one weighs in at 50,000 sq.ft., plus 25,000 sq.ft. on a mezzanine. A similar, though larger, store will open in Toronto’s east end at Gerrard Square in December 2004, while an “urban” store in downtown Calgary is scheduled to open December 16.

Nick Cowling, PR manager for Home Depot Canada, says the company has gone to great lengths with the “urban” format to ensure that these stores will fit into the neighborhoods they serve. For example, the Park Royal store doesn’t look anything like a traditional Home Depot store, he says. The proposed Kitsilano store would have followed similar guidelines.

Local residents of the upscale Kitsilano neighborhood could not be assuaged, however. Hearings on the issue had to be carried over two nights, after so many retailers and residents came out to voice their opposition. In the end, councillors voted to limit the size of retail stores in the Kitsilano area to 10,000 sq.ft. — much too small for a Home Depot store.

Exceptions to the size rule are grocery stores and pharmacies, which can be up to about 30,000 sq.ft. Cowling points out that both these retail formats carry a lot of hardlines items, too.

Traffic was a big concern for many, although Home Depot did at least two traffic impact studies, says Cowling. In each case, traffic was expected to stay the same or even be reduced as shoppers would be able to cut about 15 minutes off their drive to an existing full-size Home Depot on Terminal Rd.

Home Depot owns the property in question, having paid $22 million for it. It has two tenants, who are in the midst of two-year leases — an IGA grocery store and a liquor store.

Both Chambers and Leete worked with Contractor Yards’ president Ben Phillips when the three worked for Pelican Cos., which merged with Builders FirstSource (then known as Stonegate Resources) in November 1998.

Phillips described Leete as his “sounding board” who will also lend his expertise in marketing and advertising to the company.

Strober, the Brooklyn, N.Y.-based pro dealer that is the 24^th-largest home improvement retailer in the U.S., acquired Contractor Yards from Lowe’s Cos. in November 2003, and completed that acquisition on February 2 of this year. That purchase brought Strober’s equivalent sales in 2003 to more than $860 million from 71 stores. Strober’s CEO, Fred Marino, said the Contractor Yards division would be a springboard for his company’s expansion in the Southeast.

Under Urquhart’s direction, Tim-BR-Mart’s ranks have grown by 11 since the beginning of this year, including the latest addition, TimberTown Building Centre Ltd., which alone represents five locations and an estimated $15 million in sales.

Tim-BR-Marts is also facing some reorganization of its own. By July 24, it will have relocated its head office from the scenic Granville Island location in the heart of Vancouver to Calgary, in a facility right by that city’s airport. Sales and marketing will move there first, while the accounting and IT functions, currently located in Winnipeg, will be brought in later this year.

The company has been battling anti-growth forces in Austin for several years. According to the Daily Texan, the City of Sunset Valley and a group called Save Our Springs Alliance sued Lowe’s in 2003 to try and block this store. The Austin City Council had voted 4-3 last December to exempt this store from certain ordinances so that the construction could proceed.

As Lowe’s gets bigger, its exposure to this kind of opposition has become more pronounced. In California, Lowe’s is awaiting a court ruling on whether it will be allowed to build a store in Colati, where a citizens group — bankrolled by Lowe’s rival Yardbirds — has been trying to block the construction of the 165,000-sq.ft. warehouse home center. In Bethlehem, Pa., a neighborhood group has filed an appeal with Commonwealth Court to stall a $32 million commercial development that would include a Lowe’s, a bank, a restaurant and an apartment complex. On June 7, a judge had denied this group’s case, which contends the city council had improperly rezoned this site. And in Longview, Wash., residents calling themselves Citizens for Better Planning have hired an attorney to fight Lowe’s plan to build a 163,000-sq.ft. store on 12 acres along Ocean Beach Highway.

Residents fear the store will cause traffic congestion on the already busy highway, devalue nearby homes and impinge on Lake Sacagawea Park, roughly a quarter mile away. Lowe’s representatives insist the impacts on the neighborhood would be minimal and challenge the notion that the development will affect the lake. The city’s Planning Commission is not expected to address whether to rezone the land until August.

In Framingham, Mass., Lowe’s plan to demolish Verizon New England‘s former headquarters and put a 156,000-sq.ft. store on that site has run into some snags that relate to zoning waivers Lowe’s has requested that could impact traffic congestion. Assessed at $12.9 million, the 9.5-acre site currently generates about $382,000 in tax revenue for the town.

Kingfisher opened an office earlier this year in Moscow and now Peter Partma has been appointed as country manager for Castorama in Russia. Partma, who is Swedish, joins Kingfisher from Ikea, where he served as country retail manager for Ikea Russia. There, he spent six years in charge of store operations and development.

According to Kingfisher, Russia shares many of the market characteristics which have helped drive success in Poland. The economic fundamentals of the country are positive, with strong GDP growth, even stronger retail market growth, declining inflation and a stable exchange rate.

Although Russia has 13 cities with more than 1 million inhabitants, the prosperity and stability needed to drive retail growth are centered mainly in Moscow. The population is also enjoying high disposable income due to low taxes, utility charges and housing costs. There is an enormous demand for home improvement products due to strong housing growth, while the housing stock has suffered from a lack of investment.

Kingfisher has 568 stores in nine countries in Europe and Asia, as well as a strategic alliance with Hornbach, Germany’s leading DIY warehouse retailer, which operates more than 110 stores in Europe.

SAGUENAY, Que. — A local Wal-Mart store will be the focus of an effort to unionize its workers for the second time in one year. The United Food and Commercial Workers Union has applied to the Quebec Labour Relations Board for the right to represent more than 100 workers at the outlet. An earlier accreditation vote was rejected on April 2 by a margin of eight votes, but additional employees have since signed their union cards, leading organizers to believe a majority vote will be in their favor next time.

SAINT-LAURENT, Que. — Richelieu Hardware Ltd. had sales of $81.3 million for the second quarter, up from $73.5 million for the corresponding period of the previous year. The increase came both from internal growth and acquisitions. Net earnings were $6.8 million, up 15% from $5.9 million for the same period in 2003. The company made two acquisitions in the United States during the quarter — Allied Hardware in New York and Allied Casework Supply based in Georgia and North Carolina.

MEXICO CITY — Three retailers in Mexico have convinced government regulators to approve a plan to institute a joint purchasing company that they hope will strengthen their negotiating power with suppliers. The move is an effort to enable the companies to better compete against Wal-Mart, which entered the country entered Mexico seven years ago. The three other national chains, Controladora Co- mercial Mexicana, Organización Soriana and Grupo Gigante, have formed the joint purchasing company, called Sinergia, to better compete.

CHARLOTTE, N.C. — Weyerhaeuser Co. has agreed to sell 304,000 acres of its timberland — including a popular state wildlife management area — to four companies for $404 million. Weyerhaeuser will hold onto an additional 18,000 acres it owns in Georgia, possibly for real estate development. After the deals are completed, Weyerhaeuser will own or manage about 6.5 million acres throughout the United States.

HOFFMAN ESTATES, IL — Sears, Roebuck and Co. saw total sales for the five weeks ended July 3 fall 4.4% to $2.55 billion. The retailer experienced a 3.1% decline in same-store sales in June, a casualty of unusually cool weather that affected air conditioner sales. Sears also said it expected third-quarter same-store sales to fall slightly from the year-earlier period.

For ex-dealers wishing to cash out, the stock investments will be redeemed on the basis of 25% in cash, with the remainder being released on a deferred stock redemption basis, with the first instalment payable in cash in December 2004. As of May 29, 2004, the deferred stock redemption liability totaled $36 million, of which approximately $8 million is payable in cash and the remainder is payable in the form of the instalment note.

During the period since March 1999, no stock was issued to new members joining the co-op, either. However, earlier in the year, TruServ resumed issuing stock to new members, as well. The resumption of stock issuance to new members followed the Securities and Exchange Commission’s declaration, effective April 30, that TruServ could once again issue its class A stock to new members.

TruServ’s wholesale sales in 2003 reached $2 billion, while sales at retail by all its 6,100 independent members topped an estimated $11 billion.

Paul Hylbert, Lanoga’s president and CEO, told Hardlines that his company — which in early 2003 acquired from Wickes 31 yards and four component plants in Wisconsin and Michigan — has agreed to purchase another 27 Wickes yards and component plants in Illinois, Michigan, Indiana, Ohio and Kentucky. Hylbert said that Bradco is the lead bidder for 12 sites in the Northeastern U.S., and that Hope will purchase another 11 yards in the southern U.S. and in Colorado. Smaller companies are expected to bid on the remaining seven Wickes properties.

The sales are subject to bankruptcy court approval and to an auction, where other interested parties can bid for these properties. If all goes as planned, the bidding process will conclude in late July.

Hylbert pointed out that the liquidation of the 59 yards and plants is expected to fetch at least $129 million, which compares favorably to their aggregate $121 million book value. “That only goes to show that Wickes’ problems were never its locations,” said Hylbert, “but the focus of their management.”

Lanoga is the 10^th-largest home improvement retailer/distributor in the U.S. based on its sales in 2003. Bradco ranked 16^th, and Hope 21^st, on Home Channel News‘ Top 500 listing for that year.

Lowe’s has made a big commitment to smaller concept stores, and up to 40% of the 140 new store openings this year are expected to be smaller sized outlets.

But one retailer is bucking the trend. Canadian Tire Corp. has had some initial, positive results with large stores, and the latest 90,000-sq.ft. outlet in Kingston has been a dramatic success, says Mark Foote, president of Canadian Tire Retail. The stores represent the company’s newest retail format, 20/20, which reduces storage space in favor of more retail space, with added emphasis on products that appeal to the entire family, including women.

In an exclusive interview with Hardlines, Foote revealed his enthusiasm for the larger formats. In fact, he added, another store, weighing in at more than 100,000 sq.ft., is currently being developed. “The bigger stores are definitely working for us,” he says.

At Home Depot, the challenge is to reinvent the stock big box footprint to widen its market penetration. In Canada, Home Depot’s key competitor is Rona, which has mastered operating stores in a variety of formats, from local hardware stores to full-sized big boxes. In the U.S., Home Depot’s attempts to grow its contractor business find it toe-to-toe with a number of strong building center chains, which drive a lot of product out of relatively few square feet of retail space.

“The move to smaller stores is not as aggressive in the U.S., but the company is using smaller stores for fill-in markets,” says Nick Cowling, PR manager at Home Depot’s Canadian division. ” They’ll put them in where they already have a heavy concentration of stores or where there is less population. For example, Home Depot’s been trying to get a store into Martha’s Vineyard, and if it’s going to happen, they’d have to put in smaller store,” says Cowling.

Home Depot in Canada has also begun building smaller versions of the chain’s traditional store, including a 70,000-sq.ft. one in Grande Prairie, Alta., the retailer’s smallest store to date. The previously announced inner city location at Toronto’s Gerrard Square will be an ‘urban” format, the second such store for Canada.

Sears’ spokesman Ted McDougal told Hardlines that this is the first time “in close to a generation” that his company is planning to expand at such an accelerated pace. “We’ve been stuck at 870 [full-line department] stores for more than two decades, but next year alone we’ll open 70 stores and increase our footprint 10%. That’s really unprecedented for us.”

The retailer will take possession of four of the stores it is acquiring this year, 55 next year, and two in 2006. Three of the four Kmarts it brings on board this year will be converted to the company’s Sears Grand format, which includes apparel, home appliances, home electronics, home improvement and home fashions, plus consumables and transactional items, including a pharmacy in certain locations. Sears expects to open a total of seven Grand outlets in 2004, and between 12 and 14 in 2005.

North of the border, Sears Canada Inc. is developing an off-mall strategy of its own. These outlets will be specialty stores that focus on home décor and accessories. Six locations have been announced so far, all in Southern Ontario. Sears Canada plans to open 30 new-format stores by the end of 2005, located primarily in power centers and high-traffic strip malls.

The website offers catalogues in both English and French.

He already had a committee in place to develop and ensure protocols, and last week he shared some of the progress Hbc has made. Speaking at the United Nations Global Compact Leaders Summit here, Heller shared the results of his successful effort to engage international retail executives on the issue of ethical sourcing. He urged the 400-plus executives attending the summit to seek solutions to social issues within their industries through involvement in the Global Compact.

“After two years of work, the global retail community is on the verge of coming together to make substantial improvements in the programs that monitor compliance to labor and human rights in our supply chains,” Heller told the group.

The challenge was to engage companies at the CEO level. In the retail sector, Hbc leveraged its profile in the international retail community and the reputation of the UN, to engage other retail CEOs. This led to a dialogue on the need for an aligned industry approach to enhance the practices of individual companies through cooperation and information sharing.

Heller offered some concrete results at the Summit. “Independently, major retailers around the world have adopted almost identical auditing programs to verify that suppliers are complying with virtually common codes of conduct that are based on ILO principles,” he said. These have resulted in a proliferation of third party compliance auditing firms, which audit complaints from manufacturers.

“Three objectives are at the core of our initiative: a common vendor code of conduct; a common standard for auditing on which we can rely; and, a common, accurate data base we can share,” Heller added. He has been speaking personally with more than 70 other CEOs from around the world to ensure the initiatives move forward.

Now, the industry is only months away from realizing two programs: a North American program led by the National Retail Federation in Washington, and a European program led by the Business Social Compliance Initiative, based in Brussels.

TORONTO — Canadian Tire Financial Services and BMO Bank of Montreal have partnered to launch a credit card for business customers. The new card, called Canadian Tire Commercial Link MasterCard, is designed for businesses that require a credit card to pay for their purchases. It will be available everywhere MasterCard is accepted, including Canadian Tire stores and gas bars. The new commercial card will replace the current Canadian Tire Business Class Commercial Card as of July 28, 2004. More than 50,000 people are active Canadian Tire business customers.

SHERBROOKE, Que. — Touch Industries moved into a new headquarters and distribution center here recently. The company invested $2.5 million in the 25,000-sq.ft. building in Sherbrooke’s industrial park.

KITCHENER, Ont. — Rona Inc. opened its 64th big-box store last week, a $20 million-plus investment that will operate under the Rona Home & Garden banner. The store features 120,000 sq.ft. of retail space, including a 4,000-sq.ft. greenhouse and 31,000-sq.ft. garden center. A Home Depot will open in Kitchener at the end of August.

In recent years, more and more retail groups are choosing to use the Conference as a site for tying in meetings of their own, as more than 200 managers and senior executives from both the retail and vendor sides of the industry gather to hear the latest industry intelligence, plus attend sessions by some of the top home improvement executives from around the world.

The networking time takes on a greater dimension with the inclusion, for the second year running, of a Gala Reception and Dinner on the evening of September 8. Commitments for tables at the Gala have come in from the likes of Home Depot, Rona, Sodisco-Howden Group and TSC Stores, guaranteeing that it will be a first-class forum for networking. In addition, comedian Red Green will be featured at the Gala, courtesy of 3M Canada.

(If you want more information on setting up meetings during the Conference, give us a call. We’ll provide special rates on rooms — and the coffee’s on us. Call 416-489-3396 for more info.—Michael)

According to Jim Inglis, a former Home Depot vice-president who now consults with some of the leading retail groups around the world, Home Depot’s first chance to enter China came a decade ago when it helped establish the first western-style home center chain, called Home Way.

“Home Way was modeled after Home Depot, and Home Depot was instrumental in the development of the stores,” says Inglis. “They had a chance to move in then, and it would have been a tremendous opportunity.”

Inglis was well known for at that time for being a strong supporter of Asian expansion. But during his time there, any intentions to expand into the Orient never got beyond a letter of intent to move forward. “Now they’re going in at a late date and at a much higher cost.”

Over the past 10 years, competition has heated up. Home Way is owned by parent company Home World, which has 30 hypermarkets and eight home centers throughout China. Orient Home, another Chinese operation that is privately held, owns multiple outlets in Northern China, while Home Mart is owned in part by the Shanghai government. Other retailers, all from the Europe Union, have targeted China for growth. OBI in Germany and U.K.-based B&Q both own about a dozen stores each there.

(Jim Inglis will be a featured speaker at the Hardlines Conference Series, September 8-9, 2004 in Toronto. For more info, contact…xx)

“This is a test to see how these systems work,” Nobers told Hardlines. He added that 84 Lumber was looking to expand this concept to other markets, but couldn’t say where or when.

This move makes sense, as 84 Lumber continues to expand its store operations and geographic coverage. By the end of this year, the 470-unit company expects to have more than 500 stores opened. Nobers said 84 Lumber is projecting its sales for this year at $3.4 billion, which, if realized, would represent a 36% increase over 2003 revenue of $2.5 billion.

Independent dealers, as represented by the dozen or so buying groups to which most independents belong, grew their market share by 9% in 2003, almost double the increase made by big boxes in Canada.

The first sign of a reverse trend was in 2002, when the rate of big box expansion appeared to start slowing. At the same time, independent dealers in LBM buying groups began to show growth that exceeded the overall growth of the industry for the first time in recent years.

(The growth of big boxes vs. independents appears in the latest issue of Hardlines Quarterly Report, which features a special report on buying groups in Canada. This is an amazing report, with everything you need to know on the size and growth of the buying groups.—Michael)

The retailer continues to support its associates who are engaged in the war by equalizing and extending pay and benefits while they are called to active duty.

Nardelli and his company’s support of the Bush Administration, which links the war in Iraq to its larger anti-terrorist crusade, is equally unambiguous. The Atlanta Journal-Constitution reported recently that, in the month of May, Home Depot employees were, aggregately, the largest source of contributions to the Republican National Committee. Thirty-six employees kicked in more than $250,000. That same month, the newspaper reported, Nardelli held a fundraiser at his home in the Atlanta suburb of Buckhead, attended by President George W. Bush and several leading area business executives. The event raised $3.2 million, $25,000 of which Nardelli himself donated.

United, one of five divisions of Lanoga Corp., is a chain of 20 yards in 20 states. The store in Jackson ended up trying a new lighting system from Orion Energy Systems, based in Plymouth, Wisc., that replaced more than 200 fluorescent tubes with fixtures that cut energy consumption almost in half. The Orion lights used specially formed, highly reflective surface to “harvest” light that would ordinarily be wasted in a fixture, by directing it downward for greater illumination.

According to Dan Rudolf, manager of the United Building Center, payback on the retrofit is expected within two years. The Orion fixtures are warrantied to last 20 years, during which time they are calculated to save enough energy to equal 1,087 tons of carbon dioxide and four tons of sulphur dioxide, or the equivalent of saving 131,742 gallons of gasoline.

MELBOURNE — Mitre 10, the dealer-owned hardware banner, is focusing more on women shoppers, along with tradesmen, as it rolls out its new Mega big box format. The Mitre Mega rollout follows the lead of Mitre 10 in New Zealand, a similar dealer-owned group with a loose affiliation to the Australian group. In New Zealand, Mitre 10 is opening its third big box, in Hornby, the biggest yet, next month. It weighs in at 11,000 s.m. “We’ll have six in place by Christmas,” says Patrick Dobson, business manager for décor from the New Zealand group.

Bunnings has only recently entered the New Zealand market and recently opened a new store in Hamilton, a city about 65 miles south of Auckland. Mitre 10 is attempting a pre-emptive strike with its own dealer-owned Mega stores. But competition will really heat up between the two retailers when they start going head-to-head in the same markets. According to Greg Robertson, editor of New Zealand Hardware Journal, observers are waiting to see if Mitre 10 will have deep enough pockets to keep up with Bunnings. He believes Bunnings will count on competing Mitre 10 Mega owners being forced to blink first.

“The hope [by Bunnings] is that the competing Mega owner will have no option but to turn the store’s reins back to head office and therefore put off any other members who may be considering the Mega format,” Robertson told Hardlines.

“As the most extensive multi-channel retailer in the country, Sears is in virtually every market,” said Mark Cohen, chairman and CEO of Sears Canada in a prepared statement. “However, with the absence of new shopping mall growth, our new specialty format store strategy will bring our key product categories and décor solutions to a growing customer segment who shop in conveniently located power centers on a regular basis.”

Sears plans to open 30 new format stores, including one called Sears Wellness, by the end of 2005. They will be primarily located in power centers and high-traffic strip malls.

According to an e-mail statement it sent to the Associated Press and KSL news radio, as well a statement it posted on its website, ELF targeted Stock — the industry’s largest pro-oriented home improvement dealer — because it claimed that Stock had ignored warnings to fix forklifts that ELF asserted were emitting more pollution than diesel engines would. The initials “ELF” were painted on the side of Stock’s building.

The group also hinted at further attacks if its warnings weren’t heeded: “They are destroying the ozone and posing a serious health risk to nearby humans and living animals. If the consequences of early Monday morning [June 13] are what it takes to bring their negligence to the attention of the media and the people of the world, then it is well worth it and we will continue in our mission to stop large companies from destroying the environment.”

TORONTO — Canadian Tire Corp. is expanding its sourcing operations in the Far East with the installation of a new office in Shanghai. The office is in place and will be up and running by fall. The giant hard goods retailer already has offices in Hong Kong, Tapei and Seoul.

WINNIPEG, Man. — Sam’s Club, the member-owned warehouse club division of Wal-Mart, will open its first Canadian outlet outside of Ontario when it sets up shop on 13 acres at the Linden Ridge Shopping Centre, according to the Winnipeg Free Press. Wal-Mart Canada currently has six Sam’s Clubs in the Southern Ontario market.

LONDON — Tesco, the giant U.K. grocery retailer, has launched an online legal store. The do-it-yourself legal store will make basic legal services available, thanks to deregulation of legal services in the country. Tesco hopes to attract a million-plus unique visitors to the site in the first year at www.tesco.com/legalstore, where they will find a wide range of DIY law kits and everything from downloadable legal forms, many of them free, to a directory of solicitors.

COLOGNE, GERMANY — Innovative products from the garden furniture and garden structures segments will get special treatment at this year’s spoga+gafa trade show, September 5-7. Koelnmesse, which owns the show, will be cooperating with the trade journal markt in grün to stage the first-ever “Garden City” Innovation Forum. The Forum will give trade visitors from all over the world an overview of innovative products for this market. Exhibitors from the garden furniture and garden structures segments will be invited to participate. Some 2,450 suppliers from approximately 60 countries will present their products and services, covering all aspects of the garden, camping and equestrianism sectors at the show.

CITY OF INDUSTRY, Calif. — Ace Hardware Corp. has signed a deal to have Global ePoint Inc., a provider of digital video surveillance systems, supply, through its Perpetual Digital division, delivery of Digital Video Recorder (DVR) Surveillance Systems, with point-of-sale interface, to Ace.

WASHINGTON — The Associated General Contractors of America, the nation’s largest construction trade association, has called on Secretary of Commerce Donald Evans to temporarily lift tariffs imposed upon Mexican cement products. The request came in light of domestic price increases and reported shortages of cement in many parts of the country. Cement demand has increased more than 8% in the last six months as the U.S. economy has improved. Duties on Mexican cement, which have been set at $57 per ton, have exacerbated tight supplies in all or parts of 23 states, even as U.S. cement mills are operating at full capacity. Cement prices are expected to increase by as much as 15-20% over the next few months as domestic mills, according to a report from the Portland Cement Association.

Nardelli noted that systems and programs can be tested, and managed, in a market that contains only 100-plus stores. When the bugs get worked out, successful programs can make an easy transition south of the border.

In fact, the softer side of Home Depot was originated in Canada, by Canadian president Annette Verschuren and then-vice-president merchandising, Eric Peterson. Verschuren has since been made president of Home Depot’s Expo division, in addition to her Canadian duties.

“Annette has been at the forefront of looking at décor,” said Nardelli.

However, don’t expect Home Depot’s high-end décor format, Expo, to come to Canada anytime soon. Expansion of the division has stalled in the U.S. “But right now we’re getting great results implementing the décor model into some of our existing stores,” he added.

“One of the things Annette and her team are doing in Canada is working the store size to suit the market,” Nardelli said. Downscaled footprints, 15%-20% smaller than the traditional 135,000-sq.ft. store, have enabled the retailer to successfully penetrate markets that would not easily support a full-sized outlet.

At-home services represent a market that Home Depot has “only scratched the surface” of, said Nardelli. But new approaches are being tested north of the border. In the Vancouver market, on Canada’s West Coast, a landscape consulting service was introduced last month.

The new additions to the team will both focus on hardlines aimed at the building center dealers in the Ace network, reflecting the growth of that business by these dealers, and giving them a more complete one-stop shop. Amy Pellerito, LBM manager at Ace, to whom Herr and Johnston report, calls it “a fast growing and highly important segment of our business.”

Herr, who has three decades of industry experience, joins Ace from San Diego-based Maintenance Warehouse, an industrial/commercial distributor owned by Home Depot, where he held various sales positions over the past two years. Prior to that, Herr was a building materials trader for Ace and Builder Marts of America (BMA), and held sales and management positions with American/Thunderbird Moulding, a business development manager for BMA. (BMA and Ace have had a strategic purchasing alliance for several years.)

Johnson has spent 27 years in the business, including the last two as sales and marketing manager for Meranjil Landscaping Corp., a commercial and residential landscaper based in Chicago Heights, Ill. Johnson’s diverse resumé also includes stints with Georgia-Pacific‘s roofing division, building products merchandising manager for TruServ Corp., and senior merchandising manager/inventory control manager for the now-defunct Handy Andy Home Improvement Centers.

Western had previously entered into an agreement to purchase House of Tools in April 2002, but that deal fell through when the two sides couldn’t agree on the price. Acquisition talks resumed last December, he said, after House of Tools had made some internal shifts that included consolidation.

In early 2004, Western also acquired 13 of Woodworkers Warehouse‘s stores, after the Revere, Mass.-based retailer decided last December to close its doors and liquidate. Kiker says these stores — in New York, Vermont, Connecticut, Maine, New Hampshire and Massachusetts — were profitable even when Woodworkers ran them. At one point last fall, Western showed interest in acquiring all of Woodworkers Warehouse. “What we were able to do eventually was cherry pick its best stores,” he says.

The acquired Woodworkers stores are now bannered as Western Tool Supply, and Kiker says their niche is far more contractor-focused (Western’s tagline is “The Contractor’s Choice”) than under Woodworkers, which targeted consumers at a time when big boxes like Home Depot and Lowe’s have come to dominate the retail tool market.

In 2003, Western, which still operates 35 stores in six western U.S. states, generated $38 million, and ranked 290^th among the 500 largest home improvement retailers in the United States, according to Home Channel News‘ annual Retailer Scoreboard. “And we’re still moving up,” says Kiker, though he declined to name companies Western might be eyeing for possible future acquisition.

Western operates stores in some big markets like San Francisco, Anaheim and Salt Lake City, but its main focus is secondary communities such as Augusta, Maine, or Klamath Falls, Ore.

From Los Angeles, Ira Kalish of Deloitte Research will give us a real global perspective, one that will help all of us understand how to run our businesses better back here at home. China’s economy is surging ahead at almost 10%, and is fast becoming the next “gold rush” for retailers. And why do we care? Because the consumer trends and demographics that fuel that expansion is affecting your competitors — and your customers.

Meanwhile, closer to home, we’ve got one of the smartest — and most outspoken — independents in the country, Roy Perkins of the Rona Home Centre in Cornwall, Ont., to join us. A great example of smart retailing put into front-lines practice.

Jim Inglis, a former vice-president at Home Depot and a true veteran of big box retailing-, will come up from Atlanta to share his depth of experience. From South America comes Guillermo Aguero, the head of Sodimac, the company that held its ground when Home Depot came to town — then had to leave!

Day one of the Conference Series, our Retail Strategies Symposium, will feature a more educational bent, with an update on the size of the market, who the industry leaders are, who’s gaining market share and who’s losing. Peter Norman, of Clayton Research, is back by popular demand to make sense of the housing market, and how housing forecasts will have an impact on home improvement retailing.

Add in an incredible morning session by Donald Cooper (more about this next week!—Michael), insights from our favorite retail guru, Anthony Stokan, plus the incredible Outstanding Retailer Awards put on by Hardware Merchandising, and our amazing Gala Reception and Dinner, and you’re guaranteed two days of money making tips, profitable insights, and executive-level networking. For more info, click here or call us at: 416-489-3396.

The eBay team held a series of seminars — and their message was aimed at everyone from reps, dealers and distributors to “mom and pop operators who have excess inventory sitting on their shelves,” Serpico said.

He added that using eBay offers sellers instant access to an existing community of more than 40 million active buyers, who bought $24 billion in goods. “It’s a great opportunity to for a new and higher margin cost-recovery channel.”

Many manufacturers have issues with buybacks, said Serpico, and that’s why eBay is so convenient. “It’s a great way to reach more buyers, because we have those buyers already.”

CHARLOTTE, N.C. — Worries about a slowdown in the U.S. housing market could have a serious impact on the performance — and share price — of Home Depot and Lowe’s. Executives of Lowe’s Cos. had to deflect investor concerns that rising interest rates will hurt the company’s fortunes. During a Credit Suisse First Boston Corp. investor conference last week, Robert Hull, CFO, and Larry Stone, senior vice-president of operations at Lowe’s, tried to reassure the audience that the industry will benefit from an aging populace that will rely more and more on Lowe’s for help on remodeling projects. In addition, the growing Hispanic population in the U.S. is proving a fertile market, Hull and Stone said.

ST-ANTONIN, Que. — Matériaux à Bas Prix ltée has signed its newest authorized dealer, Chic Metal Profil, a retailer in Saguenay. This ground-up dealer, open just over a month, is the first for Matériaux à Bas Prix ltée in the Saguenay region.

CHARLOTTE, N.C. — Towson, Md.-based Black & Decker is preparing to expand its distribution facilities here with the construction of a 350,000-sq.ft., multi-million-dollar hub in ProLogis Park West Pointe, a business park in the west end of the city. B&D acquired Baldwin and Weiser back in October, 2003 from Masco Corp., and the added lines account for the need for the new facility. Completion is expected by the fourth quarter.

AMSTERDAM — Dutch retailer Ahold, the world’s third biggest stores group, continues to battle red ink, as sales fell 11% to 15.4 billion euros in the first quarter, due to the strong euro and divestments, including selling its supermarkets in Brazil and Asia. Not counting these factors, the stores group’s sales grew roughly 1.3%. The company suffered a net loss of 405 million euros ($486.4 million), versus a profit of 84 million euros a year earlier. Ahold is still recovering from an audit scandal last year, when the group found a $1.46 billion hole in the accounts of its U.S. subsidiary, Foodservice.

TERRACE, B.C. — Workers at the Wal-Mart here are trying to get union representation, a move that could have dramatic impact on the Wal-Mart chain. The majority of staff have signed membership cards and applied to the Labour Relations Board of British Columbia for union representation with the United Food and Commercial Workers Canada.

Grainger, the North American distributor of facilities maintenance supplies, has named James A. Garman to the role of senior vice-president of human resources. In this position, Garman will be responsible for Grainger’s human resource policies, including benefits, compensation, organization effectiveness and staffing. Garman also will lead the company’s efforts to maintain effective employee relations across the entire company, which includes nearly 600 worldwide branches, 17 distribution centers and 15,000 employees.

Housing starts fell 0.7% in May, as homebuilders began construction on 1.967 million units a seasonally adjusted annual rate, from 1.98 million the previous month. It was the fourth decline in starts in the last five months, although the level of single-family starts, at 1.640 million, was the highest level since December.

Building permits, an indicator of confidence in future sales, jumped in May to a seasonally adjusted annual rate of 2.077 million units, from a 2.006 million pace in April. Single-family permits rose to a 1.590 million pace, the highest on record.

Across the chain, Nardelli noted that the company spent $500 million on store remodels last year, with everything from new ceilings and floors to improved lighting. The investment in these “refreshes” will double in 2004, as the payoff is measurable. “Those stores are performing extremely well,” he noted.

As the stores get updated, they are also being made to follow a more rigid operational format. “When I came on, 50% of the stores were compliant with standards,” Nardelli said. The objective now is to get that up to 100%. “A consistency of message is important,” he continued. “It’s a big part of our problem.”

In Canada, programs being introduced include self-checkouts, which will be in 41 stores by July, and the balance of Canada’s 105 stores by the third quarter. (More on my interview with Bob Nardelli in next week’s issue! — Michael)

The company did not reveal when it planned to open its first store in China, where, or how many it intended to open in that country. One thing for certain, though, is that Home Depot will encounter stiff competition in China, where U.K.-based B&Q and German DIY retailer OBI have already established footholds. Leroy-Merlin has affiliated itself with Home Way, the country’s first Western-style big-box retailer, which Home Depot helped launch through financial and consultative support. By choosing not to become a fuller partner in Home Way in the mid 1990s, Depot left a wide door open that several European dealers walked through.

B&Q has aggressive plans for Asian expansion, and OBI intends to have 100 stores in China by 2010. Two other domestic chains, Orient Home and Home Mart, will also provide competition for Home Depot upon its arrival in China.

Currently, Home Depot has about 50 employees working in two buying offices set up last fall in Shanghai and Shenzhen, China. Its plans to open stores are being disclosed at a time when China’s economy is booming; it grew by 9% last year, and that pace has kept up this year, at nearly 10% in the first quarter of 2004. Home Depot officials estimate that the Chinese spend $50 billion annually on home renovations, and that this spending is rising 20% per year. As the housing market booms in that country, Patterson estimated that about 70% of those expenditures go towards the completion of interior spaces in the home.

We’ll start at the top: Normand Dumont was promoted to the role of executive vice-president, merchandising. Under him are Luc Nantel, vice-president merchandising, hardware; Jeff Kilgour, vice-president merchandising, lumber; Larry Jarvis, vice-president merchandising, building materials; and Gabriel Rousseau, senior director, store sales support.

Six hardlines teams report to Nantel, as vp hardware merchandising. They are: paint, decoration and flooring, under Suzanne Maggi, director; hardware, tools, furniture and storage, under Jean Lamarche, director; plumbing, kitchen, kitchen and ventilation, under Manon Bouchard; electrical, lighting and heating, overseen by Joseph Piro, director; seasonal, garden, housewares, stoves and fireplaces, under Yves Bergeron, director; and special projects and flyer coordination, headed by Pierre Rodrigue, director.

Lumber under Jeff Kilgour: Ronald Tu, director, commodity trading, Western Canada; Wayne Sellars, director, technical services; and Josée Julien, director, lumber purchasing.

Larry Jarvis’ building materials team consists of: Rémy Harvey, director, building materials merchandising; and Hubert Robitaille, director, millwork merchandising, who will also play a key role in supplier negotiations.

Rousseau’s store sales support team will implement merchandising strategies within the stores, and be responsible for renovations, store openings and planograms. They are: Trevor Pocaluyko, regional director, store sales support, Ontario; Colleen Barker, regional director for Western Canada; and Nicole Plamondon, director, Ambiance Boutique and Decoration. Rousseau himself will be directly responsible for store sales support in Quebec.

“We look at this as an opportunity to educate residents about home security, encourage formation of block watches and increase positive interaction between the community and police,” said Major Larry Watkins, commander of the district that includes the neighborhoods. The installation teams will conduct door-to-door home security inspections through July 23.

With Anderson at the helm, the group is also taking a more focused approach to building its ranks, resulting in the formation of a new title, manager of the dealer development/sales department. Brad Dixon, formerly buyer for hardware, assumes the new role. He will be responsible for getting Irly’s 50 bannered stores more fully on board with the many programs available through the group, including re-merchandising existing stores and recruiting new members.

Irly owns a general wholesale division, Western Hardware, which sells hardware to a growing range of independents outside the Irly banner. Dixon will be charged with increasing these sales, as well.

The new management has a mandate to regain direction for the group. Anderson says Irly has many advantages, including its position as a regional supplier, one that has been entrenched in the British Columbia market for a long time. “We do have the distribution center here — it’s right in B.C., and it carries a fairly extensive line of hardware, as well as building supplies,” he says.

Home Depot will issue a store credit for a returned fan, or customers can contact SMC Marketing Corp., which is based in Grand Prairie, Tex., for instructions on receiving a refund.

BOUCHERVILLE, Que. — Rona Inc., the Canadian home improvement distributor and retailer, has erected a new Rona Building Centre store in Peterborough, Ont. The 41,000-sq.ft. store, built at a cost of $9 million, is on the site of a former Rona Cashway.

Launched just last year in Midland, Ontario, Rona’s Building Centre concept was created in response to the specific needs of trades people, contractors and DIYers looking for a range of décor and renovation products for major projects.

Ralph Hake, Maytag’s chairman, referred to these maneuvers as its “one company” strategy, and said Hoover’s and Maytag’s sales forces would be merged. But financial considerations also played a role in these reductions, as Maytag disclosed that it would not meet its earnings forecasts for the year and its second fiscal quarter. Sales of floor care products and home appliances in April and May did not meet projections, Hake said in a prepared statement. His goal is for Maytag to achieve an 8% operating profit margin by the first quarter of 2005

Maytag’s plans may be complicated by the latest news that it was unable to reach a negotiated settlement with the union workers at its Newton Laundry Products plant in Newton, Iowa, resulting in a shut down of production.

NEW YORK — Both Home Depot and Lowe’s continue to increase their share of the heavy appliance market, taking away from the number-one player, Sears, says a survey by TWICE, a trade magazine. U.S. appliance sales rose 10% overall last year, to $18.1 billion, from $16.4 billion in 2002. Lowe’s, the number-two seller, had growth of 17% to $3.5 billion, but Home Depot is narrowing the gap, as its appliance sales grew by 23.6% to hit $2 billion last year. Sears added more assortment in its white goods last year, but its sales increased by only 3.7%, to $5.6 billion.

RIVIÈRE-DU-LOUP, Que. — A program to expand Bargain Building Materials‘ dealer base beyond its home province of Quebec is starting show results. With a network of 15 corporate stores (13 in Québec and 2 in Ontario) and one 250,000 sq.ft. distribution centre, Bargain began promoting its authorized dealer concept in earnest in 2003. The program provides independent hardware stores, home decorating centers, lighting and furniture stores, floor-covering retailers, etc., with five product lines: recycled paint and accessories, MDF mouldings, electric and cordless tools, imported hardware and floor coverings. Bargain has three authorized dealers in Quebec, and has gained a foothold in the Maritimes with the signing of a new dealer in Summerside, P.E.I. Sales by Bargain were $33.5 million in 2003.

ST. JACOBS, Ont. — By the end of the month, Home Hardware Stores Ltd. will have added 18 new locations, rivalling the 22 new stores added in all of 2003. Along with the new stores, expansion by existing dealers brings Home’s total retail space to more than 8.3 million sq.ft. Aggressive plans for growth extend to Home Furniture, the company’s home furnishings banner, which has added 12 new locations in the past year, bringing the total number of stores to 62. The company has also broken ground on an expansion at its main warehouse and office facilities here. The project, which will add nearly 340,000 sq.ft., will be completed in four phases over a three-year period.

TORONTO — Following a recent announcement that his company will acquire 24 Kmart stores in the U.S., Home Depot chairman and CEO Bob Nardelli said such a large-scale purchase could happen in Canada. He mentioned the Zellers chain, as a possible example. The discount department store chain with almost 300 stores across the country, is owned by Hudson’s Bay Co., and has suffered from slow growth over the past several years, compared with its key competitor, Wal-Mart Canada. Wal-Mart entered Canada just over a decade ago when it purchased some 200 Woolworth stores.

MISSISSAUGA, Ont. — Bakor, the roofing company, has launched a product training center, calling it the first-ever for the roofing industry. The facility has been designed to train Bakor’s staff, as well as architects, specifiers, distributors and contractors, on the proper application of Bakor’s own products, but it’s also intended to provide a broader forum for teaching application techniques of building products such as roofing, air barrier and waterproofing. The training facility is located in Bakor’s new Canadian headquarters. It features a classroom with seating for 24 and a 1,000-sq.ft. demonstration area.

MINNEAPOLIS — May Department Stores Co. will buy Marshall Field’s department stores and nine Mervyn’s locations in the Twin Cities for $3.24 billion in cash, in a deal that’s expected to close in either the third or fourth quarter. May will keep using the Marshall Field’s name in a move that strengthens its presence in the Midwest, giving it a total of 62 Marshall Field’s stores, mostly in Chicago, Detroit and Minneapolis-St. Paul.

BERLIN — A German law dating back to 1891 has been upheld by that country’s highest court. According to the ruling, shopkeepers will have to keep their doors closed on Sundays, public holidays and after 8 p.m. on weekdays. The Federal Constitutional Court turned down an appeal by the giant retailer Metro AG, which had been pushing to get the law updated.

EDMONTON, Alta. — Sears Canada Inc. is putting its department store at West Edmonton Mall through a major renovation, which is scheduled to be done by October. The 103,000-sq.ft. retail area will increase by 2,500 sq.ft., offering a broader selection of home fashions and apparel. The project is part of a multi-year, multi-million dollar initiative to update all the stores at least every seven years. Four other sites will be renovated in 2004, including the store at Guildford Town Centre in Surrey.

The average price of a new home in Canada was up 0.7% in April from the previous month. Year over year, the rise in prices was up 5.6%, the highest annual increase in 14 years, says Statistics Canada.

He adds that the Winroc management will stay intact, with one change at the executive level. Wayne Jack, Winroc’s founder and chairman of the board, will exit the company, while Paul Vanderberg, president, will remain on.

“The value proposition for Winroc’s customers is based in part in service, in part in product diversity, and also in competitiveness, which will be enhanced, as we have a mandate to grow the distribution side exponentially through acquisition,” Hancock says. He expects the company to be up to three times larger within the next three years.

He expects access to a larger pool of products and an increased commodity base to make the Allroc business more appealing to potential dealers, as well.

Winroc has annual revenues of $320 million with corporate revenue in Canada split evenly between Winroc and Allroc purchases. On a North American-wide basis, Winroc accounts for 70% of Allroc’s volume.

A spokesperson reiterated Home Depot’s policy of zero tolerance for any kind of discriminatory behavior among its employees. In recent weeks, other, similar employees complaints in different markets have surfaced.

Home Depot has since issued a statement saying “the suit has no merit.”

The day before Newsday reported on this suit, Aram Rubinson, a retail analyst with Banc of America, lowered his rating for Home Depot from buy to neutral. He explained that Home Depot’s sales are likely to be affected by a slowdown in home sales. That prompted Bob Nardelli, Home Depot’s chairman and CEO, to insist, in an interview with the Associated Press, that the company’s strategy was working, and that he had no intention of adjusting it.

Surprisingly, however, Nardelli conceded that impressions held about Home Depot, good or bad, are rarely in line with reality. “The company was probably never as good as was perceived, and it sure as hell is not as bad as it’s perceived today,” he told AP.

Nardelli is understandably touchy, after shareholders held his feet to the fire last week because the company’s stock price during his tenure over the past three and a half years is down 12%. Nardelli admitted that his “greatest challenge” is to convey how well the company has been doing financially to the public.

What’s fuelling the growth of this DIY-oriented chain? “We’ve had some positive comp growth and we’re just exploring other markets,” says Darrin Gilliam, vice-president merchandising and marketing for Marvin’s.

Morrison says he wants to see the company’s sales increase threefold, in part by increasing TruServ’s share of the giant Ontario market, which accounts for fully one-third of Canada’s $31.7 billion in retail home improvement sales.

Under the agreement, TORBSA members have the ability to purchase products from both the Kitchener and Winnipeg distribution centers. They can also take advantage of TruServ Canada’s field and help desk services. TruServ operates and supplies a range of banners: True Value Hardware, V&S Department Stores, V&S Options, Country Depot and Pet Junction.

Shipments made by Canadian suppliers between May 22, 2002 and April 30, 2003 are also being reviewed and final determinations for these reviews will be made by December 7, 2004. However, if a negotiated settlement is not reached between the two countries by then, the old rate could be re-introduced.

“We are pleased to see that the rates have been cut by more than half,” said John Allan, president of the B.C. Lumber Trade Council, in a prepared release. “We are confident that the DOC will not be able to fairly find any subsidy in the final determinations.”

The council maintains that Canadian softwood lumber is not subsidized and not dumped in the U.S. and expects all duties to be removed eventually. Its member companies account for about half of Canadian lumber production and half of Canadian lumber exports to the United States.

Ray Gabel, vice-president, merchandising and marketing — hardlines for Home Hardware Stores Ltd., acknowledges the importance of testing, saying it’s “very, very important.” and notes that quality is a challenge as pressure continues to provide better pricing. “People are demanding better quality,” he says, adding that his dealers hate poor quality because of increased returns — and the buyers have to answer for it. “I get my head in a sling over it,” he adds.

That’s why OnSpeX takes the testing function beyond specs testing to help retailers and consumer products manufacturers quantify and analyze the performance of products from a more consumer-friendly perspective. The new division was developed, in large part, as the result of inquiries from major retailers and certification testing customers of CSA International.

OnSpeX is part of CSA Group, an independent, not-for-profit membership association serving business, industry, government and consumers.

The expansion is in line with Bunnings’ ongoing expansion plans, as its home improvement business has enjoyed 29% growth of the past two decades, the highest on the Australian stock exchange, but anticipated slowdowns in the housing market here are expected to slow that growth.

Bunnings continues to look for sites for its big box stores, and is preparing for its first big site in Dunedin, where it faces new competition from Mitre 10, the co-op chain that is launching its own dealer-owned big boxes (Holy Rona-style model for growth, Batman! — Michael). Martin Dippie, a Dunedin businessman and developer who owns Jacks Mitre 10, recently purchased land to build a AU$10 million megastore.

During the period, nine smaller stores were converted to B&Q’s new Mini-Warehouse format, bringing the total to 37. In addition, one new B&Q Warehouse was opened.

In France, Kingfisher’s Castorama division saw total sales grow by 11.9%, with strong same-store sales of 8%, driven, in part, by Castorama’s foray into entry-level products for the price-conscious French consumer. The Brico Depot discount banner enjoyed saw sales growth of 19.2% in constant currency.

Kingfisher’s international sales grew by 59%, as two stores were opened in Italy and one in Spain. Sales in Poland were very strong, rising 68.8%.

MOORESVILLE, N.C. — Lowe’s president Robert A. Niblock recently explained at an investors’ conference that the retailer’s plans to add 140 stores this year include moving into three new states — Minnesota, Wisconsin and Maine. In addition, a new regional distribution center is going up in central Florida. Niblock said Lowe’s merchandising strategy will target two emerging consumer groups, “serial renovators,” typically homeowners who continually upgrade their kitchens, baths or family rooms for reasons of fashion or product upgrades, and “home entertainers,” primarily younger, educated professional women who are brand loyal.

BURNABY, B.C. — Forestry giant Taiga Forest Products Ltd. ended the fiscal year ended March 31, 2004 with sales of $1.1 billion, up 18.6% from $912.7 million in 2003. Earnings for the year were $10.7 million, up from $7.8 million in the year prior. Net profit for the fourth quarter was $3.9 million on sales of $273.9 million.

TROY, Mich. — Kmart will sell off as many as 24 of its outlets to home improvement giant Home Depot. The exact number of stores, and their locations, will be determined over the next couple of months. The deal is expected to be worth up to $365 million. Kmart has more than 1,500 stores in 49 states. It emerged from bankruptcy protection last year, but sales continue to drop despite the turnaround.

NEWTON, Iowa — Appliance maker Maytag Corp. will undergo a comprehensive business restructuring that consolidates the Hoover Floor Care, Maytag Appliances and corporate headquarters organizations. The consolidation of the operations is expected to take advantage of the different divisions’ overlapping customer bases, thereby improving Maytag’s competitiveness, with a planned 8% operating profit margin goal in the first quarter of 2005. The integration of Hoover and Maytag Appliances will result in the elimination of about 20% of the salaried workforce.

ATLANTA — A former Home Depot subcontractor named Raymond Hammond has filed a lawsuit in North Carolina against the retailer, claiming wrongful contract termination after he had alerted the retailer’s former heads, Bernie Marcus and Arthur Blank, that Home Depot had overpaid him for every installation he did in November, 1999 in upstate New York. The L.A. Times reports that Hammond has received emails from about 70 other contractors across the country who were also overpaid for window and kitchen installations. The Times reports that the overpayment was usually minor — around $20 per job — but sometimes ran as high as 20% above the actual costs. However, several days after reporting the overpayments in August 2001, Hammond’s contract with Home Depot was terminated, according to his lawsuit.

ISSAQUAH, Wash. — Costco Wholesale Corp. reported net sales of $3.80 billion for the four weeks ended May 30, 2004, an increase of 19%, compared with Wal-Mart, which had gains of 12.8% from $3.20 billion. For the 39-week period ended May 30, Costco reported net sales of $35.15 billion, up 15% from $30.67 billion from the similar period a year earlier.

TORONTO — Tremco Retail Brands has changed its name to Rust-Oleum Consumer Brands Canada. The change reflects Tremco’s integration into the Rust-Oleum family of companies since being purchased by Rust-Oleum Inc. in 1997. Tremco’s brands include Tremco, Flecto, Mono, Varathane and Watco.

HOFFMAN ESTATES, Ill. — Sales for Sears Roebuck and Co. in May fell 4.7% to $2.08 billion, from $2.18 billion in the same month a year ago. Same-store sales fell 3.7%.

MILWAUKEE, Wis. — Briggs & Stratton, the industry’s leading supplier of gas engines for outdoor power equipment, has signed a definitive agreement to acquire Port Washington, Wis.-based Simplicity Manufacturing, which sells power equipment products under the Snapper, Ferris, Giant-Vac and Simplicity brands. Simplicity expects to generate $350 million in sales for the fiscal year that ends June 30, 2004. B&S will pay $227.5 million in cash for the company, and expects to close this deal by the first quarter of 2005. Simplicity’s management team will stay in place.

TORONTO — Owens Corning Canada Inc. has become a member of the Canadian Green Building Council, affirming the insulation maker’s commitment to environmental responsibility. The CaGBC is a group of representatives from different areas of the design and building industry working to change industry standards, develop green building guidelines and create educational tools to support its members in implementing sustainable design and construction practices.

STE-MARIE, Que. — The sale of bath and accessories maker MAAX closed last Friday. The previously announced acquisition was undertaken by a syndicate comprising a number of investment groups, including J.W. Childs Associates, Borealis Private Equity and the Ontario Municipal Employees Retirement System.

CHICAGO — Housewares maker Home Products International Inc. has announced that its chairman and CEO, James Tennant, will buy the company outright for $1.50 per share. Tennant owned about 6.5% of the company’s outstanding shares as of early February, according to Reuters data. The transaction would value the part of the company Tennant does not already own at about $11 million. Home Products had sales of $233.6 million in 2003.

The value of the company’s stock was also an issue, as shareholders pointed out that Home Depot’s stock price under Nardelli’s tenure had fallen 13%, even though its earnings during that period had increased by nearly $11 billion.

During the meeting, Home Depot announced that its board had authorized the repurchase of another $1 billion worth of the company’s common stock. Over the past 21/2 years, Home Depot has repurchased $5.4 billion shares.

The issue that drew wide press attention to this meeting, though, was the status of board member Ken Langone, who is embroiled in the lawsuit filed against him and New York Stock Exchange chairman Dick Grasso by New York’s Attorney General Eliot Spitzer. (Langone headed the compensation committed that okayed Grasso’s $187.5 million pay package.) At Home Depot’s meeting, Langone was re-elected to another one-year term to the company’s board of directors. Grasso, who also sat on the board, did not stand for re-election.

BOUCHERVILLE, Que. — In another major step to absorb the operations of its Réno-Dépôt acquisition, the division’s Montreal buying team has been reorganized into the buying offices of its parent, Rona Inc., here on the south shore. Réno-Dépôt’s Montreal office will remain open, and continue to house human resources and operations.

The decision to use the best practices from the Réno-Dépôt side was made several months ago, as part of the mandate of a committee struck to examine ways to bring the two companies together effectively. Rona acquired Réno-Dépôt from parent company Kingfisher Plc in the U.K. last September. Implementation of the reorganization is taking place now, says Sylvain Morissette, director of communications for Rona, as emphasis at this time of year is on selling, not buying.

“We saw the Réno-Dépôt system as an opportunity,” he says. “It will create new possibilities to reach new products and have more impact with those products at the store level.”

Under the new arrangement, all buyers and merchants will work together under Normand Dumont, who has been named executive vice-president for merchandising and buying for both Rona and Réno-Dépôt. Marc Dufresne, formerly vice-president purchasing and logistics, will remain in charge of operations and logistics, as executive vice-president for distribution. Other changes include the appointment of Jean Lamarche as hardware merchant, and Joseph Piro as merchant for electrical. (We’ll get a more complete list of buyers for next issue — Michael)

Casablanca will sell more than 30 fan designs exclusively through Lowe’s, at starting price points under $400. Lowe’s now stocks these products in more than 700 of its stores, and also offers them via special order in all of its stores.

Pergo is adding to its existing lines in Lowe’s stores two new Signature collections, called American Cottage (with 13 color choices) and Casual Living (with 14 design options).

Details of Sears’s exit from the site were only confirmed last week, when Sears Canada announced it will close the store, a discount Value Centre, on June 5, clearing the way for Home Depot to move in. Another urban store will open in West Vancouver’s Park Royal shopping center by October of this year.

The merged company will operate under the Rodda name in the U.S. and continue under the Cloverdale banner in Canada. However, Rodda’s architectural paint for residential application will be sold in Canada, and Cloverdale’s industrial/commercial products will be sold through Rodda’s stores in the U.S.

Each company was family owned before the merger. Under the new arrangement, they will be managed independently and maintain two boards, but will have common ownership. Pending financial and environmental assessments by both sides, the merger will be transacted as a transfer of private stock, with Cloverdale holding the majority share in the deal. Specific terms were not disclosed.

The first Designer Depots will be located in Bay stores in Toronto (Eglinton and Woodbine); Brampton (Shoppers World); Calgary (downtown); and Montreal (downtown). Up to 15 more Designer Depots will open within Bay stores in the next nine months. The company says it will launch a stand-alone Designer Depot location before the end of 2004.

Metro, the world’s fifth largest retailer, plans to open 10 more stores in China this year, and another 40 within five years. Its 20th store there opened in Dalian last week.

These companies are not alone: many European retailers, faced with tepid economic conditions at home, are counting on China for growth. Ikea plans to open eight more stores in China over the next five years. One of Europe’s largest home improvement retailers, OBI, wants to double the number of stores in China this year to 19, expanding to 24 stores by the end of 2005, with 100 by 2010.

Aubuchon is but one of a myriad of dealers and suppliers that have thrown their support behind auto racing, whose audience demographics closely match that of their customers. Lowe’s sponsors a motor speedway in Charlotte, N.C., as well as a team that races on the Nextel Cup circuit. Menard’s has long been a team sponsor on the Indy circuit, and notable companies such as Home Depot, Sears, PPG and Glidden all sponsor teams.

Schenectady, N.Y. — Stock Building Supply has acquired Bellevue Builders Supply Inc. Bellevue operates seven retail branches, a distribution yard, truss manufacturing center, kitchen warehouse, and a door-stair/countertop/wall panel manufacturing center. The acquisition brings Stock’s operations to more than 232 locations in 26 states.

CASTLEGAR, B.C. — Arrow Building Supplies Ltd. is the latest independent dealer in Western Canada to sign with Rona Inc. Arrow, formerly a member of Irly Distributors, has three stores in the interior of British Columbia, and estimated sales of $8 million.

The American Red Cross awarded Lowe’s as its Philanthropist of the Year during its National Awards Winners ceremony on May 26. Since 1999, Lowe’s has donated more than $6 million to the Red Cross, and this year launched a public service campaign calling on Americans to “Pledge to Prepare” for all types of emergencies.

FAIRVIEW, Alta. — Castle Building Centres Group has added a new member in Western Canada, Burkholder Building Supply. The store is owned by Henry Hamm, who also owns Woodland Castle Building Centre in Grande Prairie, Alta. Castle, which has some 260 dealers across the country, now has more than 50 yards in Western Canada, more than double the number of three years ago.

TORONTO — Canadian Tire Corp. is the latest hardlines retailer to look at setting up Asian buying offices. As sourcing becomes increasingly globalized, Canadian Tire is looking to the Far East. According to Canadian Tire Retail’s president, Mark Foote, as competencies of Asian factories increase and their product quality gets better, they are becoming better positioned to add value and drive innovation. In addition, rising costs of both raw materials and finished goods deflation, along with increased competition, has Canadian Tire exploring both new offices — and new partnerships — in the Pacific Rim.

CALGARY, Alta — Rona Inc., the Canadian home improvement distributor and retailer, officially opened its first distribution center in Western Canada last Thursday. The facility is 320,000 sq.ft. in size, with capacity to expand to 420,000 sq.ft. Stocking approximately 25,000 SKUs, it supplies 51 stores, including 11 big boxes west of the Lakehead. The opening is part of an aggressive Western expansion strategy that includes a $200 million investment over the next two and a half years.

ISSAQUAH, Wash. — Profits at Costco Wholesale Corp., the largest wholesale club operator in the country, jumped 29% in its third quarter, as net sales increased 14% to $10.67 billion from $9.34 billion, and membership fees climbed 13% to $224.5 million from $198.1 million. Same-store sales rose 11%.

Although March was strong, April saw a sharp drop in orders to factories for big-ticket durable goods. According to the U.S. Commerce Department, durable goods orders dropped by 2.9% last month, marking the biggest decline since September 2002. April’s slackening in demand for big-ticket goods came after sizable gains in February and March, where orders went up by 3.9% and a strong 5.7%, respectively.

The earnings of both retailers were affected by a reclassification of payments to vendor service organizations For Lowe’s, that $205 million expense shaved $126 million off of the bottom line for the three months ended April 30. For Home Depot, the $280 million increase in store operating expenses reduced its quarterly earnings by $78 million.

Lowe’s enjoyed strong sales activity in outdoor power equipment, appliances (where Lowe’s share of the U.S. market at the end of the quarter increased to 14.5% in units), kitchens, and installed sales, which grew nearly 40% in the quarter. The company’s gross margins rose nearly 2 percentage points, to 33.1%, and its average ticket increased around 8.5%. Lowe’s also reported a modest increase in inventory turnover, to 4.46 turns.

Home Depot’s average ticket rose 7.4% to $55.11 per customer, a company record. “We saw increases in every category,” said John Costello, the retailer’s executive vice-president, merchandising and marketing. The company noted that 35% of all transactions now go through self-checkout machines that, at the end of the quarter, were in 822 of Home Depot’s 1,740 stores.

Home Depot reported a 42% increase in its At-Home Services installed sales business.

Both companies expressed confidence about their future business prospects. Lowe’s plans to open 19 stores in the second quarter — on its way to 140 new stores this year — and is projecting a 19% sales gain for the year, with its same-store sales projected to rise between 6% and 7%. Home Depot raised its projections for sales growth to between 10% and 12%, and its projections for earnings per share to between 10% and 14%. It also committed to spend another $1 billion this year on improving the physical appearance of its stores.

Home Depot went on an acquisition binge just days before its financials were released, buying the Home Mart chain in Mexico and White Cap Construction in California.

Consolidated net sales consist of sales through Rona’s distribution centers, along with retail sales from its corporate stores and its share of retail sales from its investment in other, dealer-owned outlets.

Overall sales at retail through all outlets were up 72.3% to $440.7 million in the first quarter. Same-store sales were up 7.4%. By comparison, Home Depot’s same-store sales chain-wide were up 7.7%.

Company president and CEO Robert Dutton reiterated his company’s intention to double its share of the market by 2007, through both dealer conversions and continued acquisitions. However, he admits, there is little opportunity left in the country for major acquisitions of the scale of Rona’s takeover of Réno-Dépôt, Revelstoke and Cashway, which enabled the company to double its market share between 1999 and 2003.

At the end of 2003, Rona currently accounted for 12.2% of the $31.7 billion Canadian retail home improvement industry.

The conference portion of H2X Canada will be held on February 19, expanding the show to a four-day event.

CHRA president Bob Elliott has managed to bring back into the fold some of the organizations that had been with the show in the past. The Canadian Hardware & Housewares Manufacturers Association has given its support by scheduling its annual Gala in conjunction with the new event. A deal has been struck with the Paint and Decorating Retailers Association, Floor Coverings Institute of Ontario, and the Walls, Windows and Furnishings Association to host a simultaneous event under the same roof, called the Décor + Design Expo & Conference (D2X — Canada).

A third component of the new hardware show will be the addition of a full-day conference component on February 19, 2005, turning the show into a four-day event. The conference program will be aimed primarily at retailers and their staff, but organizers hope to attract a broader audience, as well.

Although the deal between CRHA and Messe Frankfurt has yet to be inked, details of how much equity the German trade fair giant will secure expect to be finalized over the next few weeks. “We’re comfortable with the details of what will go into the contract,” says Elliott. He would not disclose how much equity the giant German organization will secure in the new Canadian venture.

“The Home Expressions program is conveying the end use ,the dream, to the consumer, while encouraging dealers, with their limited space, to tie in product presentations within their stores,” says Ferguson. “You’ve got to give customers ideas for how to decorate their house.”

Most recently, the Forest Stewardship Council certified the Tembec-managed Gordon Cosens Forest, a five-million-acre region in Ontario, making it one of the largest FSC-certified forests in the world, and the first boreal forest to be certified in North America.

The Rainforest Alliance SmartWood Program was initiated in 1989 to improve the effectiveness of sustainable forestry in conserving biodiversity and ensuring equitable treatment of local communities and workers, as well as creating financial incentives for businesses to employ responsible forestry practices. SmartWood has certified more than 1,000 operations and 32 million acres of forest worldwide.

Since filing Chapter 11 in February, the company has closed eight stores and negotiated a new $70 million line of credit. Its stores, which average more than 130,000 sq.ft. each, at one time were seen as being in the vanguard of a home décor trend that home improvement dealers began embracing in the mid 1990s. Its stores currently stock a range of decorative merchandise, including artificial flowers, picture frames, kitchen and bath accessories and housewares.

Changes to the stores will begin this fall and be completed by year’s end.

Criterium’s findings seem to be confirmed, if indirectly, by the Home Improvement Research Institute, whose own recent survey of new home buyers found that, on average they spent $3,100 to improve their houses within one year of purchasing them. In fact, buyers of older homes spent an average of $2,000, while those who bought new homes spent an average of $5,000.

Those findings, which HIRI revealed during the National Hardware Show in Las Vegas last week, showed that, while a lot of that spending goes towards landscaping and outdoor living, windows, kitchens, bathrooms and living rooms were also upgraded during this period.

HIRI’s survey also found that 52% of recent home buyers had completed one or more home improvements within the first year of purchasing their home.

CHICAGO — Ace Hardware has made a deal to use a new software platform for its customer relationship management (CRM) systems. The adoption of technology by Teradata, a division of NCR, will begin this month and be completed by the third quarter of 2004. Ace already uses Teradata systems to drive its customer loyalty program, the Helpful Hardware Club.

LONDON — A specialty tools show has been added alongside the DIY & Garden Show held each year in January. Totally Tools will take place at Earls Court 2 January 16-18, 2005, in response to a stated desire by the hand and power tool companies to have a show of their own, says show organizer Christopher Leonard-Morgan. The DIY & Garden Show is in its 11^th year, attracting visitors from more than 30 countries.

TORONTO — After receiving approval last year to enter the banking business, Canadian Tire‘s financial services division enjoyed an increase in its first-quarter pre-tax profits of 6%, reaching $25.8 million. The increase came both from the conversion of customers from Canadian Tire store credit cards to Canadian Tire MasterCard accounts, and from an increase in customer transactions billed to the card. But the company is years away from getting average balances on Canadian Tire MasterCard accounts up to the industry average of about $1,800, says the company. The average current level is $1,350.

Gagnon informed a room full of vendors that BMR has grown its own hardware sales to its own members, located mainly in Quebec, from $9.1 million in 1997 to $80 million today. While he invited vendors to be part of that growth, he added that private label will play an increasing role in the company’s assortments, and so will offshore buying. “You have to face the reality,” he said. “We’re doing a lot of imports with direct shipments.”

But in exchange, Canada wants to keep the arbitration process in the hands of an independent binational panel.

MEXICO CITY — Home Depot has strengthened its market position in Mexico by agreeing to acquire Home Mart, that country’s first big-box home improvement retailer and currently its second-largest chain. The terms of this deal were not disclosed.

With the addition of Home Mart, Home Depot’s Mexico operations expand to 39 stores, and puts Home Depot into seven new markets. “We anticipate a smooth transition,” says Ricardo Saldivar, president of Home Depot Mexico.

Mexico’s retail home improvement industry generates an estimated $15 billion in annual sales. The country has 100 million residents living in nearly 25 million dwellings, and the government estimates that Mexico will need at least 23 million more homes by 2030, just to keep up with a population that is expected to grow by 2 million per year. Mexico’s president Vicente Fox has made housing formation a priority of his administration, and has set as a goal the construction of 750,000 homes in 100 cities per year by 2006.

However, retailers must pick their spots, as home ownership is limited by the fact that two-fifths of Mexico’s population lives below that country’s poverty level, and the country’s mortgage financing system remains restrictive.

“We look forward to offering product innovations, compelling store presentations, and exceptional service to even more customers in Mexico,” said Frank Blake, Home Depot’s executive vp-business development and corporate operations, in a prepared statement. With this acquisition, Home Depot has raised its forecast for total store openings in 2004 from 175 to 185.

Both Schurman and Irving-owned Kent Building Materials are members of Independent Lumber Dealers Co-operative, and have worked shoulder-to-shoulder through the years, sharing buying power and best practices. Kent has no stores on P.E.I., but has been expanding aggressively into new markets, primarily in its home province of New Brunswick, over the past couple of years.

However, a different mood pervaded the Las Vegas event, as the first morning of the show was jammed with people, preparing their booths for visitors, attending the morning conference sessions, and lining up for their registration badges.

An important part of the show was an expanded conference program, which ran from 8 a.m. to 10 a.m. each morning. The show itself then opened at 10 a.m.

Above all, NHS attracted that all-important element — buyers. Many of North America’s largest home improvement retailers were represented, including Home Depot, Ace Hardware, Rona, Sears and Canadian Tire. International turnout was also strong, with buyers present from companies such as Sodimac (Chile), Mitre 10 (New Zealand), Leroy Merlin (France) and Hornbach (Germany). Other countries walking the show included Switzerland, Greece, Denmark and Mexico.

While some anticipated that the show was strongly lawn and garden, it in fact featured three strong components — hardware, seasonal and paint and decorating. Familiar names, such as MD, Zircon, Benjamin Moore, Fiesta, and Minwax, were outnumbered by lesser-known companies, a plus, many buyers admitted, for finding new products. The Las Vegas location attracted a strong contingent of west-coast vendors — including a lot of well-tanned Californians.

The show also featured a number of less than conventional exhibitors, reflecting the increased blurring of the lines between various types of retail. Pfizer had a strong presence, promoting, of all things, Listerine. eBay was on hand, as well. The online auction service has been seriously pursuing the business-to-business market over the past couple of years, as a means for dealers and vendors alike to unload unwanted merchandise.

U-Haul returned to NHS after an absence of several years. The company’s trailer rentals typically serve a new home buyer, a prime customer for a home improvement retailer. And, of course, Hardlines was there in full force, garnering interest for its weekly breaking news service, and for its Annual Conference Series (September 8-9, 2004).

Retail performance was strong, with a 5.0% increase in sales during the quarter, and a 3.1% increase in same-store sales. Sales were particularly strong in the hardware, sporting goods, and lawn and garden categories.

Nor is the company content to sell hardlines and gasoline. Canadian Tire is aiming to pump up sales by providing busy commuters with prepared meals and movie rentals at its “next generation” convenience stores. The broad-based hardlines retailer will enhance its gas bars with fast and ready-to-prepare foods, such as frozen meats, fresh and frozen pizzas, sandwiches, and fruits and vegetables. The company is also looking to partner with a major movie rental company, and may even introduce photo finishing.

The expanded convenience stores should help drive sales at Canadian Tire’s petroleum division, which operates 243 gas bars and 52 car washes. That division grew quarterly sales by 3.7%, with a 33.8% rise in car wash sales and a 22.2% hike in convenience store sales. However, the high cost of wholesale gasoline lead to a pre-tax profits drop in the petroleum division of 97%, to $100,000 for the quarter.

Canadian Tire plans to open 21 stores in 2004, of which 11 will be the Concept 20/20 format.

The quarter was marked by the opening in April of a new, 1 million-sq.ft. regional distribution center just outside Sacramento, Calif., which replaced a nearby, existing center half that size in response to growing retail sales in the region, and the recent opening of an international buying office in Hong Kong.

The co-op expects to hire 65 employees for this facility in June 2005, a number that could double within a year.

Expansion of the Asian event coincides with the scaling back of Practical World in Cologne, which will now be held every two years. The next one is in March, 2006.

BOUCHERVILLE, Que. — Rona Inc., the Canadian home improvement distributor and retailer, has added four new locations to its retail network, two in British Columbia and another in Manitoba. But expansion is not just focused on hardware and building center dealers. Rona has also cut the ribbon at a 12,000-sq.ft. Botanix-L’Union des Jardiniers garden centre in Rivière-du-Loup, Que., the largest store of its kind in the province east of Quebec City.

ATLANTA — Georgia-Pacific Corp. has completed its previously announced sale of its distribution division to a newly formed company owned by Cerberus Capital Management, a private, New York-based firm, and members of the distribution business’s management team. The transaction was valued at about $810 million. The distribution business will continue purchasing structural panels, lumber and other building products manufactured by Georgia-Pacific for the next six years, as a result of an agreement between the buyer and seller.

MONTREAL — RCR has been listed with Lowe’s Cos. for the first time, with product shipping into the Wyoming DC and stocking for 85 stores for carpet bar, 425 stores for carpet rolls, supplied from its Elgin, Ill. warehouse.

BENTONVILLE, Ark. — Wal-Mart Stores Inc. saw first-quarter profit increase by 16% as sales rose at the fastest pace in more than two years. Net income climbed to $2.17 billion from $1.86 billion.

DUNCAN, B.C. — As it prepares to emerge from debt restructuring, Doman Industries has reported a 1Q net loss of $44.3 million, deepening the loss of $14.5 million in the preceding quarter and marking a swing from net earnings of $52.2 million in the first quarter of 2003. The strength of the U.S. dollar versus the Canadian currency accounted for an unrealized foreign exchange loss of $10.0 million.

LAKE FOREST, Ill. — Kitchenwares company Salton Inc. posted a third-quarter loss of $58 million on sales of $191.4 million, compared with a loss of $12.1 million on sales of $166.4 million during the same period a year earlier. As a result, Salton says it will cut expenses by at least $40 million to reduce domestic operating costs. Brands include the George Foreman grill and Westinghouse home appliances.

Home Depot would be the latest retailer to get this treatment from Playboy, which has used the “Women of … ” theme for nude pictorials of female employees of such companies as Wal-Mart and Starbucks.