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VICE PRESIDENT & PUBLISHER David Chestnut david@hardlines.ca

EDITOR Steve Payne steve@hardlines.ca

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2022-12-20 8:47 AM

V OL UME 13, NO. 1

FIRST QUARTER / 2023

CONTENTS COVER STORY

THE BEST OF THE BEST eet this industry’s 34 M2022 Outstanding

Retailer Award winners DEPARTMENTS

9 18 66

NEWSROUNDUP

PAGE 10

CONFERENCE REPORT

SPECIAL FEATURE

LOWE’S CANADA SOLD Lowe’s will disappear as a brand name in Canada as RONA makes a comeback

Kent must open books to CRA to share its pro accounts

REUNITING THE INDUSTRY 20

A summary of all eight presentations at the 26th Annual Hardlines Conference

EDITOR’S MESSAGE

Lowe’s Cos. gave Canada its best shot PRODUCT SPOTLIGHT SPECIAL!

hat’s new in W power tools ENDCAP

T he unassuming retirement

RETAIL TECHNOLOGY

A DIGITAL PLAN, SELF-CHECKOUTS, WAREHOOS look at all the 52 Atech news from the

first to the last mile PRO CORNER

Gillfor is unifying branding across all divisions

Castle’s business development manager expects big growth

THE STATE OF PLAY IN RENTALS

retailers are vacating the 58 Some field while others double down

Home Hardware’s Laura Baker talks marketing and pro sales

With Ace fully integrated, Peavey Mart looks to expand

FIRST QUARTER / 2023

7

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EDITOR’S ME S S AGE

STEVE PAYNE, EDITOR

LOWE’S RETURNS RONA TO A VERSION OF ITS FORMER SELF Contrary to popular opinion, Lowe’s was not another American retailer who didn’t understand our country

W

hen analysts were asked about Lowe’s Cos.’ sale of its Canadian operations (the deal is to close in the first quarter of this year), a number of them replied that the North Carolinabased big box operator didn’t understand Canada.

That’s a strange take. After all, the retail giant announced its decision to come to Canada all the way back in 2005. It opened its first stores here in 2007. That’s a long time in Canadian retailing to not understand the country. I think we should give Lowe’s more credit than that.

Lowe’s might not have generated quite the profits it wanted to in Canada during its almost two decades here. But credit the company with becoming very familiar with the oddities and complexities of this country.

Lowe’s doubled down on Canada when it, controversially, purchased the RONA and Rénô-Dépôt banners in 2016. At that time, the world’s second-largest home improvement retailer controlled a network of 539 stores in this country.

So Lowe’s did know what it was doing.

There was—and remains—a very fine team at the head office in Boucherville, Que.

www.hardlines.ca

Tony Cioffi, Lowe’s Canada president, has announced that the Lowe’s brand will be converted over to RONA sometime within the next 10 to 16 months. That HQ at 220 chemin du Tremblay will be a RONA head office once again.

And RONA will once again be privately operated. It will be owned by Sycamore Partners, a New York City-based private equity firm that also owns Staples Business Depot (for six years now), Anne Taylor, Loft, Lane Bryant, Belk, and Talbots. These are all great retail brands. It’s been just over 20 years since RONA was last a private firm, unworried about quarterly forecasts, stock prices, PE ratios, and all the noise of Wall Street. It can say goodbye to all that.

All the newly-owned company has to do now is serve its customers. Including the 213 RONA stores that are independently-owned and, in fact, customers of Lowe’s Canada’s wholesale distribution business.

Based on our discussions with those dealers, many of them couldn’t be happier.

“

Many RONA dealers couldn’t be happier.

”

steve@hardlines.ca

Hardlines Home Improvement Quarterly

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NEWSROUNDUP OF THE HOME IMPROVEMENT INDUS TRY

Visit Hardlines.ca for breaking news in the Home Improvement Industry

S P E C I A L F E AT U R E

LOWE’S SELLS ITS CANADIAN DIVISION TO U.S.-BASED PRIVATE EQUITY FIRM

L

owe’s Cos. is selling its Canadian home improvement operations to Sycamore Partners, a privateequity firm based in New York. At press time, the deal is to close in the first quarter.

The price was US$400 million in cash and “a performance-based deferred consideration,” according to Lowe’s.

For that, Sycamore acquires some 450 stores that include 61 Lowe’s big boxes in Canada, 31 RONA big boxes, 20 RénoDépôt big boxes, 120 corporate-owned RONA building supply stores, the wholesale supply business of another 213 independent RONA stores (owned by some 150 dealers) and five Dick’s Lumber outlets in B.C. and Alberta.

Lowe’s Cos., of Mooresville, N.C., entered Canada in 2007 with its own big boxes. It purchased RONA and its ancillary brands for US$2.4 billion in 2016, at that time valued at C$3.2 billion.

“The sale of our Canadian retail business

is an important step toward simplifying the Lowe’s business model. While this business represents approximately seven percent of our full year 2022 sales outlook, it also represents 60 basis points of dilution on our full year 2022 operating margin outlook,” said Marvin Ellison, Lowe’s chairman, president, and CEO. Sycamore Partners specializes in retail businesses. Its holdings include Staples, Ann Taylor, Loft, Lane Bryant, Belk, Talbots, Dollar Express, and Aeropostale.

LOWE’S STORES IN CANADA TO SWITCH TO RONA The news that Lowe’s Cos. is selling off its Canadian division to New York City-based Sycamore Partners, a private equity firm, is the biggest jolt to hit the Canadian home improvement industry since 2016 when Lowe’s purchased RONA and its Quebec-based banner Réno-Dépôt.

The announcement has raised more questions than it has answered, many of them from suppliers. In a letter to vendors shortly after the

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Hardlines Home Improvement Quarterly

Other Canadian home improvement retailers are watching the deal with interest.

“It’s too early to say if BMR would be interested in acquiring the RONA business,” said Alexandre Lefebvre, CEO of BMR Group, “especially as we’re looking at the market ahead with concern.”

Regardless of the future of the economy, however, he says his company can continue to have a strong appeal for RONA dealers.

“This is an opportunity for BMR—one hundred percent.”

announcement of the sale in early November, Lowe’s Canada president Tony Cioffi said, “Under our new ownership, we will maintain a strong commitment to our Canadian- and Quebec-based vendors, including through our ongoing involvement in the ‘Well Made Here’ initiative, meant to encourage the purchase of domestically manufactured quality products.”

Cioffi also shared that the Lowe’s big box stores will change names eventually. “There are no significant changes planned for the stores.

We will eventually move away from the Lowe’s banner in Canada in favour of the RONA banner in a manner that ensures the least possible disruption to our business. Otherwise, you will see minimal change.” www.hardlines.ca

KNOWLEDGE IS POWER. Stay in the know every single week with HARDLINES. Subscribe online at Hardlines.ca

S P E C I A L F E AT U R E

RONA AFFILIATES OPTIMISTIC

T

he announcement of the pending sale of Lowe’s Canada to a private equity firm has many RONA dealers expressing optimism.

Lowe’s business in Canada consists of about 450 stores, 213 of them independents, owned by some 150 dealers. They range from small local hardware stores to some of the largest regional building centres in the country. And the collective retail sales of these RONA independents are huge, estimated at around $2 billion. If they formed a buying organization of their own, their combined volumes would be bigger than many major buying groups.

After the announcement of the sale, RONA management began a series of meetings with the dealers to outline the opportunities available to them under the new regime. The larger RONA dealers will almost certainly look at taking over some of the 61 Lowe’s stores in Canada. Those stores will be replaced with RONA branding and, in Quebec, Rénô-Dépot.

But other factors have the dealers excited, as well. A big one is the fact that RONA will be privately held for the first time since RONA went public in 2002. That means dealers will no longer be concerned about

how quarterly results might affect how they get treated. They will also have access to the full range of Lowe’s programs, like VIPpro for contractor customers, and Lowe’s brands including Ego, Craftsman, and Flex.

One of the biggest RONA independent dealers in the country is Fraser Valley Building Supplies (FVBS), with six locations in B.C. FVBS President Ray Cyr said the news was “very positive.”

“It’s an opportunity for us to acquire some corporate stores,” Cyr said. “I believe Sycamore will take a year to evaluate what they’ve got.” Cyr said he liked the idea of Sycamore taking ownership “because they are specialists in the retail arena,” owning Staples and other retail brands.

Another large RONA independent dealer in B.C., Michael Allen, of B.H. Allen Building Centres, with three locations, said that Lowe’s was always going to find it tough slogging when they arrived in this country in 2007. “What they did wrong was they were the last big box in,” Allen said.

Allen told Hardlines that it would have been nice to see the independent dealers offered the opportunity to buy the firm.

“Dealers could have ponied up that $400 million,” Allen said. “I know we ourselves would

have put in whatever was needed to have a good position. That was always the negative… we didn’t have control of the brand.”

Andrew Doidge, vice-president of Doidge Building Centres, a ten-store RONA independent in Ontario, was also positive about the news. And he believes Sycamore Partners will hold onto RONA—as the private equity firm has done with the Canadian retailer Staples, which they acquired in 2017.

“They’re a private equity firm, they exist to make money and Lowe’s is a profitable firm in Canada,” Doidge told Hardlines. “RONA is going back to their roots. They are back in the style of company that they started in.

And that’s a good thing.”

A further clarification to the announcement was sent out the following morning, reaffirming that Lowe’s Canada will remain headquartered in Boucherville, Que., on the south shore of Montreal. It also notes that the deal includes “a performance-based deferred consideration”—a clarification probably deemed necessary because analysts noted that Lowe’s Cos. received cash for only 16.6 percent of the amount that it had spent on acquiring RONA just over six years earlier.

Lowe’s Canada says it is working to make the transition to the new ownership a “seamless” one, “with minimal disruption for our 26,000 associates. It will remain business as usual, including unchanged compensation and benefits.” www.hardlines.ca

Hardlines Home Improvement Quarterly

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NEWSROUNDUP BRIEFLY TIMBER MART ADDS QUEBEC MEMBER Marc Chevalier Inc. in Bedford, Que., has joined TIMBER MART as the group’s newest member dealer. Marc Chevalier Inc. opened in 2022 and offers an array of building materials such as roofing materials and exterior cladding.

It occupies a large acreage which includes a 3,000-square-foot store and a 1,500-squarefoot warehouse, with room for future expansion.

Kent is required to forward information to the CRA for all contractors belonging to the retailer’s Kent Pro loyalty program who have spent more than $20,000 annually.

KENT MUST OPEN BOOKS TO CRA TO SHARE ITS PRO ACCOUNTS, COURT RULES

T

he Federal Court of Canada has given the Canada Revenue Agency (CRA) the green light to comb through the records of Kent Building Supplies’ pro and commercial customers.

A division of J.D. Irving, Kent has 48 building centres and big boxes in Atlantic Canada.

In its latest push against the underground economy in construction, the tax agency had applied to the court to obtain “significant data” on pro customers’ purchases from Kent dating back to Jan. 1, 2019.

Kent is now required to forward to the CRA the name and contact information, CRA business number or SIN, and total transaction amounts for all contractors belonging to the retailer’s Kent Pro loyalty program who have spent more than $20,000 annually.

Hardlines contacted Kent but was referred to the only statement its parent company

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FIRST QUARTER / 2023

J.D. Irving had issued, to the National Post, calling CRA’s action a “common and routine practice for home improvement retailers in Canada, where select contractors are concerned.”

It is indeed a common and routine practice and it seems to happen regularly in November when the year is coming to a close. Home Depot Canada faced the same battle at this time in 2019. A court order was required, forcing Home Depot Canada to turn over records of sales to its contractor customers for the years 2013 through 2016.

Two years earlier, RONA went to court to attempt to block CRA from doing the same thing. At that time, the feds investigated RONA’s trade customers at some of its stores for the years 2012 to 2015.

In 2018, CRA estimated that the underground economy exceeded $50 billion, with residential construction accounting for about half of that.

Hardlines Home Improvement Quarterly

CANADIAN TIRE SALES SLIP IN THIRD QUARTER Canadian Tire Corp. reported Q3 net income of $184.9 million, down from $243.7 million a year prior. Revenues rose to $4.23 billion from $3.91 billion in the comparable period in the previous year. Comp sales at Canadian Tire Retail were up 0.7 percent, driven by the automotive, seasonal and gardening categories.

IKEA TESTS SMALLER STORES IN CANADA IKEA Canada plans to expand its small-store format with a new location in Scarborough, Ont. It’s set to open at the Scarborough Town Centre in the summer of 2023, serving residents in the east end of Toronto. It will be the company’s second small-format store in Canada, at nearly 81,000 square feet in size.

PEAVEY MART EXPANDS IN BRITISH COLUMBIA Peavey Industries has opened the doors of its newest store, in Salmon Arm, B.C. The approximately 25,000-square-foot store in Centenoka Park Mall is the third Peavey Mart in the province, joining locations in Dawson Creek and Kamloops, and the chain’s 91st location overall. It followed on the heels of an opening in Bedford, N.S., which was the chain’s first Peavey Mart store in the Maritimes.

www.hardlines.ca

NEWSROUNDUP

GILLFOR ENTERS NEW YEAR WITH UNIFIED BRANDING ACROSS ALL DIVISIONS

C

anada’s third-largest LBM distributor is poised for strong growth, backed by a new branding initiative that will consolidate its various divisions.

The Ontario-based Gillfor Distribution grew sizably last June 30, when it completed the acquisition of AFA Distribution, a competing LBM distributor based in Bolton, Ont. Gillfor was established when OWL Distribution in Woodstock, Ont., and McIlveen Lumber, an LBM wholesaler based in Calgary, merged in 2017. A year later, the company added Brown & Rutherford in Winnipeg and Brunswick Valley Distribution, based in Fredericton.

But the acquisition of AFA last year moves Gillfor to a new plateau.

And there’s more to come, says Mike Schneider, Gillfor’s VP of business development. The various divisions will shed their names to reinforce the central brand. The consolidation will include merging systems,

financing, and the onboarding of AFA’s 16 warehouses with Gillfor’s existing six. Head office will remain in Woodstock, Ont. Schneider says this will be a year of rapid growth for Gillfor. The wholesaler’s vision includes working with “best-in-class vendors and developing real partnerships to grow the market and to take share.”

Gillfor is working to combine its offering to its dealer customers across the country.

Its base is the specialty building materials

business, while the AFA acquisition adds a broader range of LBM commodities to the mix.

Schneider told Hardlines that Gillfor’s centralized model will enable it to implement its national programs along with a regional sensitivity.

“We have an unbelievable respect for and confidence in our managers at the branches,” Schneider says. “We believe they are the pillars.”

CASTLE’S BUSINESS DEVELOPMENT MANAGER ANTICIPATES ANOTHER STRONG YEAR With changes to its development team late last year, Castle Building Centres Group is looking to expand its membership.

Doug Keeling took over as the buying group’s director of business development last fall from Bruce Holman, who has retired.

Keeling oversees a team of eight people taking care of Castle’s 300-plus members, while connecting with prospects to keep adding to the group’s ranks.

Coming out of the pandemic, the industry

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FIRST QUARTER / 2023

and the economy are confronting a lot of changes, and change is always good for dealer recruitment, Keeling says.

The industry changes include new ownership at rival groups such as Sexton Group and TORBSA, plus the sale of Lowe’s Canada. “We’re coming out of a couple of years that were crazy for all the groups, not just Castle. There have been big changes across various banners. That is causing some dealers to relook at the groups they’re

Hardlines Home Improvement Quarterly

with,” Keeling says.

Part of that growth has meant splitting the Ontario territory, which has about 100 Castle dealers. The reps there are André Laurin for central and northeastern regions, and Lillian Diaz, for the central and southwestern parts of the province.

Despite the headwinds of rising interest rates and continued inflation, Keeling expects the momentum in the industry to continue.

www.hardlines.ca

Working for our members every day.

“

There’s no doubt that consolidation has cut down on the number of product manufacturers.

For independent dealers like me, that means less competition between suppliers for my business and less leverage for me to get more competitive pricing for my customers. That’s where I rely on Sexton’s strength to negotiate programs that keep me competitive.”

—Charlie Hotham, Owner, Hotham Building Materials

Hear about our story at

1.800.665.9209 Learn about our story at

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Our Promise to You. Our strength as a buying group is built on four major advantages: We’re a dedicated team of industry professionals focused on your success.

We negotiate competitive programs and leverage our strong relationships with vendors to resolve any issues quickly for you. We have a first-class accounting team that promptly delivers accurate rebate payments as promised.

Well connected.

So you can focus on what matters most — your business.

NEWSROUNDUP HOME HARDWARE’S LAURA BAKER TALKS MARKETING AND PRO SALES

H

ome Hardware has a lot on the go, and that has Laura Baker, the company’s chief marketing officer, pretty jazzed. In an exclusive interview with Hardlines, she shared her enthusiasm for the dealer-owned company’s latest initiatives.

Starting with supply chain improvements, Baker explained how Home Hardware had just locked in its ability to ship customers’ orders from any of its three warehouses either direct to store or direct to home. “That omnichannel tent we have for customers to buy, in any channel they choose, is very important to us.”

Tying in each independent dealer to the online sale with an effective attribution

NG™ H RE OL O

PE

R

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E

ES

M

STR

and Home’s own Cat brand of power tools, to a newsletter for trades that features product specials and tips. A beefed-up website offers videos, design and décor articles, and product reviews.

G

IMPACT

model was a big part of the development process, she said. “Customers will go back and forth and we’ve created a buy-in for the dealer that benefits their own Home Hardware store to have those sales.”

Baker says the look of the dealers’ microsites will change to focus more on each dealer, “and you’ll see that everything we do, not just online, is to put the dealer front and centre.”

Baker then turned her attention to another important customer—contractors and builders. “The pro is a huge component of our business.” That’s now being reflected in everything from product lines specifically for pros, such as Milwaukee power tools

Laura Baker, chief marketing officer, Home Hardware.

CHAR

Hardlines Home Improvement Quarterly

www.hardlines.ca

WITH ACE FULLY INTEGRATED, PEAVEY MART LOOKS TO EXPAND

M

anaging multiple banners keeps Doug Anderson very busy. He’s the president and CEO of Peavey Industries, which operates corporate stores under the Peavey Mart and MainStreet Hardware banners. Anderson also directs the wholesale and branding needs of a group of independent dealers that operate mainly under the Ace banner.

Ace is the newcomer that turned Peavey into a wholesale distributor. But Anderson is investing in growth on all fronts, including new stores under the Peavey Mart banner. One such store opened last fall in Bedford, N.S., marking the first location for the company east of Ontario.

Even with the Ace banner, Peavey has made a point of acquiring and maintaining a few stores as corporate locations—when the opportunity presents itself.

The renewed focus on expansion reflects the realignment of the company following several years of aggressive growth. That included the acquisition of 50-plus TSC stores, mainly in Ontario, in 2017, followed by the takeover of the Ace Canada licence in March 2020 from Lowe’s Canada. The TSC stores were fully switched to the Peavey Mart banner in 2021.

“The TSC changeover was good but there’s always work to do with redirection, etc. But we’re getting good at that.” Anderson says

Doug Anderson, president and CEO, Peavey Industries. the lead-up to the rebranding of TSC was carefully plotted, as buying teams were combined and systems consolidated. “We had moved the stores to be more aligned, so by the time of the switch it was just a matter of putting up the new sign.”

UP TO

www.hardlines.ca

Hardlines Home Improvement Quarterly

UP TO

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P werTools

BY GEOFF McLARNEY

S P O T L I G H T

The future of cleaning has arrived Clean more efficiently with the new Makita 18V LXT Brushless Cordless 3.0L Smart Robotic Vacuum. Equipped with a mapping function that allows it to automatically return to its initial position, it will clean an area of 600m² with up to 200 minutes of run time.

It’s also available in a kit (DRC300PT2) that includes two Makita 18V LXT Batteries and a Makita Dual Port Rapid Charger. www.makita.ca

Makita’s first 14" Cordless Power Cutter The new Makita 80V max XGT Brushless Cordless 14-inch Power Cutter is designed to tackle masonry and metal materials in any renovation.

With power to wet or dry cut single passes up to 5 inches deep, it claims to provide up to 55 percent more cuts per charge in concrete and up to 20 percent more cuts per charge in metal. Available in a 5.0Ah or 8.0Ah kit with four 40V max XGT batteries and a 40V max XGT Dual Port Rapid Charger, or as a stand-alone tool. www.makita.ca

Get notified when it’s time to reload this nailer From DeWalt’s Atomic Compact 20V Max series, the Brushless Cordless 23-gauge Pin Nailer boasts a high-output brushless motor and is capable of driving 23-gauge pin nails from 5/8 inch up to 1-1/2 inches in length into a variety of woods, including solid oak. The tool’s runtime allows it to drive, on average, 2,000 nails per charge to help maximize uninterrupted work time. For jobsite efficiency, the low nail lockout system with LED indicator informs users when it is time to reload. www.dewalt.ca

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Hardlines Home Improvement Quarterly

www.hardlines.ca

POWER TOOLS SPOTLIGHT

Cooling coating prolongs cutting life Diablo’s new range of Steel Demon Amped reciprocating saw blades bring innovation to thick metal cutting with the industry’s first industrial-grade coating Black Industrial Cooling Element (I.C.E.). The ultraslick Black I.C.E. provides a cool and clean cutting edge and ultra-superior chip evacuation. Highperformance carbide increases cutting life in metal cutting applications ranging in thickness from 3/16 inches to 9/16 inches. www.diablotools.com

Spade Bits make drilling holes easy Diablo’s Demo Demon Spade Bits promise durable and effortless hole drilling for nail-embedded wood. The Demo-Edge dual cutting edges, coupled with a self-feeding Dura-Tip, power through nail hits for a smooth drilling experience and up to 60 times longer life.

An optimized curved paddle design enhances the chip evacuation process for more holes per charge. www.diablotools.com

Comfort and power go cordless Bosch’s optimized cutout tool delivers corded performance and convenience.

Every drywaller knows that a mechanical sliding switch is where the most failures and repairs happen on a cutout tool. Bosch has created a simple solution: a dustresistant mechanism that keeps material and debris from entering the switch and causing failure. And keep working all day: a single 4Ah battery charge will handle 330 linear feet or cut openings for over 250 single gang junction boxes. www.boschtools.com

Portable table saw promises corded performance on the jobsite Bosch’s ProFactor 8 1/4-inch table saw provides 25-inch ripping capacity to the right of the blade for cutting sheet goods. Bosch’s BiTurbo system combines a custom brushless high-output motor designed to run off the enhanced output of its 8Ah Core18V batteries.

This table saw allows you to work longer by getting 192 linear feet per 8Ah batter charge, or 48 cuts, and nearly double that when using the ProFactor exclusive 12Ah battery. www.boschtools.com

Hardlines Home Improvement Quarterly

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CONFERENCE SERIES

2022

C ONF ERENCE C O V ER A GE

HARDLINES CONFERENCE REUNITES THE INDUSTRY IN NIAGARA-ON-THE-LAKE

T

he 26th Annual Hardlines Conference hosted almost 150 delegates at the Queen’s Landing Hotel in Niagara-on-the-Lake, Ont., in October. A large number of additional

Photos: Anand Sheoran, My Photographer Portraits Inc.

delegates across the country watched the presentations on their devices.

The two-day event attracted a veritable who’s who of the industry, with attendees from BMR, Castle, Federated Co-op, Home Hardware, Lowe’s/RONA, Peavey Industries, and Sexton Group, among others. Virtual delegates included top execs from Home Depot as well as a number of key independent dealers. The vendor community was well represented with sponsoring manufacturers, wholesalers, sales agents, and distributors in attendance.

Industry associations were represented from both sides of the border.

The traditional opening pub night, held in a nearby Irish pub and hosted by RONA, was packed. There was also a sense of relief: For many delegates this was their first national gathering in our industry in almost three years.

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FIRST QUARTER / 2023

A large crowd attends the awards gala, including (foreground from left) Michael Foltin, Cinzia Angeloni, and Diego Mazzone, all from ORA sponsor JR Tech.

Hardlines Home Improvement Quarterly

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HOW TO ATTRACT AND KEEP GOOD EMPLOYEES

Eric Palmer was “team member 22” when he joined Sexton Group in 2016. Now he’s the buying group’s VP and GM.

ERIC PALMER VP and GM of the Sexton Group Eric Palmer, VP and GM of the Sexton Group, gave a presentation entitled, “The Evolution of a Team.” He told delegates

that “change can be unexpected, but it is inevitable.”

Palmer’s employer is a case in point.

PFM Capital Inc., of Regina, will be the new majority owner of the Sexton Family of Companies in a deal that was expected to close by the end of 2022.

Palmer said he was “team member 22” when he joined the organization in January 2016. He was promoted to VP and GM of the buying group in February 2020. He cited his strong relationship with Steve Buckle, CEO of the parent company, as an asset.

Palmer noted that each employee at the firm is encouraged to have a career plan in place.

Total honesty is also a hallmark of the

company: “It’s hard to hear what you’re not doing well,” Palmer said frankly. But the support and training are there. “We provide, for example, Dale Carnegie training to all employees.” The company believes in getting out on the road, too. Given the constraints of the pandemic, the management team asked, “Should we send people to the WRLA show? Yes! Send them there!”

Palmer then put up a slide he called his “unscientific hiring matrix.” It consisted of quadrants entitled: Experience, Runway, Outside Perspective, and Industry Knowledge.

These are all important, Palmer said, because obviously the company wants experience, but Sexton Group also wants runway in a new hire—they want someone to have years of contributions ahead of them. He said his firm likes to recruit employees who have the perspective of other industries. But they also value work experience in this somewhat unique industry.

Palmer put up one of the more memorable slides of the day, quoting digital marketing guru Perry Belcher: “Nothing will kill a great employee faster than watching you tolerate a bad one.”

Michael McLarney, founder and president of Hardlines, welcomes delegates.

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HOW TO BUILD A MULTI-STORE OPERATION

C ONF ERENCE C O V ER A GE Rob and Joanne Lawrie, who own seven Home Hardware stores in Nova Scotia, said many retiring dealers will look to sell to multi-store operators like them.

ROB AND JOANNE LAWRIE Home Hardware Dealer-Owners Rob and Joanne Lawrie won an Outstanding Retailer Award in the Retail Spirit category at last year’s conference.

They were back this year as presenters.

The couple talked about their company’s growth from a single store in Annapolis Royal, N.S., founded by Rob’s parents, Beth and Robin Lawrie, to the couple’s seven Home Hardware stores today.

When they began the expansion of their (now) regional chain, it wasn’t all roses. But Rob recalls he got courage and resolve from some advice that was passed onto him at a Home Hardware dealer market by another successful multi-outlet dealer. “Whatever you do, do not stop at two stores,” said the dealer. “Do not do it!”

Joanne says that one of the many things they have learned along the way was “learning the expectations that the community has of you.” Running a hardware store (they also own stores under the Home Hardware

The Outstanding Retailer Awards was celebrating its 30th anniversary.

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Building Centre banner, as well as a Home Furniture Store) really embeds you in the community, Joanne said. It results in expectations that have to be met in ways that other types of businesses might not encounter.

For example, the Lawries have greatly expanded the services they offer at these seven stores. “We are part of the fishing community, for example,” Rob said. “It’s not uncommon for us to be down at the wharf helping to lift an engine out of a boat.”

Joanne talked about the extra expectations that have come with expansion (they purchased four of their seven stores in a cluster in 2019). “We doubled our sales,

we doubled our staff, and we doubled our expectations and responsibilities overnight,” Joanne said.

The strategy for sanity? Simple, Joanne says: “Focus on the customer.” Customer service is everything.

Rob said the future of the independent home improvement store is, in fact, dependent on operators like the Lawries who are prepared to buy out other dealers and give their stores a new life. “A lot of people [who run stores in this industry] are at retirement age,” Rob said. “I believe that multi-store owners can be a solution.

And not just in our banner, literally across the country.”

A large Home Hardware delegation celebrated its two ORA winning stores, from Grande Prairie, Alberta (see page 42), and St-Raymond, Quebec (see page 38).

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HOW THE ‘INVERTED PYRAMID’ WORKS AT LOWE’S CANADA TONY CIOFFI, President, Lowe’s Canada Tony Cioffi, president of Lowe’s Canada, might have given a totally different presentation if Lowe’s Cos.’ sale of its Canadian

operations had come three weeks before his presentation and not three weeks after, as it did.

That agreement, announced in early November, to sell Lowe’s 450 Canadian stores, including RONA, Réno-Dépôt, and Dicks Lumber, to New York-based private equity firm Sycamore Partners set the industry alight with speculation. Cioffi’s first major announcement after the sale was that the Lowe’s brand will disappear in Canada—over time—and the RONA brand will take its place. Cioffi also reiterated the company’s commitment to keep working closely with Canadian vendors.

But at the Hardlines Conference, before the sale, Cioffi talked mostly about Lowe’s principles—and how they have served Lowe’s Canada very well during the pandemic.

“Our employees focus on what we call the Big Three,” Cioffi said. “Customer service is number one; being in stock is number two;

and having a clean and safe store is number three. Everything we do surrounds those three things.”

Cioffi then talked about the “inverted pyramid,” which is a mantra at Lowe’s. In this “servant leadership” model, the customers are at the top; the head office executives are at the very bottom. “I work for the store support centres, who look after the associates, who look after our customers. If we do a better job of looking after our associates, they will do a better job of looking after our customers. And the best way to do that is to give them technological advantages. (See page 52 for an article on the various tech features that Lowe’s Canada was able to deploy so successfully during the pandemic.)

“I can tell you we’re in supply chain optimization right now,” Cioffi said. He cited the opening of a brand new 1.23-millionsquare-foot bulk DC just north of Calgary, and the planned construction of another large DC in Ontario. “Really, the objective is getting the product to the customer over the last mile.”

Tony Cioffi: “If we do a better job of looking after our associates, they will do a better job of looking after our customers.”

“Today, the norm is people expect their product to be delivered in two to three days. Soon, same day will be the expectation. Frankly, 33 percent of customers today already expect same-day delivery.

The scary stat is that 50 percent of your customers go on your website and look for a product, select the product, go to the checkout, and then when they look at the delivery expectations… if it doesn’t meet their needs, 50 percent of those customers leave to go somewhere else.”

“So getting to same-day delivery is not years away. Same-day is almost today.”

Hardlines publisher David Chestnut emcees the awards gala.

Lowe’s Canada president Tony Cioffi explains his firm’s pickup lockers.

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ORA winner Marianne Moisan at the BMR/Acceo/Belanger table.

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WHY A CORPORATE EXEC FOUNDED HER OWN COOKWARES STORE

Possibly the most frank and engaging presentation at the Hardlines Conference came from Cookery’s Alison Fletcher.

ALISON FLETCHER, Owner, Cookery

Alison Fletcher, owner of Cookery—a cookware retailer with five stores in Toronto and Montreal—opened day one of

the Hardlines Conference with a no-holdsbarred description of the career battles she has gone through in several decades in the food and beverage industry. Cookery’s charismatic owner urged delegates to follow their dreams—and the data.

Fletcher also spoke about talent and her own career path. She presented her “Ego Meter,” a screen on which bad experiences at firms resulted in a steep downward line.

And she’s worked for a lot of corporations, including Maple Leaf Foods, Tim Hortons, the George Weston Co., and Burger King.

“I’m going to tell you, warts and all, about my journey,” she promised.

After climbing the corporate ladder at both big brands and consulting firms, Fletcher got unceremoniously fired from her top marketing post at Burger King. She had then seen enough of working for other people. “I was 43 years old, I’m a woman, I’m in management. I realized I’m going to have to chase work.” But that was something she didn’t want to do anymore. Instead, she decided it was time to “do what I loved in a way that I loved to do it.”

“A former colleague said to me that every

time I was on vacation, they’d noticed that I would go into kitchen cookware stores…

I discovered that food was my passion. My love language is cooking! Does anyone else here [in the audience] love cooking? Oh, your love language is hardware!”

“I had always dreamt about my own business. But I needed data to make all my decisions. I wanted cooking courses at the centre of the business.” And she wanted to have a store that could be a positive part of the community. “I wanted to be able to walk down the street and have someone say, ‘Hey, Alison!’ ”

Geoff McLarney, Hardlines’ Montreal-based associate editor.

Hardlines’ Jillian MacLeod and Michelle “The Showrunner” Porter.

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Alex Yakovyshenko, Haney’s Builders’ Supplies; Gary Sangha of Crown Building Supplies; and BSIABC’s Thomas Foreman.

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LEADERSHIP AND COMMUNICATION STYLES AT WORK ZAIDA FAZLIC, VP, People and Culture, Taiga Building Products Zaida Fazlic, VP people, culture and change management at Taiga Building Products, gave a presentation on the skills required to be a good leader. She talked about col-

laborative leadership and servant leadership, which both require listening carefully and authentically to the feedback and needs of employees.

“At Taiga all of our leadership team takes part in team-building exercises. It’s a talent assessment tool. Some people are people-oriented, some are process-oriented, and some are results-oriented.”

Process-oriented people are interested in the rules. They are methodical, they are analytical, and they are safety oriented.

Results-oriented people are interested in the “win,” achieving a successful outcome.

They have a tendency only to look at the process when the results are negative.

People-oriented people favour maintaining good relationships at all costs.

The different orientations are expressed in different communication styles. “Conflict can arise,” Fazlic said, “when we communicate to people who have other styles in communication than we prefer.”

Regardless of the communication style you bring to the workplace, it’s important to moderate it—or at least self-monitor it, lest it derail your career, she said. “Margaret Thatcher [UK prime minister in the 1980s who earned the nickname, ‘The Iron Lady’] is a great example of a strength taken too far.”

She was ruthless and blunt, which worked at times. But she also humiliated her team members in public. Ultimately, she was brought down by her own political party.

So it’s important not to overdose on one particular communication style, whatever yours happens to be. In fact, Fazlic said, “It’s possible to borrow elements from different leadership styles and still be true to yourself.”

Zaida Fazlic pointed out that conflict in the workplace can arise when we try to communicate in a style that is different from that of our co-workers’.

ORA winner Marc-André Lebel, BMR Pierre Naud; Tannis Bourgeois, Grunthal Lumber.

Relaxing at the traditional RONA pub night: (Front, from left) Kim Laurette, A.O. Smith; Krista Hamilton, McDonald Sales; Paul Crawford, King Marketing; (Rear) Michael McLarney and David Chestnut, Hardlines.

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Syl Haisan, C.A.Fischer Lumber Co.; Dale MacPherson, Home Hardware Stores; Kevin Gillman, Grande Prairie Home Hardware Building Centre, an ORA winner.

Hardlines Home Improvement Quarterly

Christine Joannou, Luxo Marbre; Marie-Eve Morin, Belanger Laminates.

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EXPANSION AND PRODUCT MIX CHANGES AT ‘GROUPE BMR 2.0’ CHARLES GRÉGOIRE-BÉLIVEAU, VP Merchandising, BMR Group Charles Grégoire-Béliveau, VP merchandising at BMR, took Hardlines Conference delegates through a tour of what he called “BMR 2.0.” Self-quarantined due to Covid, he appeared on a video screen from his home in Quebec. BMR, a subsidiary of Sollio Cooperative Group (formerly La Coop fédérée), has more than 275 stores in Quebec and, increasingly, outside it.

The Quebec-based buying group and retailer is continuing to sign new dealers in Ontario and the Atlantic Provinces as well as pursuing expansion in its home province. It has four formats: the “full featured” BMR store, BMR Pro, BMR Express, and AgriZone—which exists both as a standalone store and as a store-within-a-store, specializing in the farm market, including the maple-sugar industry.

“We are building BMR 2.0 and our vision is to be the leading independent retailer [in our industry] in Canada,” Grégoire-Béliveau said.

The RONA pub night vibrates to the sounds of The Danny Boys.

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BMR’s top merchant outlined his company’s product assortment review over the previous 14 months, focusing on four categories.

The company has done a thorough review of its product assortment over the past 14 months, Grégoire-Béliveau revealed. “We are going to be investing in specific categories: building materials, plumbing—where the number one project is kitchen and bath, flooring, and seasonal.”

In addition to listing these categories as opportunities, Grégoire-Béliveau didn’t shy away from mentioning “a number of

At the pub night, Sheila Carr, Mountain View Building Materials; Liz Kovach, WRLA; Sarah Hounslow, BMF; ORA winner Deb Brinson, Gander Bay Castle.

challenges” that the industry faces. He cited inflation, consumer-spending patterns having changed so much after the pandemic (namely online shopping), the difficulty of attracting labour, the housing market slowdown, and interest rate increases.

No Hardlines Conference would be complete without Michael playing the harmonica.

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ECONOMIST SAYS ‘UNCERTAINTY AND CAUTION’ ARE WHAT’S AHEAD PETER NORMAN, VP and Chief Economist, Altus Group Altus Group economist Peter Norman was blunt at the outset of his presentation.

“Uncertainty and caution are what we’re going to talk about this morning,” he warned.

“But also some good things,” he promised.

First the good news. Canada is not likely to experience a housing crash, Norman said. But interest rate hikes will likely mean the heady times for home improvement retailers are over.

“If your industry involves construction, you’ll have found that business has been quite good lately,” Norman said. “But the economy is in transition and all sorts of stuff is going on.”

Inflation was the first topic that Norman tackled in his analysis of that “stuff.” The Consumer Price Index was up 6.9 percent in August, the most recent month for which stats were available at the time of Norman’s presentation. Transportation cost increases led the way at 10.2 percent in August, food was at a 9.6 percent increase, and shelter was up 6.6 percent year-over-year.

Norman predicted “one more 75-point change” in the Bank of Canada policy interest rate to come. He was slightly pessimistic.

A week after his speech, the central bank

“

In addition to presenting an “uncertainty and caution” view of the 2023 economy, Norman pointed out that (at the time of the conference) 500,000 more Canadians were employed than a year previous.

18 months … then we might see that rate come down.”

And there’s more behind the Bank of Canada’s rate increases, Norman said. In addition to inflation control, the central bankers are attempting to support the Canadian dollar.

Expectations are that the recession will last through the end of [2023].

raised its rate by 50 basis points to 3.75 per cent. He compared that to the three previous peaks over the past 20 years: 3.0 percent in October 2008, 4.5 percent in November 2007, and 5.75 percent in January 2001.

Norman forecast that the Bank of Canada rate will stay around 4.0 percent for “12 to

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”

Still, the effect of the interest rate increases on retail sales are easy to predict.

“If you’re taking out a mortgage right now, you are paying roughly twice the rate you were about a year ago,” Norman said. “The market effect is that house prices come down. It is not a bubble bursting but the

Hardlines Home Improvement Quarterly

market is adjusting to these new rates.”

“People renewing their mortgages, who got them four or five years ago, have no choice but to renew at these new rates. And they will not be spending as much money in hardware stores.”

Norman had good news to share, as well.

“500,000 more people have jobs than a year ago,” he said. However, the peak employment month was June and employment has been flat since then. Firms have slowed their hiring because of risk, Norman said.

The overriding question is: “Are we going into a recession or not?”

Norman said yes. “Expectations are that the recession will last through the end of [2023].” Ending on good news, the economy is being stimulated by lots of new consumers, Norman said. “We had almost 656,000 immigrants last year. That’s 703,000 new Canadians including the birth rate.” www.hardlines.ca

‘’ADDING A RETAIL COMPONENT

to our store has created stability for our business.

THE BRAND helps create a balance between retail/hardware and LBM.’’

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rona.ca/becomeRONA BE PART OF SOMETHING BIGGER

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Tony Perillo 204-218-5808

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ONTARIO & MARITIMES Scott Wilson 519-281-1824

NATIONAL Josée Desrosiers 418-391-7101

scott.wilson@rona.ca

josee.desrosiers@rona.ca

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WHY OUR SUPPLY CHAINS KEEP FAILING —AND HOW TO FIX THEM DOUG STEPHENS, Retail Prophet

Industries need to learn from the experience of Covid-related supply chain disruptions to mitigate the next global crisis.

That was “Retail Prophet” Doug Stephens’ message at the Hardlines Conference.

“We haven’t learned much about supply chains in at least 160 years,” Stephens told conference delegates. “We’ve seen this movie before.” He pointed to the example of the U.S. cotton trade in the mid-19th century. Powered by slave labour that gave it “what many would consider an unfair advantage in pricing,” the U.S. did a booming world trade in the material.

U.S. cotton made up two-thirds of cotton imports in the United Kingdom, which in turn exported finished cotton goods around the world. An estimated one in five U.K. workers was reliant on the American cotton trade at that time, Stephens said. When the U.S. Civil War hit, the cotton supply to the U.K. was choked off, and the country went into an economic crisis.

“You would have thought that we might

have learned our lesson [about putting] all our eggs in one basket,” Stephens observed, but there has been little innovation in supply chain management since then.

“In truth, our supply chains today are not sophisticated and they’re not advanced.

“

The problem isn’t really Covid and it isn’t really China. It is our industry’s myopic, almost singular focus on lowest landed cost.

Like the U.S. in the 19th century, “today, China is the world’s everything factory.”

Stephens said.

“The problem isn’t really Covid and it isn’t really China, as much as some have tried to point the finger at both. It is our industry’s myopic, almost singular focus on lowest landed cost.”

Taking the form of a lesson-learned review, Stephens’ talk sketched out three principles that are needed to guide the Stephens said that most supply chains today operate on a few microscopic pieces of information, much as they did when they failed 160 years ago.

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rethinking of supply chain infrastructure.

First, the model of risk shifting needs to be replaced with risk sharing. Stephens characterized the current dominant approach as a game of “hot potato,” with manufacturers, wholesalers, and retail-

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ers seeking to push risk onto each other.

“Shared risk needs to become a core business objective,” he said, in order to avoid “data silos or deserts.”

Next, the rebuilding needs to foster transparency. Most firms, Stephens said, have a pretty good mental map of their first-tier vendors. But “by the time you get to their second-tier vendors, it gets a bit murky. By the time you get to their vendors’ vendors’ vendors, it’s a black box.”

Finally, intelligence will be key to a sound rebuilding. “Surprisingly, most supply chains even today operate on a few microscopic pieces of info: what is our sales velocity, what is our on-hand, what is in transit, what’s our turnaround?”

A broader intelligence strategy, on the other hand, could take into account data ranging from climate statistics to industrial sales trends to raw materials pricing. “The most sophisticated organizations are now getting into what we call digital twinning,” creating “a working digital model” of the business “that works in tandem with the operating organization.”

Ultimately, the retail futurist concluded, “we have a choice to decide what futurism will be.” www.hardlines.ca

IN APPRECIATION OF OUR SPONSORS! The industry gathered once again at our October conference in Niagara-on-the-Lake, Ontario.

Outstanding Retailer Award winners joined exceptional dealers of various banners, head office executives, manufacturers, distributors and agents—from coast to coast. All were there to listen to presentations from some of the brightest minds in our industry.

Only because of our sponsors was this possible. Thanks to these companies listed here, our industry was able to come together for mutual benefit and in the spirit of cooperation. We were all made stronger.

THANK YOU!

David Chestnut | Vice President and Publisher

SEE YOU THIS FALL IN WHISTLER

Fairmont Chateau Whistler, BC October 17 & 18, 2023

HARDLINESCONFERENCE.CA

R E TA IL S P IR I T AWA R D

GANDER BAY BUILDING SUPPLIES (CASTLE) Gander Bay, Newfoundland

The prestigious Outstanding Retailer Awards (ORAs)

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Hardlines Home Improvement Quarterly

Photo: Emma Hutchinson

were presented in October at the Hardlines Conference in Niagara-on-the-Lake, Ont. Owners and managers from eight visionary home improvement retailers came up on stage at a gala dinner at the Queen’s Landing Hotel to receive their awards. Congratulations to all of our winners!

TODD AND DEB BRINSON exemplify what the Outstanding Retailer Awards are all about. The couple knew nothing about hardware or building supply retailing when they took a giant leap of faith and bought the store in Gander Bay in 2007. They had both been working at an auto parts factory in Kitchener, Ont. Converting to the Castle banner after they bought this store in Deb’s hometown, the couple brilliantly run their business in a town with less than 2,000 residents. The passion and pride that the Brinsons feel for their enterprise is replicated in each of the other ORA winners you will meet in the pages ahead.

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GANDER BAY BUILDING SUPPLIES Victoria Cove, Gander Bay, Newfoundland and Labrador

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eb Brinson grew up in this tiny town on the Atlantic Ocean, 45 minutes from Gander. In 2007, she and her husband, Todd, were living in Kitchener, Ont., where they both had jobs in the auto industry.

“Like all Newfoundlanders who live on the mainland, you do look forward to the day that you can move back home,” Deb recalled. Then the Gander Bay store went up for sale. “We thought, how hard could it be?”

“

Deb Brinson (right), co-owner, with store staff member Ruth Purchase.

Like all Newfoundlanders on the mainland, they dreamed of the day they could move home.

”

The couple had no experience in building supply retailing. Yet, Deb and Todd’s determination to make a going concern out of a small store in this town of just 1,300 residents has pulled them through.

They have complementary skills. “I pick up where she leaves off. And she picks up where I leave off,” Todd says.

The store, founded in 1912, used to sell everything—even gasoline that they pumped out of barrels. Back in the day, most of the customers arrived by boat.

Customers still arrive in boats! “There’s a different culture here, that’s for sure,” Deb says.

Jobs are not plentiful here. Many of the

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locals fly to and from jobs in Alberta’s oil patch. Owing to the pandemic, those same workers were grounded for much of 2020 and 2021. Local housing starts dropped to zero.

Today, life has restarted in Gander Bay. Deb and Todd are busy once again. And their bond with their community is even stronger for the experience.

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Yesterday.

Today.

Tomorrow.

Outstanding.

Kohltech’s outstanding service, warranty coverage, pricing and environmental sustainability has established our brand as a proud Canadian industry leader.

We deliver innovative, high-performance windows and entrance systems that make your customer’s house feel like home.

Here’s to 40 years of outstanding in all that we do. kohltech.com

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HARDLINES CONFERENCE Best Hardware Store

W I N N E R

JEAN DENIS HOME HARDWARE St-Raymond, Que.

H

usband-and-wife owners Sophie Denis and Philippe Moisan represent the fourth generation of their family to run this store. Sophie’s grandfather, Jean Denis, founded the business in St-Raymond, 40 kilometres northwest of Quebec City, in 1928.

Sophie and Philippe took over the store in 2000, adopting the Home Hardware banner in the process. Over the past 22 years they have grown the business spectacularly, moving to a new building in 2006. They added impressive plumbing and décor showrooms along the way.

Says Sophie: “Without the vision of Home Hardware co-founder Walter Hachborn, we wouldn’t be where we are now.”

There has been extraordinary sales growth at this store during the past two years. Ninety-five years after it was founded,

(From left) Philippe Moisan and Sophie Denis, owners; Diego Mazzone, JR Tech, the sponsor of the award. this powerhouse store has outstanding visual appeal. The merchandising is on point.

It’s an exciting and uplifting environment for customers.

And this business is a marketing machine, using flair and imagination to promote its offerings. It is a leader on Facebook, with

videos created in the store taking the brand out into the community. This message is extended with local TV and movie theatre advertising.

And there are some master strokes of marketing: For example, ten years ago, Philippe and Sophie purchased a 1948 Chevy pick-up truck and repainted it in Home Hardware livery. It takes the store’s brand all over town.

The store lifted the town’s spirits with vintage cars again in 2021 in the middle of the pandemic. It organized a Covid-safe event that attracted 95 classic vehicles from all over Quebec. Congratulations, Sophie and Philippe, for being named Best Hardware Store in 2022.

“

Without the vision of Home Hardware founder Walter Hachborn, we wouldn’t be where we are now.

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Best Building Supply Under 15,000 Square Feet

GRUNTHAL LUMBER (CASTLE) Grunthal, Manitoba

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his Castle Building Centre, 70 kilometres south of Winnipeg, is co-owned by Murray Rempel and Mel Funk. The hardware manager is Mike Bourgeois.

While the store has changed hands throughout its 78 years in business, the employees have tended to stay in place. No doubt that is due to the way the owners and managers take time to truly listen to their staff.

In 2021, a dream came true for Grunthal Lumber. The business moved across the street from its existing 4,000 square feet of retail to a new 10,000-square-foot location.

“It opened up a big new retail world for all of us,” says Mike Bourgeois. With the help of hardware wholesaler Orgill, the store was able to expand its front end significantly.

Grunthal Lumber remains the dominant player in its marketplace when it comes to LBM. Its impressive eight warehouses sit on 7.5 acres of land. And its fleet of 12 delivery trucks and 11 forklifts are constantly busy.

The store’s design and drafting department offers a virtual reality experience for its customers. They can “walk around” and see what their new home or renovation will look like—well before the contractors ever start to build!

Grunthal Lumber believes strongly in digital marketing. In a town of just 2,000

“

Mike Bourgeois (right), hardware manager at Grunthal Lumber, with Gino Allegro, Johns Manville, sponsor of the award.

residents, the business employs a full-time marketing person who is an expert at social media. The result? Grunthal Lumber has about as many Instagram followers as the town has residents!

Today, this store does more business in a week than Murray Rempel was doing all year when he bought the business in 1995.

An Outstanding Retailer indeed!

The store is doing more business in a week than Murray Rempel was doing all year when he bought the operation in 1995.

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HARDLINES CONFERENCE Best Building Supply Over 15,000 Square Feet

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GRANDE PRAIRIE HOME HARDWARE BUILDING CENTRE Grande Prairie, Alberta

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rande Prairie Home Hardware Building Centre is in Peace River Country in northwestern Alberta, 450 kilometres north of Edmonton. A former Beaver Lumber, the store was purchased by C.A. Fischer owner Ken McCourt in 2012. C.A. Fisher has an impressive 15 Home Hardware stores in Western Canada.

Our judges noted that this store faced some of the most intense competition of any of this year’s entries.

Kevin Gillman (centre), manager, with Syl Haisan (left) from store owner C.A. Fischer Lumber Co., and Adam Gollan, Trex, sponsor of the award.

“

This store brings a laser-focus on service to one of the most competitive home improvement markets in all of Canada.

”

Within just a few minutes’ drive of this Home Hardware Building Centre are seven daunting competitors: Nelson Lumber, RONA, Home Depot, Wal-Mart, Canadian Tire, Windsor Plywood and Costco.

The competitive heat means that store manager Kevin Gillman and his staff are laser-focused on providing an incredibly high standard of customer service.

And it’s working. This store had by far the highest sales increase last year of any of this year’s Outstanding Retailer Award entries.

The business has done superbly well since the owners almost doubled the retail

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footprint of this business four years ago.

The 25,000-square-foot store’s advertising is intensive, particularly radio advertising. The store’s community outreach is relentless. The store goes the extra mile to provide all the services that contractors need: door manufacturing, a stair shop, a truss plant, and more.

For its superb services to its community— in one of the most competitive marketplaces outside of a major city in the entire country—Grande Prairie Home Hardware Building Centre is a worthy winner of a 2022 Outstanding Retailer Award.

Hardlines Home Improvement Quarterly

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HARDLINES CONFERENCE Best Large Surface Retailer

W I N N E R

LOWE’S PICKERING Pickering, Ontario

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corporate store, Lowe’s Pickering has been managed for the last six years by Angelo Tzogas. He says there is no secret behind his store’s success: It all starts with the staff.

“We train and mentor a passionate group of associates,” Angelo says. “We nurture their service delivery by connecting with them, making them feel part of our family, addressing their concerns in a timely manner… and giving them the tools they need to grow and succeed.”

Angelo says that pandemic lockdowns completely changed the way his Lowe’s store did business. Luckily, this store just east of

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Angelo Tzogas, store manager, with Beth Casson, National Hardware Show, the sponsor of the award.

The marketing obviously had to change significantly, too. In 2021, a completely digital flyer, which had never been tried before, was deployed. Lowe’s Canada uses

Connecting with the store’s staff and making them feel part of the family is important at this store, manager Angelo Tzogas says.

Toronto—and the entire Lowe’s Canada network—was able to leverage its e-commerce head start on its competitors.

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what it calls its “360-degree retargeting strategy” involving all social, Google and video tools, to maximize revenue.

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The sales growth of this Lowe’s store is aided by the rapidly ageing housing stock in the immediate area. A quarter of the homes in the area were constructed between 1981 to 1990. A high percentage were constructed between 1961 to 1980. That makes for a lot of renovation customers.

But this obviously attracts competitors, too. There are two Home Depots within five kilometres of this Lowe’s. And a Canadian Tire is in the very same parking lot.

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2022

HARDLINES CONFERENCE Best Contractor Specialist

W I N N E R

BMR PIERRE NAUD INC. Trois-Rivières, Quebec

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his Trois-Rivières store is part of a six-store regional chain that dates back to 1890. That year, Pierre Naud opened a window and door manufacturing business out of his house in St-Thècle, Que. The Trois-Rivières store was added to the organization by current owners MarcAndré Lebel and Philippe Lebel, descendants of Pierre Naud, in 2012.

The brothers set about extensively renovating and expanding the store in 2017. And then, shortly after the renovations were complete, a devastating fire occurred—it all burned down.

The store manager, Jessica Bastarache, wrote in her entry for these awards that this terrible fire was the most important test that any of the owners and staff had ever faced.

The contractors proved their loyalty. And then some. It was a “beautiful solidarity,” says Jessica.

It’s worth noting that this store is literally surrounded by excellent competitors, including a Canac location 250 metres away.

And there are two major big boxes within just two kilometres.

When the store was rebuilt from the fire, an entirely new and unique concept of customer service was put into play.

Instead of just a regular contractor desk

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Marc-André Lebel and Philippe Lebel (centre), owners, with (left) Jake Smith, NHPA, and (right) Bob Cutter, NHPA, sponsors of the award.

and a separate cashier, contractor-consultant employees are deployed to attach themselves to the pros from the moment they walk through the doors.

Every single one of the 25 employees at Pierre Naud Inc. in Trois-Rivières can be proud to share in this award.

When the store burned to the ground shortly after it was renovated, manager Jessica Bastarache noticed ‘a beautiful solidarity’ from the contractors who gathered to rebuild it.

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Hardlines Home Improvement Quarterly

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2022

HARDLINES CONFERENCE

W I N N E R

Young Retailers of the Year

MARIANNE AND MATHIEU MOISAN BMR Paulin Moisan, St-Raymond, Que.

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hese cousins, 28 and 33 years of age when they entered the ORAs last summer, are the grandchildren of the founders of the store, Paulin Moisan and Thérèse Dion, who founded their hardware store in 1961.

The legacy of these two entrepreneurs is still celebrated in St-Raymond, near Quebec City. A special “Paulin” beer was brewed to commemorate the store’s 60th anniversary!

Mathieu and Marianne started working in the store while they were in school. They both knew they wanted to be proprietors of the business one day.

But the second generation of the Moisan family had a strict rule for any third-generation family members who wanted to become owners. They would have to go work somewhere else first!

So, after formal studies in sales and architectural drawing, Mathieu went to work as a construction estimator for a non-family company.

Marianne, meanwhile, studied accounting and attained her professional accounting

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Mathieu Moisan and Marianne Moisan (centre), dealer-owners, with Trevor Schellenberg (left) and Jason McIntyre (right), Acceo, the sponsor of the award. designation. She worked for several years as a controller in the aviation industry.

Now Marianne and Mathieu are back at the family store as owners—since April 2021.

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Our personality differences lead to a wonderful synergy.

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merchandised and visually striking stores in our industry.

The two cousins have very different skill sets. Marianne has the operations, finance and HR skills. Mathieu has the construction, sales, purchasing and logistics skills.

“Our personality differences lead to a wonderful synergy,” Marianne says.

Back in 2011, the business relocated to allow for expansion. Today, this 15,000-square-foot store is one of the best

Hardlines Home Improvement Quarterly

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HARDLINES CONFERENCE

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Marc Robichaud Community Leader

DOIDGE BUILDING CENTRES, RONA FORT ERIE Fort Erie, Ontario

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his store is owned by Dennis Doidge and run by long-standing manager Jeff Hill. It’s one of 10 Doidge Group stores in Southern Ontario.

The Fort Erie building supply store switched banners to RONA four years ago.

Today, the business is doing eight times the volume that the store was doing when Dennis Doidge purchased it in 2007. But RONA Fort Erie is also highly successful as a community leader.

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(From left) Jake den Hollander, regional manager; Sarah Hounslow, BMF, the sponsor of the award; Jeff Hill, store manager; Andrew Doidge, VP Doidge Group.

We don’t do this for financial gain. We do it out of the goodness of our staff’s and customer’s hearts.

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Fort Erie is a city of just 30,000 residents across the Niagara River from Buffalo, New York. It has small town, community values. “We Love Fort Erie” is the store’s official slogan. The store’s core values are: “Respect, Responsibility, Unity, Service and Common Good.”

To give just one of dozens of examples of the store’s Common Good philosophy, in the fall of 2019, Fort Erie RONA held a charity barbecue for Amanda Martin’s children. Amanda had lost her life trying to save her son from drowning in the Niagara River. RONA Fort Erie raised $26,000 for Amanda’s son and daughter.

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The store donates annually to a local food bank. It gave $46,600 last fall, which made it the leading independent donor in the Lowe’s Canada Heroes campaign.

The company also gives large donations to The Heart and Stroke Foundation, Big Brothers and Big Sisters, Boys and Girls Club, Meals on Wheels, and many more.

During the pandemic, RONA Fort Erie regularly donated food for health care workers at the local hospital as well as at three long-term care homes.

Hardlines Home Improvement Quarterly

Says manager Jeff Hill: “We don’t do this for financial gain. We do it out of the goodness of our staff’s and customers’ hearts.” www.hardlines.ca

Industry Partner in Store Renovation “ We did these renovations because of pride in our stores. We are a big part of these communities. So, we wanted our stores to be absolutely spectacular.

And working with BMF, that’s exactly what we were able to produce.”

MICHAEL ALLEN RONA North Vancouver, Powell River and Salmon Arm, B.C.

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RETAIL TECH

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HOW LOWE’S USED TECH DURING COVID

The pending sale of Lowe’s Canada to a private equity firm doesn’t obscure the fact that it was already doing pretty well with the “gadgets”

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echnology is not just about gadgets,” said Lowe’s Canada president Tony Cioffi to a packed ballroom at the recent Hardlines Conference in Niagara-on-the-Lake, Ont. “Because gadgets are just gadgets.”

“But by giving our associates the tools to be more productive, they can do a better job at looking after our customers,” Cioffi explained. “I’ll give you some examples.”

The examples (which we explore in this article) have no doubt been explained

by Cioffi to the pending new owners at Sycamore Partners. That private equity firm intends to pay $400-million in cash (plus an unspecified performance incentive) for Lowe’s Canada’s entire operations, with the deal to close early this year. Sycamore will get 450 stores including Lowe’s Canada’s corporate stores, RONA’s corporate stores and the wholesale business of RONA independents, plus Réno-Dépôt stores and a handful of Dick’s Lumber stores. (See page 10 for more on the acquisition.)

And Sycamore will also get some DCs that are among the biggest in Canada (including the newly-opened 1.23-millionsquare-feet DC just north of Calgary). And a lot of retail tech. A whole lot of retail tech.

Let’s look at the technology that Cioffi was explaining at the Hardlines Conference.

ZEBRA HANDHELD DEVICES

“We put Zebra devices in the hands of all of our associates in the last couple of years,” Cioffi said. Lowe’s Canada wasn’t alone— the Illinois-based Zebra Technologies

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Associates can scan a label using a Zebra device and know the status of that SKU in the store, in the market, in the country.

Corporation sells its software and hardware in 55 countries and is a tech giant, not only in retail, but in manufacturing, transportation, and logistics. Home Depot is a customer, as is Canadian Tire, WalMart, and pretty well any other box store that you care to mention.

“These handheld devices allow the associate to have all the data they need around in-stocks, so they can better serve the customer. If they scan a label in an aisle,” Cioffi said, “they’ll know if the product is in stock and where it is in the store. And if it’s not in stock, they’ll know when it’s going to be delivered so they can tell the customer, ‘You

Hardlines Home Improvement Quarterly

know what, I apologize. We don’t have it in stock but we can offer this alternative item.’

Or they can tell the customer all the other stores that have it in stock so they can get it later the same day. Or we can ship it to your house. So this is empowering the associate with the technology. These tools are phenomenal. We can actually scan a label and know the status of that SKU in the store, in the market, in the country. And we will know what are the best-selling accessories for that SKU.” www.hardlines.ca

THE ENDLESS AISLE

Lowe’s offering of online products that are not normally stocked in its bricksand-mortar stores totals 300,000 skus, Cioffi said. Home Depot Canada claims to have 1,000,000 in its “Extended Aisle.”

Regardless, both firms are busy training their staff never to give up on a sale just because a product is out of stock. “We are in the process of, hopefully next year, giving the associate credit for that sale,” Cioffi said.

Lowe’s Canada has done extensive research and focus groups with customers who, Cioffi says, indicate they prefer the “touch and feel” experience of a physical store.

“I’ve talked to a lot of folks who’ve sat around the table and they’ve told us, ‘We don’t expect you to have in your physical stores everything in every assortment.

We know that you will have more online.

But something we like is to touch and feel the product. We want to come in and see the physical faucet, for example, but if we decide to select something from your endless aisle, help me to buy it.’ ”

SELF-CHECKOUTS

“In the last twelve months, we in Canada installed between four and six self-checkouts in every single one of our big box stores,” Cioffi said. “It’s been a godsend. We

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PICKUP LOCKERS

The third of the “Big Three” Lowe’s principles is simply “A clean and safe store.”

“During the pandemic we were hearing back from customers, ‘We don’t want to be seeing people,’ ” Cioffi said. “They’d order online, they’d select that they wanted to

Thanks to self checkouts, we’ve been able to take some of the cashiers and upskill them to become sales associates. all know the challenges we’ve had [in this industry] in our labour market. In some of our markets, particularly Quebec City, the south shore of Montreal, Vancouver, where it’s difficult to find staff, we’ve been able to take some of the cashiers and upskill them to become sales associates. It gives them a chance to grow their careers. Consumers like self-checkout.” www.hardlines.ca

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pick up their product at a checkout locker and they’d get an email with a QR code [that gave them access to the specified locker].”

DIGITAL SCREENS AND SIGNAGE

Cioffi predicted that consumers would start to see, soon, “at some of our stores, digital screens so customers can see where to go for some of our promotions [within the

During some Covid lockdowns in Canada, associates were not allowed to colour paint in-store so Lowe’s created an online paint colour selector. store]. Signage is critical. We’ve done a lot of improvements on physical signage over the last few years but now we’re going to take them to the digital level.”

LOWE’S PAINT SELECTOR

“During the pandemic lockdowns we were not allowed to colour our paint [in some jurisdictions in Canada],” Cioffi said.

“White paint was deemed essential, but coloured paint was not essential. I didn’t make up the rules, I’m just repeating them,” Cioffi said to laughter from the audience. “So we actually created an online paint colour selector. Customers could get their paint coloured, virtually, and then pick it up. The thought process was: Too much time in the store waiting for your paint to get coloured was not good.”

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FIRST SELF-CHECKOUTS INSTALLED AT HOME HARDWARE AND RONA INDEPENDENTS

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he first retail self-checkout machines were installed at a Kroger grocery store in Atlanta in 1986.

But it’s taken almost four decades for them to arrive at independent hardware and building supply stores. In October and November, Acceo, a retail technology provider based in Montreal, installed its first independent store self-checkout units at a Home Hardware store in Guelph, Ont., and a RONA store in Magog, Que. JL’s Home Hardware is a three-store operation based in Guelph, Ont., an hour west of Toronto. Those stores, a building centre and two hardware stores, are the first Home Hardware stores to get self-checkout technology. Dealer-owner Andre Belisle said that the store is not going to replace humans with machines.

“The self-checkouts are already tested and fully operational as an added service and option for customers that wish to use it,” Belisle said. “Our full-service checkout option will always remain. Our intention is to improve our service for our customers and that includes providing options for any customer’s preference.”

Meanwhile, at Magog, Que., RONA Matériaux Magog Orford, a building cen-

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JL’s Home Hardware, in Guelph, Ont. is the first Home Hardware store to get this technology. according to Marc Leblanc, Acceo’s senior vice president of home and building supply industry ERP. “Just as the pandemic hit (2020), we met our first independent dealer who said, ‘We need a self-checkout because it’s difficult to find new people [to work in the store]. Beginning in 2022 we said, let’s do it. We agreed with a technology partner

Our intention is to improve our service for our customers and that includes providing options for any customer’s preference.

tre, also had Acceo self-checkouts installed at its location. While many Lowe’s Canada and RONA corporate stores have received self-checkouts (from another supplier other than Acceo), this is the first RONA independent dealer to get the technology.

The installations both went smoothly,

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in about five months.”

Mark Nykamp, an operations manager for JL’s Home Hardware said, “In 30 years in the industry, this was the smoothest deployment I’ve ever taken part in.”

Acceo, a division of software-giant Harris Computer Corporation, has a large

Hardlines Home Improvement Quarterly

share of the retail technology market in the Canadian home improvement industry. Since its founding in 1988, the company has acquired Canadian POS providers and now offers four ERP solutions to hardware and building supply stores and their head offices: ogasys, OGC, Omni, and Profitmaster.

Acceo’s customers include most of the major banners in our industry, including BMR, Castle, Home Hardware, Lowe’s/ RONA, Patrick Morin, Peavey, and TIMBER MART, among others. www.hardlines.ca

WE OFFER MORE THAN MERCHANDISING We have set ourselves the goal of expanding our range of services by offering more than merchandising

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RETAIL TECH

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ONLINE BUILDING MATERIALS SUPPLIER OFFERS ‘LAST MILE’ SERVICE FOR PROS

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TECH BYTES

t started out 18 months ago as a way to get products to contractors’ jobsites in Greater Vancouver. Now, Warehoos Online Inc. has rolled out its delivery services throughout Canada and parts of the U.S. Warehoos serves builders and provides same-day delivery for most building materials through its online marketplace. Unlike some “last mile” delivery services, Warehoos does not rely on its own warehousing but works with existing building supply dealers to source its products.

“Almost everything is actually fulfilled from building supply yards closest to the delivery, or if we don’t have a yard in the area, from the closest one we’ve partnered with,” says Ross Power of Warehoos. For example, in the Vancouver area, the service has worked with dealers like Dick’s Lumber in Surrey, Poco Building Supplies in Port Coquitlam, and Griff Building Supplies in New Westminster. A third-party logistics company picks up the products and makes the actual deliveries to the jobsites.

Power is also the president of PowerHouse Building Solutions, a Surrey, B.C.-based distributor specializing in building products for home construction on the West Coast.

But the new business is completely separate.

JRTech Solutions has secured agreements to install its shelf label technology and cloud platform in 24 RONA affiliate stores. Among them are the nine stores under RONA Moffatt & Powell.

“We don’t carry inventory ourselves, so we’re really an extension of the building supply yards that we partner with,” Power says. It’s a different business from PowerHouse, he stresses, with different staff and even competitive products to those of PowerHouse.

Power admits the new service is a way to adopt to the changing demands of the marketplace, “to remain relevant in the years to come as opposed to some online suppliers that try to cut out the middleman and do as much as possible directly.

We’re here to disrupt the industry and service the contractor without messing with the current distribution channel—to be complementary.”

He recognizes the need to overcome that “last mile” delivery challenge in the product

through its e-commerce website, which went live in March 2022. The store’s president Brent Perry says his team is also putting the finishing touches on their own app. Perry sees his company’s sales growth coming primarily from e-commerce.

Alf Curtis Home Improvements, which has three Castle yards in Peterborough, Lindsay and Belleville, Ont., is reaching out to pro customers

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BuildDirect Technologies Inc., the Vancouver-based internet LBM seller, reported Q3 revenues of $22 million,

Hardlines Home Improvement Quarterly

Warehoos’ marketing promises sameday delivery for most building materials through its online marketplace. supply chain. “Contractors inherently need service and products ASAP that most online companies simply cannot provide. The fact that we use building supply yards and have connections all over the place allows us to get product into the hands of the contractor faster than any other service we know of.”

Power adds that the manufacturers appreciate the Warehoos model as well.

“We can connect their materials to contractors that want to use them in markets where their products cannot otherwise be easily sourced.”

down from $22.3 million in the comparable period of 2021. Profits declined to $6.9 million from $8.1 million a year earlier. Revenue from pros reached $19.4 million, representing 88.2 percent of the company’s total revenue and 5.6 percent growth from the previous quarter.

Home Hardware Stores Ltd. has partnered with shopping rewards

app FlipGive to launch the Play More Matching Grant. Building on last spring’s $25,000 investment in young athletes, this year’s program will distribute another $50,000 to local teams. “Home Hardware’s dealer-owners have a long-standing history of supporting local youth sport in the communities they serve,” CEO and president Kevin Macnab said in a release.

www.hardlines.ca

evr-green evr-green

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BY STEVE PAYNE

GETTING SERIOUS ABOUT

TOOL+EQUIPMENT

RENTALS

Some home improvement retailers are profiting from this category.

Others are absent from the field of play. Hardlines Home Improvement Quarterly looks at the upsides and downsides of the tool for hire trade.

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www.hardlines.ca

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nly a fraction of Canada’s almost 5,000 home improvement stores engage in the tool and equipment rentals business. Why? The reasons why many retailers don’t want to run a rental department are varied.

Many retailers prefer to sell tools outright rather than lend them. Rental tools require a lot of maintenance and repair—and that can get expensive. Specialty tool and equipment rental firms abound, which provide stiff competition.

On that last point, the big boys aren’t messing around when it comes to equipment rentals. Just consider United Rentals, for example, which is a rentals behemoth. It is, in fact, the largest equipment rental firm in the world. Yes, it’s into much heavier types of equipment than your average Home Hardware or Home Depot will rent, and yet it competes with our industry for smaller tool rentals, too. United Rentals had revenues of US$11.1 billion in 2022, up more than 20 percent on its 2021 revenues. And United bills itself as having about 15 percent of the tool and equipment rentals market in North America—which it serves with 1,300-plus outlets, including some 120 in Canada.

In second place in our market is Sunbelt Rentals, a big international concern, which has about 7 per cent of the market in Canada, according to Statista. Sunbelt has some 60 outlets in Canada.

Many home improvement retailers in Canada don’t want to tangle with these big rental firms. Even the big boxes don’t all participate in rentals in Canada.

Lowe’s Canada announced a year ago that it had ended its agreement with Stephenson’s Rental Services—the granddaddy of Canadian specialty rental shops.

Sixteen Lowe’s big boxes were operating Stephenson’s Rental stores-within-a-store.

A Lowe’s spokesperson in Montreal said that there were only two corporate stores in the Lowe’s/RONA network (out of 240 corporate Lowe’s, RONA and Réno-Dépôt stores) that still offer rentals. www.hardlines.ca

Paul Tomblin, rentals manager, and Jamie Kuepfer, dealer/owner, Wellesley Home Centre, Wellesley, Ont.

Meanwhile, Stephenson’s soldiers on, publicizing 24 standalone rental stores in Canada, 16 of them in the Greater Toronto Area. Before United and Sunbelt took away a lot of market share from it, private equity firm Edgestone Partners paid a whopping $134 million to acquire Stephenson’s in 2007. Repeatedly renting the same piece of

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It has tool rentals available at more than half of its 2,188 stores in the U.S. and Canada. And some Home Depot stores have recently entered the heavy equipment rental arena, too.

Way back in 2014, when Home Depot was on a big marketing push to sell its rentals, it had some impressive numbers to trot out.

The (Home Hardware) PRO Rentals department is unique in the tool/equipment industry for its focus on supporting the business of other departments within the organization.

equipment that you’ve paid for many years ago is a high cash-flow business.

Still, Lowe’s didn’t see it that way. Lowe’s did not offer rentals in its U.S. stores at all until 2020, when it opened a test rental program in a single store in Charlotte, North Carolina. But Home Depot has been heavily into the rentals game since 1995, when it opened a tool rental counter at a Nashville, Tenn., store as a test. The Home Depot now bills itself as America’s fourth largest equipment rental company.

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Such as: 6,000 associates specifically dedicated to tool rentals, 750,000 carpet cleaner rentals that year, 250,000 concrete breakers, and 2,000 chainsaws rented.

HOME HARDWARE’S RENTAL PROGRAM

Home Depot isn’t the only home improvement retailer in Canada to take rentals seriously.

“Home Hardware Stores Ltd. sees rentals as an important service offering to its consumer and pro contractors at its building centre

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PRO CORNER locations,” says Michael Gawtrey, director, marketing—CRM consumer engagement at Home Hardware Stores Ltd. “Supporting our dealers with the required training, tools, and equipment to run a successful rental department is key for our pro customers to get what they need to get the job done… By offering rentals, our stores become the one-stop destination for building materials purchases, jobsite delivery, pro deals, and more.”

Paul Tomblin, rentals manager for Wellesley Home Centre in Wellesley, Ont., agrees that their Home Hardware rental

F LE program brings a multiplier of good things to the store beyond the rentals themselves— which is a profit centre anyway. “[Home Hardware’s] Pro Rentals department is unique in the tool/equipment industry for its focus on supporting the business of the other departments within the organization,” Tomblin said. “The equipment selection supports the LBM department, the flooring department, our installation services, and the garden centre.”

Tomblin said that his store is big into equipment beyond just small power tools.

UNEXPECTED BENEFITS OF A RENTAL PROGRAM Kim Emmerson has run an extensive rentals business out of his Castle Building Centres yard in Haliburton, Ont., for some 35 years. He gave us some “unexpected benefits” of running a tool rental business out of a building supply operation.

“It’s a handy business to have when you’re running a lumberyard. You’re always building and fixing stuff—so we can usually just go and grab the tool we need,” Emmerson said.

It differentiates you from the competition. “Let’s say you have a contractor who has a choice of Yard A and Yard B. Say they also need to pick up a cement mixer (one of Emmerson’s most popular rentals). You get the business.”

There is a tax advantage to running a rentals business, too, Emmerson says. “Most of the tools we rent have a CCA [Capital Cost Allowance] of 100 percent.” That means that you can write off the full cost of a tool from your business’s income, all in one year.

Emmerson points out there are exceptions for some classes of tools.

The most little-known benefit to rentals, according to Emmerson? “You will likely sell more rental tools than you rent. Lawn tractors, chainsaws, small power equipment, you tend to sell more.” That sounds like a reason to get into rentals right off the bat.

Kim Emmerson has run a rentals business out of his Castle Building Centre in Haliburton, Ont. for 35 years.

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“Our most frequent rental items are compaction equipment, power cutting equipment, demolition and drilling equipment, earth auger equipment, cement mixers, and scaffolding. New items now available for rent at Wellesley are ICF bracing. “It supports our sales of ICF blocks and has become one of our top performers in the last two years,” Tomblin said.

OFFERING A CONVENIENCE ASSORTMENT

Still, one of the reasons that some retailers don’t get into rentals is the space commitment required. “We would have more SKUs but we don’t have the space,” says Mac Snobelen, owner of Bowsser Builders’ Supply, a TIMBER MART dealer in Bowser, B.C. But the store doesn’t want to disappoint its DIY customers when they need to rent, say, a post hole digger, so he offers a “20 SKU convenience assortment of rental tools.”

For a B.C. independent home improvement retailer who has gone deep into rentals, Hardlines took a look at the Windsor Plywood store on Qualicum Beach, on the east coast of Vancouver Island, just above Nanaimo.

This unusual store even brands itself Windsor Rentals—the only one of the 66 Windsor Plywood stores (five of which are in the U.S.) to do so. To have the room for its extensive rentals offering, the store leaves some specialty woods (a Windsor speciality) to a local Windsor Plywood store, six km southeast, in Parksville, B.C. The Qualicum Beach Windsor Rentals definitely aims to make money at tool rentals. “It’s a sideline,” says manager Paul Atkinson. “But we are not into the heavy equipment—no Bobcats, scissor lifts, etc.

We stick to power tools, air tools, generators, small stuff like that.”

It’s typical in the tool rental business that the sanding disks make much more margin than the floor sander itself. We asked Atkinson if that was the case at his store.

“For sure. More money is made on the accessories for rental products.” www.hardlines.ca

PRO CORNER

F LE Kandace Brown and Tyler Knight, dealer-owners at Knights’ Home Building Centre, Meaford, Ont.

TOP 20 TOOL RENTALS 1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

11.

12.

13.

14.

15.

16.

17.

18.

19.

20.

Scaffolding Forklift Trencher Articulated Lift Scissor Lift Auger Mini-Excavator Larger Excavator Sod Cutter Backhoe Floor Sander Ladder Boom Lift Heavy Equipment Rental Log-Splitter Paint Sprayer Crane Bucket Truck (Cherry Picker) Lawn Mower Chainsaw

Source: Quipli, software for independent rental companies. www.quipli.com

MECHANIC WANTED

As for the tools breaking down, this is one of the reasons that many retailers lose interest in rentals. “But we have a full-time mechanic just for our rentals and also small engine repair,” Atkinson said. The mechanic will repair other tools that customers bring in. “Our pricing policy is, we will open it up and look at it for free. If you ask us to fix it, then the billing starts.”

Tomblin at Wellesley Home Centre says that the repair part of his rental operation is all important. “Currently we have one employee working full-time servicing our rental equipment and in small engine sales.

Success in the equipment rental industry requires that all equipment is reliable and meets customer expectations for every rental transaction. In the beginning, we used a local independent small engine shop to maintain our equipment.”

Most home improvement retailers who offer extensive rentals need to have a plan

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FIRST QUARTER / 2023

for repairs. “We have three very capable full-time staff members that work in every aspect of the rental store,” said Tyler Knight, dealer-owner at Knights’ Home Building Centre, Meaford, Ont. “They are able to do most repairs to the equipment, but we will send heavy equipment to the dealership if it’s a large job or an expensive warranty item. Usually, small items, even if a warranty item, we will fix in-house due to the time delays with the (equipment) dealer.

Our team can usually have the equipment fixed and back out on rental within a couple of days. Dealers usually take weeks.”

Still, Knights’ Home Building Centre is unusual in that it has repair capabilities beyond most stores. “We have staff that are able to machine parts with a mill and a lathe.”

A SEPARATE INCOME STATEMENT

With such a professional approach to rentals, it’s no surprise that Knights’ is running this section of its business as a “standalone

Hardlines Home Improvement Quarterly

business, profit wise,” Tyler Knight says.

“All of our revenues and expenses for rentals are tracked and we monitor its success with its own income statement. Our rental store is just finishing its sixth season, so it is still a young operation. But it has been profitable since year two.”

Another Home Hardware dealer in Ontario, Mike Keizer, dealer-owner at Smithville Home Hardware Building Centre, also runs his rental business as a profit centre. He’s eager to grow this aspect of his business, especially seeing how the business kept steady during Covid, even during lockdowns Keizer says his most frequently rented items are quick cut saws, rotary hammer drills, concrete breakers, compactors of various sizes, carpet cleaners, mini excavators, dumpsters, and walk-behind skidsteers. He is investigating battery-operated tools where he didn’t offer battery power before, such as in quik-kut saws and concrete breakers. www.hardlines.ca

Get a new perspective from industry leaders.

What’s in Store A free podcast series from Hardlines that features interviews with industry leaders from all parts of the home improvement industry. Listen while you are in the car, or from the comfort of your office.

You will be entertained, educated and that much more connected to the industry!

RECENTLY ADDED PODCASTS

Derek Smith

A conversation with the Vice President of ACE Canada. Derek shares the expansion track of ACE in this country, which is a division of Peavey Industries based in Red Deer, Alta. ACE offers support for independent dealers across the country who want to grow with this banner or pursue the succession opportunities that ACE can provide.

Geneviève Gagnon

An interview with the leader of a five-store chain of home centres throughout Quebec that goes to market under the brand, La Grande Quincaillerie (The Great Hardware Store). Geneviève talks about her experiences growing up in the family business run by her famous father Yves Gagnon, president of Groupe BMR from 1995 to 2015. And how she is making her own distinctive mark on the business.

Marianne Thompson

An in-depth discussion with Home Hardware’s Chief Commercial Officer covering relevant topics such as supply chain roadblocks, inflation and the road ahead for Home Hardware post-pandemic.

Rebecca Gravelle

A chat with a woman who is on the front lines of retail at two Castle Building Centres-affiliated stores in Eastern Ontario—in Renfrew and Burnstown, Ont. Rebecca is both operations director and HR lead at these busy stores.

She talks about the vital role of HR in home improvement stores today. Rebecca is a 2019 winner of Hardlines’ Outstanding Young Retailer of the Year Award.

Jim Inglis

We talk to the former pioneering Home Depot executive who looks back on the early years of the company and the skepticism it was met with in the industry. He also delves into Home Depot’s entry into Canada through the acquisition of Aikenhead’s.

Plus many more podcasts to choose from!

Listen today for free at hardlinespodcast.ca The Hardlines Podcast Series has been made possible through the support of:

AD INDEX

ADVERTISERS: FIRST QUARTER / 2023 ACCEO

acceo.com

ACE Canada ace-canada.ca

49 8

JR Tech Solutions

39

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King Marketing

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Arxada

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Kohltech

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33, 47, 64

reliablefasteners.com rona.ca/becomeRONA sextongroup.com

Home Hardware Stores

6

Taiga Building Products

68

JELD-WEN

4

Trex

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home-owner.ca jeld-wen.ca

Johns Manville jm.com

IN THE

NEXT ISSUE OF HHIQ:

taigabuilding.com trex.com

41

The State of the Supply Chain: Distribution PLUS: Loyalty Programs Report Product feature: Windows and Doors

HOME IMPROVEMENT QUARTERLY

Publication Date: April 7, 2023 • Ad Reservations: February 24, 2023 (contact david@hardlines.ca) • Ad Material Due: March 10, 2023

www.hardlines.ca

Hardlines Home Improvement Quarterly

FIRST QUARTER / 2023

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ENDCAP

F LE

BY GEOFF McLARNEY

THE UNASSUMING RETIREMENT BMR hardware store owner Bill Towndrow took what he thought was a one-month Christmas holiday, only to find out he had retired without knowing it

“I

t was intended initially as a test,” Bill Towndrow recalls of his decision to stay home from Lunenburg Hardware (a BMR member) for the holidays in December 2019.

Succession is a source of stress for many independent retailers, but Towndrow and his wife, Margaret, always knew their children would take the reins of their hardware store on the south shore of Nova Scotia— one day. “The intent was that Heather and Greg would become the owners… but there was never a timeline.”

“At some point around Christmas my wife basically told me I didn’t need to go back to the store.” The timing caught him by surprise. “I wasn’t mentally expecting that at all.”

Today, however, Bill is content in retirement and the business’s success continues under the new generation’s watch. “It was a family decision to carry on and there was no financial reason for me to keep working,” he reflects. “So, I went with the flow.”

The surprise timing of the handoff meant that Bill didn’t get the chance to debrief his successors. “In a family-owned retail store, there’s a gazillion things that you think of, to pass on”.

Heather and Greg knew that Bill was around if they needed guidance, but they have largely charted their own path, even through the chaos of the pandemic that began just a few months after Bill retired.

At that point, “the focus became keeping everyone as healthy as possible. And dealing with supply chain issues.”

Greg and Heather weathered those challenges. Under their management the store logged sales increases of 12 percent in 2020 and seven percent in 2021. Strong sales

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FIRST QUARTER / 2023

(Top) Margaret and Bill Towndrow.

(Middle) Next gen owners Heather and Greg Towndrow. (Bottom) The original downtown store.

have continued through 2022. The new generation is clearly carrying on the legacy of their parents.

Founded in the 1940s, the store was struggling when Bill and Margaret took it over in 1989 just as the economy was beginning to weaken on the eve of a recession.

Under the Towndrows, the store’s annual sales have gone from $30,000 to almost $3 million. They outgrew their downtown Lunenburg location and moved in 2006 to a 10,000-square-foot building in a newer subdivision.

Greg and Heather, like their parents, combine customer service with community involvement, including support for the local music and theatre scenes. The store’s team includes six full-time and eight part-time staff, the most senior of whom came with the store when the Towndrows bought it and who has watched Greg and Heather grow up.

Hardlines Home Improvement Quarterly

As for Bill, he says he’s “quite happily clear of the store,” adding that “it’s very freeing.”

“Sometimes you just have to make a decision and go with it.” www.hardlines.ca

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