Keynobr surueys hadwarc industry's position

1f, CftON and cooperation are T the solutions to many of the ills of the hardware industrY today, Lawrence R. Gavin, president of Ace Hardware Corp., proposed in his keynotc address at the 1985 National Hardware Show/Hardware Industry Week.

"What I propose is a symPosium to be held this fall or early next spring to include representation from all of those within the golden triangle of distributiorrwholesalers, retailcrs and manufacturersj' he told the audience at the Aug. 12 opening of the Chicago meeting. "The American Hardware Manufacturers Association, the National Wholesale Hardware Association, the National Retail Hardware Association, all coming together with a common purpose;

"Think of what a meeting like this could accomplish. It would open uP lines of communication as never before. All of the critical issues which face retailers, wholesalers and manufacturers could be addressed in a setting with input from all those who would be affected. Tbpics could include video cornunications, the UPC Code, inventory control at the retail

Story at a Glance

$113 billion home improvement ma*el by 1990 . rctailer who pleases customer will suwive strategy can beat compeli. tion... m|r, wholesaler, rctailer musl cooperate . .lndustrywHe sympoeium called f,or and wholesale lwel, computers, electronic marketing, the importance of long range planning for our industry, and much more."

At the beginning of his speech, Gavin indicatd he would tell "how I see the indrutry toda$ who's winning, who's losing and why, what we all must do to remain competitive." He challenged his audience to make a commitment to excellqnce.

Outlining opportuniti€s, Gavin called the industry dynamic, stimulating and changing. D-i-y rsearch indicates that the,tptal home improvement market will reach $ll3 billion by 190, he said. The d-i-y home improvement market will reach $78 billion, thecompound annual growth rate will be 890 in the home improvement market and 12.70/o inthe d-i-y segment in the next five years.

The d-i-y industry is entering a new strategic era characterized by a sustained high level of demandand above average earnings prospcts, Gavin pointed out. Backing his comments with "in one day, Americans spend almost $154 million at building supply home centers, hardware'stores, home improvement warehouses, lumberyards and the like . about $53 per household each and every month. AIso in one day, Americans undertake 252,W d-i-y projects, about 1.8 million per week. American d-i-yers do more painting related projcts than any oiiGr type almost 97,000 per day. They also spend almost $29'000 per drv on room additions and start almost 10,000 security related.pfojocts. lbuching on the comPetition between the independenl and the chain, especially the warehouse operations, he gave examples of how Harry's in New Orleans, La., mapped out a strategy of convenience and service to meet the arrival of Home DePot and Houseworks in that city. Independents who rcpresent at least 7590 of the companies in the industry should replace paranoia with preparation and planning, he said. Power retailers need to rep,lace marketing mania with market sunrcys and round business principles.

He characterized the problerns of the, industry as "all competing for basically the same consumers, consumers who have gfeater.choies than ever beforel' Comparing the proliferat-ion of retailers in one areafighting for the same culttomers to service stations on everycorrter and the gqs wars of t}e '50s and '60s, he stressed that the retailer must identify the consumer he serves.

ManufactwCrs and'wholesalers must work together with relailers, he said. From manufacturers and suP pliers, wholesalss exp€ct programs tailor-made to their needs. Vendors must work with buyers and theirmerchandising department to create the best possible program for dealers. Wholesalers want suppliers to provide information on new products, new trends and new offerings.

"All of us in this room have shared in the growth of tlre hardware-home center business. ,T1e doit yourself market continues to groq fostering new forms of retailing whichgenerates new customers. Many of the hardware store and lumb,er yard retailcs have evolved into home centers q&d then to warehouse stores. It is a mad scramble for business with the retailer after the consumer, the manufactur€r after the retailer, and the wholesale/distributor sometimc caught somewhere in be, tweenl'