July 27, 2015 Volume xxi, #30

“There is no wealth like knowledge, and no poverty like ignorance.” —Buddha (Indian sage and founder of Buddhism, circa 6 BCE)

SUMMER PUBLISHING SCHEDULE

There will be no weekly edition of HARDLINES on August 3, 17, or 31. The World Headquarters will remain open, however, during this time as we finalize the speakers for our incredible 20th Anniversary Hardlines Conference. The regular weekly schedule will resume September 7.

IN THIS ISSUE:

• Lennie to head Home Depot’s MRO division

• Lowe’s Canada announces aggressive store growth

• Industry leaders will present at 20th Hardlines Conference

• Vendors: Taiga seeks vendors with strong brands

• PLUS: Another Lowe’s store?, RONA workers win $55 million, West Fraser’s second quarter, Mitre 10 joins global group, Bona showroom, Grainger’s results, Pearson leads Renin, retail sales —and more!

Lennie to head Home Depot’s MRO division

ATLANTA — The Home Depot has announced a definitive agreement to acquire Jacksonville, Fla.-based Interline Brands, Inc., a national distributor and direct marketer of broad-line maintenance, repair and operations (MRO) products. And it's putting the Canadian division’s current president in charge.

Under the terms of the deal, Home Depot will acquire Interline for $1.625 billion in cash, subject to customary adjustments. At the same time, Bill Lennie, president of The Home Depot Canada, has been named EVP, outside sales and service, a newly created post that puts Lennie in charge of the company’s pro, MRO, and installation services business. In his new role, he will also oversee the integration of Interline. Lennie will continue to run Home Depot Canada until a replacement is found.

Lowe’s Canada announces aggressive store growth

TORONTO — Lowe’s Canada announced last week that in addition to completing the acquisition of 12 former Target sites, the company also plans to open two more locations in Ontario. Construction is currently underway in Ancaster, Ont., and Mississauga, Ont., representing an additional investment of approximately $50 million. Ancaster will be 84,000 square feet and Mississauga will be 94,000 square feet in size, both plus garden centres. Both stores are expected to open either in late January or early February 2016.

“These 14 new locations are a tremendous win for us in Canada, accelerating our growth across the country and bringing our total store count to 54 locations,” said Sylvain Prud’homme, president of Lowe’s Canada.

The new Lowe's sites are located across Canada, many in markets where Lowe’s is currently under-represented, bringing up the total of Canadian Lowe’s stores to 54, with 37 stores in Ontario, three in Saskatchewan, nine in Alberta, and five in British Columbia. Click here to see a full list of the new store locations. 

Lowe’s has completed its acquisition of the 12 former Target locations, including the purchase of Target's Milton, Ont., distribution centre for a total purchase price of approximately $147.75 million. This acquisition came as part of a real estate auction following Target's decision to cease operations in Canada.

The 14 new stores, located across the country, will enhance Lowe's presence in Western Canada and strengthen its base in Ontario and will also create approximately 2,000 jobs.

Industry leaders will present at 20th Hardlines Conference

WORLD HQ, TORONTO — What do Terry Davis, CEO of Home Hardware Stores; Bernie Owens, president of TIM-BR MART Group; Joe Scarlett, retired CEO of Tractor Supply Stores and founder of the Scarlett Leadership Institute; and Ken Jenkins, president of Castle Building Centres, all have in common? They will be presenters at the 20th Annual Hardlines Conference.

The conference will be held October 21 and 22 at the Westin Bristol Place Hotel near the Toronto Pearson Airport. This annual event will play host to 200 senior managers and executives from hardware and home improvement retailing in Canada and North America. Attendees will have exposure to two days of learning, ideas, and networking, as they rub shoulders with industry leaders.

This year’s program promises to be rich and varied. Aron Gampel, VP and economist for Scotiabank, will share his insights into the direction of the economy, while a panel of young retail leaders will share their viewpoints and concerns. Other speakers include: Mark Scherer of Scherer Brothers Lumber in Minneapolis; and retail guru Ibrahim Ibrahim, from UK-based Portland Design. Hugo Girard, Quebec strongman and motivator will present in our “Profiles in Leadership” Series.

The future of bricks and mortar will be top of mind at this year’s conference. Two key figures in e-commerce will present: Joseph Thompson, VP marketing and communications for online LBM retailer BuildDirect; and a senior sales and marketing executive from Google Canada. 
 
Sign up now to join the suppliers and dealers who will converge in Toronto from October 21 to 22 to increase their learning, sharpen their insights, network with industry leaders—and help Hardlines celebrate its 20th anniversary!

Vendors: Taiga seeks vendors with strong brands

TORONTO — While Taiga Building Products is a household name in the home improvement industry, the breadth of products it carries and the extent of its support network may come as a surprise to many vendors.

That was certainly the case during the Hardlines Meet the Buyers Breakfast, held in May in Toronto. A room full of vendors sat raptly as Dave McNeil, Taiga’s vice president Eastern Canada, explained that the wholesale distributor may be rooted in commodities, but its focus is firmly on retail. Products include lumber, preserved wood, engineered wood—OSB, I-joists, and beams—plywood, moulding, insulation, composite decking, flooring, and roofing.

McNeil provided some insights for vendors seeking to get listed with the Burnaby, B.C.-based company, which does almost $1 billion in sales annually. That includes knowing about the vendors themselves. “Taiga wants to understand what your company stands for, to understand its culture and its people.” He said Taiga wants to do business with a company “with a good track record.”

These will all factor into negotiations in which price plays only one part. “Price is at the bottom of the list. It can be tweaked; it can be fixed.” Margin is more important, he stressed.

FROM THE ARCHIVES: This week in 1995

While Home Depot was taking a breather from its breakneck expansion in Canada, another big box player was still going gangbusters. Revelstoke CEO Carl Grittner was planning to have a total of seven Revy Home & Garden stores by the end of the year, with another 10 planned for the following year. Also: Schurman in P.E.I. was celebrating its 100th anniversary and Hickman’s in Newfoundland was growing its contractor business. Click here to read these blasts from the past!

DID YOU KNOW…?

…that the deadline is fast approaching for entries for the Outstanding Retailer Awards? The industry’s only independent awards program is dedicated to celebrating the achievements of hardware, home improvement, and building supply dealers in Canada. All Canadian home improvement retailers that have operated under the current ownership for at least two years are eligible to enter their stores. You can submit your entry online or print out this 2015 ORA PDF Entry Form or ORA Word Document Entry Form. But the deadline is 5 p.m. EDT, July 31, so act now to get your entry in!

RETAILER NEWS

CORNWALL, Ont. ― Could Ontario’s easternmost city be the next site for a Lowe’s store? The local news media are speculating over the next tenant for an empty Walmart store in Cornwall. As per company policy, Lowe’s Canada won’t comment on sites in development until the real estate deal has closed.

BOUCHERVILLE, Que. —A group of 20 night shift workers at RONA’s warehouse on Montreal’s South Shore have won a $55 million Lotto-Max jackpot. The group buys tickets every week in hopes of just such an outcome, and their investment paid off when Dominic Lord discovered their ticket had won at a Longueuil Petro-Canada station, which will get a $550,000 bonus. The Canada-wide jackpot is the largest ever paid out by Loto-Québec.

COLOGNE, Germany ― The Global Home Improvement Network, a worldwide federation of home improvement dealers, has accepted New Zealand’s Mitre 10 as a member. Mitre 10, a market leader with annual sales of $1.2 billion, is a co-op with 39 big box stores and 42 small format stores. GHIN now has 116 member companies in 98 countries, either as direct members or through a country association.
 

SUPPLIER NEWS
Vancouver, B.C. — West Fraser Timber Co. Ltd. reported earnings of $14 million on sales of $1.03 billion in the second quarter of 2015. In the quarter, lumber operations generated operating earnings of $13 million. A sharp decline in U.S. lumber prices, which triggered export duties on shipments of lumber from Canada, a slightly stronger Canadian dollar, and increased inventory write-downs were major factors in the decreases. President and CEO Ted Seraphim called it “a very challenging quarter.”

AURORA, Colo. — Hardwood floor care specialists Bona U.S. have announced the opening of Canada’s first Bona Regional Training Centre, in Toronto. The 1,500-square-foot facility houses two test floors of red oak and maple, and is equipped for training on the installation, sand and finish, and care of hardwood floors. The centre joins the firm’s seven existing training centres in the U.S.

CHICAGO — Grainger’s second-quarter sales increased 1% to $2.5 billion. Net earnings for the quarter increased 7% to $221 million and earnings per share increased 11% to $3.25. Sales for the company’s Canadian operations, Acklands-Grainger, were down 9% in U.S. dollars but were up 2% in local currency. Acklands-Grainger had lower sales to the oil and gas, construction, commercial, retail, heavy manufacturing, forestry, and transportation markets, partially offset by growth to customers in the light manufacturing, mining, government and utilities customer markets. The business in Canada continues to be affected by weak oil and gas prices and lower commodity prices. 

STOCKHOLM ― Outdoor appliances maker Husqvarna saw second-quarter earnings rise, with operating profit of 1.68 billion crowns ($196 million) from 1.37 billion crowns a year ago.

PEOPLE ON THE MOVE
At Renin Corp., Shawn Pearson has been named president and CEO, and been appointed to the board. He joins Renin after 13 years with Danby Products, most recently serving as President of the Danby companies in Canada, the U.S. and, Asia. Besides having an MBA from the Ivey School of Business at the University of Western Ontario, Pearson was an all-American baseball player who played with the Toronto Blue Jays. Pearson replaces Kevin Campbell, who had been with Renin and its predecessors since 1987.

ECONOMIC INDICATORS
Retail sales rose 1.0% to $43 billion in May. After removing the effects of price changes, retail sales in volume terms were up 0.4%. Store types associated with housing purchases and home renovation showed continued growth in May. Sales at building material and garden equipment and supplies dealers were up 1.9%, the sixth straight monthly increase. Year-over-year sales in this sector were up a healthy 9.4%. Receipts at furniture and home furnishings stores were up 0.3%, the fourth consecutive monthly increase, and up 5.8% year-over-year. (StatCan)

OVERHEARD…
“Addressing the needs of our pro customers is a top priority for The Home Depot.”
—Craig Menear, chairman, CEO and president of The Home Depot, on the acquisition this week of Interline Brands, a U.S. distributor to the maintenance, repair, and operations sector.

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