HHIQ Q3 2022

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C O N N E C T I N G

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H O M E

I M P R O V E M E N T

I N D U S T R Y

THIRD QUARTER / 2022

Langton Chodokufa HOME DEPOT STORE MANAGER Toronto, Ontario

HOME IMPROVEMENT QUARTERLY

TOP E XCLUSIVE REPORT

F E AT U R E S T O R Y

A MANAGER’S

JOURNEY

HHIQ interviews Langton Chodokufa about his odyssey from bank employee in Zimbabwe to manager of Home Depot’s South Etobicoke store

20 RETAILERS

Sales figures, market shares, and strategies from the industry’s biggest players

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PRESIDENT Michael McLarney mike@hardlines.ca

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ASSOCIATE EDITOR Geoffrey McLarney geoff@hardlines.ca

ART DIRECTION Shawn Samson TwoCreative.ca

CONTRIBUTING WRITER John Caulfield

ACCOUNTING accounting@hardlines.ca COVER STORY PHOTOGRAPHY Larry Arnal arnalpix.com

Hardlines Home Improvement Quarterly is published four times a year by Hardlines Inc., 330 Bay Street, Suite 1400, Toronto, ON M5H 2S8. $25 per issue or $90 per year for Canada.

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V O L UME 12, NO . 3

THIRD QUARTER / 2022

CONTENTS

COVER STORY

A MANAGER’S JOURNEY

DEPARTMENTS

9

An interview with Langton Chodokufa, store manager at a bustling Home Depot in Etobicoke, Ont.

26

20 74

EDITOR’S MESSAGE

Brave New World, Part 3 PRODUCT SPOTLIGHT SPECIAL!

What’s new in kitchen and bath ENDCAP

Start ’em young

NEWSROUNDUP

PAGE 10

TORBSA merges with AD, a U.S.-based buying group

SPECIAL FEATURE

CANADA’S TOP 20 Ranking the leading banners in our industry by sales, store counts and market share

36

Quebec giant Canac makes changes at the top

Gillfor Distribution buys AFA Forest Products E-COMMERCE FEATURE

THE AMAZON DO PANDEMIC EFFECT MAKING How five PRO CORNER

Home Hardware’s chief merchant talks shop

Canadian Tire rolls out integrated online platform

BMR appoints new head buyer and a new COO

Lowe’s introduces power tool lines for pros and DIYers

improvement retailers 58 Home surged towards online sales

during the pandemic. A report on what the leaders are doing

66 dealers are

meeting supply chain and inflation challenges head on

HARDWARE

THIRD QUARTER / 2022

7

EDITOR’S ME S S AGE

STEVE PAYNE, EDITOR

PART 3 BRAVE NEW WORLD It’s been an utterly crazy two years and it looks like it’s about to get even crazier

A

bit of industry history. It happens about every three decades—and it’s happening again.

By 1964, the arrival of the American retail chains in Canada was threatening to wipe out the Mom and Pop hardware store. So Walter Hachborn convened a meeting of 122 such dealers at the Flying Dutchman Hotel in Kitchener, Ont., and they voted to form Home Hardware.

Other leading groups formed around that time, too. Powerful, influential and capable of fighting back against chaos, the LBM groups rose up. In Quebec, the Ro-Na brand was even faster out of the gate (1960) than Walter.

Fast forward three decades. The year was 1994. Our Canadian industry got rocked again by the arrival of not one but two American behemoths—Home Depot and Walmart. Our industry went through convulsions again before rearranging itself. Now we had strong co-ops/buying groups and big box retailers.

Fast forward another three decades.

The era of e-commerce is “suddenly” upon us. Last year, Amazon pulled in $US 469-billion ($CDN 574-billion). Now

www.hardlines.ca

we have strong co-ops and big box retailing and e-commerce.

How is your store going to react to Brave New World Part 3? How are your vendors going to react?

Well, as the industry realized six decades ago and again three decades ago: It’s not going to be business as usual. Pay attention to what’s happening out there.

This special Top 20 issue of Hardlines Home Improvement Quarterly covers both the brick-and-mortar state of the nation and the e-commerce reality.

Hopefully, you will find some clues in these pages as to your own best path forward. And remember, the package of information you hold in your hand is just a fraction of the data potentially available to you in the Hardlines Retail Report and the Hardlines Market Share Report.

To get hooked up with those valuable documents, just send me an email.

“

Seismic changes in our industry occurred in 1964 and 1994. You’ve probably noticed they are happening again.

”

steve@hardlines.ca

Hardlines Home Improvement Quarterly

THIRD QUARTER / 2022

9

NEWSROUNDUP OF THE HOME IMPROVEMENT INDUS TRY

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

TORBSA MERGES WITH AD (AFFILIATED DISTRIBUTORS), A $58-BILLION MULTI-INDUSTRY BUYING GROUP

T

ORBSA Ltd., the Bolton, Ont.based buying group, announced on June 1 that it was merging with a giant U.S.-based buying group, Affiliated Distributors (AD), headquartered in Wayne, Penn.

Prior to the merger with TORBSA, AD Canada, which has recently-expanded its DC in Mississauga, Ont., was already operating in multiple construction and industrial sectors in this country.

“The decision to align our business with AD was one that was scrutinized thoroughly,” said TORBSA president Paul Williams. “TORBSA and its shareholders are truly excited at the road ahead, as we lay the foundation for what will be many years of success as a business.”

Founded in 1966, TORBSA represents 30 members in 40 locations across Canada. But with the merger, a new division of AD has been created: AD Canada Building Supplies.

Williams will head this new division, which effectively replaces TORBSA, and TORBSA members will become shareholders of AD Canada. Williams will now report to Rob Dewar, president of AD Canada, while three additional TORBSA employees will join the AD team.

AD is a wholesale buying group formed in 1981 that provides contractor-related and industrial products to some 845plus independent member owners in the U.S., Mexico, and Canada. AD publicizes annual sales of $US 58.5 billion. It operates

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AD Canada, which is merging with TORBSA, has a Canadian head office and distribution centre at 3630 Odyssey Drive, Mississauga. The U.S. head office of AD is in Wayne, Penn.

13 divisions that cover industries including electrical, industrial, safety, bearings and power transmission, plumbing, PVF (pipes, valves and fittings), HVAC, decorative brands, and building supplies.

“AD brings decades of experience, strong leadership throughout the organization, and strong business ethics and core values that align with our own,” Williams said. “Their scale and expertise across North America give us the strength to compete and succeed

Hardlines Home Improvement Quarterly

in an ever-changing marketplace.”

AD’s Rob Dewar added that TORBSA’s strong leadership and financial success made the buying group an ideal match for AD. “TORBSA has been a leader in this space for a long time, and our new relationship will help us provide more benefits for members, including an increased supplier portfolio.” The deal also fits with a key priority of AD in recent years to grow its presence in Canada. www.hardlines.ca

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

BRIEFLY

QUEBEC RETAILER CANAC MAKES CHANGES AT THE TOP

T

he retirement of Pierre Laberge from the helm of Canac in May has resulted in management changes at the top of the giant home improvement chain. Still, the Laberge family remains firmly in control.

Based in L’Ancienne-Lorette, in the Quebec City region, Canac has 31 stores throughout the province—with number 32 scheduled to open early in 2023—with sales of some $1.3-billion (Hardlines estimate).

Canac employs 4,200 people and is the largest family-owned home improvement retailer in Quebec.

Pierre Laberge retired early in May after 45 years in the business. He had been at the helm of both Canac and its parent company, Laberge Group, for two years, following the retirement of company founder Jean Laberge, Pierre’s cousin.

Martin Gamache takes over the general manager’s role from Pierre Laberge. He was formerly Canac’s director of operations, a Pierre Laberge, pictured at right, has retired from the helm of Canac, the 31-store retail chain in Quebec.

He had worked in his family’s business for some 45 years.

title Gamache will keep. Gilles Laberge is Laberge Group’s new president, in charge of overseeing all the Laberge companies, including Canac.

All these changes will help support continued growth at Canac. It already has a dozen stores in the Quebec City region, but Canac only has four in the greater Montreal area, three of them on the South Shore. Its next store will be in Contrecœur, 57 km northeast of Montreal along the St. Lawrence River. That store is expected to be operational in the first quarter of 2023.

Canac also has an option on a new store near Hawkesbury, Ont., halfway between Montreal and Ottawa on the Ottawa River.

CERTAIN TEED PARENT SAINT-GOBAIN TO ACQUIRE CANADA’S KAYCAN CertainTeed parent Saint-Gobain—a French conglomerate—has agreed to acquire Kaycan Ltd., the Montreal-based manufacturer and distributor of siding products. The $928-million transaction is slated to close by the end of 2022.

The deal includes the planned divestiture of Kaycan’s small U.S. distribution arm. Saint-Gobain says it intends to hold onto Kaycan’s “locally well-established Canadian distribution.”

HUDSON’S BAY CO. TRANSFERS DOWNTOWN WINNIPEG PROPERTY TO FIRST NATIONS Hudson’s Bay Co. is transferring ownership of its downtown Winnipeg property to an umbrella group of Manitoba First Nations. The Southern Chiefs’ Organization (SCO) is the recipient of the 600,000-square-foot Beaux Arts building. The site will serve as a multipurpose space including 300 housing units, two restaurants, a health clinic, daycare centre, and museums.

CASTLE BUILDING CENTRES GROUP’S BRUCE HOLMAN TO RETIRE Castle Building Centres Group has announced that Bruce Holman will retire as director of business development this summer. Holman has spent nearly two decades building the dealer base for the Mississauga, Ont.-based buying group.

Doug Keeling, who has been business development manager for Ontario since he joined Castle in 2016, will replace Holman in the national role, effective Sept. 1.

www.hardlines.ca

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THIRD QUARTER / 2022

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NEWSROUNDUP

HOME HARDWARE’S CHIEF MERCHANT TALKS SHOP IN NEW HARDLINES PODCAST

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new podcast from Hardlines features an in-depth conversation with the senior merchant at Home Hardware Stores Ltd. Marianne Thompson is the company’s chief merchandising officer. On the latest episode of the Hardlines What’s In Store podcast, she shares details of Home Hardware’s investments in its supply chain—and how it’s using new technology to track selling cycles, manage product orders, and get closer to its customers.

Thompson also talks about the new buying team in St. Jacobs. Following her arrival in 2019, a number of company veterans retired and both the hardware and LBM buying teams underwent a reorganization.

New buyers joined Home Hardware from industries such as grocery—and even from competitors.

For example, Carol Crystal joined Home Hardware from Lowe’s Canada in 2020 as director, merchandise hardlines. Recently Crystal, whose background also includes Walmart Canada and the Hudson’s Bay Co.,

Marianne Thompson, chief merchandising officer at Home Hardware Stores, is interviewed in a new Hardlines podcast.

was promoted to VP, merchandise LBM. “Our strength at Home Hardware lies in ensuring that our talent and our culture remain a competitive advantage,” Thompson says. “And it continues to propel our business forward as we really stay focused on our vision, which is to be

Canada’s most trusted and preferred home improvement retail brand.”

The full conversation with Marianne Thompson is available for free from Hardlines.ca. Just click on the Podcast tab at the top of the page to register.

GILLFOR DISTRIBUTION EXPANDS NATIONAL REACH WITH TAKEOVER OF AFA FOREST PRODUCTS Gillfor Distribution Inc. announced in May its acquisition of AFA Forest Products Inc., the LBM distributor headquartered in Bolton, Ont. AFA owns and operates 13 distribution facilities, serving the entire Canadian retail home improvement market.

Gillfor says it will operate “in parallel” with AFA “until a full operational assessment is completed and a seamless integration can be executed.”

Headed by Grant Yegavian, CEO, and presi-

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dent Murray Finkbiner, AFA is the latest acquisition by Gillfor in its ongoing effort to firmly establish its position as a key national player on the building materials distribution scene.

Based in Woodstock, Ont., Gillfor is the brainchild of the Gill brothers. In 2012 they determined they wanted to establish a national distribution channel for the family’s cedar production in British Columbia.

“This acquisition will elevate Gillfor to be amongst the largest Canadian distributors

Hardlines Home Improvement Quarterly

for building products, and allow us to truly provide local partnerships from coast to coast,” says Gary Gill, chairman of Gillfor Distribution.

Gillfor Distribution was established when OWL Distribution in Woodstock, Ont., and McIlveen Lumber, an LBM wholesaler based in Calgary, merged to form the new business in 2017. A year later, the company added Brown & Rutherford in Winnipeg and Brunswick Valley Distribution, based in Fredericton. www.hardlines.ca

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NEWSROUNDUP

CANADIAN TIRE ROLLS OUT INTEGRATED ONLINE PLATFORM

BRIEFLY

SLEGG BUILDING MATERIALS CELEBRATES 75TH ANNIVERSARY, HOLDS PRO SHOW Slegg Building Materials, with 12 locations on Vancouver Island, is celebrating its 75th anniversary this year. The Slegg organization is in an upbeat mood for another reason, too.

On May 6, Slegg held its 2022 Slegg Pro Show, the first such live event in two years owing to COVID-19 restrictions. The event took place in Victoria, B.C.

WALMART CANADA EQUIPS EMPLOYEES WITH WEARABLE RING SCANNERS Canadian Tire is pledging to create a “seamless” e-commerce experience for its customers, across all its brands.

“T

he future belongs to retailers who can provide the most seamless experience across digital and physical channels,” said Greg Hicks, president and CEO of Canadian Tire Corporation during a recent teleconference with investment analysts and media.

“We are investing to provide a seamless end-to-end connection along the supply chain and to our customers across whichever channel they choose,” Hicks said, noting that a new integrated platform is being rolled out to facilitate that connection.

One way that Canadian Tire has been working this year to enhance its omnichannel experience is through the deployment of in-store technology. These enhancements include the installation of electronic shelf labels, which, through a designated app, guide customers directly to products in the store.

Canadian Tire has also added pickup lockers at 86 more CTR stores, while at its Sport Chek stores, DoorDash delivery

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THIRD QUARTER / 2022

is being used to get products to customers’ doors. The company expected 90 percent of Sport Chek’s e-commerce customers to be serviced by DoorDash by the end of Q2.

The initiative to expand Canadian Tire’s omnichannel experience is called “One Digital.” This is “a future-safe digital ecosystem that will serve as the new, single digital platform used across all CTC banners,” Hicks said. The platform was tested in New Brunswick in Q1 and has now been introduced nationally at all CTC stores. The company also plans to bring its banners Mark’s, Sport Chek, Triangle, and Party City onto One Digital by the end of the year.

“It’s a critical part of our evolution from a company made up of disconnected banners, brands, and services to an enterprise-wide platform where all banners and channels collectively amplify and render each other more valuable, creating a truly differentiated customer experience,” Hicks said.

Hardlines Home Improvement Quarterly

Walmart Canada is providing its retail staff with wearable ring scanners. The devices are designed to simplify and speed up workers’ ability to fulfill online grocery orders. The company ordered more than 1,500 of the wearables in May. Employees can use them to scan products by pushing a button with their thumbs.

KENT OPENS BIG BOX IN MONCTON Kent Building Supplies has opened its latest big box store, this time in Moncton, N.B. The store features modernized displays and enhanced signage to aid customer flow, along with expanded product assortments, a drive-through lumber yard, year-round garden centre, cut shop, and a large pro service desk. There’s also a bigger online pickup area than in existing Kent stores.

GROCERY CHAIN METRO NIXES SINGLE-USE PLASTIC BAGS Metro will no longer sell single-use plastic bags at its stores beginning this fall. The grocer says the move will mean that 330 million bags will be kept out of circulation annually. The move away from plastic bags follows other retailers who have phased out single-use plastics. Most recently, Walmart Canada pulled them from their stores in April.

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NEWSROUNDUP

BMR APPOINTS NEW HEAD BUYER, CHIEF OPERATING OFFICER

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management shuffle at the head office of Boucherville, Que.-based BMR Group has resulted in a new head buyer, a new COO, and the departure of at least one senior executive.

Charles Grégoire-Béliveau is the new top merchant. He has been named vice president, merchandising. He joined BMR in 2016 as director, purchasing for corporate stores. In that role, he led the merger of the purchasing, distribution, and corporate stores teams.

He also increased BMR’s imports from Asia.

He was promoted in 2020 to senior director, merchandising before getting this latest title. Grégoire-Béliveau is also chairman of Éco-Peinture, an organization that regulates paint recycling in Quebec.

The other major change at BMR is a new chief operations officer. Antonio Di Pasquale joined the group in 2020 as vice president, supply chain and operational excellence. In his new role, Di Pasquale

will oversee all of BMR’s operations.

Meanwhile, Jonathan Gendreau, who had been BMR’s VP business development, marketing, and customer experience, has left the organization. He had been with BMR since 2017.

BMR has seen a number of changes at head office over the past year and a half.

In March 2021, Alexandre Lefebvre was appointed CEO, replacing Pascal Houle as head of the group. Lefebvre came over from Lefebvre & Benoît, a large commercial dealer that is owned by BMR. BMR officials say the latest changes are aimed at continuing to grow the dealer in eastern Canada. Along with its strong presence in Quebec, where it has more than 230 stores, BMR has long been present in the Maritimes and particularly New Brunswick, where it has 11 stores. The group’s biggest expansion opportunity seems to be in Ontario, where it has some 20 locations.

Charles Grégoire-Béliveau

Antonio Di Pasquale

LOWE’S CANADA INTRODUCES POWER TOOL LINES FOR CONTRACTORS AND DIYERS Lowe’s Canada will roll out two dedicated power tool lines in its stores over the next few months. The Flex and Kobalt brands are already in Lowe’s U.S. stores.

Flex is a power tool line for contractors and pros. The Flex line first arrived in Lowe’s stores in the U.S. just over a year ago as part of the retailer’s strategy to strengthen its connection with contractors. It’s produced

by Chervon, a global tool manufacturer, which also manufactures Kobalt’s cordless power tool lines for Lowe’s.

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The new lines are already available online, but they’ll be gradually introduced to stores beginning with Réno-Dépôt. Lowe’s stores will get the lines in the fall.

“These two brands are real game changers for DIYers and contractors nationwide,” said Chris West, SVP merchandising at Lowe’s Canada. “(They) set new standards in the market in their respective categories and offer more value to our customers.”

For the pro customer, Flex cordless tools boast fast charging times, long runtimes, and

Hardlines Home Improvement Quarterly

more power. Lowe’s, RONA, and Réno-Dépôt customers currently have access to some 30 Flex products, but this range is expected to grow later in the year with a second wave of products that feature lithium batteries.

“The addition of this brand is exciting news for our professional customers,” said Jeff Oben, senior director, pro sales - in store, at Lowe’s Canada. “Things move fast on a job site, so it’s essential for contractors to have reliable, high-performance tools that allow them to do more work, more efficiently.” www.hardlines.ca

exton has been “ Sgreat for us.”

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NEWSROUNDUP

B.C. BUILDING SUPPLY ASSOCIATION CONFRONTS CHALLENGES IN HIRING

A

research study to figure out how to make the home improvement industry more attractive to potential workers has been commissioned by the Building Supply Industry Association (BSIA) of British Columbia. Funding is being provided by the province’s Ministry of Advanced Education and Skills Training.

The study is being conducted by R.A. Malatest and Associates.

“It’s an 18-month deep dive into our industry,” says Thomas Foreman, president of the BSIA. Frustrated by the shortcomings of the industry in terms of recruitment and succession planning, Foreman wanted to build a blueprint to help member companies, which include dealers and suppliers, to tap into the province’s workforce.

Like everywhere in North America, staffing in B.C. has become a huge issue.

Yet, at the same time, the industry is busier than it has been in two decades, preventing many companies from having the luxury to look ahead and plan their talent acquisition strategies. “All of us see what the challenges are,” Foreman says.

Take training, for example. Most of the focus in this area is on entry-level skills, important enough for any new employee.

But, with some exceptions, there’s a lack of meaningful training for managers and other senior people, Foreman points out.

The answer, Foreman says, is to get more data on who the future workforce represents, and what their values are. Malatest and Associates has been constructing and

Thomas Foreman, president of the BSIA of BC, says his organization is conducting a study to assist recruitment strategies. conducting surveys and focus groups to gather that data. The study is now in phase two, and Foreman expects the final report to be ready next spring.

COPENHAGEN DIY SUMMIT HEARS PREDICTIONS ON DURATION OF SUPPLY CHAIN WOES, INFLATION Expect the supply chain to remain in disarray in our industry for at least another eight months. Nor will inflation go away any time before that, though it will likely start to ease into 2023.

These were just some of the predictions shared in early June by Mark Herbek, executive director, home improvement, at the Cleveland Research Co. Herbek was speaking to 900 home improvement executives from around the world—including Hardlines—at the eighth DIY Summit, in Copenhagen, Denmark.

Mark Herbek of the Cleveland Research Co. addresses delegates at the recent DIY Summit held in Copenhagen.

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Hardlines Home Improvement Quarterly

Herbek noted that home improvement retail was up 35 percent in the U.S. over two years under COVID (comparable to growth in Canada, according to Hardlines). Out-ofstocks continue to run as high as 25 percent and this will extend the home improvement cycle as people push out projects until product is available. “But more dollars will be chasing fewer products and this is resulting in staggering inflation,” Herbek said.

While online sales continue to stay relatively healthy, in-store traffic has flattened, compared with pre-COVID rates. “We are past the peak in the U.S.,” Herbek notes. “We are now seeing a declining environment.” He said that it has taken “from 10 to 17 months” historically for this cycle to recover. www.hardlines.ca

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Kitchen&Bath S P O T L I G H T

Extended reach makes for a clean sink Isenberg’s Velox faucet is constructed of premium stainless steel with a pull-down faucet and dual function sprayer whose extended reach can easily and thoroughly clean all areas around the sink. All thin-film, ceramic-based finishes are oven-cured and finished to perfection for a durable product that is resistant to corrosion, scratches, and chips. Available with a matching soap dispenser, Velox features single-hole installation and is ADA- and WaterSense-compliant. www.isenbergfaucets.com

Minimize clutter with handy below-sink storage Blanco’s new Botton II organizational system maximizes storage for recycling, cleaning supplies, and more. It fits seamlessly below the sink base cabinet and boasts easy to access under-the-sink organization, including two removable four-gallon bins with handles and a top shelf for additional storage. Install easily on the bottom of the cabinet with just four screws. www.blanco.com

Art Deco-style faucets in multiple styles and colours The Rivana faucet collection from Blanco features a geometrical square base which transitions into a round spout with a streamlined pull-down spray head, blending organic shapes with ergonomic function. Inspired by Art Deco design, the full Rivana family includes three styles: Semi-Professional, High Arc, and Bar. The faucets are available in Chrome, PVD Steel, Satin Gold, and Matte Black, and are complemented by a soap dispenser. www.blanco.com

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Hardlines Home Improvement Quarterly

www.hardlines.ca

KITCHEN & BATH SPOTLIGHT

Easy-to-clean baths with no colour bleed BainUltra’s Celestia baths are made with FineStone, composed of refined minerals and pure liquid acrylic inspiration from the sky. Equipped with thermal insulation, the baths resist hot temperatures and are strong and durable. Light and colour resistant, with no colour bleed or wear, they are non-porous, hygienic, and easy to clean and repair. www.bainultra.com

Sliding shower panels are easy to clean At 8mm, Maax’s Inverto Sliding Shower Door Glass panels feature Lotus easy clean glass protection. It fits showers with 70-1⁄2-in. wall clearance, and the glass extends to 74-in. Two sliding glass panels make for flexible entryway or plumbing access on the left or on the right. Sleek and square elements for a modern look. Combine a shower door with a return panel for a corner shower. www.maax.ca

Cut chlorine levels and adjust spray setting American Standard’s Spectra Filtered 4-Spray Hand Shower Rail System reduces chlorine levels in the shower by at least 50 percent. The filter is built into the rail system so it’s easy to change and eliminates the need for a bulky add-on filter. The hand shower features four spray functions, from a drenching rain to a pulsating massage, and is mounted on an adjustable, smooth-gliding holder. www.americanstandard.ca

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Hardlines Home Improvement Quarterly

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Kitchen&Bath S P O T L I G H T

Get chilled sparkling water instantly The GROHE Blue Chilled and Sparkling 2.0 Faucet gives homeowners instant access to filtered chilled water, medium carbonated, or full sparkling water, and unfiltered tap water in one technologically advanced design. Use the push button with LED ring to dispense the preferred water and its single lever handle to dispense tap water. The pull-down kitchen faucet is equipped with WiFi and Bluetooth to monitor faucet performance, track, and notify users of CO2 usage, filter status, and control water portioning via the app. www.grohe.ca

Bidet toilet is packed with features The DXV AT200® LS SpaLet bidet toilet combines luxury design and performance paired with personalized hygiene, comfort, and cleansing features to pamper in comfort for a fresh, out-of-the-shower feeling. Advanced features harness the power of technology to keep your room smelling fresh, with air circulation, room refresh deodorizer, and an air shield deodorizer. A soft night light illuminates the seat and bowl. The seat includes an aerated feminine wash and aerated posterior wash with dual adjustable self-cleaning nozzles, plus a heated toilet seat with adjustable temperature settings. www.dxv.com

Hand shower is easy to install, easy to release Inspired by natural elements and soft modern lines, Moen’s 6-Function Hand Shower in Chrome offers a streamlined look that fits into any décor. The Magnetix docking system allows for easy release and securely snaps the hand shower back into place. The included 84-inch kink-free metal hose extends your reach and flexibility.

Installation is quick and easy, requiring only a wrench and three simple steps. www.moen.ca

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Hardlines Home Improvement Quarterly

www.hardlines.ca

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Kitchen&Bath S P O T L I G H T

Shower rod offers more elbow room Moen’s Tension Curved Shower Rod has a bowed design that offers extra room to move in the shower. This tension curved shower rod is corrosion-resistant for reliable long-lasting use. Its adjustable design allows easy installation with no cutting necessary. The included decorative covers add a stylish element while helping to conceal the mounting hardware. Pivoting flanges allow you to securely install the rod on uneven walls in minutes, with no cutting required. www.moen.ca

For a safer bath with no wall damage Taymor’s Suction Assist Bar offers additional balance and stability in the shower or anywhere else in the home. The suction cups secure instantly to smooth, non-porous surfaces such as glass, fibreglass, or tile. With flip-up locking tabs, the cups are easy to install with no tools required and no damage to walls.

Available in white and grey or white and blue finish. www.taymor.ca

A faucet that is a functional work of art Equipped with everything you need to prep, cook, and clean in the kitchen, this Bruton faucet is a functional work of art. The coil and the knurling details are both practical and decorative, adding to the performance and the timeless design. It’s beautifully symmetrical and offers maximum clearance and reach. Available in polished chrome, stainless steel, matte black and brushed gold. www.pfisterfaucets.com

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Hardlines Home Improvement Quarterly

www.hardlines.ca

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.

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COVER FEATURE

LANGTON CHODOKUFA

A MANAGER’S JOURNEY INTERVIEW BY STEVE PAYNE

“

LANGTON CHODOKUFA has come a long way since his decision, 21 years ago, to reluctantly leave his family and move from Mutare, Zimbabwe, to North America.

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Hardlines Home Improvement Quarterly

Photography: Larry Arnal

“It was supposed to be for a two-year stint,” he told HHIQ. “Getting experience in a developed economy would be advantageous for the career roles that I aspired to.” Langton’s first stop, Cleveland, was not an easy place to find a job. “I became frustrated with my job search,” he confesses. But one day he walked into a Home Depot which had set up a recruiting kiosk. Two decades later, and one more country on his odyssey later, Langton is the proud store manager of Home Depot’s store #7011, South Etobicoke (Toronto).

I am naturally attracted to the impossible task in the room.

”

www.hardlines.ca

R’S

www.hardlines.ca

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COVER FEATURE

LANGTON CHODOKUFA

LET’S START WITH YOUR BASIC CAREER PATH AT HOME DEPOT.

I started at Home Depot in Cleveland as a cashier. I’ve now worked for three different divisions—Northern Division, Expo Division and the Canadian Division. I relocated to Canada for family reasons and really loved how Home Depot supported me through that. I was in the U.S. from 2001 and then I moved in 2006 to Oakville, Ont. I was promoted to an assistant store manager role in the Brampton market in 2007, and then, ultimately, I became a store manager.

TELL US ABOUT YOUR DECISION TO COME TO NORTH AMERICA.

My previous work experience in Zimbabwe was in banking. When I immigrated to the United States, it was supposed to be for a two-year stint. Getting experience in a developed economy would be advantageous for the career roles that I aspired to. Not only that, the thrill of what I would learn and the person I would grow into! However, I became frustrated with my job search in Cleveland. Sometime down the road, I walked into a Home Depot, and there was a kiosk. I filled out the application right there.

When I was hired, I worked as a cashier for

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Langton Chodokufa confers with Sabrina Scrivo (left), human resources manager at Home Depot South Etobicoke and (centre) Trey Reynolds, operations assistant store manager. three days. But I was taking a computer science and engineering degree at the time, so the store manager moved me to work with the computers in the store.

GROWING UP IN ZIMBABWE, WHAT DID YOU WANT TO DO FOR A LIVING?

In high school, I had the privilege of winning some academic awards a couple of times, allowing me to access some events.

There was an event with different speakers at my school. Two of the speakers sat on various boards of high-profile organizations at the time. I thought it was so cool that someone could be in a position to help create environments for others to prosper.

Hardlines Home Improvement Quarterly

Since childhood, I have always been a sucker for hard work and I am naturally attracted to the impossible task in the room.

HOW DOES THAT PASSION TRANSLATE TO YOUR ROLE AS STORE MANAGER?

It definitely connects to my store manager role. There are a lot of different roles to play.

As a store manager, you can pretty much make of it what you want to make it. There’s endless stuff to do. Every day is different, always trying to figure out the next big thing that pushes your team to be able to deliver on customers’ ever-shifting needs.

My passion is really about how do I leave the environment I’m in a little bit better

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COVER FEATURE than how I found it? When you’re talking about extending that into our associates lives, I think about how I can make things different for my associates. Improve things for them and with them. Help support them in their goals.

I also really love product excitement and

LANGTON CHODOKUFA bringing that to my associates and customers. I really love the idea of the challenge in that. How do we bring a product to life? How do we communicate that? It’s exciting in the sense that it’s always thrilling and it keeps you on your toes. And I love seeing how our associates take on that challenge every day.

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WHO HAVE BEEN SOME OF YOUR MENTORS?

Eileen Hooker was one of my first mentors. She was a computer room supervisor at Home Depot. Everything she did, she really strived for excellence, and she was one of a kind. Eileen took me on from my early career days at Home Depot and she would just give me opportunities to experiment. She was amazing, always there—no matter what—to support me. Eileen was really important to me. I stayed in contact with her until she passed a few years ago.

The work ethic I have now is from my Dad. He’s passed, but he used to work for the provincial government in Zimbabwe.

He would take me to work sometimes and the reason I would go is because we got to have lunch together—and he had a computer, which he let me play games on. Back then, computers were a big thing!

My Dad was tireless. His role was as an operational officer—it was his work to make sure communities were safe and provided for. It was amazing to me how he would do that selflessly. He’d give away personal stuff to ensure communities had what they required. He would organize food, or countless times he’d walk home after lending his car out to someone, to help a community member. My family and I have sponsored families all my life and we raised funds for an orphanage in Uganda during the pandemic. This past holiday, our store helped support 65 families with meals for the week.

I love that Home Depot is an enabler for such activities to happen.

My passion is really about how do I leave the environment I’m in a little bit better than how I found it?

”

www.hardlines.ca

COVER FEATURE

LANGTON CHODOKUFA

Langton in the power tool corral with (from left) Antonio (Tony) Stampone, supervisor of the merchandising execution team (MET); Sabrina Scrivo, human resources manager; Hydie Vicente, MET associate; and Trey Reynolds, operations assistant store manager.

WHAT WERE SOME OF THE BUSINESS CHALLENGES OF THE PANDEMIC?

I think the biggest challenge for the team was the conversion of our business model.

Everything changed with those initial lockdowns. But even though that was incredibly difficult for us, our associates just kept showing up. They could have stopped coming to work at least until such a time that they could assess the severity of what was going on, but they didn’t. That was really incredible. They really wanted to make it work, support the community and do what they could.

WHAT’S CHANGED ABOUT WORKING FOR HOME DEPOT SINCE YOU STARTED IN 2001?

The fantastic part of Home Depot is just how we’ve been evolving as a company.

We’ve really improved operational aspects in different internal departments to work more cohesively—we truly are becoming One Home Depot. Concerning the industry itself, it’s around the evolution of our customers. Seeing the evolution of each generation go through its life stages. Customers today have different shopping styles, they define value differently and what they define as “convenience” is totally different

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compared to 20 years ago. I love that we find a way to position ourselves as a destination for each of our diverse customers’ needs. We have the services that the ‘do it for me’ customers want; we have the threehour express shipping that the pros and the Generation Z customers want. I really love that we look at what each generation values.

You see that in the growth of our services, and how our associates go about helping our customers in the aisles.

HOW HAS DIGITAL TECH CHANGED YOUR JOB?

In the beginning, it was a rough start, but let’s remember, I’ve been here for more than 20 years. It wasn’t necessarily just on the technology, but at that time, everyone was just trying to figure this all out. When you’re used to one way, this created a lot of challenges. But overall, it has been amazing, and it’s made my job a lot easier; it’s made my team’s job a lot easier. Now we can’t wait to hear the next thing that’s coming out.

AS A MANAGER, HOW DO YOU SEE YOUR ROLE IN DEVELOPING TALENT AT YOUR STORE?

Managers can truly set the foundation to help individuals become who they want to become. A store of individuals who maybe

Hardlines Home Improvement Quarterly

don’t see that in themselves yet. That is at the very top of my list. If someone were to say to me, write a job description for your role, I would say I’m there to facilitate a place that people can grow in—in their careers and as people.

WHAT ARE YOUR SOME OF YOUR HOBBIES?

I love watching (children’s animated TV show) Peppa Pig with the kids, and there’s not an episode I don’t know. Beyond that, I love fishing. The quietness on the water, it brings me closer to nature. I used to do it by myself when I first started, but with six kids, it’s always a party. My boat is already packed with just my family! I also fish with friends—we get together a few times in the summer.

WHAT IS YOUR BIGGEST WEAKNESS?

I can’t stand still! I’m always on the move doing something or learning something new. I take classes often, and I’ve enrolled myself at York University, which lets me sign up for courses of interest. I took critical thinking, and it was interesting. I also may want to take a marketing course in addition to core business courses. Information is always changing. www.hardlines.ca

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COVER FEATURE HOW DO YOU FIND TIME FOR ALL THIS?

I don’t even know, I guess I find time within my down time. Most of this happens when the kids go to bed. I jump on online classes, I’ll read books, or sometimes I get audiobooks, so I can listen to my books while I’m driving to work. I look forward to my drive that way, as it’s a little longer than a normal commute.

LANGTON CHODOKUFA Home Depot store #7011’s Sabrina Scrivo, Langton Chodokufa, and Hydie Vicente.

WHO IS YOUR FAVOURITE AUTHOR?

It depends on what topic I’m reading. If it’s business or if it’s philosophical, it’s different. But in general, one book I read over and over again is Over The Top by Zig Ziglar. If I don’t have something to read, I will pick

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that book up, and I always get something new out of it.

DO YOU HAVE A FAVOURITE PRO SPORTS PLAYER?

This one’s a little biased because I came from the Cleveland area, so Lebron James.

WHAT WAS THE MOST EXCITING DAY OF YOUR LIFE?

For me, it’s when I got married. It was the top highlight of my life for me, and with each kid, their birth was just over the top—these were are all extraordinary, life-defining moments for me. When it comes to working, the best days are when you’re able to facilitate someone getting closer to the role they’re working towards—that’s the most gratifying.

When you see you’ve had an impact in an environment you helped to create or foster, a positive impact on people as they work towards a goal. Those are exciting moments.

WHAT WAS THE BIGGEST CHALLENGE YOU HAVE EVER OVERCOME?

My biggest challenge was leaving my family in Zimbabwe—new territory, restarting life again, and restarting my career. I was one of the youngest to hold the position I had at the bank I worked at—and it was a pretty big bank—and I left all that and my family.

I came to the U.S. to start in a place where I didn’t know what was around the corner.

The only aspect I understood of the culture was what I had read. That was challenging.

WHAT WOULD YOU WANT YOUR COMMUNITY TO SAY ABOUT YOUR STORE?

What I would really want is that my store’s name comes up in important personal conversations. That would mean so much to me and our associates who work so hard to serve our community. To have touched an individual to the point where they… speak about something (at our store) that had a significant impact on them. That they can’t help in those private conversations but share a positive experience that we helped create. It would be most humbling to hear Home Depot played a small part in helping to meet that opportunity—touching and leaving the communities we serve a little bit better than when we first got there.

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CANADA’S

TOP 20

FEATURE

CANADA’S

BY THE EDITORS OF HARDLINES

TOP HOME 20 IMPROVEMENT RETAILERS

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Hardlines Home Improvement Quarterly

www.hardlines.ca

The country’s home improvement retailers enjoyed another banner year in 2021—the second year of COVID restrictions.

Canadians continued to plough money into their homes as other spending options were reduced. In spite of supply chain problems, HARDLINES estimates our industry grew by 11.3 per cent last year, bringing total retail* sales to over $58-billion.

Here’s how that breaks out...

*Sales to end users—consumers, contractors and industry

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October 18 & 19, 2022 NIAGARA-ON-THE-LAKE, ONTARIO

CONFERENCE SERIES

2022

www.hardlinesconference.ca

It’s Time to Re-connect.

Join us in person for the 26th Annual Hardlines Conference October 18 & 19, 2022 at the beautiful Queen’s

Landing Hotel in the historic town of Niagara-on-the-Lake, Ontario, just 80 minutes from Toronto.

Join other top retailers and managers from across the country, along with leaders from the key retail banners and buying groups, their wholesalers, and vendors.

PLUS: The Outstanding Retailer Awards

Canada’s only national awards program dedicated to celebrating the achievements of hardware, home improvement and building supply dealers and their staff.

Can’t make the trip in person?

This year, you can attend the Conference and Awards Gala virtually. We’ll make it easy to join your fellow retailers and celebrate award winners and top speakers!

A fantastic networking experience!

This year’s event will feature some of North America’s top thought leaders in hardware and home improvement retail, who will share their stories and their insights on the future of retail. MEET OUR SPEAKERS:

The 26th Annual Hardlines Conference

October 18 & 19, 2022 NIAGARA-ON-THE-LAKE, ON

Tony Cioffi President

LOWE’S CANADA

Eric Palmer

www.hardlinesconference.ca

VP & General Manager SEXTON GROUP

AGENDA AT-A-GLANCE

Charles Grégoire-Béliveau

Dan Tratensek

BMR GROUP

NHPA

VP, Merchandising

COO & Publisher

OCTOBER 17TH OPENING NIGHT RONA Pub Night 7:00pm – 9:00pm OCTOBER 18TH DAY 1 Breakfast, Lunch & Sessions 8:00am – 3:35pm Home Hardware Industry Reception 4:30pm – 6:00pm

Rob & Joanne Lawrie Owners

Zaida Fazlic

VP, People & Culture

THE LAWRIE GROUP OF HOME HARDWARE STORES

TAIGA BUILDING PRODUCTS

Peter Norman

Alison Fletcher

ALTUS GROUP

THE COOKERY STORE

VP & Chief Economist

Doug Stephens Founder

RETAIL PROPHET

Outstanding Retailer Awards 6:00pm - 9:00pm OCTOBER 19TH DAY 2 Breakfast & Sessions 8:00am – 11:50am

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Plus lots of networking time with colleagues and customers!

CONFERENCE SERIES

2022

CANADA’S

TOP 20

1. THE HOME DEPOT CANADA HQ: Toronto, Ont. 2021 SALES: $11.673-billion STORES: 182

The world’s largest home improvement retailer is also the number one player by sales in Canada. The Home Depot Canada is a business division of The Home Depot in Atlanta. The parent company had US$151.2billion in 2021 sales—up a whopping 14.4

FEATURE percent from 2020. Orange Crush had 2,137 stores last year in Canada, the U.S., and Mexico.

Here in Canada, the company has held steady with 182 stores for the past decade, concentrating on increasing sales from its existing stores rather than adding new locations. The growth effort is being directed at both in-store sales and e-commerce sales, that latter in what the company calls its “endless aisle” (which contains a reported one million SKUs).

One of Home Depot Canada’s key target markets for growth is the pro customer. In the U.S., contractors represent 12 percent of Home Depot’s customers. Services for pros include designated service counters in the stores and online connections such as Pro Xtra, which ties pro members to the Home Depot’s commercial credit card. Benefits of this program include rewards on all purchases, 365-day in-store returns, and the ability to issue cards to trusted members of contractors’ staffs.

2. HOME HARDWARE STORES HQ: St. Jacobs, Ont. 2021 SALES: $8.875-billion STORES: 1,053

The largest Canadian-owned banner in the retail home improvement industry, Home Hardware Stores continued to develop its e-commerce technology in 2021. After many years offering BOPIS (buy online pick-up in store) through its thousand-plus

Size of the industry year over year (sales $millions) $58,467

$60,000

11.3%

$55,000

$52,534 15.5%

$50,000

$44,030 $45,000

$45,644 3.7%

5.4%

$45.500 -0.3%

$40,000 2017

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2018

Hardlines Home Improvement Quarterly

2019

2020

2021

www.hardlines.ca

‘’ADDING A RETAIL COMPONENT

to our store has created stability for our business.

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

Matthew Wagstaff & Ryan McKay RONA Black Diamond, Alberta RONA dealers since 2004

DISCOVER THE ADVANTAGES OF RONA, VISIT

rona.ca/becomeRONA BE PART OF SOMETHING BIGGER

becomeRONA@rona.ca WESTERN CANADA

QUEBEC

Tony Perillo 204-218-5805

Pierre Nolet 514-213-9162

ONTARIO

NATIONAL Josée Desrosiers 418-391-7101

Glen Duczek 416-528-7131

ONTARIO & MARITIMES Scott Wilson 519-281-1824

CANADA’S

TOP 20

stores, Home Hardware is now offering BOSTH (buy online ship to home) from its Wetaskiwin, Alta., distribution centre.

A BOSTH functionality will soon be operational from the Home Hardware central DC in St. Jacobs, Ont., too 2021 was a year of further expansion into Quebec for Home Hardware. Early last year it partnered with Groupe Turcotte (a Home Hardware dealer in Quebec with seven stores) to purchase home improvement retail chain Patrick Morin (see separate listing). This added an impressive 21 stores and a distribution centre to Home Hardware’s roster in Quebec.

Like many retailers during the continuing supply chain disruptions of 2021, Home Hardware has moved up its seasonal ordering times to accommodate the longer lead times from Asia. It has also decided to secure more product that in the past and has worked hard to move product between its three main DCs to keep its dealers supplied. Home Hardware Stores has also seen an influx of new buyers, some of them from big boxes and mass merchants with which Home Hardware competes.

3. LOWE’S CANADA/RONA HQ: Boucherville, Que. 2021 SALES: $8.53-billion STORES: 445

2021 was another pandemic year in which Lowe’s benefited from its ability to make

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FEATURE

Market share of big box stores ($millions) Home Depot Canada $11,763 20.1%

Lowe’s Canada* $4,687 8.0%

Kent* $432 0.7%

Rest of the Industry $41,585 71.1% * Sales from these retailers’ big box stores only.

investments in e-commerce. It did significant business from internet tools like its online paint selector (a first in Canada).

It installed significant numbers of bluetooth-powered lockers to permit “contactless” customer pick-up. And it continued to expand its controlled and house brands.

Lowe’s’ business model in Canada is radically different from its U.S. operations.

Only its big box stores up here follow its American model. Lowe’s inherited from its 2016 takeover of RONA a 496 store network in Canada, many of them owned and operated by independents. The corporate RONA stores include a mix of full-size big boxes, mini big-boxes (proximity stores), and building supply stores. Lowe’s Canada also operates 20 Réno-Dépôt stores in Quebec that are very strong with contractors and five Dick’s Lumber yards in B.C. and Alberta.

On Jan. 6, 2022, Tony Cioffi was appointed president of Lowe’s Canada, reporting to Tony Hurst in the U.S., who had held the top role in Canada for two years. Cioffi had joined the company in 2016 as senior

Hardlines Home Improvement Quarterly

vice-president, finance, and he had served as interim president of the Canadian operations once before.

4. CANADIAN TIRE RETAIL HQ: Toronto, Ont. 2021 SALES: $7.87-billion*

* hardware/home improvement only STORES: 504 Canadian Tire Corp. owns a range of retail brands, including Sport Chek, PartSource, Mark’s, Helly Hansen, and Party City. The

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CANADA’S

TOP 20

company’s flagship Canadian Tire Retail stores are focused on the hardware, housewares, and sporting goods sectors. Stores are located in every province and territory except Nunavut. They’re independently operated and co-owned by Canadian Tire’s franchise, or associate, dealers. The dealers own the fixtures, equipment, and inventory, while the head office owns the real estate.

The company is celebrating its 100th anniversary this year.

Throughout COVID, Canadian Tire stores became go-to destinations for home repairs (the stores do not carry lumber, commodities, or other building materials).

A surge in online sales early in the pandemic was accompanied by bad publicity about Canadian Tire’s online systems crashing under the strain. Heavily publicized investments in the company’s omnichannel presence have followed.

Canadian Tire managed to double its number of online customers from 2019 to 2021. The Triangle Rewards program is an important part of this effort. It ties all the Canadian Tire banners together under one online brand. It is also proving to be an effective way to connect with younger customers.

FEATURE

Buying group sales and market shares ($millions) Buying Group

2021 Retail Sales

Market Share

BMR Group*

$1,534

2.6%

Castle Building Centres

$1,887

3.2%

Delroc Industries

$908

1.6%

Home Hardware (building and home centres only)

$6,391

10.9%

ILDC*

$3,027

5.2%

Sexton Group

$3,300

5.6%

TIMBER MART

$4,080

7.0%

TORBSA

$715

1.2%

TOTAL Buying Groups

$21,842

37.4%

TOTAL Rest of the Industry

$36,625

62.6%

5. INDEPENDENT LUMBER DEALERS CO-OPERATIVE HQ: Ajax, Ont. 2021 SALES: $4.561-billion STORES: 120

Composed of mostly large regional LBM players, the ILDC has negotiated deals for its members since 1964. The scope of its

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THIRD QUARTER / 2022

* BMR’s sales have been backed out of ILDC’s total for this table, as BMR is also a member of ILDC. Therefore, the total of ILDC’s actual market share will be a combination of BMR and ILDC

Hardlines Home Improvement Quarterly

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Joining TORBSA has been one of the best moves our company has made. Not only have we expanded our product offering, but we’ve been able to make better deals with our existing vendors, improving our bottom line. Having TORBSA at the negotiation table is like having an extra hammer in your toolbelt.

And each member is also a shareholder, so TORBSA’s transparency is second to none. The staff at TORBSA are some of the hardest working people out there, constantly challenging the status quo and finding new opportunities. We look forward to working with them for years to come.

Ryan Hillier-Spurr

For more information about TORBSA, call Paul Williams at 1-866-865-1689

www.torbsa.com

CANADA’S

TOP 20 ALLIANCE INTERNATIONAL LLC

DO IT BEST (U.S.)

HOME HARDWARE STORES

Home Hardware Building Centre

FEATURE

THE HOME DEPOT (U.S.)

LOWE’S COS. (U.S.)

THE HOME DEPOT CANADA

LOWE’S CANADA

HD Supply Canada

Big Box Stores

RONA

CASTLE BUILDING CENTRES GROUP

OCTO HARDWARE

Traditional Building Centres

Contractor Stores

Home Building Centre

Home Hardware

Home Furniture

RONA Building Centres (Corporate)

RONA Affiliated Dealers (Independents)

PLUS 60 OTHER MEMBERS

PEAVEY INDUSTRIES

PRESTON HARDWARE

MainStreet Hardware

Peavey Mart

Ace Canada

Lowe’s

RONA Home and Garden/ RONA L’éntrepôt

CANAC

AD CANADA (INCLUDES TORBSA)

Commercial Building Supplies (CBS) Réno-Dépôt

Dick’s Lumber Specialty Dealers

E.G. PENNER BUILDING CENTRES

ÉVOLUTION DISTRIBUTION

Patrick Morin

2022 BANNER MAP ©2022 Hardlines Inc.

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Hardlines Home Improvement Quarterly

Groupe Yves Gagnon

NOTE: The placement of the groups in this chart does not intend to rank them in any way, but merely to show how they are related.

www.hardlines.ca

SOLLIO COOPERATIVE GROUP

FOUNDATION BUILDING MATERIALS (U.S.)

SPANCAN

TIMBER MART

INDEPENDENT LUMBER DEALERS CO-OPERATIVE

Potvin & Bouchard

Lefebvre & Benoit

BMR Express

BMR Pro

BYCO

FEDERATED CO-OPERATIVES LTD.

ALLROC Tool

Co-op

BMR Group

GMS INC. (U.S.)

BMR Expert

Agrizone

FBM

WSB Titan

Delroc Industries

Sexton Group

Windsor Plywood

UFA Farm and Ranch Supply

Copp Building Materials Ltd.

Emard Bros.

Lumber Company Ltd.

Fries Tallman Lumber (1976) Inc.

Igloo Building Supplies Group

Matério Laurentiens Inc.

Watson Building Supplies

Shoemaker Drywall Supplies

Le Groupe Beauchesne

J&H Builder’s Warehouse

Kent Building Supplies

Les Entreprises P. Bonhomme Ltée

L. Villeneuve & Cie (1973) Ltée

Jacques Laferté Ltée

Slegg Building Materials

BC Ceilings Ltd.

Rigney Building Supplies

Star Building Materials

Turkstra Lumber Company Ltd.

D.L. Building Materials

Bytown Lumber

McMunn & Yates Building Supplies Ltd.

www.hardlines.ca

Simcoe Block Ltd.

Soo Mill & Lumber Company Ltd.

United Building Products

Yvon Building Supplies

Quincaillerie Ste-Helene

Hardlines Home Improvement Quarterly

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47

CANADA’S

TOP 20

FEATURE

Market share by store type Building Centres 3,108 stores $29.647 billion 50.7%

Canadian Tire* 504 stores $7.870 billion 13.5%

Hardware Stores 1,007 stores $4.158 billion 7.1%

Big Boxes

302 stores $16.792 billion 28.7%

* Home category only, excluding sporting goods and auto.

Total home improvement stores by province/territory

Total stores 4,921

Yukon 18

Newfoundland and Labrador

Northwest Territories

164

19

Nunavut 6

Prince Edward Island 36

British Columbia 610

Nova Scotia 188

Alberta 607

Saskatchewan 312

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THIRD QUARTER / 2022

New Brunswick Manitoba 245

Hardlines Home Improvement Quarterly

Ontario 1,453

Quebec

174

1,089

www.hardlines.ca

Top 20 banner groups 2021 retail sales ($millions) Rank

Company

2021

2020

Change

Stores

Notes

1

The Home Depot Canada

$11,673

$10,437

11.8%

182

2

Home Hardware Stores

$8,875

$7,732

14.8%

1053

3

Lowe’s Canada

$8,530

$7,891

8.1%

445

Includes RONA, Réno-Dépôt and Dick’s Lumber.

4

Canadian Tire

$7,870

$7,327

7.4%

504

Home category only, excluding sporting goods and auto.

5

ILDC

$4,561

$4,416

3.3%

120

Sales include separately-listed BMR, Federated Co-operatives and Kent.

6

TIMBER MART

$4,080

$3,526

15.7%

603

7

Sexton Group

$3,300

$2,430

35.8%

465

8

Castle Building Centres

$1,887

$1,685

12.0%

293

9

BMR Group

$1,534

$1,364

12.5%

266

10

Canac

$1,300

$1,075

20.9%

31

11

Kent Building Materials

$1,151

$1,079

6.7%

48

12

GMS/WSB Titan

$975

$855

14.0%

32

13

Delroc

$908

$811

12.0%

136

Sales include separately-listed Windsor.

14

TORBSA

$715

$650

10.0%

40

Merged with AD Canada on July 1, 2022.

15

Federated Co-operatives

$644

$556

15.8%

92

16

Peavey Industries

$509

$475

7.2%

92

17

UFA

$414

$367

12.8%

34

18

FBM/Winroc

$389

$351

10.8%

27

19

Patrick Morin

$380

$346

9.8%

21

20

Windsor Plywood

$326

$306

6.5%

53

$55,952

$49,661

12.7%

4,537

TOTALS www.hardlines.ca

Sales do not include HD Supply Canada.

Sales include separately-listed UFA.

Includes Peavey Mart, Ace Canada and Main Street Hardware.

Owned by Home Hardware. Not included in Home Hardware sales figure above.

Hardlines Home Improvement Quarterly

THIRD QUARTER / 2022

49

CANADA’S

TOP 20

membership ranges from other buying groups (Federated Co-operatives, BMR), to powerhouse regional operators (such as Kent, with 48 locations, some of them big boxes, in Atlantic Canada), to family businesses clustered around a central medium-sized city (like Copp’s Buildall, London, Ont.), to single location outlets (for example, J&H Builders Warehouse, Saskatoon). Together, ILDC members control some 120 stores (not inluding Federated Co-operatives and BMR). In early 2021, ILDC lost an important member in Quebec when Patrick Morin was purchased by Groupe Turcotte (Home Hardware).

FEATURE

7. SEXTON GROUP

9. BMR GROUP

HQ: Winnipeg, Man.

HQ: Boucherville, Que.

2021 SALES: $3.3-billion

2021 SALES: $1.534-billion

STORES: 465

STORES: 266

Sexton, once a regional buying group that operated mostly in Western Canada, has long since transformed itself into a national player. But there is still one province where it hopes to grow. Eric Palmer, vice president and general manager of the group, told Hardlines in a 2021 podcast that expansion in La Belle Province was very much on the agenda. “We are committed to bringing the full value of the Sexton Group to Quebec,” Palmer said. Sexton has an LBM supply agreement with Ace dealers and their licence holder in Canada, Peavey Industries.

The largest Quebec-owned home improvement retailer, BMR got a new CEO last year. Alexandre Lefebvre took over in March from Pascal Houle, who was then named CEO of BMR’s parent company Sollio Cooperative Group (Formerly La Coop fédérée) later in the year. In 2021, BMR Group continued its growth outside of Quebec. It welcomed a dealer in Shippagan, N.B., last year and it also signed stores in Kemptville, Hawkesbury, and Winchester, Ont. The Boucherville, Que.-based group has identified Ontario as a key target for expansion beyond its existing 19 stores there. In June 2022, BMR appointed a new head buyer, Charles Grégoire-Béliveau, and a new COO, Antonio Di Pasquale.

6. TIMBER MART HQ: Calgary, Alta.

8. CASTLE BUILDING CENTRES

2021 SALES: $4.08-billion STORES: 603

HQ: Mississauga, Ont.

Claiming to have the highest volume drywall purchases of any buying group, TIMBER MART experienced another year in 2021 in which LBM prices stayed elevated because of the pandemic. TIMBER MART welcomed important new Quebec members last year and it also picked up dealers in the Toronto and Ottawa areas, as well as one in B.C. The group realigned its LBM buying function last year. Last fall, Bruno Baldessari, an industry veteran formerly at competitor BMR, was hired as vice president of forest products trading. Several new traders were recruited to join his team, with a goal to expand the product offerings available to the group’s approximately 600 member stores.

2021 SALES: $1.887-billion

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STORES: 293

Ken Jenkins, who has been leading Castle Building Centres Group since 2007, recently added the CEO role to his existing title of president. During Jenkins’ 15 years at the helm, Castle has grown from just over 200 dealer locations to almost 300 outlets today.

They consist of building supply dealers, hardware stores, and specialty and commercial dealers. Castle has locations in every region of the country except Yukon and the Northwest Territories. The group has been actively adding new members across the country in recent years. Castle’s commercial division is called Commercial Builders Supply.

Hardlines Home Improvement Quarterly

10. CANAC HQ: Quebec City, Que. 2021 SALES: $1.3-billion STORES: 31

Canac is a powerful home improvement retail chain owned by the Laberge family. It has 31 stores in Quebec with only a handful in the Greater Montreal Area, so Canac still has room to grow substantially in the province before the company enters (as company officials promise) the Ontario market. To fuel its ongoing expansion, Canac has been expanding its DCs substantially, completing

www.hardlines.ca

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CANADA’S

TOP 20

FEATURE

Big box sales ($millions) and market share (%) n Home Depot Canada

n Lowe’s Canada*

n Kent*

n Rest of the Industry

$41,783 71.5%

$40,000

$37,445 74.8%

$37,500

$37,565 71.5%

$37,445 74.4%

$35,970 74.6% $35,000

$12,500 $10,437 19.9%

Sales $millions

$10,000 $8,845 17.6%

$8,473 16.9%

$8,150 16.9%

$11,763 20.1%

$7,500

$5,000

$3,817 7.6%

$3,807 7.9%

$3,674 7.3%

$4,154 7.9%

$4,490 7.7%

$2,500 $306 0.6%

$324 0.6%

$342 0.7%

$404 0.8%

$432 0.7%

$0 2017

2018

2019

2020

2021

* Sales from these retailers’ big box stores only.

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Hardlines Home Improvement Quarterly

www.hardlines.ca

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

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

MICHAEL ALLEN RONA

North Vancouver, Powell River and Salmon Arm, B.C.

Contact BMF About Your Store and Fixture Design Challenges: Brian Glen Director of North American Sales 416-389-6070 bglen@bmfonline.com

STORE PLANNING | STORE FIXTURES | LBM DISPLAYS | GRAPHIC DESIGN & SIGNAGE | INSTALLATION | SERVICE COUNTERS

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CANADA’S

TOP 20

a second building in Drummondville, Que. in January of this year. It is now building a DC (and a store) in Lévis, Que. on the south shore of the St. Lawrence River near Quebec City. Canac’s next store opening looks like it will be in Contrecoeur (east of Montreal) in spring 2023.

FEATURE “largest independently-owned drywall supplier in the country with 23 locations.”

After further growth, WSB Titan was purchased in 2018 by GMS Inc., a large wallboard distributor based in Atlanta. The seven Canadian dealers currently in the group have grown considerably—and some of them, like multi-outlet Slegg Building Materials on Vancouver Island, are fullscale building supply operations.

thoroughly,” said TORBSA president Paul Williams. “TORBSA and its shareholders are truly excited at the road ahead, as we lay the foundation for what will be many years of success as a business.” Founded in 1966, TORBSA represents 30 members in 40 locations across Canada. AD is based in Wayne, Penn., and buys contractor-related and industrial products for some 845-plus member owners in the U.S., Mexico, and Canada.

13. DELROC

15. FEDERATED CO-OPERATIVES

11. KENT BUILDING MATERIALS HQ: Saint John, N.B. 2021 SALES: $1.151-billion STORES: 48

A subsidiary of the J.D. Irving company, Kent is the only retailer other than Lowe’s Canada to go to market with a multi-format big box and building supply store blend. Kent opened its latest big box store in March 2022 in Moncton, N.B. The store features modernized displays and enhanced signage to aid customer flow, along with expanded product assortments, a drive-through lumberyard, and more. In March 2021, Kent launched a new customer loyalty program with Exchange Solutions, a Boston-based firm. Kent’s new program gives its customers access to exclusive offers and rewards—and increases Kent’s e-commerce presence. Exchange Solutions also counts Lowe’s Canada among its clients.

12. GMS/WSB TITAN

HQ: Langley, B.C.

HQ: Saskatoon, Sask.

2021 SALES: $908-million

2021 SALES: $644-million

STORES: 136

STORES: 92

Approaching its 50th anniversary in 2024, Delroc is a privately-owned buying group founded by entrepreneur Bruno Mauro of Dryco Building Supplies in Langley, B.C. Today, Delroc buys for 33 members representing 136 stores. It negotiates in a wide range of building material categories. It is strongest in B.C., where it has 69 dealer locations, followed by Alberta with 27. It has 19 dealer locations in Ontario and four in Atlantic Canada. Its largest member is B.C.based Windsor Building Supplies—which has its own listing at position 20.

Federated Co-ops is one of the country’s largest farm co-ops. On the retail side, it supplies member co-ops throughout Western Canada that have ag centres, supermarkets, convenience stores, department stores, and home centres.

This last category is serviced by FCL’s Home and Building Solutions business. To support its stores, FCL is building a new LBM distribution hub on a 6.7-acre site outside of Regina. The $7.5-million investment will allow FCL to procure and distribute materials such as lumber, drywall, and decking materials from a centralized facility to Co-op Home Centres in Manitoba and most of Saskatchewan. A second facility in Alberta is planned to be operational in 2023.

14. TORBSA

HQ: Surrey, B.C.

HQ: Bolton, Ont.

2021 SALES: $975-million

2021 SALES: $715-million

STORES: 32

STORES: 40

16. PEAVEY INDUSTRIES

WSB Titan was formed as a commercial building supplies buying group in 2009 by three regional building supply dealers representing the Prairies, Ontario and Quebec. The new firm billed itself as the

A buying group whose members specialize in pro builders, TORBSA announced in June that it had merged with a U.S.-based buying group, AD. “The decision to align our business with AD was one that was scrutinized

HQ: Red Deer, Alta.

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THIRD QUARTER / 2022

Hardlines Home Improvement Quarterly

2021 SALES: $509-million STORES: 92

Peavey Industries operates farm and ranch stores across Canada under the www.hardlines.ca

?

Why

• Are you a successful hardware retailer looking to retire?

Areyou youwant a successful hardware looking retire?

•• Do to avoid the hassleretailer of trying to sellto your

to an buyer of and instead work with a • business Do you want tounqualified avoid the hassle trying to sell your company that has a proven track record with acquisitions business to an unqualified buyer and instead work with a and due-diligence in place to execute a company that has processes a proven track record with acquisitions deal quickly? and due-diligence processes in place to execute a dealyou quickly?

• Are independent and thinking you should introduce a

toindependent your business that will provide the kind of greata • brand Are you and thinking you should introduce business, product, marketing and distribution support ACE brand to your business that will provide the kind of great Canada dealers enjoy? business, product, marketing and distribution support ACE Canada dealers enjoy?

These questions are all answers to ‘Why ACE Canada?’ – and there are many unique situations, questions These questions aremore all answers to ‘Why ACE Canada?’and – answers.

Industries LP and ACE Canada invite you and therePeavey are many more unique situations, questions and to further Peavey exploreIndustries ‘why ACE’ LP may beACE the Canada perfect fit for you, answers. and invite you your business and your team.

Please reach out to us at to further explore ‘why ACE’ may be the perfect fit for you, joinACE@peaveyindustries.com to findreach out more about your business and your team. Please out to us atthe benefits and solutions ACE Canada canout offer for about your the joinACE@peaveyindustries.com to find more unique benefitssituation. and solutions ACE Canada can offer for your unique situation.

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INDUSTRIES LP INDUSTRIES LP

Are you you aAre dealer a dealer considering considering converting converting to the Ace to the Ace banner?

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CANADA’S

TOP 20

Peavey Mart brand. In 2016, it purchased TSC stores in Canada. Peavey is also the licensee of the Ace Hardware brand in Canada, which it took over in March 2020 from Lowe’s Canada. There are some 100 Ace-branded stores in Canada but this is a small presence considering there are more than 5,000 Ace-bannered dealers in the U.S. Peavey has a relationship with Sexton to provide that LBM group with Ace hardware, while Sexton reciprocates with LBM buys for Ace dealers in Canada.

FEATURE trusted supplier partner of the construction trades in North America, delivering on safety, service, innovation and value for our customers.” FBM Inc. purchased its Canadian outlets, known as Winroc yards, from Superior Plus LLC., a Toronto-based chemical firm, in 2016. There are currently 27 FBM/Winroc locations in Canada.

six in Quebec and one in Stittsville, Ont. near Ottawa. Patrick Morin subsequently left the ILDC.

20. WINDSOR PLYWOOD HQ: Langley, B.C. 2021 SALES: $326-million STORES: 53

19. PATRICK MORIN HQ: Saint-Paul, Que.

17. UNITED FARMERS OF ALBERTA CO-OPERATIVE HQ: Calgary, Alta.

2021 SALES: $414-million STORES: 34

UFA is a co-operative meeting the needs of more than 120,000 member-owners—as well as non-members—throughout Alberta (with a handful of locations in B.C. and Saskatchewan). There are currently 34 UFA Farm and Ranch Supply stores, often twinned with cardlock locations (fleet fuel depots). UFA is a significant player in the home improvement industry in its region, buying lumber and building supplies through Sexton Group.

2021 SALES: $38-million STORES: 21

The Morin family founded this business in 1960 and grew it into one of Quebec’s most important home improvement retail chains. In February 2021, the family sold their Patrick Morin stores to Groupe Turcotte and Home Hardware Stores Ltd. Louis Turcotte has been in the Quebec home improvement industry for over 30 years and, at the time of the acquisition, had seven Home Hardware stores of his own,

18. FOUNDATION BUILDING MATERIALS (WINROC) HQ: Calgary, Alta.

2021 SALES: $389-million

Like many retailers in our industry, Windsor Plywood stores did well during the pandemic. “Results were well above expectations,” president Curt Crego told Hardlines. Windsor is a privately-held chain of mid-sized building centres based in B.C. with 53 stores in Canada and five in the Pacific Northwest of the U.S. The outlets are, with a handful of exceptions, owned and operated by franchisees. “Had the pandemic not intervened, I expect we would have opened additional locations by now,” Crego said. “Unfortunately COVID, and, in particular, the cross-border travel restrictions, have and continue to pose an obstacle to our growth in the U.S.”

WANT MORE? The HHIQ Top 20 is just a fraction of the info we have for you in the Hardlines Retail Report and Hardlines Market Share Report.

Available online at www.hardlines.ca

STORES: 27

Foundation Building Materials (FBM) is a U.S.-based group of GSDs with over 250 locations across the U.S. and Canada.

Its mission statement is “To be the most

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THIRD QUARTER / 2022

Hardlines Home Improvement Quarterly

www.hardlines.ca

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THE AMAZO

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HARDWARE

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Hardlines Home Improvement Quarterly

www.hardlines.ca

ZON EFFECT Home improvement retailers in Canada surged towards e-commerce during the pandemic—or at least some of them did. While Canadian Tire embarks on a multi-billion dollar investment in ‘Omnichannel,’ hundreds of independent dealers in Canada still do virtually no business online. HHIQ investigates.

www.hardlines.ca

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59

E-COMMERCE

F LE

A

nyone in this industry who is still doubting that they should be doing e-commerce needs only to consider one dollar figure. $US469-billion. $574-billion in Canadian dollars.

That was the revenue of the world’s largest online retailer, Amazon, last year.

Amazon was certainly top of mind to a western Canadian hardware retailer recently, who responded to a Hardlines survey about online sales with two bleak sentences: “Our sales are dropping! Everybody is shopping at Amazon!”

Well, not everybody.

But consider this. If Amazon was a country, it would have the 25th largest economy in the world, just slightly behind Belgium.

Amazonia’s GDP would be half again as big as that of Israel. Or South Africa. Or Saudi Arabia. 2017 was the first year that Amazon was responsible for at least 50 per cent of the growth in American retailing. Around that time, a now familiar term was coined: The Amazon Effect.

Why is Amazon so successful? You could write a PhD thesis on everything the e-retailer has done to become the third largest company in the world (behind Walmart and China Petroleum Chemical Company). But one of the many things Amazon has done is to dominate internet search itself—at

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THIRD QUARTER / 2022

Amazon reported revenues of $US 469-billion in 2021. That figure is ten times the size of the entire Canadian retail home improvement industry.

least when it comes to shopping online.

Interestingly, more than 50 per cent of retail searches begin with Amazon not Google.

WHO LEADS OUR INDUSTRY?

So, other than Amazon, who is the leading e-commerce power in our industry?

It depends how you define “our industry.”

The home improvement industry is just one spoke in Canadian Tire’s wheel—but it’s certainly one of the online leaders in hardware and home products. CTC approached $2-billion in online sales in 2021. That

Hardlines Home Improvement Quarterly

means Canadian Tire has a healthy online penetration of 12.5 per cent of all revenues—equating to at least 16 per cent of the company’s “retail only” sales.

Obviously, Canadian Tire is hungry for an even greater share of digital sales. It is spending a lot of money to achieve this.

“Canadian Tire to invest $3.4-billion in its online business” was a headline that ran in the Financial Post on March 10, 2022.

Although neither of Canadian Tire’s largest publicly-traded competitors in our industry break out their Canadian online figures in their annual reports, Home Depot and Lowe’s Canada are currently thought to do online sales of between 10 and 12 per cent of their total sales, spurred on by a huge jump in e-commerce activity during COVID 19. In fact, Hardlines has seen figures that show some big box home improvement retailers were doing 30 per cent of total sales online in 2020: “The curbside year.”

Even if COVID restrictions have now ended, the desire to be a part of the “Omnichannel” world has intensified because of the bump that the pandemic gave to online activity. For the past five years, the word Ominichannel has been a standard feature of almost every publicly-traded retailer’s press releases. www.hardlines.ca

There are cynics. “The term Omnichannel is BS, to a certain extent, because it just means different channels to market,” said an anonymous well-known digital executive from another retail industry. “There’s no ratio. Canadian Tire’s announcement was mostly about bricks-and-mortar spending anyway.”

When it comes to e-commerce, there are now three tiers of merchants in our industry. Alone at the top level is Amazon, which is obviously taking an increasing percentage of home improvement sales. The second publicly-traded group is Canadian Tire, Home Depot, and Lowe’s Canada—giant brick-and-mortar retailers. And then there’s everyone else.

ONE DIGITAL AT CANADIAN TIRE

One of the long-standing problems with brick-and-mortar retailers moving into e-commerce is that the majority of retailers have been slow to integrate their websites/apps with their store POS systems.

“Traditionally, an order comes in online and then someone has to enter it manually into the POS,” said the anonymous digital executive.

When Lowe’s launched BOPIS (Buy Online, Pickup In Store) at about 30 of its Canadian stores approximately ten years ago, there was effectively a single terminal at each store receiving those orders. An associate was charged with taking those orders one-by-one and treating them like any other order that was physically placed in the store. “For most retailers, it’s still like that today,” the digital executive said.

Which is where the word “seamless” comes from. Everyone wants to move beyond the clumsy human interface where an associate rekeys an order.

“The future belongs to retailers who can provide the most seamless experience across digital and physical channels.” Greg Hicks, president and CEO of Canadian Tire Corp., said in videoconference with analysts following the release of the company’s first-quarter results. www.hardlines.ca

“We are investing to provide a seamless end-to-end connection along the supply chain and to our customers across whichever channel they choose,” Hicks added, noting that a new platform is being rolled out to facilitate that seamless connection. It will be called One Digital. The platform was tested in New Brunswick in Q1 and a national rollout is following. One Digital will ultimately encompass CTC’s other banners, such as Mark’s, Sport Chek, and Party City.

“It’s a critical part of our evolution from a company made up of disconnected banners, brands, and services to an enterprise-wide platform where all banners and channels collectively amplify and render each other more valuable, creating a truly differentiated customer experience,” Hicks said.

E-COMMERCE AT HOME HARDWARE

As impressive as Canadian Tire’s announcements have been, important e-commerce moves are being made by other retail groups in our industry. Chris Parsons, director of e-commerce at Home Hardware Stores Ltd. in St. Jacobs, Ont., says his firm has learned a lot since the group first introduced BOPIS to its dealer network in 2014.

The potential for online shopping in the retail home improvement industry is vast, Parsons says. “Most e-commerce websites

“

Greg Hicks, president and CEO of Canadian Tire Corporation, says the future belongs to retailers who can provide the most “seamless” experience across digital and physical channels. “conversion rate” (percentage of visitors to a website who make an online purchase) can be deceptively low. He says a lot of customers will search up a Home Hardware product online but go to a physical store to buy it, because Home Hardware has over a thousand locations and there is usually one nearby. In addition to the products in Home Hardware’s three main DCs across Canada, customers can view inventory at more than 600 Home Hardware stores.

As long as you’re there in the customer’s thinking process, whether they convert online or in-store isn’t that important.

convert at a rate of around one per cent,” Parsons says. “But they might have a $60 product. It’s not unusual in our industry to have a $4,000 and up basket size” because of project-based buying. Parsons told HHIQ he believes the potential penetration for online sales in our industry is high, at least “in the high twenties” percent of total sales.

Parsons also points out that the most familiar metric of e-commerce, the

”

“As long as you’re there in the customer’s thinking process, whether they convert online or in-store isn’t that important,” Parsons said. What is important to independents is that the customer comes to the store. “BOPIS is an opportunity to build rapport,” Parsons says. “In home improvement, customers love to have that expert advice, that process where they engage with the associates at the store level.” That

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E-COMMERCE

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Iggy Lorenzo (left), store manager at an independent RONA dealer in Guelph, Ont., with store owner Paul Sharpe.

Sharpe estimates they hit 20 per cent of their frontline sales online by May 2021.

human experience is the one advantage that smaller stores have over the (mostly) storeless online giants.

Parsons says that Home Hardware is currently displaying 45,000 SKUs on its website, compared to 300,000 items online according to Lowe’s Canada and a much-publicized 1,000,000-plus online items at Home Depot Canada. Then again, Amazon has a reported 12,000,000 SKUs online worldwide. But Parsons says that looking at online transactions and online SKUs is missing the point. “E-commerce is not just about a transaction. A true e-commerce strategy is a whole digital strategy,” he says, including marketing, the community that can build up between shoppers online, advice, instructions, reviews, and more.

When it comes to BOSTH (Buy Online Ship To Home), every Home Hardware store except those in Ontario is currently capable of participating in BOSTH, Parsons says.

The DC in Wetaskawin, Alta., is already up and running BOSTH with Ontario to follow when changes are made to warehouse management technology in St. Jacobs. That should take place before the end of the year, Parsons said.

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LOWE’S/RONA: THREE OPTIONS

Lowe’s Canada is in a unique position when it comes to e-commerce in Canada. Customers have at least three options for buying online from Lowe’s in this country: the Lowe’s site supporting some 70 Lowe’s big boxes in Canada; the RONA site, supporting more than 210 independent RONA dealers as well as close to 150 corporate-owned RONA stores; and the Reno-Depot site supporting 20 corporate stores.

“

“Customers are often building a project,” not just ordering individual SKUs, Bernier said. Lowe’s recognizes that customers needing expertise want to have a discussion online, too.

Bill Morrison, retail consultant, says that an important part of smart retailers’ online strategies is to have exclusive or control brands that can protect them from direct price comparisons with the Amazons of the world. Bernier told HHIQ that Lowe’s Canada’s control brands such as Ego, Craftsman, Kobalt and Eklipse Cabinets, among others, have all been very important to growing his company’s online sales.

When the world began to lock down in March 2020, Lowe’s/RONA was already reasonably well prepared, Bernier said: “RONA was already in a favourable position because we had made significant investments in online in the years beforthe pandemic.”

A RONA INDEPENDENT’S EXPERIENCE

Paul Sharpe, a RONA independent dealer in Guelph, Ont., says that there are advantages to being a member of a multi-brand banner like Lowe’s/RONA. “There are great aspects of the RONA website and great aspects of the Lowe’s website. So we try to give them feedback

True expertise is the product. It’s about the service, not just the product and the price.

HHIQ asked Michel Bernier, Lowe’s Canada’s senior director, sales and dealer services, about how the company’s e-commerce strategies have changed since the pandemic began.

“True expertise is the product,” Bernier replied. “It’s about the service, not just the product and the price. During the pandemic, we introduced online tools like our colour selector, which is easy to use… and also our deck design tool.” Customers want expertise.

Hardlines Home Improvement Quarterly

”

on what we’d like to see from each side... so that the RONA website can be even better.”

“If your store is on the web, your trading area is a lot larger,” Sharpe said. “People decide they want a RONA product and their local store might not have stock. Then they start to check on other RONA store websites. We get customers from east of Bowmanville (Ontario).”

Bernier at Lowe’s considers Sharpe to be one of the best independents in the organization as far as growing online sales. “In www.hardlines.ca

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2019 we were at less than five per cent of our business (in online sales),” Sharpe said.

“The potential was there but it wasn’t blowing our socks off.” Then in 2020, when the lockdowns began, “online sales grew drastically. By May 2021 we were at over 10 per cent of our total sales. Effectively this was about 20 per cent of retail because we are 50/50 retail and back end,” Sharpe said.

Sharpe says his manager, Iggy Lorenzo, did a research project on customers coming into the store. “Iggy looked at the data and he found that 80 per cent of them have been pre-shopping.” Again, this echoes what Chris Parsons at Home Hardware said about “being there in the customers’ thought process” and that the power of digital marketing is not all about actual online sales.

“When we look back on the pandemic, what most retailers went through, compared

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to what we were able to achieve… it was a point of leverage we had that RONA had already been making the investments,” Sharpe said.

TOOLBX

One of the relationships that Lowe’s Canada had already been leveraging before the pandemic—as have independents with other banners—is with TOOLBX, the North American platform that was founded by a trio of entrepreneurs in 2018.

TOOLBX started as an online construction materials delivery platform and procurement tool focused on builders, trades, general contractors, and dealers. It offers very fast search and checkout. Products, sourced from home improvement store partners, are delivered in the company’s variety of vehicles which can handle up to 3,000 lbs of building materials.

Hardlines Home Improvement Quarterly

The economics of such online delivery services are widely understood. It’s expensive for trades to lay down their tools and go pick up more materials at the local building supply.

Since the pandemic, TOOLBX has launched a brand new platform to become a full-service digital enablement tech company. This new platform, says company co-founder and CEO Erik Bornstein, “can set up a building supply dealer on a single platform that empowers them to sell, deliver and process payments online through their own e-commerce store.”

Bornstein, a former home builder, says that independent dealers should not be intimidated by recent headlines about Canadian Tire investing billions in e-commerce.

“A dealer moving to e-commerce is embarking on a journey,” he said to HHIQ. Whereas the CEO of Canadian Tire talks about a “seamless end-to-end experience,” Bornstein says his firm could be the starting point for thousands of building supply dealers in Canada who do minimal sales online.

“Phase one is to get the dealers online to process orders. We don’t believe the dealers need to spend billions of dollars to provide a seamless online customer experience.

Getting online should not require a dealer to lose themselves in the minutaie of tech.

We know that dealers have full-time jobs running their businesses.”

“We integrate our online ordering e-commerce platform into their customer experience experience,” Bornstein says of his firm’s typical “four- to six-week onboarding experience” for an independent building supply dealer. “They bring their top SKUs—one hundred to a thousand is typical.”

“Some may say we are disrupting the building material ecosystem but we dislike the term ‘disrupter.’ We are building a business to collaborate with our partner dealers.

When the dealers win, we all win. We are excited to see this industry evolve and gain traction online.” www.hardlines.ca

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PRO CORNER

F LE

MAKING DO

BY JOHN CAULFIELD

How five dealers are meeting supply-chain and inflation challenges head-on

I

n late April, HHIQ asked Ron Sytsma, who manages procurement and supplier relations for Convoy Supply, the Surrey, B.C.-based building products distributor, to look into the distance and predict when his customers would get relief from the current price inflation and supply-chain disruptions.

Not any time soon.

“The honest answer is [that] there is no immediate solution on supply, and price is

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totally last in any product supply discussion,” he replied by email. Sytsma doesn’t expect much improvement any time soon, either. “For the next 120-180 days, there is no change in my line of sight for the products we distribute in North America.”

Sytsma declined to comment further about his company’s purchasing strategy under circumstances where allocation and availability remain question marks for many product categories.

Hardlines Home Improvement Quarterly

Other dealers and distributors willing to broach this subject weren’t exactly waving the white flag. But they acknowledged that their actions could only go so far to counteract broader causes of shortages and price hikes, such as production gaps and transportation shortcomings.

The following provides a snapshot of how several dealers have been wrestling with current market conditions to meet their pro customers’ needs. www.hardlines.ca

LVL ALLOCATION OPENS DOORS FOR ALTERNATIVES

George Begley owns and operates an 8,000-square-foot store on a six-acre lumberyard in Elmvale, Ont., north of Barrie. In a typical year that store supplies materials to contractors for the construction of 350 large, high-end houses. In 2021, Begley says his company increased its business by 35 percent through better planning around permitting and project start dates.

This year, though, “is a very different animal,” he says, because of allocation of engineered wood products that, for example, is restricting LVL beam and truss shipments to his store to one truckload per month. This allocation is not likely to ease until the fourth quarter of this year—at the earliest. Consequently, Begley says his pro customers have been more willing to accept substitutes that include “open-web” floor and roof trusses with spans up to 14 feet.

Begley pins supply-chain problems in Canada partly on “the constant shortage in transportation” in terms of drivers, vehicles, and containers. He doubts the private sector can resolve this dilemma because “it’s always racing to the bottom to do things as

orders, to 90 percent, from 50 percent last year. Despite supply-chain snags, Begley still thinks his store’s business will be up 7 to 10 percent this year. And he’s in the site-plan phase for opening a second store, 50 kilometers from Elmvale.

LOCAL PROS STILL FIRST IN LINE

Have you heard this one before? Last fall, a guy in a semi drove up to Econo Lumber in Prince Albert, Sask., and presented a certified check with which he offered to buy Econo’s entire inventory of engineered

Ontario LBM dealer George Begley pins supplychain problems in Canada partly on the constant shortage of drivers, vehicles, and containers cheaply as possible.” What he’d like to see is the government stepping in on a national level and treating truck driving as a trade, with commitments to recruiting, training, and apprenticeship programs.

Meanwhile, Begley—whose store was in the process of switching to BMR’s Pro banner—says he’ll continue to emphasize building materials that are more readily available, like roofing, drywall, and insulation. He’s also seen a dramatic improvement in the fill rate for his store’s hardware www.hardlines.ca

wood products (estimated value: $750,000, says owner and manager Curtis Lemieux).

The customer said he could send three additional semis to the yard the next day to transport the inventory to Quebec.

Lemieux turned down the offer. Econo’s LVL supplier, TJI, has its product on allocation, and Econo Lumber continues to prioritize its local contractors’ needs “because if you don’t have joists, you can’t start a house.”

Econo generally isn’t having trouble meeting demand for other building products,

Many dealers in Canada are still on allocation for LBM products, especially engineered wood, owing to supply chain problems caused by the pandemic. although price inflation remains an issue.

“When roofing, drywall, and insulation vendors raise prices, they usually stick,” observes Lemieux.

He’s exaggerating only slightly when he quips that “all I do all day is change prices.”

He’s also being cautious about how much he buys after dealers got “stung” last year when lumber prices plummeted. Lemieux thinks some dealers have fallen too comfortably into the inflation cycle “and are standing in line to raise prices.” Econo isn’t opposed to passing vendors’ price hikes along to customers, but as a last resort when those increases go haywire as has been the case for OSB. Econo is a TIMBER MART dealer, and that relationship provides some cachet with longstanding vendors. But order fulfillment can be a hassle, especially for harder-to-get items like paint, caulking, spray foams, and hand tools. “I’m in vendors’ faces, because the squeaky wheel gets the order,” says Lemieux. Dealers need to make noise, he explains, because vendors are “overwhelmed” with purchase orders they can’t fill, and often don’t have good methods for tracking back orders. If Lemieux hadn’t

Hardlines Home Improvement Quarterly

THIRD QUARTER / 2022

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PRO CORNER

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Turkstra Lumber’s president Jon Wagner told HHIQ that it’s inevitable that supplychain delays would temper what had been booming residential construction. badgered some vendors, he never would have known they weren’t filling back orders unless dealers reordered.

Shortages have led Econo Lumber to offer alternate products and brands. Customers don’t like substitutes, Lemieux admits, “but are okay as long as it’s an equal product.”

For example, Econo carries two paint lines, and the one that’s been shipping more regularly lately is promoted.

MORE WAREHOUSING IS BECOMING A NECESSITY

Mission, B.C.-based Fraser Valley Building Supplies, which operates two hardware stores and four pro-oriented yards, offers 50,000 SKUs. Prices have been rising faster and more constantly (monthly, for some hardlines) than this dealer can make changes.

“On every P.O., our margins erode,” states Ray Cyr, Fraser Valley’s president and CEO, whom HHIQ interviewed with Peter Gilson, the company’s director of supply chain.

Fraser Valley is focused on maintaining what Cyr calls “delivered margins.” That means paying closer attention to controlling

supply-chain team around what parameters of vendor increases are acceptable before prices need to be raised at retail.

So far, Fraser Valley has been able to pass along price increases to customers, even as Gilson admits this requires “a delicate balance” that doesn’t cause customers to shop elsewhere.

This strategy is complicated by the fact that Fraser Valley, as a hedge against product shortages and longer lead times, has been ordering more product more often.

“

The light at the end of this tunnel is a slowdown in the building market to more reasonable levels of demand.

“soft” expenses like rent (leases on three of the company’s properties are up for renewal next year, and Cyr estimates that Fraser Valley might need to increase its margins by three-quarters of a percentage point to cover the extra cost). The company has also created a set of rules for its 25-person

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”

Gilson and Cyr say that, on a dollar basis, the company is carrying 15-20 percent more inventory than during “normal” times.

While it’s purchasing lumber as needed for shorter time periods, mostly from local suppliers, its stores are carrying three times as much hardlines inventory.

Hardlines Home Improvement Quarterly

With just-in-time delivery sputtering, Gilson advocates for a shift in how the supply chain functions, with a greater emphasis on warehousing and storage. That position isn’t surprising coming from a RONAaffiliated dealer with wide-ranging distribution support. But Gilson contends that more industry-wide warehousing would eventually relieve the pressure on manufacturers to ramp up every time demand spurts.

CONVEYING INFO TO CUSTOMERS SOONER

In March, housing starts in Ontario, at 6,214 units, were off 28 percent from the same month in 2021, according to the Canadian Mortgage and Housing Corporation. The province’s seasonally adjusted annual rate that month was down 16 percent to 83,602 units.

These numbers didn’t surprise Jon Wagner, president of Turkstra Lumber, whose 11 locations in Ontario serve 4,300 active pro customers and get 75 percent of their sales from pros. Wagner posits that it was inevitable that supply-chain delays would temper what had been booming

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PRO CORNER

F LE Slegg Building Materials president Tim Urquhart says his company’s affiliation with Gypsum Management & Supply has partly eased his supply chain challenges.

residential construction and remodeling.

“The light at the end of this tunnel is a slowdown in the building market to more reasonable levels of demand.”

Current housing start levels, however, still exceed historical averages, which means Turkstra Lumber must deal with shortages in lumber, LVL, and certain other building products. That means doing a better job at forecasting, says Wagner, especially about products on allocation. “We are more focused on the details of our business then we ever have been.”

As an ILDC member, Turkstra “is in a little bit better shape on allocation” than some other dealers, says Wagner.

But Turkstra has also changed its pricing model so it can communicate changes to customers on a biweekly basis, followed up by monthly phone calls to its biggest contractors to update them on prices and supply. Internally, Turkstra is churning out more key reports about demand, which it corroborates by having its sales team visit customers’ jobsites to confirm permitting and starts.

Three of Turkstra’s larger yards, including its Stoney Creek, Ont., location that

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has a rail spur, serve as central distribution points for wood commodities. One of its larger yards also doubles as a distribution nexus for hardlines, whose fill rates, says Wagner, continue to be “sporadic,” especially on “A” items whose lead times can run as long as 12 weeks.

DECODING MESSAGES FROM THE FIELD

On Vancouver Island, Slegg Building Materials is celebrating its 75th anniversary this year. Its 12 locations serve between 7,000 and 8,000 active pro customers who

To ensure consistent distribution, Slegg— which receives all the products it sells by ferry or barge—operates, with Marpole Transport, a reload center for wood commodities that account for two-fifths of Slegg’s revenue. The retailer has increased its on-the-ground inventory to more than $51-million, from a pre-pandemic level of $35-million. (Urquhart says that Slegg’s yards are large enough to add to their capacity.) Slegg has consolidated its vendor base, and has sought out new suppliers.

And, in emergencies, the retailer’s 38 contract salespeople have been known to fill orders by purchasing products from competitors, including big boxes.

Slegg’s parent company is Gypsum Management & Supply (GMS), with 250 locations in North America. That affiliation, says Urquhart, has made life somewhat easier for purchasing drywall, insulation, steel, ceilings, and even hardlines through GMS’s Tool Source Warehouse.

But the availability of other products— LVL, I-joists, PVC plumbing, paint and stain—is still “tight.” So Slegg’s purchasing decisions rely more than ever on reconnaissance from its field staff.

Slegg Building Materials has increased its on-the-ground inventory substantially from its pre-pandemic levels. account for 85 percent of its annual sales.

So this retailer, says its president Tim Urquhart, feels an obligation to be in stock on building products those pros require to keep working. “Our contractors depend on us to be part of their solution,” he says.

Hardlines Home Improvement Quarterly

Urquhart is confident that Slegg has “a pretty good handle” on inventory needs for the jobs on its books. But he’s also wary that pros reflexively tend to build a sense of urgency into their forecasting because “they don’t want to get caught shorthanded.”

www.hardlines.ca

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Hardlines Home Improvement Quarterly

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Get a new perspective from industry leaders.

The new podcast series from Hardlines provides news, insights, and retail intelligence for success.

What’s in Store Dedicated to interviews with industry leaders from the retail, wholesale, and vendor sides of home improvement selling. Get insights into the trends and challenges confronting home improvement retail today.

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

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

The History of Home Improvement Get ready for some history lessons in our ongoing history of home improvement retailing. These blasts from the past draw from the notable and pivotal moments in the growth of hardware stores, lumber yards, big boxes, and home centres in Canada over the past 50 years. Learn about the people and events that have shaped this dynamic retail sector.

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F LE

BY GEOFF McLARNEY

ENTREPRENEURSHIP STARTS SMALL Grande Prairie Home Hardware Building Centre cares deeply about its community.

Which is why the store jumped at the opportunity to help with “Lemonade Day”

W

hen a local organization reached out to Grande Prairie Home Hardware Building Centre to purchase supplies for a youth project, dealerowner Kevin Gillman did them one better.

“Community Futures of Grande Prairie approached us and said they were trying to get kids to be young entrepreneurs by learning to run their own business by operating a lemonade stand.”

The “Lemonade Day” event has taken place in Northern Alberta since 2018.

Participating kids are given an entrepreneurial workbook and keep all the profits they earn from operating their stands.

The local organizers of the event pitched their budget to Gillman for the construction of the youngsters’ lemonade stands. “We just said, we’re going to donate,” Gillman said.

“We don’t want any money from you guys; it’s a good project and we want to help.’”

While the store only had the opportunity to participate in the program once before the pandemic hit, Gillman says he’s willing to do it again if it’s offered in future years.

It’s just one way the store has proven it’s there for the community it serves.

“We help all kinds of people that need help,” says Gillman. The store has supported the local minor soccer league since 2014, including holding an annual barbecue.

“We like to support the community because the community supports us.”

“

Some of the lemonade stands constructed for Lemonade Day, which teaches youngsters about business. of the hotels. We usually have about 150 contractors show up.

“We serve a hot breakfast and everybody gets a ticket when they come in and everyone gets a prize. They can win anything

We don’t want any money from you guys.

It’s a good project and we want to help.

One of the highlights of the year at the building centre is an annual breakfast for its pro customers. “We do that every December. We rent a big room from one

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”

from a $50 tape measure to a $500 pair of Oiler tickets.”

Gillman adds the breakfast is so popular that “often we’ll have contractors come in

Hardlines Home Improvement Quarterly

October or November and ask when the event is.”

The loyalty of that professional customer base, along with that of Grande Prairie’s staff, has helped the store weather the pandemic, even as projects dropped off in its early days when contractors were reluctant to enter homes. “We have a very solid base of core staff: one employee has been here for 50 years,” Gillman said. “In our contractor base, we have builders who have been here 20 years or longer. We support all the builders and they support us. It’s a win-win.” www.hardlines.ca

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