May 16, 2016 Volume xxii, #20

“I think life is far too short to concentrate on your past. I rather look into the future.”
—Lou Reed (American musician, songwriter, and founder of the proto-punk band Velvet Underground, 1942-2013)

IN THIS ISSUE:

• Innovation front and centre at Vegas hardware show

• Peavey Mart’s 35th store to open in High Prairie, Alta.

• RONA will host show in Montreal for affiliated dealers

• Titan partners with investor with an eye to more acquisitions

• PLUS: RONA profits up, Home Hardware sells anniversary tulip, Canadian Tire closes test store, Acceo tweaks brand, new territory manager at Johns Manville, housing starts, Sears and Lowe’s, Owens Corning awarded—and more!

Innovation front and centre at Vegas hardware show

LAS VEGAS ― Lots of Canadian companies were exhibiting at the National Hardware Show last week, while a number of Canadian agents and reps were walking the show looking for new lines to bring back home.

The show, spread over 600,000 square feet, played host to 2,700 vendors. Feedback overall from the event was positive, with most Canadian vendors pleased with the attendance by key buyers from the Canadian retail groups.
 
Canadian companies used the event as a venue for showcasing, or even launching, new products. Names like Task Tools, EAB, and Nour were there in force, and Duschesne et fils was exhibiting for the first time. Andrew Pantiledes of Regal explained that his company owns its own factory in China, so everything is made right there, and to spec exclusively for Telesteps products. Asher Peres and Jennifer Cave of Toolway Industries kept busy showing the Goldblatt brand to Canadian buyers.

Industry veteran Christian Nadeau (shown here) was exhibiting with his company, CTM, showing a new line of hardwood countertops for kitchens. “This is something no one is doing right now,” he said enthusiastically. His enthusiasm was shared by the many visitors in the booth, including a representative from HGTV, who wanted more information about the 60 species of wood that are available.

Rammie Kamal, general manager of Dover Finishing, was promoting a line of wood treating products. Response, he noted, was very positive. “It’s way up over last year. Whether it’s Home Hardware or Home Depot or Canadian Tire, everyone is coming in and they’re all asking about our new offerings.”

Newcomer SciCorp International from Barrie, Ont., reported similar good results. The company introduced an odour-eliminating spray for composters and recycling bins licensing the WM/Waste Management name. “We launched yesterday,” said Bill Waters, director of marketing. “Ace Hardware wants us in immediately. True Value wants us in every one of their stores; Kent wants us in every one of their stores.”

Peavey Mart’s 35th store to open in High Prairie, Alta.

RED DEER, Alta. — Amidst the gloom of the Alberta economy, farm and hardware retailing is shining a bright light on High Prairie, Alta., where Peavey Mart will open its 35th store location in fall 2016.

Peavey Mart stores, which are part of Peavey Industries, feature a range of farm, hardware, pet, workwear, outdoor living, and automotive across Western Canada. The newest location will be about 16,000 square feet and create 12 jobs. The store and adjoining greenhouse will be the anchor tenant of the first phase of the East Gate retail development, which will eventually cover five acres.

“High Prairie is a central hub for a large trade area of about 30,000 people,” says Peavey Industries President Doug Anderson. “The farming history and solid trades sector attracted us, because we have a unique mix of items to serve the people of the area.”

Peavey was designated as one of Canada’s Top 10 Corporate Cultures in 2015. Besides offering traditional farming, hardware, trades and housewares products, stores offer unique items such as honey bees, chicks, and a free electric car-charging service. The company began fine-tuning the look of its stores last year with a store in Strathmore, Alta. (shown here). The High Prairie store will be modeled after that one, albeit slightly smaller.

RONA will host show in Montreal for affiliated dealers

BOUCHERVILLE, Que. — RONA inc. has confirmed it will hold another market for its independent or affiliated dealers, and for store managers of its corporate stores. The 2016 Buying Show will be held August 31 to September2 at the Palais de congrès in Montreal.

The show will take up 125,000 square feet and feature about 300 vendors. Day one will be devoted to seminars and presentations from RONA management, including a general session in the morning. The show floor will open the following day.

According to Philippe Element, vice president sales and dealer support, 85% of the dealer base of 250 independents across Canada is expected to attend, many with their buyers and managers. Like last year, the show will feature special promotions and “power buys,” and dealers will be equipped with iPads for placing orders electronically on the spot. The range of RONA services for its independent dealers will also be featured.

An LBM product auction, which proved very successful in 2015, will be reprised this year, while enhancements will include expanded space for new products, especially in outdoor living and patio furniture.

Titan partners with investor with an eye to more acquisitions

VAUGHAN, Ont. — WSB Titan, the giant commercial drywall operation headquartered just north of Toronto, is on the acquisition trail again, thanks to a partnership with a new investment group. Effective April 29, Titan has entered into a relationship with a “market-leading financial investor.”

According to Doug Skrepnek, one of the principals of WSB Titan, and president of Watson Building Supplies, “We were dealing with conventional banking. But we’ve been expanding at an extremely rapid rate over the past four to five years.” The bank, he says, was happy with Watson’s current status and did not want to provide money for further growth. However, Skrepnek says he has his eye on at least two more acquisitions, “so we went to the street.”

WSB Titan (WSB stands for Watson-Shoemaker-Beauchesne), is the result of a merger of some of Canada’s largest gypsum-supply dealers (GSDs) and represents almost 40 locations across the country. Nor is the company a stranger to big deals. In 2014, Titan acquired Slegg Lumber, the leading dealer on Vancouver Island. Last year it became an equity partner in BC Ceiling Systems, a West Coast distributor with locations in Vancouver, Richmond, and Langley, B.C., and in Calgary. 

Skrepnek won’t put a timeline on the next big deal, but expects to see something happen over the next three to six months. Nor would he name the potential candidates for acquisition, but he did narrow down the geographic possibilities. “We see opportunities in B.C. We’re definitely looking in B.C. That’s our number-one priority.”

However, he makes a point to discount any notion that Titan would acquire Pacific West Systems Supply Ltd., a TIMBER MART dealer which has five locations in British Columbia and two in Alberta. Those rumours, he says, are “completely false.”

DID YOU KNOW…?

RETAILER NEWS

OTTAWA —Canada’s Competition Bureau will not obstruct Lowe’s bid to acquire RONA, the Canadian Press has reported. The agency has concluded that the purchase, which has already been approved by regulators in Quebec, will not limit consumer choice. The transaction, which is also subject to review under the Investment Canada Act, is expected to close by the end of May. As he announced the federal government signed off on the deal, Economic Development Minister Navdeep Bains said that Canadian suppliers will benefit from the sale of RONA to Lowe’s.

BOUCHERVILLE, Que. ― RONA’s consolidated revenues for the first quarter were $819.2 million, up 5.2% from $778.8 million last year. With the adjustment of franchised store sales in order to compare them to those of the previous fiscal year, sales grew 3.4% to $805.4 million. The increase reflects a 3.1% increase in same-store sales in the RONA retail network, the seventh consecutive quarterly gain, resulting from a strong performance in Ontario and British Columbia and by the Réno-Dépôt banner in Quebec, which more than offset a decline in same-store sales in the Prairie Provinces. The company posted a loss of $16.5 million, however, which included $3.5 million in restructuring costs and $4.1 million spent acquiring a number of big box stores in Quebec.

TORONTO — Canadian Tire has closed its “urban” Express store, located in the Greektown neighbourhood of Toronto’s east end. The store was reportedly generating disappointing sales. The store had two levels, catering to the home maintenance needs of the inner-city customer.

ST JACOBS, Ont. — To celebrate Canada’s 150th anniversary in 2017, Home Hardware Stores Limited has joined the National Capital Commission, Kingdom of the Netherlands, and Communities in Bloom to be the exclusive carrier of the “Canada 150” tulip. The tulip is white with red flames, the colours of the Canadian flag. Customers will be able to purchase the Canada 150 tulip at Home Hardware stores across Canada this fall.

NEW YORK ― As the future of Sears Holding comes under question, an analysis in Forbes looks at which players stand to pick up the most business from its appliance segment. As the current number-two in that department, Lowe’s is a likely contender to see the most growth if Sears’ business continues to implode. A Prosper consumer survey found that Lowe’s ranked second in shopper preferences when seeking appliances, clocking in at 14.3% next to Sears’ 21%. Both Best Buy and Home Depot hover near 10%.

SUPPLIER NEWS
MONTREAL — Acceo Solutions Inc., a Canadian provider of IT and retail management software, has unveiled a new brand image. Working with Brandbourg, a Montreal branding and marketing agency, Acceo has redefined many aspects of the brand to better illustrate the company’s identity. The result? A new tagline: “Acceo: programmed for your performance.” The new brand image updates Acceo’s logo, promotion tools, various online platforms, and certain work areas. The makeover began earlier this year and will continue gradually in the coming months. “The change announced today by Acceo is … a major step in the right direction toward achieving our company’s goals surrounding strategy and vision,” says Gilles Létourneau, president and CEO of Acceo. “We want to become the North American leader in e-business transaction processing.”
 
TORONTO — Owens Corning Canada was awarded recently for contributions to energy efficient housing. Andy Goyda, Canadian builder lead and market development manager for Owens Corning Canada, has been inaugurated into the EnerQuality Hall of Fame. EnerQuality, which certifies energy efficient homes in Canada, holds the awards annually to recognize the residential construction industry’s leading innovators. Goyda was recognized for his impact on energy efficiency and green building in the housing industry—an honour that is typically given to a builder, not a manufacturer. The awards audience also voted Owens Corning Canada in for the Industry Partner Award. 

ST. LOUIS, Mo. ― Energizer announced its Q2 results, with net earnings of $16.4 million, compared to a net loss of $69.2 million a year ago. Adjusted net earnings in the second quarter were $18.5 million, compared to $27.5 million.

PEOPLE ON THE MOVE
Cheryl Allen is the new territory manager in Atlantic Canada for insulation maker Johns Manville, reporting to Canadian Sales Manager Gino Allegro. Allen previously owned a Benjamin Moore signature store in Amherst, N.S., and then went to work for Sherwin Williams as a territory manager in Atlantic Canada. (cheryl.allen@jm.com; 902-614-9545)

ECONOMIC INDICATORS
Housing starts nationwide fell to 191,512 units seasonally adjusted in April, from 202,375 units in March. Urban starts decreased by 4.6% to 174,810 units. Multiple urban starts decreased by 4% to 117,851 units in April and single-detached urban starts decreased by 5.8% to 56,959 units. In April, the seasonally adjusted annual rate of urban starts increased in the Prairies, British Columbia, and Atlantic Canada, but decreased in Ontario and Quebec. Rural starts were estimated at a seasonally adjusted annual rate of 16,702 units. (CMHC)

CORRECTION
In the announcement last week of Castle’s recent recruitment of Matthew Raetsen, his previous title was stated incorrectly. He was formerly branch manager for Mitten/Ply Gem.

NOTED
The Global DIY Summit, the world’s leading event, is only a month away! This premier event for retailers and manufacturers from the home improvement and garden centre industry will provide a unique opportunity to exchange views on current and future developments within the global market with the industry’s leading players. Click here for more info!

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