March 7, 2016 Volume xxii, #10

“Ill habits gather by unseen degrees, as brooks make rivers, rivers run to seas.”
—Ovid (Roman poet, 43 BC-18 AD)

IN THIS ISSUE:

• La Coop fédérée woos RONA dealers

• Atlantic buying show will move to Halifax in 2017

• Quebec connection helped Lowe’s expand spring product lines

• Home Hardware begins offering digital gift cards

• PLUS: Major DIY conference in Stockholm, CanWel reports healthy year-end, BuildDirect creates new platform, Ace launches month of paint colour ideas —and more!

La Coop fédérée woos RONA dealers

MONTREAL — La Coop fédérée is positioning itself to pick up RONA’s affiliate dealers if they opt not to follow the banner into business with Lowe’s.

According to CEO Gaétan Desroches, La Coop, which operates Groupe BMR and the Unimat retail chain, is in a “courtship phase” with independent RONA merchants. Interviewed by phone during the company’s AGM, Desroches told La Presse canadienne that RONA’s acquisition by Lowe’s could contribute to the expansion La Coop is seeking in Quebec.

The Retail and Innovation Division went through a year of transition. The purchase of 100% of Groupe BMR during the fiscal year is expected to be positive over the long haul for the organization and its network. However, the company admits that an acquisition of this size “necessarily involves short term adjustments.”

The Retail and Innovation Division, which consists of hardware and building supply outlets, energy, and innovation, enjoyed total sales of $1.41 billion in 2015. That’s up from $981.5 million in 2014, due mainly to the acquisition in January 2015 of all outstanding shares of Groupe BMR. While this increase helped offset a large decrease in oil product prices in La Coop’s Sonic Energy Sector, the co-op retailer still faces a challenging market for renovation and building materials in Quebec.

To overcome those challenges, it has been working to integrate BMR and Unimat through signage conversions, logistical procurement adjustments to serve twice as many stores, integration of the two cultures, and rationalization of selected corporate stores.

Amidst these changes, the desire to pursue more stores in Quebec has increased. While acknowledging that other banners like Home Hardware will also be looking to scoop up affiliates, La Coop’s Desroches hopes to appeal to dealers who want to keep their business in Quebec.

Atlantic buying show will move to Halifax in 2017

MONCTON, N.B. —After more than 30 years in Moncton, the Atlantic Building Supply Dealers Association announced its annual trade show will be moving to Halifax next year.

Denis Melanson, president of the ABSDA, made the announcement to more than 700 members and sponsors at the annual gala dinner last week. After experiencing a steady decline in attendance over the last few years, Melanson asked everyone—dealers and vendors alike—to commit to bringing the show back to its past glory.

“We can’t sit here and say there’s less and less people here every year and not do anything about it,” he said. He especially called on the vendors to emphasize the buying aspect of the event by offering show-exclusive deals and inviting their customers to attend. Melanson estimated they could see a 25% to 30% increase in attendance if everyone committed to the effort.

On the show floor, vendors were positive about the new location, and were hopeful that it may involve an uptick in attendance next year.

This year’s show also introduced a contractor afternoon on the second day. Wayne Duplantis, Henkel Canada, said he was looking forward to seeing how that would go. “It will be interesting to do some demos and talk to the guys who use the products.”

In typical Canadian fashion, the most talked about topic on the floor was the weather, or lack thereof. Melanson joked that 2016 will be, “the year forever known as the year of no snow.” However, snowstorms in Ontario and Quebec and a number of cancelled flights did delay many vendor representatives travelling east for the show.

Melanson concluded his remarks with a call to arms, encouraging attendees to work on attracting more people, not just to the buying show, but to the industry as a whole. “This industry is changing and evolving and we have to provide more value and more services. And we have to stop talking about jobs, and make people aware of the careers they can have in this industry.”

Quebec connection helped Lowe’s expand spring product lines

MONTREAL — A meeting held in November 2015, with Lowe’s Canada and a group of Quebec home improvement vendors has turned out to be another part of a larger plan for Lowe’s to acquire Quebec market leader RONA.

The meeting gathered about 80 vendors in an event in Montreal that was organized by the Bureau of Quebec in Toronto. Lowe’s already has 42 stores in Canada, but none in Quebec. The event gave Lowe’s the chance to meet and begin doing business with Quebec companies, some of whose products are appearing in Lowe’s stores this spring.

In anticipation of eventual expansion into Quebec, which since this meeting took place includes the landmark takeover of RONA, suppliers at this event heard from Lowe’s Canada President Sylvain Prud’homme about the company’s growth plans and commitment to omnichannel marketing.

“This was definitely a first step to get more familiar with the Quebec marketplace, both in terms of vendors and market demands,” said Igor Halencak, head of marketing and merchandising at Lowe’s, who also presented at the meeting in November.

He adds that a number of new listings came from the meeting and many of them will be rolled out with Lowe’s Canada’s spring and summer product launches, including “a tremendous seasonal program.” He says the first of them will appear mid-April.

Home Hardware begins offering digital gift cards

ST. JACOBS, Ont. — Home Hardware Stores Limited is now offering gift cards online. The eGift cards can be purchased online at homehardware.ca in both French and English and are redeemable at any Home store location. The option for purchasing physical cards is still available to customers.

Home has partnered with Buyatab, a digital ecard provider, and is claiming that the program, which launched on March 1, is the first of its kind in the Canadian hardware industry.

A purchaser of the eGift card can customize it using an assortment of gift card designs to create a personalized message. The card can be scheduled to send at a desired time and date. Upon receiving the eGift card, the recipient is emailed a card number and activation pin that can be redeemed by displaying the information on their mobile device or presenting a printed copy. The card balance can be tracked online.

“Our partnership with Buyatab to offer digital gift cards is another way that our dealers continue to offer flexible and secure shopping to customers,” says Bruce Hammer, retail payment services manager at Home Hardware Stores.

DID YOU KNOW…?

RETAILER NEWS

MONTREAL — RONA’s largest shareholder, the Caisse de dépôt et placement du Québec, has reaffirmed its commitment to sell its shares to Lowe’s, reports the Globe and Mail, adding more certainty to a positive outcome for that acquisition. The Caisse owns roughly 17% of the RONA shares, and Caisse CEO Michael Sabia has supported the takeover since the start, even though he had opposed Lowe’s first takeover attempt in 2012, believing it did not reflect the value of RONA or its potential for growth at the time.

VANCOUVER —Online LBM retailer BuildDirect has selected commerce and media software provider GroupBy to power its site search and merchandising layout on builddirect.com, and its recently unveiled Home Marketplace, GroupBy has announced. Home Marketplace is designed to assist homeowners throughout the renovation process, from planning and design, to selection of products, through home delivery. For suppliers, the platform provides a direct link to consumers, allowing them to connect the goods with demand. GroupBy’s Searchandiser platform will replace BuildDirect’s previous Oracle Endeca site search operator.

OAK BROOK, Ill. — Ace Hardware, the U.S.-based hardware co-operative, is running its second annual “31 Days of Colour” program throughout March. The initiative offers daily paint colour suggestions and design advice to encourage consumers to use colour in new and imaginative ways. Ace will do this via interactive online experiences, including daily paint colour focuses, giveaways, and a nationwide paint makeover sweepstakes.

SUPPLIER NEWS
MILTON, Ont. — Roxul has announced that its North American headquarters has earned LEED Gold certification in the New Construction category from the Canada Green Building Council. With this certification, Roxul’s head office ranks among Ontario’s most energy-efficient new buildings. Gold certification, the second highest attainable level, requires a LEED score of 60-79 points. Roxul’s head office, built with more than 86,000 square feet of its own stone wool insulation products, received a score of 65. The company is a subsidiary of Rockwood International, the world’s largest producer of stone wool insulation.

VANCOUVER ― CanWel, the building supplies wholesaler, reported year-end revenues of $825 million, up 8.6% compared to $759 million in 2014. The increase was due primarily to sales generated by CanWel’s newly acquired California division. The company also cited “continued focus on product mix strategies and target customer base, as well as the mild weather across Canada during the fourth quarter of 2015” for the boost. For the fourth quarter, revenues increased by 23.3% to $193 million.

PEOPLE ON THE MOVE
At its 94th annual meeting last week, La Coop fédérée appointed a new president, Ghislain Gervais. Gervais is a poultry and crop producer from Saint-Guillaume, Que., who has been on the board since 2011 and since 2014 as first vice-president. He replaces Denis Richard, who occupied the position since 2003.

Lumber Liquidators has appointed Dennis R. Knowles as COO. Knowles will be responsible for the company’s stores and related operations and will report directly to CEO John Presley. The new COO has more than 25 years of experience in store and business operations, most recently as chief store operations officer at Lowe’s.

NOTED
The Fourth Global DIY Summit will be Western Europe’s major conference for the retail home improvement industry in Europe and North America. With this year’s theme, “A Disruptive World – New Trends in Home Improvement,” delegates from around the world will hear what retail and industry experts have to say about this phenomenon. We encourage any Canadian vendor or retailer looking to expand their understanding, their contacts—and their business—to attend this powerful event. Come to Stockholm, Sweden, June 8 and 9. Early Bird offer available until 15 March 2016. Save your place now.

OUT AND ABOUT
Our Managing Editor Sigrid Forberg, Marketing Director Katherine Yager, and Editor Michael McLarney are in Cologne, Germany, this week, where they’re attending the International Hardware Fair. They hosted a very successful Canada Night last evening. We’ll have lots to report back about (and lots of German beer to drink), so stayed tuned! Want to see a bit of what we’ve been up to right now? Check out #hardlinestravels on Twitter.

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