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Hint: It’s NOT price. The answers will surprise you

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V OL UME 14, NO. 1

FIRST QUARTER / 2024

CONTENTS

COVER STORY

THE BEST LES MEILLEURS

DEPARTMENTS EDITOR’S MESSAGE

11 The best quote

eet this industry’s 36 M2023 Outstanding

from Whistler

Retailer Award winners

RESOURCES 55 AHUMAN BSDA, Gugler talk

hiring and recruiting PRODUCT SPOTLIGHT

67 What’s new in

building materials ENDCAP

78 A champion

NEWSROUNDUP

PAGE 12

RONA has new branding for its Lowe’s stores and independents

BMR CEO foresees national expansion via acquisition

turns a corner

CONFERENCE REPORT

A RECORD TURNOUT IN WHISTLER recap of all the 20 Apresentations at the 27th

Annual Hardlines Conference

CONFERENCE REPORT

BSIA TEAMS UP WITH HARDLINES

report on a successful 34 Aawards gala and trade show

Kent introduces heavy appliances in select stores in the Maritimes TIMBER MART adds LBM distribution centre in Winnipeg

AD reports solid performance by its Canadian members

SUCCESSION PLANNING

SELLING YOUR STORE t’s complex but 60 Istraightforward—if you

know the rules of the game

Thieves steal entire safe from a Home Hardware store in Ontario

PRO CORNER

WHAT PROS WANT THE MOST e asked top 70 Wcontractors why they shop where they do FIRST QUARTER / 2024

Marcel Preville

Home Store Owner Hinton, AB

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2023-12-08 11:20 AM

EDITOR’S ME S S AGE

STEVE PAYNE, EDITOR

THE BEST QUOTE FROM WHISTLER It came from the most important management thinker of the last century. It was relayed to us by Jim Inglis, one of the seminal figures in the early years of Home Depot.

eter Drucker was once the most famous management consultant in the world. Almost alone at first, he pioneered the concept of the line worker as the most important part of a business—an asset not a liability. When we look back at the first Hardlines Conference to be held in British Columbia, in October, we have to thank Peter Drucker for being there—in words (Drucker died in 2005 at the age of 95). His wisdom was pithily conveyed to us by our first speaker, the legendary Jim Inglis. Jim was doing a presentation on the formative years of Home Depot, in which he played an integral executive role. “People ask me, what’s the magic of Home Depot? Is it the pricing? Is it the size of the stores? Is it the assortment, the marketing, the logistics?” “It all boils down to one thing: the people. We started with Bleeding Orange Zealots,” Inglis said. “As Peter Drucker said, ‘Culture drives performance.’” “We knew that attitude was important. We needed people with an aggressive

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attitude, that wanted to make a change in the industry. We wanted people with a strong work ethic. We wanted people who weren’t afraid to get their hands dirty. We wanted people who were hungry for success. We couldn’t offer them premium pay because we were a small start-up and we couldn’t offer premium pay.” It’s all about your front line. For more in this issue on Inglis’s theme, see our Human Resources section starting on page 55. I can’t include all of the magical moments that delegates experienced at the Hardlines Conference in Whistler. To put it simply, you had to be there. So, if you missed Whistler, I hope that you’ll flip through this conference highlights issue and decide that it’s a priority to join us at the next Hardlines Conference in Charlevoix, Quebec, Oct. 21 to 23, 2024. Mark your calendars.

“

As Peter Drucker said: ‘Culture drives performance.’

”

steve@hardlines.ca

Hardlines Home Improvement Quarterly

FIRST QUARTER / 2024

NEWSROUNDUP OF THE HOME IMPROVEMENT INDUS TRY

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

LOWE’S BANNER AND RONA DEALERS ARE GETTING NEW LOOK

he rebranding of Lowe’s stores in Canada is nearing completion as RONA inc. works to shed the brand after being sold by Lowe’s Cos. a year ago. Under the ownership of New York-based private equity firm Sycamore Partners, 62 Lowe’s stores in this country have been targeted for rebranding, which involved renaming them with the RONA name—but with a twist. The former Lowe’s stores are all being branded as RONA+. The first former Lowe’s big boxes to get the new branding were in Ontario last summer and fall. Then RONA inc. announced the rebranding of its Lowe’s stores in Manitoba, Saskatchewan, and British Columbia. In December, the retailer unveiled another round of conversions,13 stores in Alberta. Also in December, RONA initiated another round of conversions, this time for nine stores in the Greater Toronto Area. Throughout this process, the company is looking to build on the strong legacy of the RONA brand and build momentum for

a well-known Canadian home improvement brand. The brand consolidation has resulted in the closing of one Lowe’s store and two RONA stores in Ontario, plus a RONA store in Quebec. But the big boxes aren’t the only stores getting a new look. RONA dealers will also be getting an updated identity. The brand refresh, introduced at the RONA dealer market last fall, has been designed exclusively for RONA’s affiliated dealers and

ENVIRONICS PRESENTS DATA ON HOME PRODUCTS SPENDING A recent webinar hosted by the Retail Council of Canada offered some important insights into the profiles of various consumer groups in Canada and how they spend on home improvement products.

FOURTH QUARTER / 2023

The presentation was given by two individuals from Environics Analytics. David Spira is the director of account management and Michael Scida is director of business development. Scida is also an alumnus of this industry, having served almost seven years at Lowe’s Canada. Scida identified roughly 19,000 retailers that cover the home products space, not

Hardlines Home Improvement Quarterly

involves a new, clean banner with room to further identify the store’s own name and brand, using its own colours and look. “The new look means the store is branded as a dealer store. We see tremendous value in identifying them as dealer-owned,” said Jean-Sébastien Lamoureux, senior vicepresident, RONA affiliated dealers and public affairs. This new identity is designed to promote the entrepreneurial side of the dealers while capitalizing on RONA’s brand awareness.

including Walmart or Canadian Tire. About 57 percent of those stores are in Quebec and Ontario. The total aggregate spend, says Scida, is $118 billion. Environics’ data broke the sales down, with furniture accounting for $33 billion, large appliances for $8 billion, and small appliances and home décor equalling $19 billion in sales. Environics estimates the home improvement category, which includes tools, lawn and garden, building materials, and labour, at $69 billion. www.hardlines.ca

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

ACQUISITIONS WILL BE KEY TO BMR’S NATIONAL EXPANSION, SAYS CEO

MR Group is continuing to pursue growth outside its home province of Quebec. And not only in Ontario but with a view to acquisitions nationwide, its CEO says. Hardlines spoke with Alexandre Lefebvre during BMR’s annual buying show, held in November at the Centre des congrès in Quebec City. “Obviously, we’re a dominant player in Quebec but in the past few years we’ve been able to make inroads, mainly in Ontario,” Lefebvre said. “Every year we’ve been fortunate enough to be able to sign fairly big dealers in Ontario, so it’s giving us bigger market share there.” Lefebvre adds that BMR’s commercial division in the Greater Toronto Area, while “less well known,” is “growing a lot.” That division is part of the Lefebvre & Benoit business that BMR bought into in 2019. Shortly thereafter, Lefebvre moved into the top job at BMR. “More than ever, growing outside Quebec is a priority for us.” It makes sense to Alexandre Lefebvre is CEO of BMR Group. Hardlines interviewed him in November about the group’s national expansion plans.

pursue that growth “organically, through the Maritimes, Quebec, and Ontario.” But Lefebvre emphasized that, “The rest of Canada is still very much on the radar. Realistically, it’s going to have to come through acquisitions, so if there’s a good opportunity that presents itself, we’re going to be looking.” BMR’s management team has ensured the company’s house is in order and ready for growth. “We really solidified our balance sheet, cleared off the debt, so that we’re in a good position to be able to make acquisitions.” The group offers an assortment of banners under the BMR name, including BMR Express for smaller, convenience-oriented hardware stores and BMR Pro for contractororiented dealers. Lefebvre notes that these options can help BMR appeal to dealers in a wide variety of contexts. “We’re a network of independent dealers, so it’s important for us to cater to different markets, different models, different sizes of stores.”

BRIEFLY CASTLE ADDS NEW MEMBERS ACROSS CANADA Castle Building Centres added new members during the last quarter of 2023. Island Home & Garden in Gabriola, B.C., rejoined the group and a second location, in Cumberland, B.C., was to open as well. In Toronto, Mr. Bin Inc. has also joined, followed by Windeco Building Supply in London, Ont. Most recently, VP Resources in Invermere, B.C., joined the group.

CANAC INVESTS IN QUEBEC CITY STORE Canac is investing $10 million in the expansion and renewal of its store in Quebec City’s Charlesbourg district. The store was lifted onto beams and moved by truck in what marketing director Patrick Delisle called “a manoeuvre you don’t often see.”

GIANT TIGER CONTINUES TO OPEN STORES Giant Tiger has opened a 20,000-squarefoot location in Sault Ste. Marie, Ont., the discount mass merchant retailer’s second location in the Soo. The retailer also opened its second location in Saint John, N.B., at 16,675 square feet.

CANADIAN TIRE TARGETS WORKWEAR CATEGORY Canadian Tire Corp. is introducing new retail destinations exclusively serving customers in the industrial sector. Called Mark’s WorkPro-L’Équipeur Pro, they will sell workwear for the pro market. Four stores are planned for this year: the first location opened last week in Edmonton, with further openings slated for Toronto, Montreal, and St. Catharines, Ont.

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Hardlines Home Improvement Quarterly

FOURTH QUARTER / 2023

NEWSROUNDUP

BOLD THIEVES STEAL THE ENTIRE SAFE FROM AN ONTARIO HOME HARDWARE STORE

hefts from retailers are getting increasingly more aggressive, and in one recent case, more outrageous. Grand Valley Home Hardware, in the township of East Garafaxa, 100 kilometres northwest of Toronto, was broken into twice in the early morning hours of Oct. 22. Security footage from the second breakand-enter incident shows the perpetrators stealing the store’s safe, which was on the second floor. The two suspects first arrived at 2:10 a.m. in a dark-coloured SUV and one of the suspects gained access to the building by removing a window in the side door. The suspect who removed the window was captured on a security camera wearing a dark-coloured pullover with hood, a facial covering, and gloves. Both individuals spent 35 minutes at the store, but it is unknown whether they stole

anything on that first visit. At about 4:10 a.m., the suspects returned to the store in the same vehicle. This time, the second suspect was captured on video. He was wearing a dark jacket with a hood, a surgical mask, orange gloves, blue jeans, and blue running shoes. His partner in crime re-entered the building and lowered the safe from a second-storey window, where the second suspect placed it on a dolly. Both suspects moved the safe to the vehicle, put it inside, and then drove off. Despite the elaborateness of the scheme, they had spent a total of just 20 minutes at the store stealing the safe, security videos indicated. Ontario Provincial Police are investigating but had made no arrests by the time of publication. The Arthurs family has owned Grand Valley Home Hardware since 2016.

Daring thieves left with the entire safe. (Photos courtesy of the Ontario Provincial Police.)

BRIEFLY

THIRD-QUARTER SALES OFF AT LOWE’S Lowe’s Cos. reported Q3 revenues of $20.74 billion, down 11.7 percent from a year earlier. CEO Marvin Ellison pointed to a “greater-thanexpected pullback in DIY discretionary spending, particularly in bigger ticket categories.” Lowe’s has downgraded its forecast for the full year and expects comp sales to be down about five percent, compared to its forecast at the end of Q2 of a drop of two to four percent.

ACE PICKS UP DEALER IN NEW BRUNSWICK Carleton Co-operative in Florenceville-Bristol, N.B., has converted its country store to the Ace Country & Garden banner. Founded in 1946, Carleton Co-op is some 3,000 square feet in size. In addition to the country store, the site includes a Foodland grocery store, gas bar, NB Liquor agency, and propane fill station.

FEDERATED CO-OP MEMBER ADDS LOCATIONS Swan Valley Co-op, part of Federated Co-operatives, has purchased two home and building retail sites, in the Manitoba communities of Swan River and The Pas, from the Minsh Group of Companies. Each property includes over 9,000 square feet of retail space, a lumber yard, and storage facilities.

HOME DEPOT’S SALES DIP IN Q3 The Home Depot reported third-quarter sales of $37.7 billion, a decrease of three percent from the third quarter of fiscal 2022. Comparable sales for the third quarter of fiscal 2023 decreased 3.1 percent, and comparable sales in the U.S. decreased 3.5 percent. However, in local currency, Canada posted comps above the company average. Net earnings were $3.8 billion, compared with earnings of $4.3 billion in Q3 2022.

FIRST QUARTER / 2024

Hardlines Home Improvement Quarterly

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CONCRETE

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2023-12-05 10:09 AM

NEWSROUNDUP

TIMBER MART ADDS LBM DISTRIBUTION CENTRE IN WINNIPEG

IMBER MART has launched a new LBM distribution facility on a three-acre property in Winnipeg. Its location is within a six-hour radius of the buying group’s members in Manitoba, Saskatchewan, and northwestern Ontario. The facility will offer weekly deliveries, cross-docking and furtherance service, and easy access for dealers looking to pick up their orders. With an estimated 600 dealers nationwide, TIMBER MART has almost 120 members on the Prairies, including about 35 dealers in Manitoba. “Our new distribution centre in Winnipeg will offer many of our members in the Prairies all of the conveniences that our existing facilities provide for our members in British Columbia, Ontario, Quebec, and New Brunswick,” says Bernie Owens,

TIMBER MART’s new DC in Winnipeg is its fourth in its distribution network, joining existing facilities in B.C., Ontario, and Quebec.

president and CEO of TIMBER MART. “We look forward to providing our dealers with a great source of LBM products and competitive advantage in their local markets.” TIMBER MART’s new distribution

centre will be its fourth facility. It represents a significant expansion of the group’s distribution network, which also includes existing facilities in Langley, B.C.; Mount Forest, Ont.; and St-Nicolas, Que.

KENT INTRODUCES HEAVY APPLIANCES IN SELECT STORES IN ATLANTIC CANADA Kent Building Supplies has launched a new and significant addition to its product mix. The Atlantic building supply dealer began selling heavy appliances in some of its stores last fall, and soon after the new assortments were available online as well. The products are being sold at Kent’s nine big box stores for starters and are expected to roll out to additional stores over time. The retailer will ship direct to customers’ homes, as well. The launch is getting a push on social media, including Facebook. A contest that invited people to “like” the Kent post made them eligible to win a $2,200 GE stainless

FIRST QUARTER / 2024

steel refrigerator and a $1,000 grocery gift card. Kent is certainly not alone in taking on appliances. Other hardlines retailers are carrying appliances in Atlantic Canada, including Home Hardware dealers. Both RONA and Home Hardware introduced them about six years ago, following the demise of Sears, which was a major seller of fridges and stoves in Canada. When RONA exited Newfoundland and Labrador at the beginning of 2019, that left further room in the appliances market. Real Canadian Superstores introduced appliances in some of its stores in May

Hardlines Home Improvement Quarterly

2023. Loblaw owns 54 Atlantic Superstores in Atlantic Canada that have the potential to sell appliances, too.

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NEWSROUNDUP

THE BATTLE AMONG RETAIL LOYALTY PROGRAMS CONTINUES TO HEAT UP

very Monday for a month last fall, riders who tapped onto Toronto’s buses, subways, and streetcars could save up to $10, but only if they used their Tims credit card from Tim Hortons. It was just one more example of how retailers are leveraging their rewards programs. The Tims card is powered by Calgarybased Neo Financial, which as of last spring had more than 10,000 retail partners, including Hudson’s Bay Co. and Walmart. Neo continues to add companies. In our industry, Canadian Tire has been particularly aggressive in expanding its Triangle Rewards program. Earlier this year, it rolled out a paid subscription tier, Triangle Select. But other retailers have recognized the value of these plans, which offer savings to shoppers and valuable customer data to businesses. Scotiabank’s Scene+ program was originally simply Scene, a partnership

Tim Hortons is just the latest company to join forces with Calgary-based Neo Financial, a provider of loyalty cards. with Cineplex that allowed customers to accumulate points they could redeem at box offices and concession stands. It’s been expanding dramatically to a wide network of retail partners, including Empire Co., parent of Sobeys, IGA, and Safeway grocery stores. Home Hardware Stores is its exclusive home improvement partner. Lowe’s Canada, now RONA inc., signed on to Avion Rewards last fall, after dropping Air Miles. At the time, benefits were limited to holders of RBC credit or debit cards, but RBC announced it will offer travel benefits to clients of other financial institutions. Air Miles, for its part, lost several key partners in the last few years—not only RONA, but also Staples, Empire Co., and Ontario’s liquor stores. The program’s

owner, LoyaltyOne, filed for bankruptcy in both Canada and the U.S. earlier this year. But the company persists: in June, Bank of Montreal acquired the program, whose retail partners include TIMBER MART, Kent Building Supplies, and Dollarama.

AD REPORTS SOLID PERFORMANCE FOR CANADIAN MEMBERS YEAR-TO-DATE AD (Affiliated Distributors) reported ownermember sales of US$57.6 billion at the end of Q3 2023. That’s an increase of three percent over the previous Q3 and a record for the Wayne, Penn.-based contractor and industrial products wholesale buying group. Its Canadian members, including those within AD’s Building Supplies Canada division, also fared well. Eighty companies have joined the group so far this year, while 35 of AD’s existing 866

FIRST QUARTER / 2024

members were sold to outside entities. Ownermember same-store sales grew six percent through the first nine months of 2023. The home improvement division, AD Building Supplies Canada, was formed when the TORBSA buying group merged with AD Canada in June 2022. That division consists of about 45 former TORBSA member locations, plus new members that have joined since the division was established.

Hardlines Home Improvement Quarterly

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Good news for our dealers

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C ONF ERENCE C O V ER A GE

27TH HARDLINES CONFERENCE SETS RECORD ATTENDANCE IN WHISTLER, BRITISH COLUMBIA

he 27th Hardlines Conference was held in October, with record attendance, at the Fairmont Chateau Whistler in British Columbia. It

Photos: Jozef Povazan

was the first Hardlines Conference to be held in Western Canada. Hardlines collaborated with the BSIA of B.C., which held a concurrent trade show and presented that association’s own Orion awards at the same venue. In the following pages, we summarize some of the key highlights drawn from presenters at the Hardlines Conference. This year’s conference will be held in Charlevoix, Quebec, from Oct. 21 to 23, 2024, in association with Quebec trade association AQMAT.

FIRST QUARTER / 2024

Hardlines Home Improvement Quarterly

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HOME DEPOT’S EARLY YEARS: DAMN THE TORPEDOES JIM INGLIS, Former Home Depot EVP The stories around the start of what is today’s the world’s largest home improvement retailer are filled with colourful characters, determination, and breaks—good and bad. Jim Inglis

was there for much of it. He joined The Home Depot early in its growth, in 1983, at a time when the big box model was new, unproven, and widely ridiculed by competitors. He ended up becoming EVP of merchandising and EVP of strategic development before leaving 13 years later. Inglis shared some memories at the Hardlines Conference of how Home Depot grew—and recalled the naysayers who said the fledgling company would never last. Home Depot opened its first two stores in Atlanta in 1979 and went public in 1981. Amidst the struggles and the victories that underscored the retailer’s growth, one factor was crucial to holding the company together, and that was its clearly defined culture—what Inglis refers to as “bleeding orange.” According to Inglis, co-founder Arthur Blank was the numbers guy. His partner Bernie Marcus was the culture and people person. And Pat Farrah, who had first initiated the concept in a store in California before Blank and Marcus joined, was the merchandising visionary. These three individuals formed the basis upon which that orange culture was established. Inglis noted that by 1988 Home Depot had surpassed Lowe’s in sales. Another big competitor at the time was a chain called Scotty’s Builders Supply in Florida. Scotty’s issued its latest catalogue, proudly displaying its competitive pricing

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“

The ‘secret’ of Home Depot was not its large surface format, pricing, or marketing. It was its people.

”

on a range of products. Home Depot staff rounded up the catalogues and put them on the end aisles of its stores, then wrote on them with magic marker that Home Depot would sell anything at 20 percent less than the Scotty’s prices. That take-no-prisoners approach was a cornerstone of the Home Depot philosophy. And that was the last time Scotty’s published a catalogue.

Home Depot pioneer Jim Inglis did two presentations in Whistler. His ‘Orange Blooded Zealots’ slide outlined the attributes of a perfect Home Depot worker. Inglis also talked about Home Depot’s entry into Canada in 1994. He admitted that the executives in the U.S. figured Canada to be something of a 51st state, similar to California in market size. But initial forays, with the acquisiton of the five-store Aikenhead’s chain, did not go smoothly. That all changed when the company hired a Canadian, Annette Verschuren, to head the company. Within a few years, Canada was Home Depot’s fastest growing division.

Hardlines Home Improvement Quarterly

FIRST QUARTER / 2024

C ONF ERENCE C O V ER A GE

A FAMILY BUSINESS THAT WALKS ITS TALK

“

GENEVIÈVE GAGNON President, Gagnon La Grande Quincaillerie

The home I was born in was literally in the lumberyard.

”

Geneviève Gagnon isn’t exaggerating when she says was born into the industry. “The home I was born in was literally in the lumberyard” of her family’s store, she told Hardlines Conference delegates. Gagnon’s grandfather founded his general store in the 1940s in Chénéville, Que. Her father Yves converted it in 1973 into a hardware store and lumberyard, the nucleus of what would become Gagnon, La Grande Quincaillerie. The banner, now with five stores, is one of three businesses Gagnon helms. The family business spent 35 years under the BMR banner, where Yves also served as CEO and Geneviève was named financial director at 26, before her family made a decision to become an independent in 2020.

Shortly after, Geneviève took the reins, giving Yves “a much-deserved retirement,” and presiding over a period of growth and innovation. The stores hold regular contests, the most popular being a beef contest (“Yes, we put a cow’s head on the flyers”). They draw contractors with a dedicated rewards program, G+. The name is a play on Gagnon and the phrase J’ai plus (“I have more”, as in “I have more rewards”). The business also benefits from distinctive marketing, including its signature purple hue. “Purple represents peace—and it’s a feminine colour and we stand by that.”

The opening night RONA Pub Night was packed with delegates.

FIRST QUARTER / 2024

Hardlines Home Improvement Quarterly

Gagnon La Grande Quincaillerie might be the only home improvement store in Canada with a distinctive scent, called La Souche. The banner even has a signature fragrance, La Souche, to welcome customers into the store. At the conclusion of her talk, Gagnon presented samples to all the tables at the conference. Gagnon sums her attitude up in a nutshell. “The best compliment we can get is, les bottines suivent les babines—the boots walk the talk.”

Dealers and vendors caught up with old friends and made some new ones. www.hardlines.ca

Putting our members first in everything we do.

“

The Cedar Shop has been a Sexton member since 1993. Having the Sexton Group on our side has permitted us to compete in a very volatile market for many years. Today we are Canada’s largest Cedar showroom which would not be possible without access to the vendors and pricing that Sexton has made available. Rebates are timely and in our hands, allowing us to use the funds to grow and improve bottom line profitability. Joining the Sexton Group is a sound business decision for your future.” —Mitch Wile, President, The Cedar Shop

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Our Promise to You: Our strength as a buying group is built on four major advantages:

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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.

Driven by our members’ success.

C ONF ERENCE C O V ER A GE

FIVE THINGS THAT KEEP RETAILERS UP AT NIGHT

“

The question should be: ‘How do I win?’

”

DAN TRATENSEK CEO and Publisher, NHPA A key player at the North American Hardware and Paint Association, Dan Tratensek gave an impassioned presentation at the conference. Before he enumerated the challenges facing dealers today, he highlighted the resilience and the robustness of the independent retailer in our industry—which represents 2,600 storefronts in Canada that account for half of the sales generated by the industry. But in spite of many of these stores getting a double digit “Covid bump” in sales during 2020 and 2021, Tratensek said he’s concerned by a recent negative attitude among independents. “The question has become, ‘How do I survive? How do I eke out a living in the shadow of the competition?’” he said. The question should instead be, Tratensek argued, “How do I win?”

Tratensek gave a powerful presentation about the importance of the independent. The key to winning lies in figuring out the five things keeping independent retailers from sleeping: the economy, employee engagement, inventory, technology, and transition/growth. The economy being so volatile in the last three years has forced independent retailers to relearn how to budget, buy, and evaluate their operating performance, Tratensek said. Employee engagement in an inflationary environment is forcing retailers to pay more for staff, which leads to a need to provide better training and technology to get the return on payroll investment.

A Quebec contingent at the RONA Pub Night in Whistler.

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When it comes to inventory and the supply chain, “retailers still have PTSD” about the issue, Tratensek noted. Technology is the biggest thing that the pandemic changed about the industry. According to a survey of NHPA members, 54 percent of retailers are planning to reinvest the windfall of their Covid bump in sales in technology. And finally, the average independent retailer in our industry is 65 years old, Tratensek said. Issues of transition to the new generation—and how to grow—have never been more important.

Hardlines founder Michael McLarney (left) chatting with ORA winning retailers.

Hardlines Home Improvement Quarterly

www.hardlines.ca

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C ONF ERENCE C O V ER A GE

HOW FEDERATED CO-OPERATIVES IS EXPANDING

FUTURE-PROOFING CANADIAN RETAILING DAVID IAN GRAY, DIG360 Consulting

CODY SMITH, Director of Home and Building Solutions, Federated Co-operatives

“If anyone’s got their notebook out and is going to write down the five things from my talk to start working on tomorrow, you’re going to be horribly disappointed,” joked Gray.

As head of FCL’s Home and Building Solutions business (HABS), Cody Smith talked about the value of the co-op retail system to local farm communities. FCL supports 160 local co-op organiz-

ations in 600 communities serving 2.2 million members across western Canada with a vision of “Building sustainable communities together.” Smith’s division represents $560 million in retail sales through 104 home centres. He shared with delegates how FCL restructured its business to add more focus to LBM sales in recent years. FCL is opening a distribution centre in Fort Saskatchewan, Alta. Smith also noted the rollout of his stores’ new electronic shelf label (ESL) system and order management system. Cody Smith, the head of FCL’s Home and Building Solutions division.

He actually gave the audience about 100 things to think about in a talk that focused on “micro-stories” about the way stores overcame the severe trauma they face during the pandemic. Success in retail is not about brilliant ideas but “about avoiding really horrible things,” Gray Prominent retail consultant said. He quoted one of David Ian Gray quoted the CEO of one of his clients, Lee Valley his long-standing clients, Ottawa’s Lee Valley Tools, Tools, on the value of caution. whose CEO, Robin Lee, once said to Gray: “Yes we need a change. But don’t change something until you know why you built it that way in the first place.”

At the Home Hardware Reception before the awards gala.

The ORAs have been called the ‘Oscars of the Retail Home Improvement Industry.’

During a networking break.

FIRST QUARTER / 2024

Hardlines Home Improvement Quarterly

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C ONF ERENCE C O V ER A GE

“IT’S SUPPOSED TO BE HARD”

Tom Hanks’ character in the baseball movie A League of their Own, has the perfect reply to a talented player who’s quitting “because it’s too hard.”

Sylvain and Marilyne Laferriere told the emotional story of their Ace store’s battle to survive against the odds.

“It’s supposed to be hard,” Hanks retorts. “If it were easy, everyone would do it. The hard is what makes it great.” Probably no retailer knows “hard” and “great” as thoroughly as Marilyne and Sylvain Laferriere, of Ace Victory Building Centre in Mackenzie, B.C. These 2019

Outstanding Retailer Award winners gave a presentation that did not shy away from detailing their struggles pursuing their dreams in “an industry that is not easy or forgiving,” as Marilyne phrased it. Mackenzie, with a population of just 3,800 people in northern B.C., has been hit over

the years by repeated mill closures, related population exoduses, and a desperate lack of essential services as residents moved out. The couple had bought a former interior finishing store in 2005, because they loved Mackenzie and were frustrated by the lack of products in the town. Little did they know that they’d have to have extraordinary creativity to survive. Three years after they opened, AbitibiBowater announced the closing of the local mills. Then every major mill in Mackenzie closed. “We lost valuable employees, friends, and volunteers,” Marilyne said. And suddenly they had a realization. “There was a need for more than customer service,” Marilyne said. “More than that, there was a need to lift morale, lift spirits.” The couple cleared out a space where they sold flooring and Mackenzie’s dance floor was born. They hired a local DJ and dance instructor, put up a disco ball, and once a week, customers visited the building centre. Not to buy quarter-round but to feel good about themselves again. By the end of their talk, they had won the delegates over. When Sylvain shared that the nearby McLeod Lake Indian Band planned to team up with Mitsubishi to build a multi-billion-dollar hydrogen plant, the room erupted in applause.

From left: David Ian Gray, presenter, with Monica Reid, Emerge2 Digital and Steve Payne, editor of Hardlines.

John Pierce and Bernie Gauthier, Home Hardware

Michael McLarney, Hardlines

MARILYNE AND SYVLAIN LAFERRIERE Victory Ace Building Centre

“

There was a need for more than customer service. More than that, there was a need to lift morale, lift spirits.

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”

Hardlines Home Improvement Quarterly

www.hardlines.ca

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C ONF ERENCE C O V ER A GE

KNOWING YOUR CUSTOMER BETTER THROUGH DATA ROMAIN MERCIER, Founding partner, PS&Co Data Lab

“

There’s a tendency for retailers to do one-sizefits-all marketing.

More than any other speaker, Romain Mercier brought the digital angle to the Hardlines Conference.

”

Data expert Romain Mercier told delegates that most businesses know little about their customers, to their detriment.

But for all the digital technology referenced in his talk, Mercier, a founding partner of the PS&Co Data Lab in Vancouver, had a fundamentally human message: “Over the decades, nothing much has changed. Most purchases are emotionally driven. E-commerce is still commerce between

people. And people do business with people they trust, with whom they share mutual values. This is not rocket science.” Mercier led off his presentation with a carrot and a stick. The carrot was that there is going to be—if Ottawa has its way—a

Geoff McLarney, Hardlines’ Montreal-based associate editor.

Michael McLarney with Thomas Foreman, BSIA of B.C., and Richard Darveau, AQMAT.

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Hardlines Home Improvement Quarterly

home-building boom between now and 2030 the likes of which Canada has not seen before. “The federal government has finally realized that to get affordable housing we need to double the amount of housing being constructed in the next seven years,” Mercier said. This obviously provides unparalleled opportunities for our industry. The stick was that retailers are generally in the stone age when it comes to reaching out to customers, digitally. “Retailers don’t know very much about their customers,” he said. “Each customer is a persona, is part of a segment. There’s a tendency for retailers to do one-size-fits-all marketing. When, if you knew more about your customer, you could send something personalized.” But the big question is, how do we do that? Mercier is a big believer in collecting data, online, about customers. “Most businesses have five or fewer attributes [discrete pieces of information] for each customer. What can you say to your customer with that information? Nothing.” Mercier closed his presentation with a summary of the funding available from the Canada Digital Adoption Program (CDAP). Almost every home improvement retailer in Canada is eligible.

Eight retailers were celebrated at the ORA Gala.

www.hardlines.ca

FOUR GENERATIONS IN THE WORKPLACE

“

Each generation has their own version of how it was hard for them.

ZAIDA FAZLIC HR lead, Taiga Building Products Workers from different generations have distinctive perspectives that can be mutually enriching and shouldn’t be reduced to stereotypes. That was the

word from Zaida Fazlic, HR lead at Taiga Building Products. Fazlic herself identifies as an “Xennial” or “elder millennial,” “on the cusp” of the turn from Gen X to the millennial generation. “Each generation has their own version of how it was hard for them. It was hard for my parents, it’s hard for my generation, and it’s hard for my son and his generation. But it’s not a contest.” There are currently four generations in the workplace, Fazlic explained. Baby boomers, those closest to retirement, are characterized by their “strong work ethic, loyalty to organizations, and

Zaida Fazlic, Taiga’s VP of people, culture, and change management, analyzed the different generations working today. their experience of major historic events.” Immediately following them is generation X. Having come of age during the advent of personal computing, this cohort is “independent, adaptable, and tech-savvy.” Millennials, or Generation Y, were broadly born around the last decade of the Cold War. Fazlic emphasizes that while their view of work-life balance is more holistic, they should not be mistaken for lazy. “Millennials are also hard-working and driven and will deliver.” Gen Z is just arriving in the workforce: “Just as managers are starting to figure out millennials, there’s a new kid on the block.” Millennials may have grown up

”

with digital technology from a young age, but Gen Z are “digital natives” who have never known a world without it. Fazlic calls them “purpose-driven,” adding they “prefer to work with organizations whose values align with their own.” Fazlic believes strongly that team members from all cohorts have something to contribute. “Older generations need to be patient with the younger ones as they figure out their own struggles and become adults. Younger generations need to remain open-minded about learning from older generations.” “Listen to all of them. All of them are right.”

A standing ovation at the end of the Laferrieres’ presentation (see page 28).

Hardlines’ David Chestnut, emcee of the ORA Gala.

www.hardlines.ca

Sherri Amos, Home Hardware head office, chats with ORA winner Tyler Nowochin, dealer-owner from Lacombe, Alta.

Hardlines Home Improvement Quarterly

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C ONF ERENCE C O V ER A GE

INDEPENDENTS STILL FRONT AND CENTRE AT RONA JEAN-SÉBASTIEN LAMOUREUX, Senior vice-president, RONA

“

The pandemic encouraged Canadians everywhere to prioritize buying local.

”

RONA’s Jean-Sébastien Lamoureux reaffirmed the company’s commitment to independent affiliates in his talk at the Hardlines Conference. “Following the acquisition by Sycamore Partners, we brought the RONA brand back front and centre,” he said. Regarding RONA’s commitment to independent dealers, Lamoureux admitted

Yves St-Cyr, Senior Director, National Accounts, BP Canada.

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RONA’s SVP of affiliate dealers and public affairs told the Hardlines Conference about the renewed focus on independents at the company post-Lowe’s. that the model has advantages of its own, which fit into RONA’s overall strategy. Independent dealers are “often in more remote areas where big corporate players

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

Hardlines Home Improvement Quarterly

don’t set up shop,” he said, adding they also have the personal knowledge of their local markets to customize their mix. That can give independents an advantage in an environment where consumers are increasingly favouring proximity. “The pandemic encouraged Canadians everywhere to prioritize buying local. I encourage you to capitalize on that.” It’s not only in rural areas that small independents can thrive, either. “We see a clear need for more urban stores that carry the essentials that homeowners need,” Lamoureux observed. Moreover, e-commerce can enable even the smallest stores to offer a wider variety of products than they could accommodate on-site. “No matter how you choose to do it, if you’re not online yet, you need to work on getting there as soon as possible,” he underscored. “Dealers who have a good online offering and offer buy-online, pick-up in-store can turn their customers from competitors who either don’t offer online shopping or don’t have a bricks-and-mortar store.” Ultimately, the strength of the local independent lies in service. “I can’t emphasize enough the importance of training your staff to support the top-notch experience you need to deliver to your customers.”

The 27th Hardlines Conference featuring a harmonica. www.hardlines.ca

CONFERENCE SERIES

2023

IN APPRECIATION OF OUR SPONSORS! The retail home improvement industry gathered once again at our Annual Hardlines Conference last fall, this time at the Fairmont Chateau Whistler in British Columbia. The Outstanding Retailer Award winners joined other exceptional dealers from various banners, along with head office executives, manufacturers, distributors, and agents from every part of Canada. Hardlines worked in concert with the BSIA of British Columbia to bring more dealers than ever to this event. Our sponsors were also key to the Conference’s success. Our thanks to the companies listed below, who worked in a spirit of cooperation to make us all stronger through this event. THANK YOU!

David Chestnut | Vice President and Publisher

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HARDLINESCONFERENCE.CA

C ONF ERENCE C O V ER A GE

BSIABC CELEBRATES 85TH ANNIVERSARY AT HARDLINES CONFERENCE

Collaborating with Hardlines, the BSIA presented a concurrent trade show alongside the conference and held its Orion and Award of Merit awards gala

he Building Supply Industry Association (BSIA) of B.C. was celebrating its 85th anniversary at the Hardlines Conference in October. The celebrations—and an important trade show—took place at the Fairmont Chateau Whistler. Collaborating with Hardlines’ first ever conference in British Columbia, the combined offering benefited both organizations, attracting a record number of delegates and increasing networking opportunities on a national basis.

AWARD WINNING RETAILERS

The association honoured the following retailers with its 2023 Orion Awards: Parkland Building Supplies 1998 Ltd., a Home Building Centre dealer in Sicamous, won in the urban hardware and rural lumberyard category; Central Hardware 2018, Ltd., a TIMBER MART dealer in Enderby, won in the building

A packed house attended the BSIA’s Awards Gala, which was followed by a live auction to raise bursary funds.

Five British Columbia building centres were presented with Orion Awards.

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Hardlines Home Improvement Quarterly

www.hardlines.ca

The Business Development Bank of Canada was on hand to answer dealers’ questions about financing.

Brad McCluskie, business development manager at Coast Distributors.

Ray Cyr, president of Fraser Valley Building Supplies, which operates six RONA stores in B.C. Bruce Allen, founder of B.H. Allen Building Centres, a RONA affiliate.

centre contractor yard category; Nelson Home Building Centre, in Nelson, won in the building centre/mini-box category; Windsor Plywood, Courtenay, won in the finishing and specialty products category; and Arbutus Home Building Centre, Galiano Island, won in the mystery shopping category.

AWARDS OF MERIT

TimberTech booth at the BSIA trade show.

www.hardlines.ca

The BSIA of B.C. handed out its 2023 Industry Merit Awards to three individuals who have made significant contributions over decades to building up the province’s retail home improvement industry. The honourees were: Bruce Allen, a RONA dealer-owner who is president of

three RONA-bannered stores, in North Vancouver, Powell River, and Salmon Arm; Brad McCluskie, business development manager of Coast Distributors, a prominent west coast hardlines distributor; and Ray Cyr, president of Fraser Valley Building Supplies, with six RONA stores in the province. Following the BSIA Awards Gala, a live auction proved to be a big hit, with guests bidding on a range of donated items from sports and concert tickets and hotel nights to various items donated from the industry. In addition to being a lot of fun, there was a serious purpose to the auction—the BSIA raised a total of $6,100 for its important BSIA Bursary Fund.

Hardlines Home Improvement Quarterly

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LES were presented in October at the Hardlines Conference in Whistler, B.C. Owners and managers from eight visionary home improvement retailers came up on stage at a gala dinner at the Fairmont Chateau Whistler to receive their awards. Congratulations to all of our winners!

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Hardlines Home Improvement Quarterly

Photo: Lyne Tétreault, Photographes Commercial

The prestigious Outstanding Retailer Awards (ORAs)

www.hardlines.ca

2023

HARDLINES CONFERENCE

Best Building Supply Over 15,000 Square Feet

MARIEVILLE HOME HARDWARE BUILDING CENTRE Marieville, Quebec

Eric Berthiaume (left) is partners with Louis Turcotte (right) in Marieville Home Hardware Building Centre. The duo have effected a turnaround of the once-struggling business, in part by betting big on contractors.

hen Eric Berthiaume acquired Centre de rénovation Home Hardware Marieville, it wasn’t the first time he’d taken over a struggling store with a view to turning its fortunes around. “I had tried to do a management buy-out in a similar business in the Ottawa region” while working for another banner, he recalls. Berthiaume was so successful in rebuilding the venture that he inadvertently cheated himself out of the acquisition. “I turned it around so quickly that they decided not to sell!” Luckily, his employers compensated him well to relocate to Montreal. There, he says, “One of my suppliers told me, ‘I know you want to have your own business.’ Fifteen months later, we made a deal with Home Hardware.” Berthiaume and Louis Turcotte went in to buy the Marieville store (a half hour east of Montreal) from Home, which in turn had acquired it as part of its “Good Home” program. The initiative allows head office to purchase struggling stores, give them new life, and then sell them to the new dealers. (In addition to Marieville, Groupe Turcotte has five other Home Hardware stores and is

Hardlines Home Improvement Quarterly

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2023

HARDLINES CONFERENCE From left: Eric Berthiaume, general manager and co-owner; Yves St-Cyr, BP Canada (award sponsor); Louis Turcotte, co-owner.

W I N N E R

“ Photo: Jozef Povazan

I had seen what the commercial side of the business can do.

co-owner with Home Hardware corporate of the Patrick Morin chain.) “Louis has been turning around stores as a majority owner for a long time. I didn’t have enough capital and I thought he was an ideal partner,” Berthiaume said. For Berthiaume, the stakes were high: he had put a significant chunk of his life savings into a store that had been losing money for almost 10 years, in a rural area with minimal walk-in traffic. Fortunately, his industry background, including time at RONA and Home Depot, had given him experience working with at-risk stores. It paid off: “We bought it at $4.3 million [in sales] then more than doubled the sales in the first year.” In 2020, during the early days of the pandemic, the entire store was rem-

“

”

up less than $1 million of its annual sales. “I had seen what the commercial part of the business can do. It’s complicated because you have a Business-to-Business and Business-toConsumer part of the business cohabiting together. You can leverage them against each other but it’s also very different because you

It’s complicated because you have a B2B and B2C part of the business cohabiting together.

erchandised. The business has recently purchased an additional 160,000 square feet of land, with plans for a $1 million expansion, including a 2,000-square-foot greenhouse to replace the current outdoor garden centre. One factor in the turnaround was Berthiaume’s decision to focus on wooing the pro customer. Previously, the store’s LBM business “was not non-existent,” but made

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”

buy differently, you deliver differently.” But Berthiaume also lays much of the store’s success at the feet of his staff. Pay exceeds minimum wage, and new recruits are twinned with more experienced mentors as they adjust to the job. He points to the store’s low staff turnover rate as a rare accomplishment in this industry. Finding the best people can mean having

Hardlines Home Improvement Quarterly

to look off the beaten path. “I was needing boom truck drivers,” Berthiaume recalls. “It’s not easy, when you’re starting a small company and just have two trucks, to get the best drivers around.” He posted a job offer on social media and received an application all the way from France via Quebec’s temporary foreign worker program. That’s how Frédéric came aboard. “Since then, we had another guy reach out [from France] through a Facebook page for boom drivers. Frédéric saw it and reached out to him.” Working at the store is now a family affair for the transplants. “When you decide to leave your country, you want stability and a good environment and I think that’s what we’re providing. Maybe we’ll get some more because these guys are very good.” www.hardlines.ca

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2023

HARDLINES CONFERENCE Retail Spirit Award

W I N N E R

HODGINS BUILDING CENTRE Wingham, Ontario

From left: Yanick Miron, Taiga (award sponsor); Nik Glazounov, general manager; Jordan Hodgins, co-owner; Gino Allegro, Johns Manville (award sponsor); Brock Hodgins, co-owner. family business or should they sell it off? “Selling it off… was simply unthinkable,” Brock says. “We made a firm commitment to preserve our family tradition and embark on a mission to revolutionize the store.” Together with their best friend, Nik Glazounov, the brothers set about their

mission. And they realized that their secret weapon was not the physical assets of the business, but their mental attitude. “Our customers are not just patrons, they are an extension of our family,” the brothers told us. But the physical space needed to change. In 2017, they added a 24,000-square-foot warehouse to their facilities. And when Covid put a halt to in-store shopping, the group decided to use the crisis to their advantage. They initiated a full-store remodel, acquiring a neighbouring property and adding an additional 16,000 square feet of warehouse space.

“

We made a firm commitment to preserve our family tradition and embark on a mission to revolutionize the store. 40

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www.hardlines.ca

Photo: Jozef Povazan

he Retail Spirit Award goes to a store which best exemplifies the spirit of entrepreneurialism, dedication, and determination. Third-generation owners of this Castle Building Centre store are brothers Brock and Jordan Hodgins. The store is managed by Nik Glazounov. The store was founded in the southwestern Ontario town of Wingham by Brock and Jordan’s grandfather, Jack Hodgins, in 1961. The second-generation owners, Dave and Rick Hodgins, took the baton from Jack and grew the business—opening a second location in nearby Lucknow in 1988. But by 2015, the third generation, Jordan and Brock, faced a crucial decision. The business needed significant modernization. Should they continue the legacy of the

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Young Retailer of the Year

BARRY EIDT Arthur Ace Hardware, Arthur, Ontario

From left: Isabelle Bergeron, ACCEO (award sponsor); Barry Eidt, co-owner, Arthur Ace Hardware; Marc Leblanc, ACCEO (award sponsor). of stores to three, building a 6,000-squarefoot wholesale distribution centre, and hiring the staff needed to accommodate that growth. During Covid, Barry found himself working seven days a week. Even when he

was at home, he’d stay busy researching different marketing and merchandising opportunities. Or planning store events such as fundraiser barbecues. More recently, Barry again put his money where his mouth is. This past spring, he sold his house and moved into a smaller apartment to help finance the acquisition of the family’s third and newest store. Barry says it was important that he establish himself as a true fifty-fifty partner. For these and other reasons, Barry Eidt was a standout choice for our Young Retailer of the Year.

“

At the age of 19, Barry took all his savings out of the bank and invested them in the store when his dad was buying out his partners. 42

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”

www.hardlines.ca

Photo: Jozef Povazan

arry Eidt started working in his father’s hardware store when he was 13. But from the start he had a sense of ownership of the business. Sweeping the floors and putting products on the shelves was not a chore; it quickly became a passion for this young man. When he came out of college seven years ago, Barry’s dedication guided him to become an integral part of the family business full-time. He had already demonstrated his commitment to the store at the age of 19. At that time, he took all his savings out of the bank and invested them in the store when his dad, Doug, was buying out his partners! In his young career, Barry has already been instrumental in expanding the number

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2023

HARDLINES CONFERENCE Best Contractor Specialist Store

W I N N E R

THE CEDAR SHOP Calgary, Alberta

From left: Mitch Wile, president; Gord Catherwood, Trex (award sponsor); Leigh Palko, co-owner; Yanick Miron, Taiga (award sponsor); Tyler Palko, co-owner. Bev passed away in 2019—but she knew that the turnaround was going to be a success. She also got to see the store’s new building in Calgary. One of the most important operational aspects of The Cedar Shop is the store’s incentive plan for staff. And by 2021, all

those incentive plans were reached. “The staff were now engaged and are driving to achieve our new, higher incentive levels,” Mitch says. The store, a Sexton Group member, is now operating at peak efficiency, piling up sales increases, satisfying customers, and easily qualifying as one of the best contractor-specialist stores in the country.

“

We realized it would cost The Cedar Shop close to $500,000 in bad debts and severance payments to turn it around. 44

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”

www.hardlines.ca

Photo: Jozef Povazan

he owners of The Cedar Shop are Tyler and Brad Palko. The manager is Mitch Wile. The business was founded in 1978 by Jerry and Bev Palko. They experienced significant success until Jerry sadly passed away in 2007. Alone as owner, Bev struggled to maintain the momentum and The Cedar Shop’s sales began to falter. Mitch doesn’t mince words when he describes the challenges he confronted when Bev hired him in 2015 to turn the business around. “The company had lost control of its spending,” he says. Morale was at an alltime low. The bad debt situation was dire. “We realized it would cost The Cedar Shop close to $500,000 in bad debts and severance payments” to even begin to turn the business around, Mitch said. A turning point came when Mitch directed his staff to do a complete SKU analysis. The problem was crystal clear. Twenty-five percent of The Cedar Shop’s stock was being sold at a viewable loss!

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2023

HARDLINES CONFERENCE Best Building Supply Under 15,000 Square Feet

W I N N E R

NOVA SCOTIA BUILDING SUPPLIES Blockhouse, Nova Scotia

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From left: Susan Albizre, JELD-WEN (award sponsor); Alison Briand, Nova Scotia Building Supplies; Andrew Mills, Nova Scotia Building Supplies; Adrienne Burgess, JELD-WEN (award sponsor). stopping there. It is currently in the process of building the store’s largest warehouse yet. This project comes just three years after extensive renovations allowed the store to broaden its selection of plumbing, kitchens, paint, and flooring. The store’s community involvement is

”

We understand the value of treating our employees right and investing in their futures.

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Hardlines Home Improvement Quarterly

extensive. Last year, it raised over $40,000 for the local children’s hospital and donated $15,000 to the Mahone Bay Area Food Bank. All told, the store supports over 50 different charitable organizations. The business formula works, too. Over the past four years, Nova Scotia Building Supplies’ revenue has grown by almost 60 percent. Every niche that can be served, the store is on it. Like the All-Install program, where a dedicated crew is always busy installing products for customers. Then there’s Interhabs, a panelized home manufacturing business. Add to that a thriving kitchen cabinet business, an eavestrough business, and the manufacturing of docks, floats, and picnic tables.

www.hardlines.ca

Photo: Jozef Povazan

he owners of this Castle Building Centre store on Nova Scotia’s South Shore are Harold Mills and his sons, Andrew Mills and Matt Mills. The manager is Wayne Nelson. Says Andrew: “The foundations of our business are honesty, integrity, respect, trust, and excellence.” The business dates back to 1982 in the same physical location. Arthur Mills— Andrew and Matt’s grandfather—acquired the store not long after that. Expansion has been ongoing for almost 42 years—including the acquisition of a sister store in Chester, on the other side of Mahone Bay. But the Mills family is not

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HARDLINES CONFERENCE Best Large Surface Retailer

W I N N E R

RONA+ WHITBY Whitby, Ontario

“

A very important part of my job is to identify talent within the store and ensure associates have the opportunity for advancement.

”

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From left: Michael Foltin, JRTech Solutions (award sponsor); Paul Santos, store manager. providing a level of service under difficult conditions that was truly extraordinary. At this store, training is well-rounded and not focused solely on learning in-store. A student incentive program rewards returning summer students with up to $500 per year. A tuition reimbursement program provides up to $1,500 annually. Oh, and the store’s sales doubled over the past decade—including strong gains in 2022, when much of the industry was

Hardlines Home Improvement Quarterly

starting to flatten out. With a team of more than 150 people working in a store that’s 150,000 square feet in size, the leadership team recognizes the value of developing their people. Said store manager Paul Santos: “A very important part of my job is to identify talent within the store and ensure associates have the opportunity for advancement, reaching their career and financial goals—and bettering their lives as well as the lives of their families.” Now, that’s the stuff of a true Outstanding Retailer Award winner.

www.hardlines.ca

Photo: Jozef Povazan

ig box stores did not have an easy time of it during the pandemic. For the leadership team at the newly-rebranded RONA+ store (it converted from the Lowe’s banner in 2023) in Whitby, Ont., the lockdowns—and the resulting staffing crisis—were just some of the challenges they faced. As customers got more frustrated and anxious during the pandemic, the situation required more than solid product knowledge from the staff. The team at Lowe’s Whitby had to rise to the occasion,

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2023

HARDLINES CONFERENCE

W I N N E R

Marc Robichaud Award for Community Leadership

NOWCO HOME HARDWARE Lacombe, Alberta

FIRST QUARTER / 2024

From left: Tyler Nowochin and Deanna Nowochin, dealer-owners; Sarah Hounslow, BMF (award sponsor).

“

We are in the business of people, not product!

back is its Chairs for Charity event. Every July, Nowco Home Hardware asks local

Hardlines Home Improvement Quarterly

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businesses to purchase an Adirondack chair from them and paint or decorate it however they wish. The businesses display the chairs on the sidewalks downtown and sell raffle tickets to win the chairs. In this way, Tyler and Deanna have raised $24,000 for local charities. This is just the tip of the iceberg for Nowco Home Hardware’s charitable giving. They have donated to the Parkinson’s Association of Alberta, the local food bank, and Santas Anonymous, a program run by the local Kinsmen club. They’ve donated tools to the local junior high school for their shop program. They are a title sponsor of the Lacombe Performing Arts Centre. They donate to Big Brothers and Big Sisters, the local Family and Community Support Services… wherever the town needs their help. Nowco Home Hardware is truly in the people, not product, business. www.hardlines.ca

Photo: Jozef Povazan

he owners of Nowco Home Hardware, along with store manager Tami Schneider, believe that good retailing is about more than selling products. Muriel and Edwin Nowochin purchased this store in Lacombe, Alta., 25 kilometres north of Red Deer, in 1986. Their son, Tyler, became the third-generation owner in 2010 and his wife, Deanna, officially joined him as co-owner a year later. Community-mindedness has been a feature of Nowco Home Hardware since the beginning. “We are in the business of people, not product!” Tyler and Deanna say. One of the store’s biggest ways to give

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2023

HARDLINES CONFERENCE Best Hardware Store

W I N N E R

HYDWAY HARDWARE Fort Vermilion, Alberta

From left: Robyn Currie and Ray Toews, co-owners; Joelle Cohn, National Hardware Show (sponsor of the award). But when it was time to return to hardware, Ray did not want to take on another banner. “I’m not a corporate kind of

guy,” he said. So, Ray and Robyn opened Hydway Hardware as a true independent in Fort Vermilion in 2000. This hamlet is in Northern Alberta on the Peace River. The same river which turned destructive on April 29, 2020. Says Ray: “By noon we had four feet of water in the store as the Peace River ice jammed and destroyed the community.” Rebuilding from that disaster wiped out the couple’s savings. During the year it took to reopen, their customers got used to other stores. To win them back, the Toews built a new, modern store. It has assortments from hardware wholesaler Orgill, and a focus on customer service that is truly extraordinary.

“

My preference is to run very personal businesses in small towns.

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Hardlines Home Improvement Quarterly

”

www.hardlines.ca

Photo: Jozef Povazan

or Ray Toews and his wife Robyn, co-owners of Hydway Hardware, small is beautiful. “My preference is to operate very personal businesses in small towns,” Ray says. A veteran hardware retailer, Ray got his start in this industry in 1980 when he sold his convenience store and gas bar in Cochrane, Alta., to buy his first hardware store. It turned out to be a good investment. He was able to sell his store six years later and open a Home Hardware store. Selling that store three years later, he decided to take a decade away from retail.

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Congratulations to our Outstanding Retail Award Winners Marc Robichaud Community Leader

Best Building Supply/Home Centre over 15,000 square feet

Tyler and Deanna Nowochin

Eric Berthiaume & Louis Turcotte

“The Outstanding Retailer Awards honour excellence in the home improvement industry, and I can think of no one more deserving of this award for excellence than Tyler and Deanna Nowochin,” said Kevin Macnab, President and CEO, Home Hardware Stores Limited. “Tyler and Deanna consistently find ways to raise the bar when it comes to charitable giving and creating points of connection in their community, while encouraging others to do the same. I want to extend my congratulations on this incredible achievement on behalf of Home Hardware Stores Limited and our Dealers.”

“Eric, Louis, and their team at Centre de Renovation Marieville could not be more deserving of this national industry recognition,” said Kevin Macnab, President and CEO, Home Hardware Stores Limited. “They work tirelessly to make sure their store offers the Marieville community the best customer service and highest quality products. On behalf of Home Hardware Stores Limited and our Dealer network across Canada, I would like to congratulate them on their Outstanding Retailer Award.”

Dealer-Owners Nowco Home Hardware

Dealer-Owners Centre de Renovation Marieville

HUMAN RESOURCES

F LE BY MICHAEL MCLARNEY

ABSDA TACKLES NEW TALENT ACQUISITION

The association’s second annual HR Conference provided insights into how to find and retain new workers

he Atlantic Building Supply Dealers Association (ABSDA) held its second annual HR Conference in November. Experts on hiring and recruitment presented strategies to a room full of dealers looking for ways to cope with the ongoing shortage of available workers. More than 100 people from across Atlantic Canada were in attendance. “It’s a perfect storm of aging demographics and a new generation coming up,” said ABSDA president Denis Melanson in his opening remarks. He added that 34 percent of the population in Atlantic Canada is now 62 years of age or older. Where will the replacement workers come from? Melanson and his team created the ABSDA HR Conference in 2022 in response to a survey of members that had revealed a range of hiring issues for dealers. These included recruitment, onboarding, and what kinds of policies are in place to help individuals along in their careers. “It identified some glaring gaps, but in turn it offered some opportunities for us as an association to provide services.” The morning was devoted to a hands-on workshop conducted by HR and workplace issues expert and author Pierre Battah. Battah’s presentation gave each table of delegates a set of tasks and challenges through the morning. At the heart of his talk was the need for communication. Not full-on all the time, but tailored to the situation. And that includes conversations that address conflict within the team, something too many leaders are reluctant to face. www.hardlines.ca

“

We can lose people if we’re not prepared to have the difficult conversations. As managers we try to get everyone on the same page.

”

— Pierre Battah , HR & workplace issues expert and author

“We can lose people if we’re not prepared to have the difficult conversations,” Battah said. These tough conversations help get to the heart of which issues are divisive for a team. “A lot of what we do as managers is trying to get everyone on the same page.” Julie Melanson is an HR consultant with JMC HR Consulting in Moncton, N.B. She took to the podium after lunch to share some tips and guidelines for hiring and retaining staff with her “HR tool kit.” She stressed the need to create a positive and welcoming environment for your candidates right from the start. She reminded the audience that some people can be extremely nervous during a job interview. “It’s not something we do very often.”

The realities of today’s labour market require employers to consider new Canadians in their hiring. Jordan Remedios, program co-ordinator for the Immigrant Services Association of Nova Scotia, talked to the delegates about how to make your workplace more welcoming to new hires, regardless of where they come from. But with new Canadians especially, he said, cultural differences can create confusion in the workplace. Overcoming that confusion and fostering an environment that enables all workers to share ideas goes a long way to ensuring one’s workplace will reap the benefits, Remedios said. “The more we can commit to this, the more we can commit to inclusivity in the workplace.”

Hardlines Home Improvement Quarterly

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HUMAN RESOURCES

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BY MICHAEL MCLARNEY

TIPS FOR HIRING TOP-LEVEL TALENT We asked Wolf Gugler, one of our industry’s top executive search specialists, how you can fill that key position in your business speedily, effectively, and with less risk

olf Gugler is president of Wolf Gugler Executive Search. He specializes in landing roles for hardware companies in Canada and the U.S., especially in sales and marketing. With Canada’s unemployment rate running at 5.2 percent in November, “It’s still a candidate’s market,” he says. As a result, companies looking to hire can be at a disadvantage. And that means the process of hiring can’t be a long one, Gugler warns. The days of three, four, and even five interviews are over. Nowadays, he’s seeing many candidates receive multiple job offers. For companies looking to hire, he says, “In many cases, if you don’t move quickly enough, that talent goes by the wayside.” Timeliness works at different levels. It’s not just a matter of securing the right candidate before someone else does. It can also be indicative of your management culture. That means a candidate can evaluate your company based on how long it takes to make the hire. Gugler says some candidates have shared with him their concerns about the culture of a company that’s doing the hire. Dragging

FIRST QUARTER / 2024

out the hire may demonstrate to the candidate that your company is indecisive or struggling with too many layers of authority to respond quickly. “The timeliness part is demonstrative of how a company runs their business,” Gugler says. So if the candidate sees that your hiring process is stretched out or indecisive, or whatever the case might be, they can relate it to: ‘Is that the way it’s going to be when I’m on board and I need a decision made?’”

“

THE INTERVIEW PROCESS

After clicking through a mountain of applications and resumés, the next step in choosing your next hire comes down to face-toface meetings. Gugler says that first meeting is likely to be a Zoom call—and that’s okay for the first round. But even remotely, you can learn a lot about a person from that meeting, he says, and not just through their conversation. Body language and how they hold them-

Timeliness is everything. In many cases, if you don’t move quickly enough, that talent goes by the wayside.

His advice to any HR department? “Make sure you have a good relationship with your senior team. Try to do whatever you can to build that line of communication and trust, so when they say, ‘I have a need, here it is, take care of it,’ the HR team can go ahead and take care of what they need to do.” Then, when HR presents the short list of candidates, they can be trusted to have included strong potential hires.

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selves are all factors that can be assessed in that inaugural online meeting. In terms of the interview process with the candidate, don’t be afraid to ask some soft questions that reflect the candidate’s personal life. Ask them about other stuff outside of work, such as charities or hobbies. “What kind of a person are they? What kind of things do they do outside of work? Are they involved in any charitable activities

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HUMAN RESOURCES or involved in their community, that kind of thing.” When it comes time to make an offer, Gugler’s advice is straightforward: keep it simple. He cites the case of one candidate for a middle-management position who received a 17-page offer. “We’re talking about someone who’s probably making something in the $60,000 to $80,000 range,” says Gugler. “They’d probably have to get a lawyer to go through that.” Such an offer is simply a waste of time and will only slow down the hiring process even more. He recommends keeping the offer to no more than two pages and, if necessary, include your company’s benefits booklet. “Just try to simplify.” One no-no that Gugler warns his clients against is asking for references up front. That, he says, is just not cool and and sends the wrong message to a potential hire. So it’s better to wait until you are near the end of your negotiations. “I don’t often get a company that says they want references right up front. That’s almost insulting to a candidate when you ask for that information. And, of course, if they’re gainfully employed, maybe it could represent a breach of confidence.”

CALLING A REFERENCE

When Gugler calls a reference, first he makes sure they have time for the call to give them time to gather their thoughts and

“

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Wolf Gugler is a recruiter for hardlines firms in North America. Speed up your hiring process, he advises. that individual, besides what the new role is and what skills are required. Fully apprised of the opportunity, the reference can answer in a more informed way, and potentially provide additional insights into the candidate’s suitability for the role in question. This helps make the interview

Ask a reference a key question: ‘Would you rehire the person if another opportunity came along?’ Then wait for the pregnant pause.

ensure they are engaged in the conversation. Then he gives the reference a description of the opportunity and some of the key requisites the new employer expects from

FIRST QUARTER / 2024

”

more “open and freewheeling”—and not so structured. This approach is better than just asking the reference to verify the candidate’s job history.

Hardlines Home Improvement Quarterly

As far as their resumé goes, Gugler says you can hire a third party to verify their background, “or just go on LinkedIn and see if it matches up with their resumé. It’s amazing how many times it doesn’t match up, either.” Gugler recommends asking the reference if they can think of anyone else the candidate knows and has worked with whom you could speak with. This gives you the chance to connect with someone who the candidate may not expect you to talk with. “One of my last questions usually is, would you work with this person again? Would you hire them if the appropriate opportunity came up?” Then wait for the pause, Gugler advises. “That pregnant pause can tell you a lot.” It’s important, he says, to read between the lines.

www.hardlines.ca

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SUCCESSION PLANNING AND SELLING YOUR STORE INTERVIEW BY STEVE PAYNE

Both processes are “complex but straightforward”—if you know the rules of the game, says JOHN LONGO, former recruitment specialist for RONA and other banners

ohn Longo spent about 25 years with RONA—in two stints— recruiting dealers to the banner during its pan-Canadian expansion out of Quebec. Longo has seen so many stores bought and sold—many of which transactions he was deeply involved with—that he’s become one of Canada’s foremost experts in buying and selling

FIRST QUARTER / 2024

hardware and building supply stores. Longo is also a passionate Canadian nationalist. “We need more entrepreneurs in Canada,” he says. “More risk-takers. I don’t want to see Canada become a sales office for American firms. The more people that go out and start businesses in this country, the more prosperous country we will have.”

Hardlines Home Improvement Quarterly

For Longo, the succession process is a “complex but straightforward” thing. “As much effort should be put into exiting the business as entering it,” he says. “In fact, when you enter a business is the perfect time to think about your exit strategy.” In the following interview, HHIQ picked Longo’s brain about the entire process of buying or selling a home improvement store. www.hardlines.ca

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SUCCESSION PL ANNING

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The three biggest considerations in selling your store are: One, the price. Two, the time frame over which you will be paid. Three, the disposition of the buyer you are negotiating with.

What considerations should a dealer-owner take into account when selling their business? Obviously the top one is the valuation— what is the fair price for your business? Secondly, how is that person going to pay you in terms of time? And thirdly, you’ve got to understand the disposition of the person you’re selling to. www.hardlines.ca

”

The reason these three things are important is because you’re likely to end up with a buyer with high skill and low capital. Very rarely is the buyer going to have high skill and high capital. Because even if he’s a corporate refugee, and he’s been packaged out, if he’s smart, he’s not going to blow it all on you. You need to take your time and figure out how to do it properly.

Let’s talk about the valuation of your business in terms of multiples of EBITDA. Over the last 15 years of low interest rates (a period when the Bank of Canada Rate was generally below two percent) stores in the industry were commonly valued at between four and seven times EBITDA. That’s changed now. We are now paying interest rates that we haven’t seen for almost

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SUCCESSION PL ANNING

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25 years. Today, I would never pay more than three to five times EBITDA for a store. And when I say three to five, it’s three that I would stick to.

thing is, the business has to be profitable. And by that I mean, is the business is able to pay its bills? Because what you’re going to have is the buyer has to take money that’s extra, over and above the profit, and use it to pay you back. And that’s where it becomes very complex but yet straightforward. It’s just all very mathematical. Essentially, value is based on performance—poor performance leads to low value.

How do you know instantly if the multiples of EBITDA calculation is out of whack? Take a small hardware store that’s doing sales of a million dollars a year. It’s generating between five and seven percent EBITDA. A really good one would give you maybe 10 percent. But let’s take seven percent EBITDA. If I pay you three times that on a million dollars of sales, that’s $210,000. But the store’s inventory is obviously more than that. So, we’ve got to have another conversation. Or take a building supply that does about $3 million annually in revenues. It’s going to do, say, six percent EBITDA, or $180,000. That means I’m going to pay around three times that, or $540,000. So again, I’m paying you much less than the inventory is worth. Again, we need to have a new conversation.

What about valuing the operating company versus the real estate? You have to figure out the value of each. You have to break out the operating company—what we call the “Opco”—versus the

“

Who are the types of people you need around you to make a deal? John Longo spent some 25 years with RONA, in two stints, recruiting dealers to the banner during its national expansion. at least $350,000. But they’re currently going to have a mortgage of $650,000 at perhaps seven percent. And that’s going to cost about $46,000 a year—mostly for interest in the early years. So, whatever the bottom line of the business is, you have to take $46,000 out of it right off the top. And the buyer hasn’t paid anything significant on the real estate at that point—it’s all interest costs. The rational decision might be, “I’m not going to buy that real estate now. I’ll buy it in three years. Or I’ll buy it in five years.” You might decide that all you want to buy right now is the operating company.

With interest rates that haven’t been this high in 25 years, stores are valued at three to five times EBITDA, not the four to seven times EBITDA of the low interest days.

real estate value—what we call the “Realco.” And that’s the biggest mistake that people make when selling their stores. Because “Realco” is tangible—but it’s harder to get money out of real estate because the buyer has to put down at least 35 percent. If the building is worth a million bucks, then the buyer is going to have to put down

FIRST QUARTER / 2024

”

Let’s talk about paying for the business over time Most of the stores that I ended up selling, I would always put in the agreement two, three, or five years to get completely paid up. The way you do it is—first, it has to be a profitable business. If it’s not profitable then we have all kinds of troubles. So, the first

Hardlines Home Improvement Quarterly

You need an accountant, a lawyer, and a specialist. Why a specialist? That specialist does this stuff all day long—that’s their job. Their job is to do all the proper due diligence and then negotiate. And if you don’t hire a specialist, you can take your eye off the ball when it comes to running your business. It’s high-intensity work to run a hardware or building supply store and it takes a lot of your time. Instead of being caught up in the back and forth of selling your business—your job is to run your business while you’re negotiating to sell it. The specialist’s job is to take care of the myriad of details that the proper sale of your business will involve.

What are the different types of purchase agreements? There’s an asset purchase agreement and a share purchase agreement. In a share purchase agreement, the person that sells their shares saves on taxes. [Editor’s note: Only 50 percent of their profits on selling their shares are taxed as capital gains.] In an asset purchase agreement there is no saving to the seller on taxes, so it can cost the buyer a little bit more. But there’s a tension. The guy that wants to sell often wants the share purchase agreement because he or she gets the most tax benefit. [Editor’s note: Tax implications of selling a store vary by province.] The person who is buying it, they are looking for an asset purchase agreement because that’s got the least www.hardlines.ca

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SUCCESSION PL ANNING liability—and they can pick and choose what they are buying. When I buy a business’s shares, then I take on the liability for all of the mistakes that the previous owners may have made over the years that could come back to haunt me. It could be land that’s been polluted, a wrongful dismissal suit, what have you. Obviously, buyers tend to want asset purchase agreements to avoid the legal liabilities. So that’s a common source of tension during negotiations. The buyer wants an asset sale; the seller wants a shares sale.

Let’s talk broadly about succession. What’s most important? First of all, succession is a process. You have to ask, annually, how does my successor look? Is it going to be my son? My daughter? Is it going to be nobody, so I’m going to have to sell? And you have to think about that right at the beginning of acquiring ownership. You have to say, “I’m in this business. I joined it in 2021. I’m 46 years old. The date that I should think about leaving is in 19 years.” Once you think like that, then you bring clarity to the process. But most business owners don’t plan like that. Why? Most people don’t like to think about dying. They distract themselves so they don’t have to think about it. But all business owners need to plan for a successor. It’s not that it’s so difficult to do that planning. It isn’t. But it is complex. Add succession to the conversation you have with your accountant as you prepare your annual year-end.

Who, in your opinion, has got succession planning perfected the most, in our industry? Canadian Tire. They are the king of the game. Canadian Tire picks up high skilled, knowledgeable people, maybe with low capital. They sell you the fixtures, the inventory, and the leasehold improvements. That’s all you own. The building is owned by Canadian Tire and you pay them rent. You

FIRST QUARTER / 2024

F LE are always going to pay them rent—and it is a reasonable, market rent. Your ownership share increases over time as you make them money. Usually in seven to ten years, your equity increases until you own the business. And when you exit the business, the terms are defined at the time you got in. Canadian Tire have got succession down to an art.

What about partnerships? The most important thing with partnerships is to realize that things are going to go wrong. That’s all part of the process. Because that’s the way life is: stuff hap-

“

only going to give you something like 60 percent of anything up to 60 days. So anything over 60 percent, if you’ve got $2 million owed to you, you’ve got to have $800,000 of your own equity in the game.

So why take on that risk by being an owner? Because if you’ve got high skills, you can make a lot of money. If you’ve got years in the business—if that’s your specialty—you can do really well. I once sold a store to a manager who had been there for 15 years. More than a decade later, he’s done really,

To be an owner is not easy. But that doesn’t mean you shouldn’t be one. Because the life that that’s going to give you—and the choices that’s going to give you—you’re never going to get anywhere else. pens! That’s where it becomes important that there is a division of duties. Ideally, in a two-person partnership, one person is front-facing and one person is back-facing. Some of the great partnerships have been like that, because they give each individual their specialist role. Which means that crises happen less often, and when they occur, they are surmountable.

Let’s talk about the most difficult part—undercapitalization Our industry is high capital intensive with illiquid assets. You’ve got to put big dollars on the table. Because you’ve got to fill up the store. You’ve got to fill up the yard. And your contractor customers aren’t paying you for 60 days! Some really well-run stores, profitable stores, at any given time, they have about $2 million owed to them, on the street. So, what happens when you’ve got $2 million owed to you? Some of it is going to come out of your pocket, so you’d better have some money sitting around. Because the banks are

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really well. He knew how to operate the store before he bought it. And now he’s building equity from profit, every year, for himself and his family. So if you have high skills, you can really win big. And your shares in that business—even though the assets of your store are largely illiquid—the shares have value. To be an owner is not easy. But that doesn’t mean you shouldn’t be one. Because the life that that’s going to give you—and the choices that’s going to give you—you’re never going to get anywhere else. Finally, local family ownership leads to better outcomes for communities in Canada. The principals are approachable, and the prosperity remains in our communities. The premise of this interview is my way of giving back, having left the industry, remaining fond and grateful for my career at RONA. I have a strong belief in the importance of the independent family business. Best of luck to all who are thinking of entering or exiting. www.hardlines.ca

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Innovative installation color-coded lever terminals thewell ground terminal) for safety, make Decora Edgefeatures ideal forsuch newas home construction and MDU (including projects as as retrofit applications. faster, efficient wiring, a larger strap with a unique tongue and groove alignment feature for quicker trim out on multi-gang installations, and no exposed metal parts for safety, make Decora Edge ideal Installers using Decora Edge will experience an installation process as for new home construction and MDU projects as well as retrofit applications.

unique as it is practical. The color-coded levers provide the foundation for quick installation by helping to rapidly identify the correct terminal for wiring, including a first of it’s kind lever terminal for the ground wire. The lever termination feature assures a positive connection has been made. This patent pending design also has a snap feature with an audible “click” so installers can be confident with every termination.

PUSH. Applications

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Living/Family Rooms, Bedrooms, Kitchens, Bathrooms, Home Offices, Hallways and Basements.

DONE.

Terminate with confidence

Scan to learn more. leviton.com/DecoraEdge

Tips and information for home improvement dealers to your inbox every month! Targeted squarely at store owners and managers, Hardlines Dealer News is a monthly email newsletter with content designed especially for dealers and owners who want to run their businesses at maximum efficiency. Each issue of Hardlines Dealer News features: 4 News to help store owners and managers stay current on the latest trends in their market

4 Tips for smart retailers who want to identify ways to manage their operations more successfully

4 Insights to help dealers hire smarter, merchandise better and manage more effectively

4 Concrete ideas for managing budgets, merchandising products and identifying best practices Dealers receive a 30% discount to the 2024 Hardlines Conference in Charlevoix, QC on October 22nd and 23rd. Scan here for more details!

dealernews.ca CONFERENCE SERIES

2023

Lumber & Building Materials BY GEOFF McLARNEY

S P O T L I G H T

Luxury decking looks like real wood Trex Signature decking uses a different process than any other Trex product to offer the ease of maintenance and high performance of wood plastic composite. A proprietary shell formulation delivers the most realistic representation of wood attained to date. Available in two nature-inspired colours, Ocracoke and Whidbey, Trex Signature is the most luxurious tier in the brand’s lineup. www.trex.com

PVC panels are easy to install Trusscore’s PVC panels combine form and function. Suited to commercial, industrial, and residential applications, they are easy to install and maintain. A unique tongue-and-groove interlocking system ensures a watertight seal, making it perfect for wet environments. Resistant to mould, bacteria, and impact, it’s also long-lasting. www.trusscore.com

Rails are safety-focused and easy to maintain TimberTech’s Impression Rail Express is crafted from powder-coated aluminum to withstand the elements, ensuring a long-lasting, low-maintenance finish for decks and patios. Quick and easy to install and designed with a focus on safety, the modular design allows for versatile customization to suit all tastes. www.timbertech.ca

Trimboards work with any cladding system Natural Elements Ultra-Light Wood Trimboards are lightweight and easy to handle and work well with any cladding system. Offering two finishes in one, this reversible trimboard features an embossed woodgrain pattern on one side and a smooth finish on the other. Available in a variety of painted finishes or primed and ready-to-paint. www.domanbm.com 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

Richard Darveau

Hardlines Assistant Editor and podcast host Geoff McLarney, and Hardlines Editor Steve Payne, interview Richard Darveau, President of the Association québécoise de la quincaillerie et des matériaux de construction (AQMAT). Richard recounts the history of AQMAT and discusses one of its important initiatives, the creation of the Bien Fait Içi (“Well Made Here”) program that promotes Canadian-made products.

Geneviève Gagnon

An interview with the leader of a five-store chain of home centres in Quebec, 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, former president of Groupe BMR, and how she’s making her own mark on the business.

Zaida Fazlic Romain Mercier

In this episode Hardlines editor Steve Payne talks to Romain Mercier, partner and co-founder at Vancouverbased PS&Co Data Lab—and a customer engagement and communications expert. Romain discusses the importance of e-commerce and why getting started needn’t be daunting for independent dealers. Romain also explains the Canadian Digital Adoption Program, which provides funding to businesses having over $3 million in sales over

Hardlines Assistant Editor and podcast host Geoff McLarney interviews Zaida Fazlic, Vice President of People, Culture, & Change Management at Taiga Building Products. Zaida shares her expertise on how different generations of employees can work and learn from each other, helping them stay engaged while keeping a business successful.

the last three years.

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:

LUMBER & BUILDING MATERIALS SPOTLIGHT

Four steps to install stone veneer CanWel’s new profile Bay Stone from Fusion Stone is available in two colours and is suited to both interior and exterior projects. Its patented veneer system comes complete with stainless steel clips and screws. It can be easily installed in any weather in four simple steps. www.domanbm.com

Wind-resistant shingles come in innovative colours BP Signature is an asphalt shingle that offers wind resistance in an array of colours created in the BP Chroma Colour Lab. Signature’s improved sealant technology offers long-term resistance to wind damage. Its high nail pull-through resistance ensures superior strength and stability during construction. The collection of contemporary takes on traditional shingle colours harmonizes with both modern and traditional architectural styles. www.bpcan.com

New colours in quartz collection DuPont’s Corian Quartz is available in three new colours. London Royal has a subtle grey background with tone-on-tone colouring and a mix of light and dark swirls. London Abbey’s light grey veins flow through the white background for a subtle take on marble looks. London Sky features variable grey veins on a light background, with tone-on-tone touches. www.corianquartz.com

Eco-friendly treated wood withstands water MicroPro Sienna treated wood is designed with aesthetics, durability, and sustainability in mind. Approved for use above ground, in contact with ground, and in freshwater, it offers improved corrosion resistance and can be used in contact with aluminum. Left unprotected, the warm brown colour of Sienna will fade to a soft beige before gradually transitioning to grey. www.domanbm.com www.hardlines.ca

Hardlines Home Improvement Quarterly

FIRST QUARTER / 2024

PRO CORNER

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BY JOHN CAULFIELD

WHY PROS BUY WHERE THEY DO:

TRUST According to our interviews, trust that a retailer will stand behind them when things go wrong is the number one factor determining where pros shop

FIRST QUARTER / 2024

Hardlines Home Improvement Quarterly

www.hardlines.ca

Hardlines Home Improvement Quarterly

FIRST QUARTER / 2024

PRO CORNER

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ecently, Neil Damackine found himself in a quandary to which most other contractors could relate. His company, Construction ND, a Montreal-based firm that specializes in the installation of millwork for institutional customers like banks, had ordered building products for a job that, at the last minute, got cancelled. Soon after that cancellation, Damackine recalls, he was on the phone with his building materials retailer urging it to hold off on the shipment, not bill him, and not charge him a restocking fee. “When things go wrong, I don’t want to be nickeled and dimed,” he says. Trusting that a retailer will do the right thing on behalf of its customers is a big factor—perhaps the biggest factor—determining where pros buy product, according to five contractors interviewed in November. Coming in a close second are price, quality, product selection, and payment terms. “If these aren’t at least competitive, the rest doesn’t really matter,” says Steve Barkhouse,

co-owner of Amsted Design-Build, serving the Ottawa market and doing around 50 projects per year including two or three homes built.

FAIR PRICE WINS—NOT THE LOWEST

Barkhouse and other pros add that retailers don’t need to be the absolute lowest when it comes to price, or the absolute best at service; they just need to meet expectations, what Damackine calls “fair market value,” seasoned with “respect.”

“

Wayne Wittal, president of DW Builders in Kamloops, B.C., isn’t shy about calling attention to a competitor’s prices when they are lower than his preferred dealer’s. that these pros don’t let their preferred retailers know when they aren’t hitting their marks. Wayne Wittal, president of DW Builders in Kamloops, B.C., isn’t shy about calling attention to a competitor’s prices when they are lower than his preferred dealer’s, from

When things go wrong, I don’t want to be nickeled and dimed... And I won’t suffer in silence.

Neil Damackine’s Montreal-based firm, Construction ND, specializes in the installation of millwork for institutional customers like banks.

FIRST QUARTER / 2024

—Neil Damackine, Construction ND, Montreal

And when retailers fall short, pros say they still are reluctant to jump ship and switch suppliers, or to try out a newcomer to their markets. That doesn’t mean, however,

Hardlines Home Improvement Quarterly

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whom he’s been buying for more than 30 years. “They’ve been open to sharpening their pencils and lowering their prices, too,” he says.

www.hardlines.ca

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PRO CORNER

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“

A lot of stores now are operated by accountants, and it’s reflected in their quality and quantities. —Frank Cohn, Cohn Construction, Mississauga, Ont.

SOME SERVICES LESS RELEVANT

Frank Cohn owns Frank Cohn Construction, a Greater Toronto Areabased renovator that performs about 10 interior projects a year. Frank Cohn, who owns Frank Cohn Construction, a Greater Toronto Areabased renovator that performs about 10 interior projects a year, says he’s loyal to a fault to the retailers he’s frequented for decades. “Wild horses couldn’t pull me away from them.” But he doesn’t let them off the hook, either, when he’s disappointed. “I don’t scream or yell, but I get my point across.” When he’s not happy with a dealer’s performance, the normally “stoic” Damackine says “I won’t suffer in silence.” The pros contacted for this article insist that they don’t automatically gravitate toward retailers with the lowest prices. Indeed, they say it’s more important to them that the retailers they shop stand behind their products. “We’re generally reasonable to deal with, but if I get a load of 2x4s that look like hockey sticks, I want to be able to send them back, no questions asked,” says Barkhouse.

FIRST QUARTER / 2024

Some things just aren’t that important to contractors when choosing retailers: for example, none of the pros interviewed thought being able to communicate digitally with a retailer 24/7 would influence their selection process. Nor would a retailer’s familiarity with a particular market’s building codes. Loyalty programs aren’t considered incentives to favour one retailer over another, either. “We know we’re paying [for these programs] somewhere down the line,” quips Barkhouse. And ancillary services, like rental or product-knowledge seminars, barely register a mention from these pros. Perhaps surprisingly, contractors express some ambivalence about delivery as being a primary reason for shopping certain retailers, possibly because that service is a standard, and their expectations about it are measured. Half of what DW Builders purchases is delivered from retail stores, and Wittal is resigned to the fact that this service can sometimes be unreliable and slower than he’d like. Given that reality, Barkhouse says service and promptness of delivery can be “differentiators.” Convenience is essential to any shopping experience, and it’s no different for building supplies. “My choices are based on a simple calculus: we call and they’ve got what we need,” says Damackine. Mark Hofstee, who owns Rammik Construction, a custom renovator based in Guelph, Ont., says he gives 95 percent of his building materials purchases to a RONA store that’s minutes from his home office and storage facility. He also prefers that

Hardlines Home Improvement Quarterly

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store because it has a pros-only entrance and a wider yard for vehicle manoeuvrability than another local dealer.

DRIVEN TO SPECIALTY DEALERS

The pros interviewed generally prefer shopping with independent dealers. But they are also on record as saying that most building supply retailers don’t meet all of their customers’ product needs, a shortcoming that keeps pushing pros into the arms of specialty dealers. Take Cohn, for example. He’s a dedicated RONA shopper and likes that its store is five minutes from his house.

Mark Hofstee, who owns Rammik Construction, a custom renovator based in Guelph, Ont., says he gives 95 percent of his building materials purchases to a RONA store that’s minutes from his home office and storage facility.

www.hardlines.ca

PRO CORNER While he’s okay with RONA’s product selection, Cohn also fondly recalls shopping at Toronto’s Lansing Buildall (acquired by RONA in 2001 and converted to their banner), especially for its extensive trim selection, “which is hard to find now.” He also shops Alpa Lumber Group, Olympic Tile for tile, Benjamin Moore for paint, and Gerrie Electric for electrical products. Cohn buys kitchen cabinets directly from manufacturers.

Steve Barkhouse is president of Amsted Design-Build, an award-winning construction firm in Stittsville, Ont., near Ottawa. Like his colleagues, Barkhouse ranks standing behind his firm as the most important attribute a building supply dealer can exhibit. The list of retailers and distributors that Damackine buys from includes Group Northfab for steel ductwork, Distribution Nortra for cabinets, Langevin Forest for wood and woodworking tools, and the building products dealer Lefebvre & Benoit, which is owned by BMR. Other specialty dealers include Cloumatic and Lee Valley for tools, and Distribution Arcadia for drywall. Wittal calls upon specialty retailers for doors and glass partitions for baths, “mostly for commercial jobs.” He generally orders

FIRST QUARTER / 2024

F LE from stores in Vancouver with which he’s done business before, and that ship. (Wittal says special orders account for between five and 10 percent of his overall purchases.) Barkhouse buys the bulk of his lumber from Home Hardware, and uses Home Depot for certain products, but he also uses specialty dealers for plumbing and electrical, bath fixtures, tile, and flooring.

ONLINE OPTIONS

Many dealers have greatly expanded their online shopping selection and services. However, being able to order online has yet to emerge as a competitive advantage when contractors are choosing retailers. That, though, could be changing. Online purchases have become “a bigger part of the overall mix” for Rammik Construction, says Hofstee, who takes advantage of online-only exclusives that RONA regularly offers. Online purchases, while still “minuscule”

“

IT ALL COMES DOWN TO TRUST

When asked what retailers could be doing better to keep his business, Cohn starts with their assortments. “A lot of stores now are operated by accountants, and it’s reflected in their quality and quantities.” He says its harder to buy products like hinges, plumbing, and electrical in contractor packs, presumably because dealers think they can make more money selling them as single items. For bulk purchases, Cohn favours two local yards, Central Fairbank Lumber and Tamarack Lumber. But when you boil down the factors that influence which venues they shop, pros keep returning to trust. Cohn says that RONA’s staff “knows me like family.” Barkhouse equates trust with “teamwork” and “having [the retailer] as a partner,” which includes their willingness to stand behind the products they sell. Hofstee acknowledges that trust only works if it’s a two-way street,

If I get a load of 2x4s that look like hockey sticks, I want to be able to send them back, no questions asked.

for ND Construction, are increasing, says Damackine, who observes that retailers in general have been reducing the number of items they are carrying in their stores. Barkhouse agrees, noting that online has become more essential for purchasing certain hardware items. Even Cohn, who famously doesn’t own a computer, concedes that a lot of his clients have been ordering products online for projects. On that note, none of the contractors had much positive to say about online-only retailers like Amazon or Wayfair—in spite of the former’s vast selection.

Hardlines Home Improvement Quarterly

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—Steve Barkhouse, Amsted Design-Build, Ottawa

which means paying his bills on time “and not calling the store every minute to complain about something.” Wittal of DW Builders says he engages in an “open dialogue” with retailers when it comes to suggesting how they might improve their operations. Those conversations typically revolve around inventory and item selection. “Homeowners trust the builder, who is at the mercy of his suppliers. You have to gamble that you can trust the dealer.” And if that trust isn’t there, “the retailer isn’t earning my business.”

www.hardlines.ca

AD INDEX

ADVERTISERS: FIRST QUARTER / 2024 ACCEO

JELD-WEN

AD Canada

Johns Manville

Arxada

JRTech Solutions

Auto-Stak

King Marketing

BMF

Kohltech

BMR Group

Leviton

BP Canada

National Hardware Show

CanWel

Orgill

2, 3

Castle Building Centres Group

4, 5

Richelieu

Dupont

RONA

Sexton Group

acceo.com adhq.com

arxada.com autostak.com

bmfonline.com bmr.ca/becomeadealer bpcan.com

canwel.com youarethebrand.ca dupont.com

Freud/Diablo Tools diablotools.com

15, 63

jeld-wen.ca jm.com

jrtechsolutions.com kingmkt.com

kohltech.com leviton.com nhs-24.com orgill.com reliablefasteners.com rona.ca/becomeRONA sextongroup.com

Gillfor/IKO

Taiga Building Products

GSW

TIMBER MART

Trex

gillfor.com

gsw.wh.com

Hardlines hardlines.ca

Home Hardware Stores home-owner.ca

IN THE

NEXT ISSUE OF HHIQ:

33, 66, 68

taigabuilding.com timbermart.ca trex.com

10, 54

The Talent Factory: Frontline Staff Development PLUS: • SKU Analysis 101 • Contractor Credit Management

HOME IMPROVEMENT QUARTERLY

Publication Date: April 12, 2024 • Ad Reservations: February 23, 2024 (contact david@hardlines.ca) • Ad Material Due: March 8, 2024 www.hardlines.ca

Hardlines Home Improvement Quarterly

FIRST QUARTER / 2024

ENDCAP

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BY GEOFF McLARNEY

WITH STELLAR STORE HELP, A CHAMPION TURNS A CORNER Elvis Stojko is a giant in the figure skating world, but the multi-talented athlete has a passion for car racing, too. Two TIMBER MART members have helped him pursue that dream.

rand openings are always fun affairs for a store’s staff and community, and they continue to get more elaborate over time. The celebratory sawing of a piece of lumber (the industry’s customary counterpart to the ribbon-cutting in other retail sectors) can be complemented by food trucks, contests of skill such as ring toss or even axe throwing, and games for kids. It’s not uncommon for local elected officials or prominent brand ambassadors to join in the festivities. But how often does a grand opening include the presence of a nationally renowned figure skater and a skilled race car driver? Or even both in one person? When Kingdon TIMBER MART held a grand opening for a second location in Lakefield, Ont., last spring, it welcomed none other than Elvis Stojko for the occasion. Stojko is a household name for his figure skating career, but more recently he’s reinvented himself as a race car driver. He and his car had a tent in the parking lot at the opening promoting his second career. Stojko is best known for his achievements as a figure skater. He spent 20 years in the sport and was a three-time World Champion, two-time Olympic silver medallist, and seven-time Canadian champion.

“

Two TIMBER MART dealers in Ontario have sponsored famous figure skater Elvis Stojko in his second sporting career as a race car driver. Here he is with his Audi A5 at Kingdon TIMBER MART’s store opening in Lakefield, Ont., last spring. Stojko reached out to Kingdon’s neighbours at Roka TIMBER MART in Kawartha Lakes, Ont. Owners John and Donna Roka teamed up with the Kingdon team to support Stojko’s racing season. With their help, he was able to refurbish two Audi A5s, one of which Stojko personally helped transform.

Kingdon TIMBER MART and Roka TIMBER MART have helped Elvis Stojko live out his dreams on the racetrack 78

FIRST QUARTER / 2024

Hardlines Home Improvement Quarterly

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Elvis aspires to the pro ranks and also gives car racing training to help finance his pastime. He got his start in international karting and in 2013 he ranked number two in Canada. He’s involved with the Lucky Dog Racing Canada Series, whose endurance races can last up to eight hours. The Audis made their debut in April of last year at Canadian Tire Motorsport Park near Bowmanville, Ont.

www.hardlines.ca

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2023-11-30 11:32 AM