April 17, 2017 Volume xxiii, #16

“If at first you don't succeed, blame your parents.”
—Marcelene Cox (American humourist and columnist for Ladies’ Home Journal, 1899-1998)


IN THIS ISSUE:

  • Meet the Buyers: update on our event with Lowe’s top decision makers

  • Canadian Tire puts push on private-label products

  • Buyers cite outdoor living as a strong growth category

  • Lowe’s finds Canadian division’s diverse formats ideal for testing new ideas

  • PLUS: Home Hardware dealers in Quebec, Castle in Saskatchewan, RONA in Montreal, Dealer winner in Ontario, Tractor Supply’s Q1, Richelieu results, Tyvek anniversary, housing starts, and more!

Meet the Buyers: update on our event with Lowe’s top decision makers

WORLD HEADQUARTERS, Toronto — At our upcoming Meet the Buyers Breakfast, HARDLINES is proud to present senior buying executives from Lowe’s Canada. The event will take place April 26, from 7:30 to 10 a.m., at the Hilton Mississauga-Meadowvale hotel near Toronto’s Pearson International Airport.

We do want to announce one change to the lineup as originally presented. Igor Halencak, Vice President National Procurement, Central Merchandising, and Global Sourcing for Lowe’s Canada, will be replaced by Maxime Harvey, Lowe’s Canada’s Director of Building Materials.

Harvey joins these other top buying influences: Alan Blundell, Divisional Vice President, Merchandising, Lowe’s; Marc Gingras, Divisional Vice President, RONA Proximity Stores; and Christian Dauphinais, Divisional Vice President, Merchandising for Réno-Dépôt.

This vendor-only event is a must-attend for any supplier looking to grow their business with one of this country’s second-largest home improvement retailer.

(Cost for this once-in-a-lifetime vendor-only event is just $129. Click here to reserve your spot now!)

 

Canadian Tire puts push on private-label products

TORONTO — A decade ago Canadian Tire was, like many retailers, getting behind its private-label products, in an effort to drive margins for dealers. But in those days, many of those house brands were also part of the feeding frenzy that was coming out of China. And, like many of its competitors, private label became another name for cheap. Back then, under Mark Foote, the company was gaining about 25% of its sales from house brands, and aspiring for 50%.

Then, with a notion to return to quality, many retailers distanced themselves from putting their names on Asian imports and began looking again at national brands, as well as beefing up their private label.

So, by Q4 2016, private label accounted for one-third of Canadian Tire’s sales, with fully 88% of its Christmas products.

The camping category had become “fairly stagnant” for Canadian Tire, said Allan MacDonald, president of Canadian Tire Retail, in an analysts’ call following the release of the company’s year-end results. Woods is the company’s own brand for this category. He noted that other categories that need a shot in the arm could likewise benefit from the introduction of an in-house brand. He wouldn’t confirm which categories might be considered “underperforming.”

Categories such as home décor have benefited from the rollout of the Canvas line three years ago, while Canadian Tire has expanded into cleaning products and consumables—everything from paper towels to snack foods—with its Frank line, introduced in 2014.

 

Buyers cite outdoor living as a strong growth category

SPECIAL REPORT — When winters are as long and harsh as they can be in Canada, it’s natural that summer becomes a highly anticipated season. One trend retailers have picked up on in recent years is that Canadians are eager to make the most of their longer days by effectively living outside during the summer months.

Valérie Brien, BMR’s director of purchasing for hardware, says the company started to focus on outdoor living and seasonal back in 2012, and launched its first seasonal catalogue the following year. “People want to make the summer last as long as they can and they want to spend their time outside,” says Brien. “We see changes in the sales; we’re seeing increases in sales of sectionals and seating sets because people want to sit outside, comfortably.”

At Home Depot Canada, Megan Schroeder, divisional merchant for patio, has noticed the same thing. She says the trend right now is to turn the patio space into an outside living room, complete with garden décor items like carpeting, lanterns, and string lights to give it that homey feel. And she adds shoppers are not looking to sacrifice style, either.

Other major retailers have been responding to the demand for stylish outdoor furniture and accessories. Canadian Tire for its part has been releasing more trendy outdoor items under its Canvas brand, promoting all the accessories to make an outdoor space a “stylish retreat” such as lanterns, throw pillows, and planters.

(This story is excerpted from the latest issue of our sister publication, Hardlines Home Improvement Quarterly, which has just been mailed to more than 11,000 dealer-owners and managers across Canada. For more information, click here!)

Lowe’s finds Canadian division’s diverse formats ideal for testing new ideas

BOUCHERVILLE, Que. — Lowe’s announced last week the roll-out of its new Holoroom How-To technology at a second Canadian store, after an initial Boston-area pilot. Building on the first generation of the Holoroom program released in 2014, the How To app combines the former’s augmented and virtual reality visioning capabilities with instructional features and real-time practice for DIY users.

The Holoroom How To, which has made its debut in the Toronto area and is coming to a store outside Montreal in the next few weeks, is “a different experience” from the original Holoroom, with a different objective―actually teaching how to do home improvement projects, says Claire Bara, VP of Strategy and Business Insights for Lowe’s Canada.

Bara has already taken it for a spin herself. “It really feels like you are actually doing the tiling of the shower yourself, with the sensation of the tools in your hand.”

Bara says the system is great for customers who lack the skills, or even just the confidence, to take on a DIY project on their own: “The beauty of it is you can mess up, because it’s not real!” She notes that consumer tests compared the Holoroom How To experience against a control group who simply watched tutorial videos on YouTube.

“Customers who used the Holoroom How To had a 36% better recall” of the steps involved, compared with the YouTube viewers, Bara told HARDLINES, a result she attributed to the value of muscle memory. “People learn more easily by doing. This is why the virtual reality is so efficient.”

The Canadian launch of the Holoroom How To represents “a true partnership” between Lowe’s Canada and Lowe’s Innovation Labs in the U.S., according to Bara, and Canadians “can expect to see more innovation” out of that collaboration.

The lab is especially interested in Lowe’s Canadian operation because of its diversity of store types and customer profiles. With Lowe’s operating a single banner in the U.S., the Canadian company offers unique opportunities for the lab to test out new devices, applications, and innovations. That makes the Canadian stores “a nice playground,” says Bara.

 

DID YOU KNOW…?

...that space is running out at our upcoming Meet the Buyers Breakfast? This amazing event will feature Lowe’s top buying influences for its Lowe’s, RONA, and Reno-Depot stores. It’s being held at the Hilton Mississauga Meadowvale Hotel on April 26. (Click here now to see who’s coming and to reserve your spot right away!)

RETAILER NEWS

ST. JACOBS, Ont. — Home Hardware Stores Ltd., together with the Laflamme family and Groupe Brochu, have entered into an agreement for the acquisition of two stores from George Laflamme inc. The locations are in Sainte-Claire and Saint-Charles-de-Bellechasse. Groupe Brochu currently operates JNB L’Outilleur agricole and hardware stores L’Outilleur SEC in Saint-Henri and Saint-Lambert. “We want to strengthen our presence in rural areas serving agricultural producers, like my grandfather Joseph Napoleon did when he opened his first general store,” said Patrice Brochu, president of Groupe Brochu. The Laflamme family is similarly venerable, having started in 1908. The transaction remains subject to usual closing conditions and will be completed in the coming weeks, with the Sainte-Claire and Saint-Charles-de-Bellechasse stores remaining under the Home Hardware banner with new ownership.

MISSISSAUGA, Ont. — Castle Building Centres has added a new dealer in Saskatchewan: Riel Trail Building Supply in Dundurn, just outside of Saskatoon. Riel Trail Management has been in the RTM and modular building manufacturing industry for almost three years, and the move to an LBM retail location was a natural progression for the owners, including Gaetan Blouin, CEO and president of Riel Trail.

BOUCHERVILLE, Que. — RONA Quincaillerie Maisonneuve, an independent affiliate in Montreal’s east end, has completed the acquisition of the nearby Quincaillerie Moussette, which will now bear the RONA banner. All jobs will be maintained, including 18 at Maisonneuve and eight at Moussette. “By equipping ourselves with a second store to better meet the needs of new customers in the neighbourhood, we are continuing to grow in our market,” says owner Sylvain Malette.

ST. JACOBS, Ont. — Hanover Home Hardware Building Centre is the recipient of this year’s Walter J. Hachborn Store of the Year Award. The award was presented to dealer-owners Dan and Emily Moulton at the company’s recent dealer market. In addition to their customer service and expert advice, the store team’s social conscience was cited, as expressed through the support of many organizations including the Hanover and District Hospital and projects assisting several youth, seniors, and community groups.

BRENTWOOD, Tenn. — Tractor Supply Company reported that net sales for the first quarter of 2017 increased 6.6% to $1.56 billion, from $1.47 billion in the first quarter of 2016. Comparable store sales decreased 2.2% after an increase of 4.9% a year earlier. The company’s 2016 fiscal year had 53 weeks.

 

SUPPLIER NEWS
MONTREAL — Richelieu saw Q1 consolidated sales reach $195.9 million, compared with $188.9 million for last year’s first quarter, historically one of the weakest. The 3.7% increase included a 2.3% gain from internal growth, and 1.4% from acquisitions. In Canada specifically, the company logged $125.6 million in sales, increasing by 4.5% from the same period last year. Sales to manufacturers amounted to $98.4 million, against $95.7 million a year ago. Sales to hardware retailers and renovation superstores grew to $27.2 million, up by $2.7 million or 11%.

WILMINGTON, Del. — DuPont Protection has announced the 50th anniversary of it DuPont Tyvek house wrap. The non-woven material has provided protection and safety in a wide variety of industries and applications. To mark this milestone, events will be held throughout the year. In addition, a series of communications and special activities are planned. 

 

ECONOMIC INDICATORS
Housing starts for all areas in Canada reached 253,720 units seasonally adjusted in March, up 18.4% from 214,253 units in February. That’s the highest level since September 2007. Urban starts increased by 20.2% to 235,674 units. Within that number, multiple urban starts increased by 30.2% and single-detached urban starts increased by 3.1%. Rural starts were estimated at a seasonally adjusted annual rate of 18,046 units. (CMHC)

 

PEOPLE ON THE MOVE
Brampton, Ont.-based door manufacturer Renin has named Mitchell Burke as chief sales officer. Burke was previously VP of sales and customer service for the company’s retail division. He has assumed responsibility for the global sales operations of all Renin’s divisions.

Mark Spanswick has been appointed president and general manager of Ace Wholesale Holdings LLC. He joins Ace from W. W. Grainger, where he spent the last 27 years in a variety of leadership roles. Also at Ace: Kerilyn M. Johnson has been promoted to the position of vice president, general counsel, and secretary. In her new role, Johnson will lead legal affairs at Ace Hardware. Johnson joined the company in 2013 as senior corporate counsel and was promoted to assistant general counsel in 2015.

 

IN MEMORIAM
Lew Dobbie, a veteran of the hardware industry, died last week in hospital at the age of 71. Following his uncle into the hardware industry, his career took him to D.H. Howden (including Stoney Creek Pro Hardware), Chalifour, and TIMBER MART. Dobbie was a past member of the Burlington Golf and Country Club as well as past president of the Upper Burlington Optimist Club. He had a passion for harness racing and late in life renewed his enthusiasm for boating as a member of the Canadian Power and Sail Squadron. Dobbie is survived by his wife Diane, his daughters Leah and Jodi, and their spouses.

 

NOTED
The North American Retail Hardware Association (NRHA) and the Paint and Decorating Retailers Association (PDRA) have released a joint announcement outlining a new strategic alliance between the two associations. The goal of the alliance is to expand access across the home improvement industry to a broader array of products, programs, and services that both associations offer individually. Together, NRHA and PDRA represent more than 50,000 independent retail outlets throughout North America, offering their members training materials, industry information, advocacy, and marketing programs, as well as a variety of live events throughout the year. The NRHA in Canada is represented by Hardlines Inc.

 

OVERHEARD…
“We pursue our acquisition strategy and we are confident that we will be able to seize other opportunities in the coming months.”
—Richard Lord, president and CEO of Richelieu, commenting on strong results for the first quarter for the Montreal-based hardware supplier.


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