June 13, 2016 Volume xxii, #24 “Few people do business well who do nothing else.”
TORONTO ― Lowe’s is best known for its big boxes, so its commitment to the smaller stores it now owns and serves, through the acquisition of RONA, has come into question. However, a tour this past week by Lowe’s executives to affiliated RONA dealers and corporate store managers throughout Western Canada did much to affirm that commitment. The junket consisted of Sylvain Prud’homme, president and CEO of Lowe’s Canada; Alain Brisebois, chief commercial officer and executive vice-president; Christian Proulx, senior vice-president of human resources; and Dave Carr, vice-president of retail for Western Canada. First stop was the wholesale hardware distribution business in Winnipeg, Ace Canada (formerly TruServ Canada). In a separate interview with HARDLINES, Prud’homme stated earlier this month that RONA has a lot of regional expertise and understands how to serve independent dealers. He added that Lowe’s “will continue to invest in the existing RONA team, under Philippe Element, which caters to the independents, and ensure that the team is big enough to support that independent base properly.” And he had a message for dealers who may be wary of joining a group that also consists of one of their fastest-growing competitors. “Dealers have the chance to be part of the number-one choice for home improvement in Canada. It’s a great time to join and be part of this incredible growth opportunity.” That message was reiterated in last week’s lunch meeting with the Ace Canada management. According to one source, he told the Winnipeg team, “We bought the network, because we want the network. Ace fits that network.”
BMR hires new dealer development leader
BOUCHERVILLE, Que. — Immediately following the takeover of Groupe BMR by La Coop fédérée, the home improvement buying group and wholesaler pulled right back on efforts to expand its dealer network, including cuts to its dealer development team. A new hire suggests that could all change. BMR has appointed Pierre Nolet as senior director−business development. Effective July 11, he will report to Pascal Houle, CEO of BMR, and work with Jacques Pelletier, who currently holds the dealer development position. Pelletier will remain with BMR on a part-time basis as a consultant for special projects. Nolet brings to the job a solid background on the retail side. He purchased his first BMR store in 2000 in Saint-Ferdinand, in the Centre-du-Québec region. He then expanded his business by buying the Plessisville BMR store in 2010, and the Disraëli and Thetford Mines stores in 2012. In 2014, he decided to join forces with the Coop des Appalaches and to head the retail division of the co-operative, which is now known as VIVACO groupe coopératif. He will focus on the development of the hardware and LBM market and on the business relationships with BMR’s current dealers. Stéphanie Couturier, a spokesperson for BMR, adds that he will indeed have a mandate to develop the market outside Quebec, including opportunities in Ontario to develop the market and network. And yes, she adds, BMR will actively woo RONA dealers.
Castle buying expo a winning formula for dealers and vendors alike HUNTSVILLE, Ont. — Take 50 vendors and put them in a room with 50 dealers, add a timer and a bell, and you’ve got what might be the perfect model for a buying event. Castle Building Centres Group puts on three of these “speed-dating” events: in Atlantic Canada, Ontario, and British Columbia. The Ontario event was held last week at Deerhurst Inn, a toney resort in the province’s Muskoka Lakes region, about 225 kilometres north of Toronto. According to Ron Ishmael, senior hardlines buyer at Castle, each vendor gets 10 minutes with each dealer, and over the course of two days—interspersed with golf and other recreational activities—each vendor gets time with every single dealer in attendance. And, starting this year, the ordering can all be tracked digitally, using either a tablet or laptop. Like a regular buying show, this one features show specials, a new product section, and even palette buys. “It’s putting the vendors and the members together,” says Ishmael, adding that the 10-minute time slot is very productive, as it keeps both sides focused on the presentation at hand. “We try and make it better for both the vendors and the members.” Vendors interviewed by HARDLINES were equally enthusiastic and more than one observed that the costs and time involved in making sales calls to 50 dealers would be prohibitive, making this event a perfect fit for them. The event is even more remarkable for the fact that representation on both sides is typically the top people from each company. The Ontario expo serves both Ontario and Quebec dealers. According to Castle President Ken Jenkins, with 30 Castle dealers in Quebec, that province will eventually have the critical mass to warrant an event of its own. “The important piece for us is that the dealers are seeing every single vendor,” Jenkins says.
RONA team remains largely in place as Lowe’s does its due diligence BOUCHERVILLE, Que. — The departure last week of one of RONA’s top executives drew attention to the changes happening in Boucherville as the company awaits the shakeout from the takeover by Lowe’s. In fact, not much has changed. Rodier’s departure was a singular event, and not part of any larger restructuring. The only other senior people to leave were CEO Robert Sawyer and CFO Dominique Boies, whose departures had been planned in advance of the deal closing. Proulx points out that the head of Lowe’s Canada, Sylvain Prud’homme, is now CEO as well as president of Lowe’s Canada. Prud’homme has told the organization that he needs 60 days to analyze the RONA business before making decisions about leadership, structure, and buying teams. “We’re definitely in the process of looking at the business and creating a model for having these two businesses work together,” says Proulx. He does not expect Lowe’s to come and slash management and other positions. “This is quite important and one of the key messages we are sending to our people: this is not a deal based solely on synergies. It’s deal based on growth.” As for Rodier’s departure, Mario St-Louis, VP operations for RONA, is covering his role on an interim basis. St-Louis will be responsible for the entire retail side of RONA for now. Within the RONA buying team, the only confirmed senior departure is by Charles Gregoire-Beliveau, who has moved over to Groupe BMR (see PEOPLE section).
DID YOU KNOW…? …that HARDLINES will host an intimate, interactive session with HARDLINES Editor Michael McLarney on June 21? Find out how much the industry has grown, get details on the Lowe’s/RONA deal and on Orgill’s growing presence in Canada. (Space will be extremely limited for this event, so click here to register today!)
RETAILER NEWS MISSISSAUGA, Ont. ― Castle Building Centres’ newest member location is The Old Co-op, located in a historical building in North Gower, Ont., in the National Capital Region. A fixture in the community since 1846, the store is the go-to location for building supplies, hardware, outdoor gear, and farming supplies. The business was taken over by new management five years ago and owner Pat Lambert, who also operates a local construction company, has significantly grown the home improvement category. TORONTO ― Sears Canada reported that same-store sales declined 7.4% and core retail same-store sales declined 6.9% for the first quarter. Revenues of $595.9 million represented a decline of 14.5%. The decline in same-store sales was due to a decrease in big-ticket transactions such as major appliances, the loss of customer financing with the termination of Sears’ credit card agreement, reduced small-ticket sales, and higher prices for some items as a result of the weak Canadian dollar.
TORONTO ― Canadian Tire Corp. reports that plans for a new distribution centre in Bolton, Ont., are nearing completion. Canadian Tire expects to close the sale and leaseback of the DC to the Canadian Tire REIT sometime this month. BOUCHERVILLE, Que. ― The acquisition of RONA increases Lowe’s Canadian store presence tenfold, but even more important is its knowledge of its customer base, according to Forbes. RONA’s database of customer activity will be invaluable, and its long-time membership in Air Miles has given it access to information about customer purchases at other participating retailers. Such coalition loyalty programs are common in Canada and Europe, but still relatively unknown in Lowe’s native U.S. market.
SUPPLIER NEWS SCARBOROUGH, Ont. — The MIBRO Group is celebrating 70 years in business. A big supplier of private-label power tool accessories, it also produces KingChain and KingCord branded chain and rope for the home improvement and hardware markets. According to Larry Lucyshyn, president and COO, the company has been built on customer support, quality products, and innovative merchandising. “Our success is a direct reflection of our many excellent working relationships we have nurtured with our valued customers and supplier partners over the past seven decades.” TORONTO — Janette Ewen, an award-winning designer and blogger, has partnered with Delta Faucet Canada to showcase the company’s lines of kitchen and bath faucets. She offers design and style ideas through her blog and other social media accounts. Ewen is a design partner at Parker Barrow Design studio.
PEOPLE ON THE MOVE Charles Gregoire-Beliveau has left RONA, where he had been merchandise director for seasonal, heating, electrical, and horticulture, and joined Groupe BMR as purchasing director−retail. Globe Union has announced the promotion of Janet Oh to president–North American Private Brands, reporting to Charles Frankel, group chief commercial officer of Globe Union Services, Inc. As president, Oh, who joined the company in 2003, will have commercial responsibility for all of the company’s North American private-brand business channels, including plumbing wholesale, retail, and importers, as well as maintaining responsibility over big box and club channels. Andrew Jessome has been appointed director of sales for Atlantic Canada at Metrie. A native of Dartmouth, N.S., he started with Metrie more than 16 years ago as territory manager for New Brunswick and Prince Edward Island. Most recently, he served as sales manager in the company’s Brampton, Ont., location. Jessome will relocate to Nova Scotia over the coming weeks. (andrew.jessome@metrie.com)
ECONOMIC INDICATORS The value of building permits issued by municipalities edged down 0.3% to $6.9 billion in April. This marked the second consecutive monthly decline and was largely the result of lower construction intentions in Ontario, Quebec, and Nova Scotia. The value of residential permits declined 1.8%, dragged down by a slowdown in multi-family dwelling intentions, despite a gain posted by single-family home permits. Declines were reported in six provinces, led by Ontario, followed by Quebec, and Nova Scotia. (StatCan)
OVERHEARD…
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