Hardware experts on maintaining profitability

EESEIGED by predictions that E the current economic slowdown will drag on through late spring, hardware/home center dealers are looking for ways to make the best of the situation.

With this in mind, The Merchant Mogazine staff consulted several industry executives and advisors asking the question: "How can the hardware/home center retailer best retain profitability in today's challenging market?"

The question was approached from a variety of positions with advice based on the speaker's past knowledge as well as present situation. One wholesale distributor executive declined to comment because "we are not experts in the field of today's highly changing market," giving credence to the popular philosophy of "who knows?"

Along this line, Denis B. Daines, vice president of Valli & Colombo (U.S.A.) Inc., producers of decorative brass door hardware, suggested that the question might well be expanded to read "challenging and changing market."

"Some retailers have already learned the lesson that value is not necessarily low prices," he explained, ' 'and that the new products buyer for their company does not allow customers the choice or chance to

Story at a Glance

High quallty, tight control, utillzatlon buy high-value items when theyresist new products on price alone."

"Today's d-i-y buyer has had low priced products and now wants something better to make his or her home a little nicer or different," he continues. "There are many new high-value products available at the marketplace, but not featuredor sold by retailers because of a high retail price."

"When choosing such a product line, retailers should look for value, low or no stock programs, manufacturers with a reputation of quality, service, and strong dealer support," he suggests.

"Offer value, not just prices," Dains says in summing up his philosophy of upgrading merchandise to meet the tastes of the customer as well as his budget.

Some advice on product displays is included in David G. Bancroft's answer to our query. Assistant to the senior vice president, marketing and corporate development, AFCO Industries, Inc., he says "There are many variables that affect the profitability of every business including the hardware/home center retailer and to pinpoint how he can best retain profitability actually involves looking at every aspect from accounting procedures to advertising. "

"However, the utilization of floor space via store layout and product signing should be very important to the profitability of all retailers," he stresses. "It is vital to achieve an excellent return per square foot to achieve profit. Competitive pricing does play a major part, but if a product is inadequately displayed, pricing may not even be a factor. Time plays an important role in the buying decision of a consumer because the consumer cannot purchase what he cannot find."

Also related to the managing of the

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