December 4, 2017 Volume xxiii, #46
I don’t take on big things. What I do, pretty much, is make the big things small and the small things big.
—Larry David (American comedian, writer, actor, and TV producer, 1847- )
HOLIDAY PUBLISHING SCHEDULE: We’ll publish monthly in December, so there will be no issues of HARDLINES on December 11, 24, and January 1. We’ll return to our regular weekly schedule with the January 8 edition.
IN THIS ISSUE:
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Home Improvement eRetailer Summit brings e-commerce leaders together
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RONA makes big gains in Ontario with recruitment of six-store chain
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Alexandria Moulding acquires U.S. moulding company
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Peavey integrates strategy and online sales with TSC acquisition
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PLUS: Castle announces new Ontario member, TIMBER MART adds Northern Ontario dealer, BMR secures new member, Patrick Morin promises more stores, Canac relocates head office and opens store, Walmart robots, more Sears and Kmart closings, and more!
Home Improvement eRetailer Summit brings e-commerce leaders together
ORLANDO, Fla. — The second annual Home Improvement eRetailer Summit was held last week, bringing together manufacturers, distributors, and pre-qualified online retailers interested in increasing online sales of home improvement products through collaboration and partnerships. Participating companies included BuildDirect, eBay, Sustainable Supply, Supplyhog.com, and Sears.com and Kmart.com.
The event, which was held at the Rosen Shingle Creek hotel in Orlando, Fla., offered an intimate environment for vendors and retailers alike to learn from each other and network to develop online strategies for mutual growth. The summit included a day of presentations by leading e-commerce companies, with a keynote by Alyssa Steele, divisional merchandise manager for home and garden at eBay.
Retailers were looking for ways to meet the next challenge of online retailing, including the move by manufacturers to sell direct on Amazon or other e-commerce market places. Vendors in the room expressed their interest in growing their sales with legitimate sellers such as eBay and in finding strong, branded products that can be sold on an exclusive or proprietary basis.
Information sessions were presented against the backdrop of some harsh competitive realities: Amazon currently represents 7% of U.S. home improvement sales, but accounts for fully one-third of all e-commerce sales. Should the online retail giant decide to close that gap by pursuing a more concerted strategy for home improvement products, traditional bricks-and-mortar retailers could face even greater challenges. Meanwhile, Home Depot and Lowe’s combined could account for $40 billion in online sales within just four years.
Elizabeth Ragone of Lenox, an online seller of dinnerware and kitchenwares, talked about the importance of telling stories to help sell products. She made the point that content is key for communicating not just the benefits and features of a company, but for reflecting the cultural values of the company itself. “Create an experience,” she urged delegates.
Steele from eBay explained that a new generation of homeowners are making families and looking for home improvement and décor products. They will need to be catered to, she noted.
The underlying concern among delegates was the need for the traditional hardware and home improvement industry to catch up to the realities of online selling. That includes large products such as flooring, roofing, and other building materials, something that companies like BuildDirect already specialize in.
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RONA makes big gains in Ontario with recruitment of six-store chain
BOUCHERVILLE, Que. — Doidge Building Centres Ltd. and Mahood Lumber Company Ltd., which collectively are part of the Doidge TIMBER MART family of stores, has joined RONA. There are six locations in Ontario—in Kincardine, Miller Lake, Bracebridge, Bradford, Welland, and Fort Erie. The stores, which previously operated under the TIMBER MART banner, range from 6,000 square feet to 16,000 square feet of retail, with yards ranging from 2.5 to 12 acres per store. All locations have a mix of retail and contractor customers.
Owner Dennis Doidge cited a desire to step up the stores’ e-retail, marketing, and branding as a motivation for the change.
“Our decision to change banners was based on the fact that we felt we were falling behind in the areas of e-commerce, marketing and branding. After careful consideration and discussions with all the major buying groups in the industry, we concluded that RONA was the one company that could give us the tools we need to better compete in this ever changing industry.”
The company likes to point out the success of its stores as reflected in the fact that the Kincardine location is a past recipient of the Hardlines Outstanding Retailer Award for Best Building Supply or Home Centre under 10,000 square feet.
Dennis and his wife Kathryn purchased the Miller Lake location in 199. Over the years, the Doidges have added five locations in Central and Southwestern Ontario. “The synergies between the six stores work very well. Whether it is shared trucking, purchasing, or staffing, the efficiencies are there,” said Doidge. “We look forward to working with RONA to continue my expansion into additional stores and new markets.”
Lowe’s now has a network of more than 430 stores under the RONA banner. These consist of both corporate stores and independent affiliated dealers. It is also growing its ranks of independent dealers under the Ace banner, of which there are now more than 80 in Canada.
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Alexandria Moulding acquires U.S. moulding company
ALEXANDRIA, Ont. — Moulding and millwork maker Alexandria Moulding has acquired House of Fara, based in LaPorte, Ind. Founded in 1961 by the Fara family, the company manufactures standard, decorative, and embossed hardwood mouldings, in addition to other specialty products.
“This partnership solidifies our hardwood supply and product offering through our distribution facilities,” said Andre Cholette, president of Alexandria Moulding. The acquisition, he added, would allow Alexandria to strengthen its North American manufacturing presence.
House of Fara will continue to operate in the same building, with the same people. VP Tom Fara will join the Alexandria team and support the integration and combined business over the long term. President Mike Fara, and Dan Fara and Mark Martin, have announced their intention to retire.
The integration of both companies will take place over the upcoming months.
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Peavey integrates strategy and online sales with TSC acquisition
NIAGARA FALLS, Ont. — Peavey Industries is in its sweet spot: the farm and hardware retailer has seen this sector grow over the past several years, and has been evolving to maintain its position as a key retail presence. Doug Anderson, president and CEO of Peavey, shared his company’s story at the recent Hardlines Conference.
The company, based in Red Deer, Alta., operates stores under the Peavey Mart banner and, through an ongoing acquisition process, now has TSC Stores in Ontario under its umbrella. Peavey customers are typically rural, or embrace the rural lifestyle, and 50% of them live outside urban centres. Peavey’s operations now total 91 stores in five provinces.
But a decade ago, says Anderson, the biggest challenge then was a shortage of good retail sites. That inspired the company to look at smaller sites, around 10,000 square feet, in the heart of smaller centres. The concept, called MainStreet Hardware, was launched in 2012 with a store in Blackfalds, Alta. A second store soon followed in Vermillion, Alta., providing convenience farm and hardware assortments in smaller urban environments. Since then, Peavey has added another store in Ponoka, Alta.
Anderson shared with the conference delegates that two more are scheduled to open in 2018, one in Sherwood Park, Alta., and another near Winnipeg.
With increased growth came a new challenge: to preserve the company’s corporate culture, one that focuses on respecting employees and putting customers first. “We were to a point where we were adding up to 100 new people a year.”
Anderson looked for a way to reduce turnover and preserve the values of the company. In 2016, Peavey introduced employee ownership. That ownership drills right down to the cashiers in the stores, embracing the notion that the staff in the stores live in, and are involved in, their local communities. “We felt that gave us a lot more depth in the communities we are in.”
With the company now positioned to manage growth more cohesively, Peavey turned to a major acquisition target. The acquisition of TSC Stores, which began in the summer of 2016, brought together two like-minded companies, with similar customers and very few overlapping markets. (TSC’s two stores in Manitoba were renamed Peavey Mart.) TSC, which is based in London, Ont., caters to hobby farmers, rural customers, and sports, hunting, and fishing customers.
TSC also has “a strong online strategy,” said Anderson. And that’s something Peavey will share in. The company has recently announced that it will offer “a convenient, combined integration strategy” for online sales.
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RETAILER NEWS
VAUGHAN, Ont. — TIMBER MART has signed a new dealer, Timmins Home Improvement Centre, an 8,000-square-foot hardware store in Timmins, Ont. This independent dealer in Northern Ontario joins the buying group to improve its hardlines buying power through TIMBER MART’s membership in the Spancan buying group, and access to TIMBER MART’s national marketing support, including a national flyer program, television and radio media, sports marketing, the Air Miles loyalty program, and credit card and gift card programs. Roger Gagnon, and his sons Shawn and Jason Gagnon, own and operate Timmins Home Improvement Centre.
BOUCHERVILLE, Que. — Groupe BMR’s newest member-dealer is Quincaillerie Rousseau, a family-owned business based in Saint-Lambert on Montreal’s South Shore which has been in operation for 82 years. “The values of BMR, a Quebec- based company that is highly aware of its impact in local communities where its stores are located, entirely overlap with ours,” owner Philippe Desjardins.
QUEBEC CITY — Canac is outgrowing its Ancienne-Lorette head office and will relocate its base to the Lebourgneuf district of Quebec City, Le Soleil reports. The company is investing some $5 million in the new premises, where neighbours will include Canadian Tire. At the same time, Canac is planning a spring opening for its newest outlet in Saint-Augustin-de-Desmaures. The $7 million facility joins other projected openings in Longueuil and Pont-Rouge.
BOUCHERVILLE, Que. — Centre du Bricoleur RONA in Lachine, Montreal, was recognized with multiple accolades this fall. In October, the Chambre de commerce du Sud-Ouest de Montréal named owner Yves Chartier as its “Business Personality, Extraordinary Individual” during the UNION gala, which celebrates success among businesses in Montreal’s Sud-Ouest borough. A few days later, the borough of Lachine presented Chartier with the Economic Development Award during the Au fil de l’excellence gala, which pays tribute to citizens, volunteers, and community organizations. Finally, Regroupement Affaires Lachine Inc. selected RONA Lachine as one of the members honoured at its Gala des Piliers.
MISSISSAUGA, Ont. — Lowe’s Canada has announced the addition of a new Ace-bannered store, this one in Watson, Sask. Located at 101 Hwy 6 North, Ace Hardware Watson is owned by Cindy and Kelly Herridges and offers a wide assortment of essential products and supplies to serve the local community. the store can also offer Ace Canada’s new Click & Collect service, which allows customers to choose from thousands of products on www.acecanada.ca, make online purchases, and collect their orders in the store within seven to 10 days.
MISSISSAUGA, Ont. — Rainy River Hardware is the latest retailer to join Castle Building Centres. Rainy River is situated southeast of Lake of the Woods on the Rainy River, part of the Ontario-Minnesota border. Established in 1981, the store has been in the hands of current owner Millie Lindal for 20 years. With her sons Cory and Lance, Lindal offers the complete gamut of hardware merchandise to the local community. It will host a grand opening in early January with the Castle banner.
JOLIETTE, Que. — Groupe Patrick Morin is scouting sites for new outlets, Le Journal de Montréal reports. General Manager Daniel Lampron says the company is in “buyer mode.” The Quebec City region and Montreal’s South Shore are next on the horizon, according to the report. Lampron told delegates at the recent Hardlines Conference that Patrick Morin’s strategy of controlled growth allows it to ensure the success of new ventures.
BENTONVILLE, Ark. — Robots are part of Walmart’s strategy for improving its inventory management, as the retailer announces plans to add technologically advanced assistants in 50 U.S. stores, Business Insider reports. The giant retailer tested the robots at a small number of stores in Arkansas and California earlier this year and now plans to expand the program. The two-foot-tall machines travel through aisles and scan shelves for missing or incorrect price tags and out-of-stock or misplaced products using a built-in camera.
HOFFMAN ESTATES, ILL. — Sears Holdings is planning more Sears and Kmart store closures for January 2018, according to CBS News. The latest store closures include 45 Kmarts and 18 Sears locations in 25 states. Money-losing Sears has worked on selling off iconic brands such as Craftsman, has repeatedly borrowed money from CEO Edward Lampert, and has steadily closed retail stores in a struggle to return to profitability. The company’s Canadian counterpart, Sears Canada, is liquidating completely.
SUPPLIER NEWS
COLOGNE, Germany — Next year’s International Hardware Fair will feature some 2,700 exhibitors from more than 50 countries, in the Tools, Industrial Supply, Fasteners and Fixings, Fittings, and Home Improvement segments. The four-day biennial event has seen a 5% bump in bookings for the 2018 installment, of which tools will once again be the focus. The Fair will be held under the theme of digitalization, with an embedded “dSummit” helping to orient and support participants in the ever-increasingly electronic retail climate.
PEOPLE ON THE MOVE
Christine Hand, chairman of the board for Home Hardware Stores Limited, has been recognized as one of Canada’s Most Powerful Women by the Women’s Executive Network. “Canada’s Most Powerful Women: Top 100 Awards” celebrate the professional achievements of strong female leaders in private, public, and not-for-profit sectors across the country. The awards honour women in nine categories, highlighting those who push boundaries in their careers, amongst peers and for their communities. Hand earned the award once before, in 2015.
Dirk Drieberg has left Allegion. For the past three years, he had been marketing manager, consumer products, for the company’s Schlage brand. His background includes marketing roles at Henkel, Valvoline, Bic, and Black & Decker. (double.d@rogers.com; 416-716-8251)
Marty Hawthorn is retiring. Hawthorn spent the last eight years at insulation maker Johns Manville, serving as Ontario territory manager. Before that, he worked for 19 years as Ontario manager for allied products at Taiga Building Products.
OVERHEARD…
“The conversation we have with bricks-and-mortar retailers that don’t ‘get it’ are completely different from the conversations we have with retailers that are strictly digital.”
—Steve Greenspon, CEO of Honey Can Do, a storage and organization company that sells strictly online. He was speaking at the recent Home Improvement eRetailer Summit in Orlando, Fla.