PART II: HOW THE HARDWARE INDUSTRY IS COPING WITH THE PANDEMIC
April 2020 Vol. 12, No. 3
THE INDUSTRY’S DIGITAL LEADER
SPECIAL REPORT: Rising Up to
Battle the COVID-19 Threat ALSO INSIDE: How Can Your Business Get Relief from the Coronavirus CARES Act? How to Retail During COVID-19
Being Independent Orgill provides solutions that drive profits and help us grow our business!
“Working with Orgill, we have the freedom to be Hooten’s Hardware, not a generic cookie-cutter store. We run the business the way we know it needs to be run.” Kirk Reams l Hooten’s Hardware, Texas l An Orgill customer since 2005
Why We Like Working With Orgill: • Flexible, comprehensive retail programs • Broad product selection • Impressive retail knowledge • Supportive of our independence
Responding to COVID-19 For current coronavirus information and support, visit orgill.com/COVID.
Click the video link to find out how Orgill’s offerings help Hooten’s be successful!
1-800-347-2860 ext. 5373 • information@orgill.com • www.orgill.com
CONTENTS April 2020 ■ Vol. 12, No. 3
22
SPECIAL REPORT PART II: RISING UP TO BATTLE THE COVID-19 THREAT
HARDLINES DIGEST: HOW HARDWARE RETAILERS ARE ADJUSTING IN TIME OF CRISIS
Editor’s Note: Chris Jensen Trend Watch: Craig Cope Amazing But True Hardware Stories Shop Talk: Hardware Products Review Special Report Part II: Rising Up to Battle the COVID-19 Threat In Their Own Words: Century Club Retailers Share How They Are Coping Hardlines Digest: How Hardware Retailers Are Adjusting in Time of Crisis How to Retail During COVID-19: Bob Phibbs How Can Your Business Get Relief from the Coronavirus CARES Act? Gary Pittsford Category Report: Outdoor Living/Outdoor Power Equipment/Grills In the News Upcoming Events Retail Ideas Behind the Numbers The Hardware Connection app is available for iPhone, iPad, Android and Amazon. Download here.
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THE HARDWARE Connection ■ April 2020 ■ 3
DO IT BEST HELPS WOOD SHED LUMBER & HARDWARE SUPPLY LOOK INWARD—AND GROW OUTWARD. Do it Best member-owners Sharona and Cecil Eiserer always thought they were solely a contractor-driven business. But through powerful research and analysis programs from Do it Best, they discovered a steady stream of do-it-yourselfers were already coming into their store. The Eiserers jumped on the opportunity to serve this untapped market. With help from our Signature Store Design TM
and Retail Performance teams, they redesigned a larger store, adding The Color Bar and introducing popular TM
housewares brands to deliver a fresh shopping experience for all their customers. Sharona and Cecil’s investment has paid off. Sales have more than doubled, and Wood Shed Lumber & Hardware Supply is now the community’s go-to DIY store while still meeting all their pros’ needs.
“We wanted to find new ways to serve our customers—it helped to learn who our customers actually are.” Sharona Eiserer Wood Shed Lumber & Hardware Supply
» How well do you know your customer base? Do it Best can help identify your strongest customers and show you how to serve them best. Call us today at 888-DO-IT-BEST (888-364-8237) or visit doitbestonline.com.
ADVERTISERS’ INDEX A.O. Smith/Reliance Water Heaters | www.RelianceWaterHeaters.com . . . . 19, 34 Blue Rhino | www.bluerhino.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18, 44 Do it Best Corp. | www.doitbestonline.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4, 5 ECi Software Solutions | www.ecisolutions.com . . . . . . . . . . . . . . . . . . . . . . 11, 26 Epicor Corp. | www.epicor.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8, 17, 39 Ganymede Technologies Corp./J3 Point-of-Sale | www.j3pos.biz . . . . . 33, 45 Hardlines Digest | www.hardlinesdigest.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50 House-Hasson Hardware | www.househasson.com . . . . . . . . . . . . . . . . . . . 20, 46 Jack Link’s Beef Jerky | www.jacklinks.com . . . . . . . . . . . . . . . . . . . . . . . . . 32, 40 Kaba Ilco | www.ilco.us . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21, 30 Orgill Inc. | www.orgill.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2, 15 RapidFix / LHB Industries | www.rapidfix.com . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 STIHL USA | www.stihlusa.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 SureCan Inc. | www.surecanusa.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 WD-40 Company | www.wd40.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9, 24
Connection
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91900 Overseas Highway | Tavernier, FL 33070 | www.TheHardwareConnection.com Publisher/Principal: Craig Cope craig@thehardwareconnection.com 804-690-0666 Editor/Founder/Principal: Chris Jensen chris@thehardwareconnection.com 317-514-8864 Founder/Principal: Tom Chasteen tom@thehardwareconnection.com 305-852-6126 Marketing & Creative Director/Principal: Dan Akers dan@thehardwareconnection.com 317-797-6609
6 ■ THE HARDWARE Connection ■ April 2020
Senior Business Advisor: John Hammond jhammond@thehardwareconnection.com National Account Manager: Dan Beck dbeck@thehardwareconnection.com 518-852-9624 Contributing Writers: John Fix III, Doug Donaldson, Gary Pittsford The Hardware Connection is published eight times a year by The Hardware Connection, Inc. All editorial contents copyrighted 2020 by the publisher. No editorial may be reproduced without the prior permission of the publisher.
www.TheHardwareConnection.com
By Chris Jensen
EDITOR’S NOTE
We Are An Industry of Survivors
T
he coronavirus (COVID-19) pandemic is an equal opportunity threat, as every retailer has been and will continue to be greatly affected by the fear and spread of this deadly virus. It touches every employee, every customer, every vendor, every wholesaler. The situation is scary from a personal health standpoint and from a business survival standpoint, especially since the conditions on the ground seem to change on a daily basis. The new normal is that there is no normal. For those retailers who previously had trouble leaving behind the troubles and worries of their business after a day’s work, now they have the constant worry of the health and financial well-being of their employees and customers. It’s frightening on many levels. We are an industry of survivors, fiercely independent businesses that know how to fight for every last dollar. Able to tune out decades of chatter that first Sears, then the big boxes and now Amazon were going to put all independent home improvement stores out of business. This is a different fight against an unseen threat. Business survival takes a backseat to personal survival. Retailers are making decisions on social distancing, www.TheHardwareConnection.com
reducing hours, sending staff home and even blocking customers from entering their stores, because these are the right things to do from a moral standpoint. There will be a time down the road to regain equilibrium with sales and profits. How does a store thrive for 135 years? The coronavirus spread is just the latest in a long list of challenges that threatened Jack’s Country Store, since the Do it Best retailer opened in Ocean Park, Wash., in 1885. But fires, wars, recessions and a Depression were all beat back by ingenuity, agility and sheer determination. The industry is filled with similar stories of perseverance. At The Hardware Connection, our issues cover your issues, which is why we are established as the industry’s digital leader. Our March issue contained the industry’s first Special Report on what was then called the coronavirus outbreak. We added an extra newsletter edition that came out April 1 and contained Part I of our comprehensive Special Report on how the hardware industry is THE HARDWARE Connection ■ April 2020 ■ 7
Contact retail@epicor.com | 888.463.4700
coping with the COVID-19 pandemic. If you missed that, click here. Part II of our Special Report starts on page 22 of this issue and it encompasses almost the entire issue. In addition to my cover story, “Rising Up to Battle the COVID-19 Threat,” you will find Century Club retailers share “In Their Own Words” how they are coping. Another Century Club retailer, John Fix III of Cornell’s True Value Hardware, offers a recap of the COVID-19 discussion on Hardlines Digest, while Bob Phibbs the Retail Doctor examines “How to Retail During COVID-19.” Finally, Gary Pittsford provides an in-depth look at how your business can get coronavirus relief from the CARES Act. We will continue to report thoroughly on the COVID-19 pandemic for as long as it takes, offering the type of insights our readers expect from us. We will get through this together, because the alternatives are not appealing and this industry is filled with entrepreneurs who are resilient, determined and proud of their commitment to community service. It is gratifying to hear so many heartwarming stories of retailers who are finding new ways to serve their communities in amazing ways. Like Sam Ransdell of Burney True Value in Seven Lakes, N.C., who has been running a 3D printer 24 hours a day to make N95style masks—each one takes 10 hours to replicate. Click here to read more on this mission, and share your inspiring stories with me at chris@thehardwareconnection.com. Stay safe and healthy! n www.TheHardwareConnection.com
TREND WATCH
By Craig Cope
What Will the New Normal Look Like for the Hardware Channel?
O
n Tuesday, April 7, New York Governor Andrew Cuomo made a grim announcement. The number of people in New York City who died as a result of COVID-19 had surpassed those who died in the terrorist attack of September 11, 2001. As a former lower Manhattan resident who lived four blocks from the World Trade Center and lived through that troubling time in the city, it brought back a flood of memories. Many of those memories are similar to those that crop up with COVID-19—fear, anxiety, sorrow over loss of life, but also positive thoughts of heroism, generosity and unity. A few days after 9/11, my employer at the time had determined that more than 30 percent of its employees were traveling on that fateful day and immediately issued new business travel policies. It raised excellent questions about business and travel. Was the travel a necessity for day-to-day operations? Are there better ways to facilitate business? How can technology play a role to not only reduce operating costs but also keep employees safe? Fast forward to today with nearly all states on lockdown, schools closed most
10 ■ THE HARDWARE Connection ■ April 2020
likely until next year, businesses forced to furlough employees or completely close, and many of those questions are still appropriate now. Hardware stores have been deemed essential businesses by many agencies and store owners are faced with new challenges no one could have predicted. How does this “new normal” impact my daily operations? What precautions do I need to take to keep my employees and customers safe? How can I not only make it through these difficult times, but how can I thrive? The proverb “necessity is the mother of invention” could not be any more true than today. During times of great crisis, almost every aspect of business and life is stress tested. The results normally lead to significant changes and many times improvements. Shortly after 9/11 the federal government created the Department of Homeland Security, implemented significant airport security protocols and provided new communications systems for first responders, just to name a few. All of which are still in use today. The hardware channel is no exception. As the virus started spreading and “social distancing” became www.TheHardwareConnection.com
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TREND WATCH commonplace, the wholesale community had to immediately evaluate their trade shows. Ace Hardware canceled its traditional spring convention and launched a digital convention. Other companies have postponed their shows to a later date in hopes the virus will be contained so it’s safe to gather again. The digital or virtual trade show is not new and is utilized in other channels as a replacement for traditional shows or as enhancements to a trade show calendar. Only time will tell if this change will become a common occurrence or just an anomaly. Hardware stores have also been forced to take immediate action. Employee and customer safety were at the top of the list with retailers installing plexiglass shields at the point of purchase, reducing operating hours and alternating shifts to help mitigate an outbreak. Some form of PPE (personal protective equipment) has also become standard attire for many of the store employees. Digital communication with customers regarding supplies of much-needed materials has become key. Those stores that invested time in developing a social media audience or other digital marketing platforms were rewarded. On the other hand, those businesses that have not invested the time or resources in social media were left with fewer options to promote important information. Stores have also begun to implement alternative shopping methods for their 12 ■ THE HARDWARE Connection ■ April 2020
customers. Some elected to become full e-commerce capable offering delivery or buy online, pick up in store (BOPIS) options. Payment options have also become a point of concern. The number of customers paying with cash significantly decreased and were replaced with various forms of touchless payment options. Once life returns to “normal” the hardware channel will have an excellent opportunity to evaluate all aspects of its business, supply chains and processes. How could we have been better prepared to face a crisis? Is the pandemic the catalyst to push the industry further into e-commerce and digital marketing practices? Only time will tell. Until then, I am left thinking about one of my favorite quotes by Louis Pasteur, “Chance favors the prepared mind.” The COVID-19 impact, response and ultimate recovery will be studied and debated for decades to come. It will serve as a blueprint on how to handle future crises. It will also serve to strengthen our industry and nation. Remember, this too shall pass. Before I wrap up this column, I wanted to take a minute and recognize all the hard- working men and women who are now homeschooling or in some cases “store” schooling their children while schools remain closed. Keep up the tremendous work and just think, years from now we will forget all the difficulty and only remember the precious additional time we got to spend with our children. ■ www.TheHardwareConnection.com
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HARDWARE HUMOR
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E R A W D R A H
S E I R O T S
T
his guy buys a g rill from us and b rings it back, raising ca in about how the grill wasn’t working. W e ta ke a lo ok, and all the wiring had b een chewed thro u g h. Turns out, his girlfriend ’s dog went thro u g h it like a big, old chew bo ne. Trenton Maple s Ace Hardware | Amarillo, Tex.
an ne time, we had mer get unfamiliar custo of our real irate at one r the situation e ft A . s e e y lo p em t e found out tha w , n w o d d e lm ca ular customers g re r u o f o e m so of each aisle, d n e e th t a re e w and protect the in p te s to y d a re other customer t a th if e e y lo p em gressive. It’s g a re o m y n a t go r customers nice to know ou . have our backs Jeff Koenen re e Value Hardwa u Tr ’s n a m e in e R . Burlington, Wis
O
egion that r e th m o es artist fr e have an old lawnmower blad ur etal-work m picks up o a ’s e H . e area . if he’s in th sculptures l ta e m e g mu creates lar in our com e r a s artist and e r tu his homeis sculp h in f e o r l o a r m e v h nc Se re are a bu d throughout weste th d n a y n nit g, Minn., a to look at his sculpin in V f o n e tow fun uts from th nesota. It’s -o in h M c l n a u tr p n ce -tale see the tell d n a s e r tu an blades. m ts f a r C d MTD an ears ago, I had two different people s Kelly Vos pply ask how long the telephone cords are. Su Farm City . n I tell them 25 feet, and they both ask if ge, Min Breckenrid osted on yp that’s long enough to reach their bedroom. *Originall t s e Dig Maurice White Hardlines White Do it Best Hardware | McCormick, S.C. *Originally posted on Hardlines Digest
W
Y
14 ■ THE HARDWARE Connection ■ April 2020
www.TheHardwareConnection.com
The Best in the Business Orgill Helped Us Customize Our Offerings Without Sacrificing Our Independence
“Orgill is simply the best hardware distributor for our company. Orgill offers the right retail solutions to help us build our brand and grow our business.” Corby Biddle l Higginbotham Brothers l 39 locations in Texas
Why We Like Working With Orgill: • A tailored product selection • Personalized market strategies • The ability to maintain our independence
Responding to COVID-19 For current coronavirus information and support, visit orgill.ca/COVID.
Click the video link to find out how Orgill’s offerings help Higginbotham be successful!
1-800-347-2860 ext. 5373 • information@orgill.com • www.orgill.com
k l a T Shop H
S REV T C U D O R P ARDWARE
By Craig Cope
IEW
PRODUCT #1: CRESCENT 2-IN-1 EXTENDABLE LAYOUT TOOL APEX TOOL GROUP Crescent, a division of Apex Tool Group, recently launched an innovative take on the square with the launch of the EX6 2-in-1 Extendable Layout Tool. The EX6 is designed to replace the 7” and 12” square often carried by most tradesmen with one 7” square featuring a 6” foldout extension, creating a 12” square. The EX6 is constructed of solid aluminum, reducing weight and providing protection against the elements. The laser-etched markings increase visibility and resist the inevitable wear and tear. The aluminum design also offers one additional feature: limiting heat retention for roofers and other hot-climate workers. The foldout extension is controlled by a simple quick-access thumb lock. The lock is essential to keeping the extension securely closed during use and for easy storage. The hinge is constructed of the same high-grade durable aluminum, ensuring longevity. The EX6 also comes with a limited lifetime warranty for added peace of mind. 16 ■ THE HARDWARE Connection ■ April 2020
Click here to see the EX6 in action Our testers consisted of a commercial roofer and a few active woodworkers. The testers immediately questioned if the hinge would impact the performance of the EX6. Those concerns were quickly put to rest after feeling the high-quality construction of the square and seeing no give or flex when opening or closing the foldout. Each tester also commented on the weight saved by the aluminum construction. The collapsable design allows for storage in traditional work pouches, eliminating time searching for the 12” square. The Cresent EX6 is an excellent addition to any DIYer or tradesman’s toolbox and an outstanding option for customers looking to simplify jobs and tools. www.TheHardwareConnection.com
PRODUCT #2: MAGNETIC LED LIGHT LUMAX The Lumax Magnetic LED light is one of the items where we say “why didn’t I think of that?” Anyone who has turned a wrench fixing a car, motorcycle, boat or tractor, knows getting light into tight spaces is often difficult if not impossible without a third hand. Many of us have been forced to utilize the flashlightin-the-mouth trick, which is not a great option. The LED light attaches to any metal surface—including most hand tools— using two powerful magnets, and the extremely bright light illuminates even the darkest of spaces. The light is powered by three L736F replaceable button-cell batteries and weighs just 0.25 oz. Click here to watch a video highlight of its many uses. www.TheHardwareConnection.com
• Deliver exceptional customer experience • Grow margins and profits • Optimize inventory • Cut costs by taking advantage of online, mobile, and wireless technologies
k l a T p o Sh E PROD HARDWAR
UCTS REV
IEW
We provided a professional mechanic, a maintenance worker and an amateur shadetree tinkerer with samples for their review. At first glance, most questioned the purpose or usability. However, after one use all shared the same opinion, raving about the functionality, design and virtually unlimited uses. As one tester put it, “This is a tool you did not know you needed until you tried it.” Considering the compact size of the LED light, merchandising the product at retail could be a challenge. However, Lumax has you covered with a highvisibility counter-top display that calls out the benefits of the product. The Lumax Magnetic LED Light is not only an excellent addition to any toolbox, but a must-have product when working in confined spaces with limited visibility.
PRODUCT #3: WORK SHARP KNIFE & TOOL SHARPENER DAREX Work Sharp, a Darex brand, teamed up with Ken Onion to design the most advanced at-home knife and tool www.TheHardwareConnection.com
sharpening system that anyone can use. For those not familiar with the name Ken Onion, he is a custom knife builder and the youngest inductee to the Blade Magazine Hall of Fame. The Ken Onion Edition Knife & Tool Sharpener is designed to sharpen all knives including, pocket and hunting knives, serrated blades, kitchen knives, scissors and high-end steel tools. The sharpener uses adjustable sharpening guides, a variable speed motor and flexible abrasive belts to deliver professional, razor-sharp results at home. The sharpening guides are also adjustable from 15º to 30º to sharpen at any desired angle.
Initially, the Knife & Tool sharpener appears to be complex, but it is obviously made of high-quality materials. Addressing ease of use, Work Sharp provides an outstanding quick-start guide and operators guide with simple-to-follow directions and illustrations—click here to view. Click here to watch a complete
Only in your neighborhood. With a range of gas, electric and hybrid heat pump technology, you can feel confident that Reliance’s full line of water heaters will help you meet the needs of any customer. And they’re only available at local hardware stores, making you the best stop in the neighborhood for hot water.
Reliance® Water Heaters are proudly sold at
k l a T p o h S E PROD HARDWAR
UCTS REV
IEW
demo video featuring Ken Onion as he explains the important features. Living in South Florida provides us access to top outdoorsmen, where a sharp knife is not just nice to have, but a necessity. Fisherman, hunters or outdoor enthusiasts spend hundreds of dollars on high-quality blades and want to maintain their investment. All of the testers raved about the speed of sharpening, flexibility to sharpen numerous blade styles and ease of use. After a few uses, one of our testers decided to sharpen his wife’s prized professional chef
knives. He joked that she was so impressed it has become part of his “honey-do” list. The Work Sharp Knife & Tool Sharpener is an outstanding addition to any sporting goods department. The packaging is outstanding and clearly describes the benefits, which makes merchandising a breeze. ■
SUMMER SPECTACULAR
Attend our Virtual Market June 25-26, 2020
Hardware Specials Dealer Market
Due to the recent developments of the COVID-19 virus we have de decided to change our June Dealer Market, in Sevierville, to a Virtual Electronic Ordering only Market. We are disappointed that we are not going to have a physical Market as planned, but will have the same great deals and pricing as we have always had and more. All the Bonus Buy Assortments and items will be available Thursday and Friday. More great spiffs will be available at this Market from our Vendors. Go to etoolbox.net to register for our Virtual Market to participate. Chat rooms will be available for you to talk to our Buyers and Vendors from 7:30 a.m.-5:00 p.m. on both days. All House-Hasson staff will be available to help you with all of your needs.
Top Reasons to Log-in to Our Virtual Dealer Market
• • • •
Unmatched Super Saver Deals Hot Deals on Bonus Buy Assortments and Items Unbeatable Prices Industry Leading Vendor Participation
• • • • •
Easy Payment Terms Exciting New Items Electronic Ordering State-of-the-art Marketing Program Advertising & Merchandising Solutions
Register for our Virtual Market on etoolbox.net
For more information about our Virtual Market, contact us today!
1-800-333-0520 ext. 212 • www.househasson.com • House-Hasson Hardware Co., Knoxville, TN 37914 • service@househasson.com
™
Ilco Look-Alike® Remotes offer
an economical alternative to pricy OEM product while maintaining the OEM look. All Ilco remotes are engineered and tested extensively to bring you the same OEM quality that you have grown to expect and is brand new, unlike the refurbished product from other sources. The current Ilco Look-Alike offering covers most major vehicle manufacturers and will continue to grow over the coming months and years as new Ilco Look-Alike remotes are introduced.
scraatch
› To T stay up to date on all the Look-Alikes coming from ILCO and more info on the Look-Alikes featured in this brochure just scan the QR code below.
www.ilcolookalike.com Kaba Ilco Corp. • 1.800.334.1381 • www.ilco.us SCAN ME
SpeCial RepoRT: CoVid-19 paRT ii
By Chris Jensen
SpeCial RepoRT paRT ii:Rising Up
to Battle the COVID-19 Threat
M
ost home improvement retailers have been in the business for a number of years and they have seen just about everything there is to see in the industry. But no one has experienced a global pandemic before, an ever-evolving crisis that has impacted every aspect of business and personal life regardless of where you live. Century Club retailers—those in business for more than 100 years— like Mitchell Cohen of Cohen & Co. Hardware in Philadelphia and Rob Bantly of Bantly Hardware in Johnstown, Pa., say they have
22 ■ THe HARDWARe Connection ■ April 2020
Jason and Melanie Haley of Ace Hardware of Clarkston (Mich.) are going above and beyond to serve their community with essential supplies.
not experienced anything like the COVID-19 pandemic. Bantly saw his family’s entire store wiped out by a major flood in 1977, so it takes a lot to rattle him. “I was very concerned about my employees’ well-being and tried to limit sales to essential ones. We tried to keep social distance, but our customers seemingly didn’t have a clue,” he says. Bantly, who is 73, has been staying home for three weeks while www.TheHardwareConnection.com
Ace Hardware of Clarkston is bringing new meaning to its “Neighbors Serving Neighbors” slogan.
keeping his fingers crossed that his employees stay safe and healthy. The novel coronavirus (COVID-19) is a respiratory disease caused by a new strain of coronavirus that can easily spread from person to person. Older adults and those with chronic health conditions are at high risk, and there is an increased risk of rapid spread of COVID-19 among persons in close proximity to one another. Currently, there is no approved vaccine or antiviral treatment for this disease. The coronavirus pandemic has surpassed 1.8 million cases worldwide and spread to 210 countries and territories, with more than 115,000 deaths. In the United States, there were over 560,000 confirmed cases and 22,115 deaths as of April 13. Read on for Part II of our special report on how hardware retailers are rising up to accept the challenge of battling the COVID-19 threat while discovering new ways to serve their communities. www.TheHardwareConnection.com
Upper: Ace Hardware of Clarkston posts a “Best Time to Shop” chart on Facebook and Instagram, which lets customers know the busiest and slowest times so they can plan their shopping to better spread out visits. The chart shown here is based on the week of March 29- April 4. Lower: Adam Taylor has seen business pick up significantly at Trust Hardware in Indianapolis because he stays open 24 hours a day.
THe HARDWARe Connection ■ April 2020 ■ 23
SpeCial RepoRT: CoVid-19 paRT ii neiGhBoRS SeRVinG neiGhBoRS Hardware retailers are known for their can-do spirit and commitment to serve their communities, and that has been evident throughout the country as an outbreak evolved into a pandemic. “Yes, these are indeed challenging times, but we have taken an approach of trying to remind our community of the good and the hope. We have had unbelievable coming together in this community and despite uncertainty we have incredible hope,” says Jason Haley, who operates Ace Hardware of Clarkston (Mich.) with his wife, Melanie. It was Melanie’s idea to come up with the “Neighbors Serving Neighbors” slogan that has resonated so well with their customer base since the store opened four years ago. That slogan takes on deeper meaning these days. “We both have a spirit for helping,” says Melanie. Jason posts a daily video message on the store’s Facebook page to keep customers updated on the latest developments. For example, his message on Good Friday noted that big boxes in Michigan are no longer allowed to sell paint and garden center items, but their store is exempt from that restriction because it’s under 50,000 square feet. Click here to view that video. While most hardware stores are reducing their hours, the Haleys are www.TheHardwareConnection.com
CoVid-19 ReSouRCeS To learn more about the coronavirus (COVID-19) including symptoms and how to protect yourself, go to the website for the Centers for Disease Control and Prevention, www.cdc.gov or the World Health Organization, www.who.int. To learn about all SBA loan resources related to COVID-19, click here. For more information on the Paycheck Protection Program, click here. For a Small Business Guide to COVID-19 Emergency Loans from the U.S. Chamber of Commerce, click here. To download the Paycheck Protection Program loan application, click here. To see a comparison of the Paycheck Protection Program to the Economic Injury Disaster Loans, click here. For more information on the employer paid leave requirements for the Families First Coronavirus Response Act, click here. For more information on the $2 trillion stimulus package, click here. For more information on expanded federal unemployment benefits, click here.
THe HARDWARe Connection ■ April 2020 ■ 25
Keeping You Connected Now, more than ever, ECI remains committed to helping our customers adapt and thrive. Seamlessly integrating every aspect of your operation, our industry-specific business management software helps run your day-to-day more efficiently, freeing you up to focus on what matters most. It’s what we do so you can take care of what you do. It’s how business gets done.
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SpeCial RepoRT: CoVid-19 paRT ii inCReaSed ReSTRiCTionS When states started issuing stayat-home orders, hardware and home improvement retailers were initially relieved to learn they were considered “essential businesses” that were allowed to stay open. While hardware stores are still considered essential, the conditions under which they can operate have Dock Hinkle (center) of Hardware That’s Us in Craigsville, W. Va., has temporarily closed changed greatly. Miami-Dade and Fort his store for the safety of his staff, but he Lauderdale in Florida have joined Los still fulfills individual requests by phone. Angeles in requiring people to wear taking the opposite approach. They are face coverings while out in public and inside essential businesses. keeping their store open longer, from This comes after the Centers for 7:30 a.m. to 7 p.m., so customers can Disease Control and Prevention (CDC) spread out their shopping, practice issued new guidance encouraging social distancing and keep the store people to cover their face while in pubfrom getting busy at any one time. To further that goal, the Haleys post lic, particularly in areas that have seen a surge in cases. On April 2, residents a “Best Time to Shop” chart, which is a new way for customers to determine of New York City—which has by far the most cases—were urged to wear the busiest and slowest times in the homemade masks in public. store (see chart on page 23). In Kentucky, the governor ordered “Every week we will be looking at shopping to be done by one person sales by store for every hour, projectper household if visiting an essential ing the next week’s customer counts business such as a hardware or grointo two-hour segments. We’ll share cery store. this information on Instagram and In Michigan, the “Stay Home, Stay Facebook to help customers with their Safe” order announced April 9 (now planning,” says Jason, who adds that extended to May 1) by Governor 7:30-8:30 a.m. on Monday, Wednesday and Friday are reserved for seniors, first Whitmer placed major new restricresponders, expectant moms and those tions on hardware and home improvement stores. All stores that continue with compromised immune systems. www.TheHardwareConnection.com
THe HARDWARe Connection ■ April 2020 ■ 27
SpeCial RepoRT: CoVid-19 paRT ii
Northwoods Hardware, Home & Garden in Glen Arbor, Mich., has gone to pre-orders and curbside service.
in-person sales must establish lines to regulate entry by customers and utilize curbside pickup where possible. Stores in Michigan under 50,000 square feet must limit the number of people inside the store (including employees) to 25 percent of their occupancy limit. Stores over 50,000 square feet must limit the number of customers in the store at one time to four people per 1,000 square feet of customer floor space; close areas of the store that sell flooring, furniture, paint and garden center items; and create at least two hours per week of shopping time dedicated for certain vulnerable populations. Alarmed by the large number of groups of four or five people coming into his store, Dave Barone of Barone www.TheHardwareConnection.com
Hardware & Auto in Bronson, Mich., had already restricted shopping to individuals only as of March 30. In some counties in Michigan, essential businesses are required to develop and implement a daily health screening protocol of all staff before opening. For LBM stores, restrictions on construction and homebuilding are a nightmare scenario. In late March, New York shut down all nonessential construction activity until at least April 29. Construction work has also been halted in Pennsylvania, Boston, the Bay Area of California and some municipalities in Miami-Dade. Builders FirstSource, which operates 400 building supply locations in 40 states, has taken a number of measures to weather this crisis. The company is reducing senior management compensation, delaying capital expenditures, freezing hiring and drawing down $150 million of cash under a revolving credit facility. The company’s CEO, Chad Crow, stated, “We are well prepared to navigate through this rapidly evolving pandemic. As an essential business, we are proud to continue supporting our customers with a paramount focus on health and safety. We will continue to take prudent and proactive actions to safely operate our business and maintain a strong liquidity position during this uncertain period while positioning THe HARDWARe Connection ■ April 2020 ■ 29
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SoCial diSTanCinG Retailers have adopted curbside pickup and free delivery, installed shields at the checkout and limited the number of people shopping at one time. Many have stopped accepting screens and mowers for repair and now spray keys with Lysol before cutting a duplicate. They have put up signs, placed tape on the floor and posted on social media to stress the importance of social distancing. However, quite a few retailers are furious that their measures to keep staff safe have been torpedoed by customers who don’t seem to understand what a stay-at-home order is supposed to mean—only leave home for something absolutely essential. Retailers observe customers wandering aimlessly around the store, touching displays and browsing for nonessential items, while placing their staff at unnecessary risk. Fischer Hardware in Beaver, Pa., which has been around since 1929, temporarily closed its store on March 19 for the safety of employees. The doors remain locked, although customers can call the store phone number and get assisted on an individual basis. “We will be open as long as we can be. One of my biggest fears is an employee gets sick,” says Bill Pastermack of Ace Hardware Titusville (Fla.). www.TheHardwareConnection.com
Robin Smith of Petersburg Do it Best Hardware in Petersburg, Ind., said they split their staff into two teams. “One team works Monday, Tuesday and Wednesday. The second team works Thursday, Friday and Saturday. Because of the essential nature of our business, our employees committed to each team staying separate from each other, as well as staying home when not working. Our team has come together even more than usual to support our community,” she said. Century Club retailer Wankel’s Hardware, which has been serving the Upper East Side of New York City since 1896, stopped taking returns on March 13. On March 17, they suspended all cash transactions and went to pickup only of phone, text and email orders. In a city that has seen one-fifth of the total coronavirus cases and nearly one-third of the deaths, conducting business of any sort must be frightening. For now, Wankel’s is temporarily closed.
SToReS CloSinG There are some retailers that are thriving during the pandemic and cannot keep up with the steady stream of customers pouring into their stores, especially with staffing issues becoming more prevalent. Some retailers have scaled back operations and do a trickle of curbside business. Impulse sales have obviously dried up for everyone. Then there are the retailers THe HARDWARe Connection ■ April 2020 ■ 31
SpeCial RepoRT: CoVid-19 paRT ii who were struggling before the pandemic and now find their business in a fight for survival. The COVID-19 pandemic has accelerated the decision-making process for some businesses to close. Chenevert True Value Hardware in Baton Rouge, La., closed on March 21, the day Governor Edwards issued a stay-at-home order. Owner Ron Chenevert was planning to retire this year anyway, he told a local news reporter, and the pandemic caused him to act earlier than planned. Century Club retailer B.L. Ogilvie & Sons in Weston, Mass., permanently closed its store and lumberyard on April 3 after operating for 101 years. In a letter to customers, fourth-generation Southern Pines Ace in North Carolina makes sure the store stays sanitized for the health and safety of Half Page Hardware Trade Ad Artwork R2.pdf 1 3/30/20 4:07 PM customers and staff.
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President Kevin Whittemore, stated, “A lot has happened since the end of WWI when B.L. started this business by delivering coal with a horse and cart to heat the homes in our community. Since that time, Ogilvie’s has been fortunate to be able to adapt to the needs of our community over the many years of challenges and change…But as our relevance appears to be dwindling in this new world of retail and with the added financial impact of the COVID-19 pandemic, we again find ourselves in a position to pivot.” Whittemore noted that before the pandemic hit the business had been planning a celebratory farewell closeout sale, but the community’s need for social distancing now has denied them that chance to celebrate together. “It has been an honor to supply and serve this community as my great-grandfather had set out to do those 101 years ago,” he said in the letter’s closing.
loan pRoGRaMS The federal government has introduced several loan programs designed to help small businesses such as the Paycheck Protection Program and Economic Injury Disaster Loans. Retailers who have attempted to apply for those programs have largely been frustrated so far, but there was an expectation that lending activity was beginning to ramp up as the programs’ kinks were getting worked out. (See box on page 25) www.TheHardwareConnection.com
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SpeCial RepoRT: CoVid-19 paRT ii Staffing issues have started to crop up for retailers, as employees stay home due to symptoms, an abundance of caution or the reality of a business slowdown. Some retailers are concerned that they will continue to lose staff who are enticed by the generous unemployment benefits now offered. When things return to normal later on, the battle to find qualified help will be even more difficult. American workers can now qualify for 12 weeks of family leave and an additional two weeks of paid sick leave during the coronavirus pandemic, thanks to a new federal law signed by President Trump on March 18.
The “Families First Coronavirus Response Act” took effect April 2 and runs through December 31, 2020. It establishes a federal emergency paid leave benefits program to provide payments to employees taking unpaid leave due to the coronavirus outbreak. It requires employers with fewer than 500 workers to offer new and expanded benefits. The bill includes the following provisions: • Paid Sick Leave: Employers with over 50 employees and under 500 employees are required to grant two weeks (80 hours) of paid sick leave for workers dealing with the coronavirus.
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Most manufacturers have as many people working from home as they can, and some have had to reduce or temporarily suspend manufacturing activity. “Like everyone else, we’ve had supply chain disruption caused by vendors temporarily suspending operations. It’s been a relatively smaller impact,” says Randy Rusk, communications director for Do it Best Corp. “Most of our vendors are either fully operational or working in Retailers such as Lumber House True some form of reduced capacity. For Value in Abilene, Kan., use social media to let customers know when in-demand those that have temporarily closed, it’s items are in stock. primarily been impacted by staffing issues and their ability to ship with fewer • Requires employers to grant two people in their warehouses. We’ve also weeks (80 hours) paid sick leave seen vendors temporarily compress immediately product lines to smaller assortments • Covers COVID-19 related issues, such as workers experiencing symp- so they can focus on shipping their key products during the pandemic.” toms, seeking medical diagnosis, Rusk added, “We’re keeping our quarantine, caring for quarantined members up to date on all of that with family members, or caring for chila special webpage on our member dren due to school or daycare cloportal called ‘COVID-19 Supply Chain sures due to coronavirus. Updates.’ We also have a weekly email • Exempts small employers with called the Merchandising Update that under 50 workers. highlights COVID-19-related supply chain information.” Supply Chain iSSueS Most retailers are still having trouble staying in stock with cleaning supSoCial Media plies, masks and hand sanitizer. While Social media, primarily Facebook, demand is drying up in many noneshas been the primary means of comsential product categories, products munication for retailers to keep their such as grills, barbecue accessories, customers informed of daily developpaint, sidewalk chalk and family craft ments. A home center in Alabama took projects are flying off the shelves. to Facebook to let customers know that People are staying home and working rumors of an employee testing positive on home and yard projects. were unfounded and that the store was www.TheHardwareConnection.com
THe HARDWARe Connection ■ April 2020 ■ 35
SpeCial RepoRT: CoVid-19 paRT ii taking all the necessary precautions to keep the community safe. David Strano of Ambridge Do it Best Home Center in Ambridge, Pa., is an industry leader in using social media to promote his business. Click here to see how Strano leveraged Facebook Live to engage with customers and keep them informed on COVID-19. Retailers who have developed a wide following on Facebook are reaping the benefits now as they keep their customer base informed. They tell them about adjusted store hours, social distancing best practices, curbside pickup procedures and spring project reminders. Adam Taylor, owner of Trust Hardware in Indianapolis, attracted a lot Roscoe, the store mascot for Trust Hardware, demonstrates how to practice social distancing with employee James.
36 ■ THe HARDWARe Connection ■ April 2020
of attention with a recent Facebook post that depicted his dog (and store mascot) Roscoe demonstrating how to practice social distancing—Roscoe was shown sitting on the taped “X” on the floor. Taylor’s store is an anomaly—it’s open 24 hours a day, year-round. As stores around him reduce hours or close temporarily, he’s available to supply people with the everyday items they need including cleaning supplies, some food items, even laundry detergent. “It has been absolutely insane. We will do over 100K this month (April) with ease and we’re only 4,000 square feet. Just non-stop traffic,” he says. “A lot more morning and late-night business, because of other stores closing early. It’s been a blessing to have that already established (open 24 hours) and it should be concrete in people’s minds after all this—24 hours, all the time.” Taylor adds “So many things have been crazy and shocking these past few weeks, but the one that sticks out the most is that no one wants delivery or curbside pickup. No one. I blew the doors off the place in March and less than 1 percent of the business was delivery or curbside—in the middle of a pandemic. Absolutely no one wants it.” Taylor’s take on the situation is that independent hardware stores are all about touch, see, feel and physical interaction. “This tells me we’re probably a lot more Amazon-proof than it might appear,” he said. ■ www.TheHardwareConnection.com
In TheIr Own wOrds, Century Club retailers share how They Are Coping Mitchell Cohen Cohen & Co. Hardware—founded in 1913 Philadelphia, Pa. “We’re there for our customers when it snows or storms, but I don’t remember anything like this. We’re in uncharted territory. We’re letting in customers one at a time and only ones with masks. I’ve done everything in my power to get them. A while ago people were buying and shipping things over to China, so I thought I better get in more masks. My Orgill delivery driver drops off a skid of products every Friday at 9 a.m., but now he’s wearing gloves and a mask. People are now staying home and doing wood projects, buying sandpaper and polyurethane. It’s eerie not seeing anyone while I’m walking to work. Everyone in Philly has been staying home for over three weeks. People seem to be sleeping in now, so I’m opening at 10 or 11 and I’m in the store seven days a week. We’re a neighborhood store, so we’re here to serve the neighborhood. Every independent hardware store is like that. Small hardware stores will shine, because people especially don’t want to go to a big box now. Wipes are almost impossible to find, so I’m trying to keep up with www.TheHardwareConnection.com
Mitchell Cohen is the fourth-generation owner of Cohen & Co. Hardware in Philadelphia.
rubber gloves and spraying everything down in the store with a can of Lysol. I’ll give customers a little mask or a box of gloves, because I want everyone to feel safe. I’ll donate masks to the hospital, but I get more satisfaction giving a mask to someone who’s been a customer for 40 years. My doctor friends say as long as you wash your hands and stay apart you’ll be fine. If it gets worse of course I’ll shut down the store. In our business sales are need-driven. Certain items we’ve not sold for weeks. No one’s stopping to buy the little jewelry items my wife has on display. We’re blessed to still be open.” Shayna Roberts Morris Hardware— founded in 1845 McConnelsville, Ohio “Having been in business for 175 years with the same family at the helm since 1845, Morris Hardware has a THe HARDWARe Connection ■ April 2020 ■ 37
SPECIAL REPORT: COVID-19 PART II unique skill of adaptability. With a combination of early, intense research, willing management and flexible staff, we started making proactive changes at the beginning of March to protect both our team and customers. We caught a lot of flak at first. Being in rural America, global problems tend to reach us much slower, and attitudes are harder to change. However, as the virus began to spread across the country, and as Ohio began taking strict proactive measures, we have noticed a shift in customers’ attitudes and behaviors in the store. When Governor DeWine issued the stay-at-home order, we doubled down on measures in the store. We restricted customer access to the front of the store,
essentially returning us to the good old days of full-service hardware. Staff wear some form of mask, change gloves between every transaction and practice frequent handwashing. We have installed a sneeze guard in front of our registers. Spaces are taped off 6 feet apart to allow customers to follow the social distancing requirements of the order. We’ve also reduced our hours from 7 am-6 pm to 10 am-2 pm, and serving those in the highrisk group from 9 am-10 am. We have been heavily promoting our call-ahead service and have been doing curbside pickup. We communicate and coordinate with our other local hardware stores regularly so we can work together to serve the community.
While we were braced for a significant slowdown, we’ve noticed that our sales have stayed consistent with last spring. The combination of folks stuck at home and beautiful spring weather means business for a smalltown hardware store. Paint flies off the shelf, and we’ve seen an increase in seeds and gardening supplies. If there is a silver lining, hopefully it is these hard-working people having time to tend to a garden and work on long put-off home projects. Our supply chain has been affected dramatically, just like everyone else. We receive updates often from our supplier, but we are still looking at mid-April or later until we can restock the items that people need to stay safe during this scary time. The good news is that True Value has launched production on a line of cleaning supplies and hand sanitizer. We are hoping to see those items on our shelves in the coming weeks. We’ve been fortunate in having steady business to keep our store stocked with other items. Folks still need hardware, so we do our best to keep those pieces and parts on hand. The store is cleaned every morning before opening. High-touch surfaces, including doors, counters and registers, are all sanitized. Staff stays over an hour after close to repeat this process. We also do this process throughout the day, specifically areas where customers are served, which is a limited area now due to restrictions. www.TheHardwareConnection.com
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SPECIAL REPORT: COVID-19 PART II increase in this service as our customStarting April 6, we are limiting the ers become more aware of the risk and number of customers allowed in the store at one time per the new Ohio order. resources available. Morris Hardware is located in However, we have noticed our customers Morgan County, which just got its first being conscious and waiting until they see the store clear out before entering. confirmed case. Several surrounding We update our social media channels counties have multiple cases. I attribute this not to our rural isolation, but when we have a change to our policy, practices or services, and post signs on due to lack of resources and testing. I our front door and at the counter. Staff feel this contributes to a false sense of security, making our community quesalso have conversations with our customers to ensure they understand what tion preventative measures. While I do not know anyone that has tested posiwe are doing and why it is important. tive in my immediate circle, many of The people that take advantage of the people in that circle are at risk and I curbside pickup are grateful for the worry about them every day. limited We seeing Half Pagecontact. Hardware Trade Ad are Artwork R2.pdf an 1 3/30/20 4:07 PM
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Rob Bantly Bantly Hardware—founded in 1861 Johnstown, Pa. “The first week of March was up 25%. The management team of Morris Hardware includes, left to right: John Second week up about 5%. On March Houser, Shayna Roberts and Tom 19, the governor of Pennsylvania shut Schanken. down all construction activity and many government operations. He also asked I struggle everyday with the concept everyone to stay home unless for an of staying open as an essential busiessential or life-saving purpose. ness, losing many hours of sleep over I was very concerned about my it. On one hand, I have to consider employees’ well-being and tried to limit the job security of my staff, and the resource that a hardware store provides sales to essential ones. Unfortunately, the general public, while unemployed to a small rural community. We have and staying at home, saw it as a great items that people desperately need time to shop the local hardware store for right now, both for virus prevention some repair items or just to get out of and for crucial home repair, especially the house for something to do. We tried plumbing. On the other hand, we are to keep social distance, but our customfacing a global pandemic. I am putting ers seemingly didn’t have a clue. my staff (and by default, the families By the end of March, we had to resort they go home to) on the front lines every day when the leading advice from to locking the front door and taking care every epidemiologist and global health of customers by phone or email and takexpert is straight forward: STAY HOME. ing the merchandise to their car waiting in the parking lot. We also went from 7 The conversation among the management crew is ongoing. We reassess to 7 weekdays to 8 to 5 weekdays and 8 to 4 on Saturday. We have always been our strategy every day, weighing the closed on Sunday. pros and cons of staying open while Sales for March 16-31 were down continuing to work toward more preventative measures and limited contact 24% and customer count was down about services. As we inch ever closer to the 15%. No large commercial sales so more inevitable peak of COVID-19, I foresee Rob Bantly, the fifthdrastic measures to protect our staff generation owner and serve emergency needs. My heart of Bantly Hardware, is with those in heavily affected areas, helped restore the business to prosperity and I am grateful for the information after a devastating they provide to help us be prepared for flood wiped out the store in 1977. what comes next.” www.TheHardwareConnection.com
THe HARDWARe Connection ■ April 2020 ■ 41
SPECIAL REPORT: COVID-19 PART II retail with smaller average sales. Total sales for the month of March were down 3.67%. I was very surprised that’s all the sales dropped. Margin was up for March 3% and it was a profitable month. I reduced staff essentially by letting anyone that didn’t want to work because of the risk of contracting the virus sign up for unemployment. The ones that wanted to continue to work we have kept working. The equivalent of three full-time employees chose not to work. Eight employees are still working and I will keep them on payroll. I am also paying them each $2 more per hour. No one that I am aware of has become sick. We have not had problems with inventory shipments except for the highdemand items. My employees have done an amazing job, as I have not gone to work for three weeks. I think maybe they are enjoying the boss being away! For the first week of April, sales were down 25%, customer count down 20% and margin up 4%. I have been surprised sales are fairly even across all departments. Paint and cleaning are up some while the remainder is fairly spread out as normal. We are still profitable even the first week of April.” Christy Caruthers Jack’s Country Store—founded in 1885 Ocean Park, Wash. “We have coped quiet well. We have tried to run as close to normal as we 42 ■ THE HARDWARE Connection ■ April 2020
The crew at Jack’s Country Store designed and built coronavirus cashier shields out of on-hand hardware items.
possibly can. We have maintained our store hours and staffing levels. March sales are up compared to March of last year. Many of our local residents are staying closer to home to do the majority of their shopping. We have seen increases in some lines, especially our gourmet chocolates and nostalgic candy. Other big areas have been vegetable seeds, canning supplies and ammunition. Curbside pickup has been received well. It started off slow, but our customer base continues to grow and we have had lots of repeat customers. We have been very fortunate in being able to maintain our staffing levels. We have a great crew that is willing to stay extra, or come in on a day off to help out. We have definitely had to modify our procedures and implement safety protocols, such as installing shields at the registers and limiting product returns. Employees are welcome to wear gloves and masks...if they choose.” ■ www.TheHardwareConnection.com
By John Fix III
COVID-19
HARDLINES DIGEST RECAP: HOW HARDWARE RETAILERS ARE ADJUSTING IN TIME OF
Crisis A
s hardware retailers, we are all used to serving our communities in whatever way necessary. The COVID-19 pandemic has brought new meaning to that mission, as we find ourselves balancing the need to stay open as an essential business while keeping employees and customers safe. Not surprisingly, dealing with the fast-changing realities of COVID-19 has been a popular topic on Hardlines Digest. Read on to see what retailers were sharing on many aspects of this important topic.
HAZARD PAY Carrie Dickey of Dickey Bub Farm & Home in Eureka, Mo., wondered if other retailers are offering hazard pay for their team. “We are considering a bonus or a bump in pay,” she said. Joel Zaske, with two Ace stores in Arizona, said they have bumped staff by $2 per hour, while Paul Giunta of Shore True Value in Somers Point, N.J., said they are buying the staff lunch every day www.TheHardwareConnection.com
Amber Engle of Lumber House True Value in Abilene, Kan., prepares to take a curbside order out to a customer car.
and giving them an in-store credit of $1 for each hour worked. Alan Talman of Karp’s Hardware in East Northport, N.Y., posted, “Since we have a small team to begin with, and we lost a few of the young kids to parental influence during the crisis, I am putting extra money in everyone’s pay. Since we are doing way more business than usual, in less hours, and with less staff, it is an easy decision for me. I keep telling each person every week that they should save all that money, because we don’t know if we will have to close up shop as things digress.” Randy Patzer, with two Ace stores in Michigan, said he is giving everyone a $1 per hour bonus that will be added as a bonus, not a change to their hourly rate. THe HARDWARe Connection ■ April 2020 ■ 43
COVID-19 Mitch Haase of Mitch’s Incredible Ace in Plainfield, Ind., said, “We have lost about half of our staff deciding to stay home out of harm’s way. The rest are working and seem happy to do so. There might be a bonus for some of the ones still working, but that will be determined later. For those giving hazard pay increases, I would define what ‘when this is over’ means before implementing.” Haase added, “Two weeks ago I started buying lunch for my employees every day. It’s not all that much and it is well appreciated by everyone. It shows them how much I care about them and appreciate what they are doing for me and the customers. I will probably do it until the state lifts its stay-at-home order.” Perry Hahn of Hahn Ace Hardware in Wisconsin sent a letter to his staff that thanked them for their grit and determination during these times and informed them they would be getting an extra 20 percent in their May 8th check for wages earned from March 27 through May 2.
ADJUSTING HOURS/CURBSIDE SERVICE With most states adopting some form of stay-at-home order and staffing issues starting to crop up, retailers discussed the need to adjust store hours and offer curbside pickup service. Patzer said, “We have been forced to adjust our hours due to a dwindling number of employees. As we lose more, we shorten our hours some more. We did 10 to 6 and then moved it to 10 to 5.” www.TheHardwareConnection.com
we’ve had to make so far. Worst case is someone in our store gets sick.” Karla Robson of Slavens True Value in Cortez, Colo., said, “We have been on lockdown for a week now and have not adjusted our hours. We are so busy, both early and late, it is difficult to decide Cadiz Hardware promotes its curbside pickup where to cut. We are considering having service on Facebook. the employees who live in town close to store take a two-hour lunch and stay late, to maintain hours. We are also considerBrian Mushel of Justus True Value ing hiring temp help, some of the laid-off Home & Garden in Clarks Summit, Pa., folks who aren’t working right now.” said, “This is the reason we went to Hahn noted they have changed curbside only. No one is staying home staffing and hours at all four of their and this will only drag this out longer. stores. “We changed our staffing by We had the busiest days last week and splitting all of our stores into two decided to stop allowing customers employee groups per store. This hopeinto the store. Safety and health of our employees comes first. Hardest decision fully protects us if one employee gets
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COVID-19 infected, we will shut down that group for a period of time and the other group will pick up the hours. This way we have no cross contamination between the two groups, as they are not allowed in the stores on their days off. Each group works the full shift of the day, with a three days on and three days off rotation.” Jessica Bettencourt of Klems in Spencer, Mass., said they went to curbside only. “Worst/hardest business decision of my life. Sales have plummeted, but people come first.” Lisa Murphy of Hingham Lumber Co. in Cohasset, Mass., said, “We also had an extremely high volume of people
COVID-19 We are here for you! • • • • •
in the store and safety became a huge concern, so we made the switch to curbside only pickup. Our employees are so relieved. Our warehouse remains drive through, but customers may not exit their vehicles and employees maintain social distancing.” Kevin Evers of Village Do it Best Lumber & Hardware in Leipsic, Ohio, said curbside pickup is working out OK for them. “It takes knowledgeable employees to fill orders. Some customers do not like this, especially the ones that came to the store to browse.” Diane White of White’s Ace Hardware in Haines City, Fla., posted, “We closed Saturdays and are 8-5 during the week.
During these uncertain times, you need a partner that you can rely on, a partner that is stable and working hard to meet your needs. Being an essential business means people rely on your products and services for their everyday needs and we want to help you to be able to provide these things for your customers. At House-Hasson you can count on us being a committed, dependable partner and much more:
Flexible–The flexibility to adjust programs and policies for individual customers. Experienced Sales Reps–You can use as your profitibility advisors and counselors. On-time Delivery–We operate two stateof-the-art distribution centers. Competitive–Our competitive buying programs generate year-end cash rebates. Buying Right–We feature three regional buying markets a year–more than any other industry wholesaler.
• •
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Efficient–We have our etoolbox.net web website, POS communication and technical support. Meet Your Product Needs–We warehouse over 55,000 name-brand items and our private-label Hardware House line with a 96 percent service level. Your Partner for Success!–House-Hasson wants to be there for you during this difficult time period and beyond!
Please contact us to get your account setup and have a sales rep start working with you.
For more information please contact Pat McCutcheon 1-800-333-0520 Ext. 212 • househasson.com
We all need a break from the stress of trying to be safe. The employees are grateful. It seems as though customers trust us and feel safer in a smaller store than the big boxes.” Jody Bryan of H. Houst & Son in Woodstock, N.Y., said, “We made the decision earlier in the week to close this weekend and the next, to keep our regular Monday-Friday hours of 8 am-6 pm. It was a difficult choice to make thinking about the missed revenue, but by midday Friday I knew this decision was the best one for my staff. I am grateful I am able to do this and to know that all of them are home and getting well-deserved rest and reprieve from the stress.” Patzer said, “The Michigan governor’s order states that people can purchase to maintain their homes. That
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loose term encompasses 75 percent of what is in our stores. I am looking at it from both sides. How do we keep our people safe and how do we sell enough to cover our expenses? Profit be damned at the moment. I am just trying to stay alive and come out the other side of this. As long as we have the people and they are comfortable with the procedures we have put in place, then we will remain open to the public. As soon as we lose people to the point where we cannot provide good customer service, then we will go to curbside only. We are down 40 percent of our people at store #1 and 50 percent of our people at store #2. It is at the breaking point right now. One store in our region closed due to staffing issues.”
THe HARDWARe Connection ■ April 2020 ■ 47
COVID-19 GOVERNMENT PROGRAMS
Bob Brame at Cadiz Ace Hardware in Kentucky said, “Our bank called us yesThere was lots of discussion on Hardlines about the programs available terday and sent their link so we would be from the government such as expanded in line for PPP. I didn’t even know about it. It took me about 30 minutes. VP of bank unemployment, Paycheck Protection sent me a note saying we got it. That is a Program (PPP) and the CARES Act. good thing about good local banks—you Brandon Buckalew of East Grand Forks Hardware Hank in Minnesota pro- are on a first-name basis, your kids or grandkids play on the same Little League fessed to being thoroughly confused team and people don’t change often.” by the various programs. “There are Patzer posted, “The way I think it is set so many scenarios and I have so many up, an employee cannot get unemployquestions. I have commercial accounts ment if you are still open and they were that are panic buying right now, so my not sent home by you. So if they want to numbers aren’t so bad, but in a month or two they aren’t going to be very good shelter at home without reason, they do because they’ll be stocked up. My bank- not get to claim. I have two valid claims er suggested waiting to apply for these, and one invalid one at the moment. This is all very confusing, to say the least.” but there’s a fine line between waiting a long enough time to show the most injury and the programs running out of MOBILE POS/TEXT SERVICE money,” he said. Retailers on Hardlines were interested Chris Finethy of Gilford True Value in what other dealers were doing about in Gilford, N.H., posted, “Half the staff mobile POS and receiving orders and at our lumberyard quit, because they messages with a text service. realized they could make more money Ruth Meredith of McDonald Garden unemployed. Contractors realized one Center in Virginia Beach, Va., noted, of their main overhead expenses (labor) “Square and Clover Go are standalone is going to be paid for for the next cousystems that you can use on a mobile ple months. We signed up for the paydevice, and then just finalize the transacroll loan, but have half the employees as tion in POS under an Alternate Tender.” last year. The thing that blows my mind Patzer added, “We have a standalone is you could have run the worst busicredit card machine that is wired to ethness ever and still be bailed out.” ernet or phone. Then we added Square Giunta said, “We are struggling with as a cellular solution. Their box takes this as well. We sent in the application chip or NFC and there is a plug-in for this morning, but our bank said the SBA swipe. No monthly charge and it deposis not ready. More confusion!” its to the bank of your choice. They do
48 ■ THe HARDWARe Connection ■ April 2020
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Crest Hardware & Urban Garden Center in Brooklyn, N.Y., makes sure all employees and customers wear a mask.
set up as e-commerce rather than a physcharge about 1 percent more to process, ical retail store. Supposedly, we have more protection against chargebacks.” so there is a cost. Next, we purchased Dickey wondered if other retailers a cellular standalone unit that works have a phone number set up for cusgreat and takes all forms of payment. However, this too has a monthly fee for tomers to text them. Amy Earls of Page Hardware in the cellular support.” Guildford, Conn., replied, “We have Tom McKeithen at McKeithen’s True been using Instaply for two years. It Value in Statesboro, Ga., wondered if allows customers to text the store and mobile POS puts you at higher risk for have multiple users respond. Pictures fraud. “I have been burned a couple of can be sent back and forth, too.” times taking card info over the phone, Jason Haley of Ace Hardware of so we no longer do that. But what about Clarkston has been using Sideline. no signature?” “It works flawlessly and is $10 per Meredith responded, “According to my processor, if you are set up as a retail month. All of our team has the app and when a text comes in one calls store and you accept a chip card and over the radio that they have it. It do not dip it in a machine for the authoworks great with curbside.” n rization, it doesn’t matter if you have a signature or not, you are still liable for the chargeback if something hapJohn Fix started the Hardlines Digest in 1996. The list was run pens. We are currently doing curbside for many years using servers in service where orders are processed over John’s hardware store, but the list has migrated to Google Groups. the phone, but we are getting ready to There are currently more than 2,300 subscribers reading Hardlines switch that over to our website for the Digest. To read more or subscribe, credit card authorization, since that one is go to www.hardlinesdigest.com. www.TheHardwareConnection.com
THe HARDWARe Connection ■ April 2020 ■ 49
Real-World Advice from Independent Hardware Store Owners
Join a growing community of thousands of independent hardware retailers Practical tips from fellow retailers delivered fresh daily to your email inbox Share your expertise and learn from your peers
Get in on the conversation at
www.hardlinesdigest.com
“ I created Hardlines Digest in 1996 as a way for my fellow retailers to swap tips about the nitty-gritty of running an independent hardware store. Today, it’s grown to a community of thousands of independent hardware store owners just like you. I hope you’ll join today and start sharing your own expertise.” —John Fix Owner, Cornell’s Hardware Eastchester, NY
Proudly Independent. Powered by You.
100E% E! FR
Website
By Bob Phibbs, The Retail Doctor
CoViD-19
how to retail During CoViD-19
I
know I have a range of business owners with their own perspectives about the coronavirus also known as COVID-19. Some are scoffing at all the fuss, while others see it as the end of days. And there’s a range of people, attitudes and emotions between the two. I’m here to be the voice of reason for you. I’m not going to be Pollyanna, but not Voldemort either. We have to be able to hold both the good and bad in our heads right now. Embrace the awkward, the ambiguity, the possibilities. Left: Burt’s Lumber & Building Supply in Perry, If you’re still smarting from the drop N.Y., reminds customers to practice social distancing. in business the past weeks and asking Right: Mazo Hardware & Rental in Mazomanie, why me? I invite you to see another Wis., used a Facebook post to reassure side. I remember when I was dating customers they are keeping the store open someone, and they cheated on me. I and sanitized. thought the adult thing to do was for With that in mind, this article is how both of us to go to counseling. to survive now if you are able to stay As I started talking, the therapist open and for those who can only do asked me, “How long do you want to phone and online orders, but it is also feel bad about this?” He made sure for those who have to close temporarily then—30-plus years ago—that it was a choice I had to make. Either I wanted to or even permanently. I will finish with the most important part—your mindset move forward or I wanted to wallow. in the coming months. Now is not the time to be wallowing. We have to do what is important now! And we have to leave behind the stuff hoW to SurViVe noW if Your rethat makes us fearful. And that goes for taiL Store iS aBLe to StaY oPen Twitter, the news and the well-meaning 1. Tell your customers if you are but energy-draining vampire friend. Right? open. Use social media, post on Remember, I am here to help you do that. your front door, send an email, www.TheHardwareConnection.com
THe HARDWARe Connection ■ April 2020 ■ 51
CoViD-19 anything to let them know how you are operating in this crisis. Don’t assume anything. 2. Know you will have to sell your way out of this. Just cutting costs to get by is not going to cut it. If you are able to stay open, that means you are doing curbside pickups or delivery, taking orders online and on the phone, or you have a limited number of people in your store at a time. People are still buying things, and they are buying things for two reasons right now: • To get them through their day, so they are shopping for the things they need to make life work for them right now. • To help them escape from their day, so they are shopping for pleasures and fun things that will bring them joy and keep them busy. Don’t think that because you also sell a lot of nonessential items that no one will buy them from you right now. One of my customers had the highest ever boat sales this past Saturday— boats. Not really bread and butter. People need more ways than ever to entertain their kids; games and toys are being ordered like crazy. People are ordering flower deliveries just to make them happy and beautify their space at home. So, people are buying all sorts of things and by selling them in an accessible way, you are brightening their 52 ■ THe HARDWARe Connection ■ April 2020
days. You are helping them out. If you have anything right now to sell that can make someone’s stressful life better, sell it. Market it. I want to make sure you don’t hide in your stores and feel guilty for selling right now. Even though traffic might be down, you need to be sensitive to their needs, not yours. You are not taking advantage of a crisis situation by operating your business. You are meeting a need and a desire. Sell your merchandise as best you can and be a positive force in the world. That is what people need right now. 3. Focus on the future. There is a women’s clothing boutique that is set on keeping everyone on staff and doing everything they’ve been putting off for a really long time, like organizing inventory, reorganizing the store, cleaning, working on their website, all while doing curbside pickup and blasting as much social media content as possible. They are doing it all with a smile and wearing fuzzy house slippers to work because they can, and it makes them feel good. Their attitudes are amazing. You need to be like them, still going and doing, just changing to make things work in this situation. Yes, traffic might be way down. Sales might be down. It’s not going to be easy, but being successful in retail hardly ever is. Customers have always liked to shop, www.TheHardwareConnection.com
this. You might as well start now while you have the time. 3. Communicate with a newsletter. Create a compelling subject line, “What to do when you’re working from home” or “It’s too early for wine, what can you do to lighten your mood now?” Suggest something they can do without buying your products, but if they want to, how to do so. Hardware stores should promote a honey-do list and how to get it done. Garden centers, how to get the garden ready for hope and growth. Marketing Your Store in the tiMe 4. Choose pictures wisely. Don’t of CoViD-19 show a picnic, a large party of This is the time to build trust to gain people cheering, people hugging, leads for the future. holding hands, large crowds, eat1. Be of service and don’t stop ing in a restaurant or bar; be conmarketing. Make sure people know scious when choosing images of how they can order from you by people to go with advertisements phone, by website, by text or app, and other emails. whatever. Know what curbside pickIf you post pictures of associates up looks like for your business and in the store, it wouldn’t hurt to show how to promote it. 2. Review your website. Is it com- them wearing gloves as they stock shelves or wash their hands really pelling? Does a stranger know what you want them to do? Click well or other visual signs to show that people can trust you and that here, read this, download that? If it is safe to buy from you right now. not, start researching competiPost images of what you are doing tors in either stealth mode or prito make sure deliveries and pickups vate depending on your browser. are as sanitary as they can be. Your Write down what you like and hands may be washed, but customwhat caught your attention, so ers cannot see that in a picture. you know what you want to fix. They can see gloves. Gloves are Remember, when this panic eases, visual comfort. you will have to sell your way out of
because it gives them a sense of control. Why do you think they are buying toilet paper? 4. Be the smart retailer. Limit the number of people in your store, practice social distancing but make both hand washing and customer service a priority. There are still things you must be doing right now to bring in the most sales you can and meet the needs of your customers. Marketing will help you do that.
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THe HARDWARe Connection ■ April 2020 ■ 53
CoViD-19
activity in your store. Again, let people know you are open. They might uSe SoCiaL MeDia to reaCh CuStoMassume you are not. erS in the tiMe of CoViD-19 4. Talk about cleanliness, social 1. Use social media like crazy. distancing, the works. Let them Don’t fear that you are putting too know what you are doing to make much content out there. People are sure everything is sanitary and safe; craving online content more than they need to trust you. ever, so there is never too much. It’s ok to say it is lonely there, but 2. Go live in-store or even from keep your main goal to say we’re in this your home. You can use live vidtogether. You have to be positive. Don’t eos on Facebook or Instagram to feature a product someone can use beg people to buy from you to keep you to alleviate boredom, a project they in business; that is not the message you can do, a puzzle they can put togeth- want to put out there. Remember, you’re going to have to sell er. Make sure everything you feature is relevant to right now. Be cre- your way out of this hole we are all in. What shouldn’t you be doing in your ative but sensitive to the fact some marketing and social media? people who don’t have security in Don’t have panic sales as a way to their paycheck won’t bite no matter drive traffic to your website. By having a how much you promote. coronavirus sale, you are just associating Think of your content as a form of your business with a virus. The reason entertainment for your customers. Get your name out there in a positive people are not coming in is because of public health issues, not your prices. ■ way; make people laugh or smile or relieve their boredom and sense of Bob Phibbs is the Retail isolation with a live video. Facebook Doctor; a speaker, author of algorithms prefer Live videos and three books and retail sales expert of choice for some reward them with more views than of the most legendary retail recorded ones. brands including, LEGO, Those people who cannot buy from Omega and Yamaha. With over 30 years’ experience, you now need to see you and your beginning in the trenches of products, so they know to buy from you luxury retail and extending to senior management positions, he has later. This is a perfect time to focus on been a corporate officer, franchisor and building up your online audience as a entrepreneur. He and his work have appeared way to convert customers in the future. in the New York Times and the Wall Street Journal. He is one of the top retail influencers 3. Go live in-store to show people in the world. To register for a free set of you’re there. Showcase merchan8 lessons on how to retail during time of COVID-19, click here. dise you’re preparing to deliver and 54 ■ THe HARDWARe Connection ■ April 2020
www.TheHardwareConnection.com
By Gary Pittsford, CFP®
COVID-19
How Can Your Business Get Coronavirus Relief from the CARES Act?
I
n the last two months our personal lives and our business lives have been completely altered. All of the closely held businesses and the industries that we work with have been devastated financially because of this COVID-19 worldwide pandemic. In this article, we have tried to outline ideas that can be used by businesses, business owners, business employees and others affected by this coronavirus. The index below outlines ideas for business owners and employees that you need to read immediately pertaining to the new law that was passed by Congress and signed by the president on March 28: the Coronavirus Aid, Relief and Economic Security (CARES) Act. In order to implement sections of this new law and all of our business planning ideas, you need to consult with several individuals. First, make sure that your business accountant has read the CARES Act. Your accountant is going to be an important source of information for you to qualify for different sections of the new tax law outlined below. Second, your corporate attorney can also be helpful in preparing any documents to qualify for parts of the new tax law. Third, for all of the industries that Castle Wealth www.TheHardwareConnection.com
Advisors specializes in, we will make ourselves available to talk with business owners and association leaders about ideas that will help everyone through this pandemic disaster with financial ideas to implement. Fourth, there are a lot of national organizations that have quickly gotten themselves ready to help you. Consider asking your local Chamber of Commerce if they have someone on staff who can help you apply for benefits from this new CARES Act. Consider contacting the National Federation of Independent Businesses and find out if they have a local office that can help you. Also, you might think about the SCORE Association, which has offices in many cities and states. Fifth, contact your state Small Business Administration (SBA) and THe HARDWARe Connection ■ April 2020 ■ 55
COVID-19 find out if they have a local field office near you. Many of the CARES Act provisions for small businesses will be handled by the SBA.
I. IDEAS FOR BUSINESSES Paycheck Protection Program & Forgivable Loans A significant benefit included in the CARES Act for small business owners is the paycheck protection program, a partially forgivable loan program offered through the Small Business Administration. Such loans must be issued by December 31, 2020 and can have a maximum maturity of 10 years. They may be provided through existing approved SBA lenders, (local banks) as well as lenders who are otherwise certified by the SBA to offer such loans. Furthermore, such loans will be 100 percent guaranteed by the SBA.
loans may be used to pay a variety of costs including: • Payroll costs • Group health insurance premiums and other healthcare costs • Salaries and/or commission • Rent • Mortgage interest • Utilities • Other business interest incurred prior to February 15, 2020
Benefits of Loans Issued Under the Paycheck Protection Program The single-largest benefit of a loan issued under the Paycheck Protection Program is the possibility of having all, or a portion, of the loan forgiven. The amount eligible to be forgiven is the amount spent, during the first eight weeks after the loan is made, on: • Payroll costs, excluding prorated amounts for individuals with compensation greater than $100,000. Qualifying for the Paycheck • Rent pursuant to a lease in force Protection Program before February 15, 2020. Businesses, including sole proprietors • Electricity, gas, water, transportathat have fewer than 500 employees, are tion, telephone or internet access eligible for this relief. expense for services that began Under this paycheck protection before February 15, 2020. program, lenders will generally be • Group health insurance premiums able to issue 7(a) small business and other healthcare costs. loans up to a maximum of the lesser There is a catch to these provisions. of $10,000,000 or 2.5 times the averIn order for the above amounts to be age monthly payroll cost over the previous year (excluding annual com- forgiven, the business must maintain the same number of employees (or pensation of amounts over $100,000 equivalents) from February 15, 2020 per person). The proceeds of such 56 ■ THe HARDWARe Connection ■ April 2020
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through June 30, 2020 as it did during either the same period in 2019, or from January 1, 2020 until February 15, 2020. To the extent this requirement is not met, the amount eligible for forgiveness will be reduce ratably. Additional reductions in the amount to be forgiven will be incurred if employees with under $100,000 of compensation have their compensation cut by more than 25 percent as compared to the most recent quarter. The good news is that any debt forgiven pursuant to this provision is not included in taxable income for the year. Finally, payments from loans made under the Paycheck Protection Program will be deferred for a period of not less than six months, and no longer than one year.
understand that they are eligible for a credit, but also to know how much of a credit they are eligible for, as this will help you make better business decisions. In the simplest terms, the credit is equal to 50 percent of the wages paid to each employee, up to a maximum of $10,000 of wages per employee. For small businesses (100 or fewer employees), all wages (up to the $10,000 maximum limit per employee) are eligible to count towards the credit.
Deferral of Payment of Payroll Taxes Section 2302 of the CARES Act provides employers with another payrollrelated tax break. With the exception of employers who have debt forgiven by the CARES Act for certain loans providQualifying for Employee Retention ed by the SBA, employers are eligible to Credit defer payroll taxes from the date of the The “trigger” for a company to begin enactment, through the end of the year to be eligible for the credit is either that operations of the company have been ful- until the end of 2021 and 2022. More specifically, 50 percent of the ly or partially suspended during a quarter as a result of governmental authority, or a payroll taxes that would otherwise be quarter in which the revenue in 2020 that due during this period may be deferred until December 31, 2021. The remaining has less than 50% of the revenue from 50 percent is due on December 31, 2022. the same quarter in 2019. Remember Good news for self-employed persons. when calculating the business income for This relief applies to them also, at least the quarter the Act refers to the revenue with respect to the employer equivalent for the quarter and not profit. portion of their self-employed taxes. Accordingly, 50 percent of an individual’s Calculating the Employee self-employment taxes from the date Retention Credit of enactment through the end of 2022 For business planning purposes, it may be deferred, with 50 percent of that is important for employers to not only www.TheHardwareConnection.com
THe HARDWARe Connection ■ April 2020 ■ 57
COVID-19 amount (so 25 percent of the 2020 selfemployment taxes) due December 31, 2021 with the remaining deferral amount due on December 31, 2022.
II. IDEAS FOR THE BUSINESS OWNER
A new date to remember. Any person with a federal income tax return or payment due on April 15, 2020 is eligible for relief under notice 2020-18 from the Treasury Department. A “person” Net Operating Loss Rules Have includes any type of taxpayer, such as Changes an individual, a trust, an estate, a corThis could be a very important benefit for business owners in 2020. Please poration or any type of unincorporated business entity. discuss this idea in great detail with The payment due refers to both 2019 your outside accounting firm. federal income tax payments, includSection 2303 of the CARES Act ing payments of tax on self-employed amends the rules for corporations income, and 2020 estimated federal with net operating losses (NOLs). For income tax payments, including paymany years, NOLs were allowed to ments of tax on self-employed income be carried back up to two years, and regardless of the amount owed. The forward up to 20 years. The Tax Cuts return or payment must originally be and Jobs Act of 2017 changed those rules, however, for 2018, 2019 or 2020, due on April 15, 2020. This relief does to allow such losses to be carried back not apply to federal income tax returns and payments due on other dates. The five years and forward indefinitely. In Treasury notice postpones those 2019 theory, this should allow companies return filings and payments due on April to reduce prior years’ tax bills, allowing them to claim refunds of amounts 15, 2020 until July 15, 2020. previously paid, to provide further liquidity to get them through this III. IDEAS FOR BUSINESS SURVIVAL coronavirus crisis. Now is the time to make hard deciThe CARES Act further enhances the sions about your company and prepare ability of companies to use their NOLs it to become lean and strong quickly. to offset prior years’ tax liabilities by Outlined below are some ideas that you amending another rule put into place should consider for your company: by the TCJA. Under this act, NOLs were • Renegotiate loans with lenders and only able to offset up to 80 percent of vendors and ask for lower interest taxable income. Section 2303 of the rates and longer terms. CARES Act amends the law to allow for • If you pay rent on your buildings, up to 100 percent of taxable income to ask for several months of rent deferbe offset for 2018, 2019, and 2020. ral or possibly reducing the rent by 58 ■ THe HARDWARe Connection ■ April 2020
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50 percent. The rent not paid can be added to the tail end of the lease. Take a hard look at your payroll costs as you enter the second and third quarters of the year. Talk with your accountants, attorneys and bankers about using all of the government loan programs available for the next several months, but long-term make decisions about where the payroll should be in the last half of 2020. Talk to your national associations and get industry guidelines about what is normal for payroll and rent in your industry. Also, those of us at Castle Wealth Advisors have a lot of that information. Sell old inventory. Have a tent sale and get rid of old or obsolete inventory that has been lying around for more than two or three years. Now is the time for you to accumulate cash and build up your war chest rather than leaving old inventory laying on the top shelf or in the warehouse. Start being more aggressive on collecting your accounts receivable. Maintain your gross margins at their highest levels based on your industry averages. In the next six to 12 months when this coronavirus is over, you need to have the highest gross margins possible going into an economic recovery. Be aggressive on depreciation and write-offs in 2020. Previously, in this article, we talked about net
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operating losses, (NOL’s) and you should read that section carefully. • Look at each item on your profit and loss statement and start cutting unnecessary costs. Cut out the fat and get lean. Make all the cuts now that you have been thinking about for the last five years. • Make a new business priority. Promise yourself that for the next three months you will spend at least two hours per week working “on” the business and continue to improve the profit and loss statement and the balance sheet. In the second quarter, coming up, you need to make several financial changes so that your company comes back quickly in the third and fourth quarter of 2020. Business owners need to quickly contact their accountants, bankers, SBA regional office, and get details on how to apply for different sections of the CARES Act. This coronavirus disaster will come to an end and we will all be stronger on the other side. Be safe and stay healthy. To read the full article including ideas for taxpayer/family, click here. Gary Pittsford, CFP®, is president and CEO of Castle Wealth Advisors, LLC. Castle specializes in helping families and closely-held business owners with valuations, succession planning, estate and income tax analysis and retirement income security. For more information visit www.Castle3.com, call 1-888-849-9559 or e-mail Gary@Castle3.com. THe HARDWARe Connection ■ April 2020 ■ 59
Category report
BarBecue and grilling trends
M
ay is National Barbecue Month, representing the beginning of peak grilling season. The Hearth, Patio & Barbecue Association (HBPA) shares top trends expected for the barbecue, grilling and outdoor living categories for 2020. A full 37 percent of grill owners plan to purchase another grill in the year ahead, according to the Hearth, Patio & Barbecue Association’s (HPBA) biennial consumer survey. Among the study’s additional findings: Almost two-thirds (64%) of U.S. adults own a grill or smoker. • Year-round grilling remains highly popular. The survey reveals 75% of owners grill in the winter, 23% grill on Super Bowl Sunday 13% on Thanksgiving and 9% grill on New Year’s Day. • Gas remains the most popular fuel, with 61% of grill owners using propane, followed by charcoal (49%), which has increased slightly since 2017 (45%). Ten percent of owners have an electric grill, 9% have natural gas grill and 3% have a wood pellet grill. • Why do people grill? 68% of owners do it for the flavor, followed by lifestyle (45%), convenience (33%), entertainment (32%) and hobby (19%). • Grill purchasing continues to buck the e-commerce trend, with 83%
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Jed’s Hardware & Garden Center in Holden, Mass., has a showroom dedicated to Weber grills and accessories.
of grills purchased in-store but only 15% online. • One in 10 grillers have a full outdoor kitchen, and 56% of these individuals use that kitchen at least once a week.
outdoor power equipMent trends Consumers remain confused about the multiple fuel product offerings in the marketplace, according to a new study by the Outdoor Power Equipment Institute. The study shows lack of education, inadequate labeling and dangerous marketing tactics around new fuel products, such as higher ethanol-blended gasoline, are likely causing consumers to misfuel. The study found that more than one in five outdoor power equipment owners are currently mis-fueling and one quarter have done so in the past. • The study found that 37% of Americans (up from 30% in 2015) mistakenly believe that higher ethanol blends of gasoline are safe to www.ThehardwareConnection.com
Pell City Ace Hardware in Pell City, Ala., has a strong niche in outdoor power equipment from Stihl.
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use for any gasoline-powered lawn equipment or other small engine products. 52% of outdoor power equipment owners say they either don’t pay attention to (25%) or are unsure of (27%) the type of fuel they use in their outdoor power equipment. When it comes to battery-powered outdoor power equipment, 78% of owners are likely to charge the battery overnight, 63% are likely to charge the battery for more than 24 hours and 59% are likely to leave the battery on the charger until it is needed. All of which could potentially cause damage to the battery or create a safety hazard. 79% of outdoor power equipment owners say it is important to them that the extra/replacement batteries they purchase are from the same brand as the piece of equipment they will be used for. The outdoor power equipment market is expected to grow 3.2% annually, from $22.3 billion in 2019 to $26.1 billion in 2024, according to MarketsandMarkets Analysis.
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Sullivan’s Hardware & Garden in Indianapolis set up this outdoor patio vignette that showcases decorative accents.
outdoor Living trends With more Americans staying home due to the COVID-19 pandemic, they are instead investing more time and money creating a backyard oasis. This trend is driving increased interest in vegetable, herb, flower and vertical gardens; fire pits and outdoor fireplaces; outdoor kitchens and outdoor bars; patio and landscape lights; outdoor and casual furniture; yard art and decorative accent pieces. What follows are additional trends in outdoor living and furniture. • Metal and plastic outdoor furniture are being replaced with more natural materials like wood, wicker and rattan, with ergonomic comfort emerging as the function that trumps hardiness to weather elements, according to Adorable Home magazine. • Warm, earthy and inviting color hues are trending such as brown, taupe, olive green and golden yellow. • This year’s outdoor fabric color of choice is blue, from classic navy to blue striped. n The hARDWARe Connection ■ April 2020 ■ 61
outdoor power equipMent/outdoor Living/griLLing produCts
BLue rHino propane eXCHange fatwood® firestarter • Unlike most other firestarters, Fatwood is ideal for any indoor or outdoor situation. There’s no spilling, no odors, no chance of flare-up and no dangerous toxins to breathe. • It’s safe, clean, waterproof and has an indefinite shelf-life. You can use it to start your backyard grill or your indoor fireplace safely and easily, even when wet. • Born from the wood of old pine stumps left for waste after logging, Fatwood is made from splitting the stumps of pine trees that contain a high concentration of natural resin. As the stumpwood hardens over time, the resin or sap concentrates to create an all-natural, 100% organic, chemical-free fire starter. Fatwood comes from non-rainforest areas of Central America and is part of the company’s dedication to sustainable forestry. Better Wood Products www.betterwoodproducts.com 912-231-0909 62 ■ The hARDWARe Connection ■ April 2020
• Blue Rhino cleans, leak-tests and inspects every tank; retrofits tanks that have outdated components; and requalifies tanks when needed. • Blue Rhino recycles millions of propane tanks every year, keeping them out of landfills. Since propane is a clean-burning fuel, the U.S. government lists it as an alternative to other fossil fuels. • If you have an empty tank, it’s as easy as Drop, Swap & Go. First, find a Blue Rhino retailer by visiting the store locator or by texting FIND to 75653. When you arrive at the store, drop your empty tank beside the propane display. Next, purchase a tank from the cashier. A store employee will escort you to the display and provide you with a fresh, ready-to-grill tank. • Use the Rhino Gauge app from Blue Rhino to make sure you never run out of gas while grilling again. Blue Rhino www.bluerhino.com 800-258-7466 www.ThehardwareConnection.com
MuLtipurpose utiLity transfer tank
• The SR 200 gasoline-powered backpack sprayer can tackle outdoor jobs that require greater range and higher pressure than manual sprayers. • When you need more power than a manual sprayer but want the same portability, the STIHL SR 200 is the answer. This value-priced sprayer features a low-exhaustemission, fuel-efficient engine that delivers up to 20% better fuel economy than most conventional 2-stroke engines. • It’s easy to use with a one-hand, joystick-style control handle and provides excellent control over rate and range of spray. STIHL USA www.stihlusa.com 800-467-8445
• This new Multipurpose Utility Transfer Tank opens the door to vast new markets and makes performing daily tasks much easier. • Applications include watering plants, washing your hands/dishes while camping, filling up the dog’s water bowl, diesel exhaust fluid, windshield wiper fluid, coolant and more. • Comes in both 2+ gallon & 5 gallon capacities. • The flexible spout rotates down more than 180 degrees and fits perfectly into any machine’s fill location while the thumb release trigger on top controls the flow. By pulling straight back on the safety trigger and then down on the thumb button, fuel is released immediately while you stay in complete control. When you notice your fill tank is almost full, slowly release the thumb button and allow the excess fuel to drain from the top of the spout before rotating it back up. No more bending over and tipping your fuel can forward and holding it in an awkward position. SureCan www.surecanusa.com/utility 801-827-0500
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The hARDWARe Connection ■ April 2020 ■ 63
sr 200 BaCkpaCk sprayer
CONFERENCE2020 AUGUST 21-23
reGIsTer Here TOdAY!
“Where Relationships Are Formed”
3 Days of Networking, Relaxing and Learning Meet colleagues and new friends at the industry’s largest conference for independent hardware retailers. Share ideas with top retailers on how to grow your business, interact with key vendors on how to increase sales in your store and attend educational seminars, all-industry cocktail receptions and dinners in an exclusive 5-star resort setting.
Learn More About Your POS System at the Hardware Technology Forum Epicor will offer full-day, hands-on training sessions for retailers. Bring your tablet or laptop so you can log right into your store as you learn new “tips and tricks” to make your POS software more productive in your store.
Honor the Industry’s Best Retailers at the 2020 Beacon Awards The Beacon Awards are an important recognition program that honors the best of the best dealers who represent the future of the industry. Presented By
FOr MOre INFOrMATION ABOUT ATTeNdING THe BeAcON AwArds ALONG wITH ALL OTHer edUcATIONAL seMINArs, OPeN FLOOr dIscUssIONs ANd sOcIAL AcTIVITIes AT THe HArdwAre cONFereNce, VIsIT www.THeHArdwArecONFereNce.cOM
IN THE NEWS NEW STORES: • • • •
• •
•
Mount Shasta, Calif. • Rice Lumber in Shelburn, Vt., is Royersford Ace Hardware is celebrating its 90th anniversary. opening in Royersford, Pa. • Jim Leavitt of Marcus Lumber Walter Toole is opening his 11th Company in Iowa received a store, Aloma Ace Hardware, in lifetime achievement award Winter Park, Fla. from the Tri-State Lumberman’s Matt and Mark Beverly opened Association. Beverly’s Ace Hardware and Outdoor Power in Gainesville, Ga. • Matt and Amber Engle, owners of Lumber House True Value Nation’s Best has acquired five in Abilene, Kan., were honored locations of Bridgeport Building as the Abilene Area Chamber of Center, which serves the DallasCommerce 2020 Distinguished Fort Worth market. Business of the Year. In October Keyur Amir opened League City 2019, the Engles moved their small Ace Hardware in League City, Texas. lumberyard, Webb Home Center, Sleepy Eye Ace Hardware in into a former Shopko location and Sleepy Eye, Minn., is holding a grand renamed the business Lumber reopening for the business since it House True Value. was purchased by Mike Wieboldt from Russ and Ann McCabe. David and Cheryl Karsten have purchased Maricopa Ace Hardware in Maricopa, Ariz., from Lumber House True Value Mike Richey.
• The Manufacturing Institute’s 2020 STEP Ahead Award honorees • Leigh Ann Akard is celebrating and Emerging Leaders include: the 65th anniversary of Akard True Lorraine Amesbury Holder, Value Hardware in Zionsville, Ind. STIHL; Courtney Balliet, PPG; Leah Christakes, SherwinWilliams; Kristin Day and Sarah Tommelein, Whirlpool Corp.; Amber DePietro, Eaton Corp.; Katie Ehrke, John Deere; Colleen Emery and Carolyn Vanous, 3M; Elise Ramshaw’s Ace Hardware from 1961. Gauthier, Stanley Black & Decker; Sonal Gola, Pentair; • The Ramshaw family is Janet Lynch, Certainteed; Kim marking the 75th anniversary of Miller, Thomas & Betts; Christy Ramshaw’s Ace Hardware in
KUDOS TO:
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THE HARDWARE Connection ■ April 2020 ■ 65
Morton, The Clorox Company; Support Centers and more than Lauren Speaker, GE Appliances; 4,300 locally owned stores across Rebecca Tallon, A.O. Smith the U.S. Interested applicants can Company; and Meg Zehringer, visit storejobs.acehardware.com or National Gypsum. text AceStoreJobs to 242424 for • Center Hardware in San more information. Francisco is marking its 140th anniversary this year. OTHER NEWS: • Kent Schaper of Arrowhead • Epicor Software Corp. Hardware in Baldwin City, Kan., announced Ace Hardware has received the 2020 Horizon Award officially selected Epicor Eagle as from the Baldwin City Chamber of its designated point-of-sale (POS) Commerce. solution, currently installed at more • Cindy and Scott Jerousek are than 3,400 Ace Hardware stores. celebrating the 60th anniversary Based on the success of the Epicor of Farm & Home Hardware in Eagle POS partnership that kicked Wellington, Ohio. off more than two decades ago, Ace has expanded the venture to PEOPLE ON THE MOVE: include a 5-year commitment to •The Wooster Brush exclusively use Epicor Eagle. Company has named • Benjamin Moore has Ben Maibach as the teamed up with the Painting 10th president in the Contractors Association to company’s 169-yearunder write participation costs history, succeeding for the association’s Operation Bill Fagert, who will Ben Maibach COVID-19 Response conference. become vice chairman. As the founding sponsor, Benjamin • Do it Best Corp. has named Moore is committed to assisting Jason Wetzel as associate painting contractors and small merchandise manager and Lance businesses navigate through the Gordon as senior data analyst. changes in the industry brought on by the current pandemic.
WHOLESALERS IN THE NEWS:
• With increased demand for essential products and services, Ace GET THE FULL STORY: Hardware Corp. and its independent • Record number of jobless claims. Click here. retailers plan to hire more than • New York State orders 30,000 people collectively to further nonessential construction support the communities they serve activity to halt. Click here. when they need it most. Full-time, • Home Depot employee tests part-time and seasonal positions are positive. Click here. available at Ace Hardware’s Retail 66 ■ THE HARDWARE Connection ■ April 2020
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UPCOMING EVENTS MAY Inventory Management/Inventory Control Webinar May 6, Webinar Series by Epicor; Learn More
Mid-States Rendezvous August 16-18, Minneapolis Convention Center, Minneapolis
JUNE
The Hardware Conference August 21-23, JW Marriott Marco Island Beach Resort, Marco Island, Fla. — www.thehardwareconference.com
House-Hasson Virtual Summer Dealer Market June 25-26
Orgill Fall Market August 27-29, Sands Expo and Convention Center, Las Vegas, Nev.
PRO Group 2020 Virtual Group Merchandising Conference June 22-24, Embassy Suites Atlanta, Downtown at Centennial Olympic Park, Atlanta United Hardware Fall and Winter Buying Market June 26-28, Minneapolis Convention Center, Minneapolis
JULY Reporting and Analytics Webinar July 15, Webinar Series by Epicor; Learn More
SEPTEMBER Do it Best Fall Market September 11-14, Indiana Convention Center, Indianapolis Home Hardware Fall Market September 13-15, Home Hardware Distribution Centre, St. Jacobs, Ont. Horizon Distribution Trade Show & Conference Expo September 11-13, Convention Center & Sundome, Yakima, Wash.
AUGUST
Monroe Hardware Fall Market September 11-13, Greenville Convention Center, Greenville, S.C.
China International Hardware Show August 7-9, Shanghai New International Expo Center, Shanghai, China
National Hardware Show September 1-3, Las Vegas Convention Center, Las Vegas, Nev.
Independent Garden Center Show August 11-13, Lakeside McCormick, Chicago
For a complete listing of calendar dates, click here. www.TheHardwareConnection.com
THE HARDWARE Connection ■ April 2020 ■ 67
Retail iDeas
Do it Best RetaileRs FinDing new ways to seRve theiR Communities While being designated as “essential businesses” has allowed independent hardware stores to remain open throughout the country, the reality of operating during a stay-at-home order is that retailers are finding new ways to serve their communities. Papenhausen Hardware in San Francisco knows all about dealing with a crisis—the store was destroyed by a fire on January 23, 2018. With a large helping hand from the community, Owner Matt Rogers, Manager Karl Aguilar and staff opened a temporary pop-up store on the one-year anniversary of the fire. So it’s not surprising to learn Papenhausen Hardware sprung into action to help its community during the pandemic. Click here to watch a news story video illustrating how the store has served as a coronavirus command center for the community, donating more than 700 masks and goggles for local hospitals. What do you do as an essential business with a dozen locations when you can’t have all your managers in the same room? You leverage technology to stay connected. Do it Best Territory Sales Manager Tony Miner was recently invited Top: Gillman Home Centers now holds quarterly managers’ meetings via Zoom. Upper Middle: The staff at Jones Home Center has adapted to take its service outside. Lower Middle: Marcus Lumber donated 100 items to a local food pantry. Bottom: Waters Hardware created curbside sunflower craft kits for kids. 68 ■ The hARDWARe Connection ■ April 2020
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In a new era of social distancing, home improvement stores have to be agile and creative in providing a safe environment for employees and customers. It Northwoods Hardware, Home & Garden sells helps to have a little sense of humor, too, hand sanitizer made as Jones Home Center in West Upton, by a local distillery. Ky., did with this video promoting their curbside service. to the Gillman Home Center quarterly In honor of Marcus Lumber’s 100th managers’ meeting via Zoom. anniversary, the Iowa-based Do it Best “We had a great conversation about member donated 100 food items to the how they were serving their community in a safe manner for both their customers local food pantry, filling some of the and their employees,” says Miner. “I was needed items on their request list. Marcus Lumber also shared an uplifting extremely grateful to get the opportunity store video on Facebook with the followto join and discuss how the Do it Best ing message: We all could use a little smile team is working to support their needs during this time...It is a time for safety and during this challenging time.” definitely a time for care too. To us there’s When the Evers family made the decino better way to show caring than with a sion to close the inside of their store, smile. And we’ve heard it’s contagious...so Village Hardware in Leipsic, Ohio, they had no idea how curbside service would here goes nothing! Click here to view. While Northwoods Hardware, Home & be received. They set up a tent and table outside, with interaction between staff and Garden in Glen Arbor, Mich., now offers customers protected by plexiglass shields. curbside pickup and free delivery, the Do Business has remained steady since, with it Best retailer has something even more enticing to customers. It carries a limited the Do it Best store pitching in further by donating two miles of elastic for commu- quantity of locally made hand sanitizer from Northern Latitudes Distillery. nity members to make face masks. Vince Christofora, owner of Woodstock Click here to view a news story video. Do it Best Hardware in Woodstock, N.Y., In Kansas, Do it Best member-owned sent a letter to friends and customers, reasWaters Hardware is helping provide fun suring them that Woodstock Hardware and free learning opportunities for local was there to supply them with the prodchildren during the COVID-19 pandemic. They created curbside sunflower kits that ucts and knowledge to keep their families safe. However, he also urged others to include crafts and information on the Kansas state flower. It is an excellent way join him in supporting a local not-for-profit for students to keep growing their knowl- organization that is working hard to keep children and seniors fed during this crisis. edge outside of the classroom. www.ThehardwareConnection.com
The hARDWARe Connection ■ April 2020 ■ 69
Retail iDeas
tRue value haRDwaRe stoRes shining a light oF hoPe Independently owned and operated True Value hardware stores across the country are joining True Value Company’s Shine-A-Light campaign by hanging decorative lights in their store front to express goodwill, hope and solidarity. The surge of COVID-19 cases and stayat-home orders have Americans adjusting to a new reality and looking for light amid the darkness. Known for being a resource in times of crisis, True Value stores are hanging lights to help lift spirits and show solidarity with their community. Moreover, hardware stores have been deemed an ‘essential’ Upper: Akard True Value Hardware kicked off business and the lights help remind peo- a Shine-A-Light campaign that has resonated throughout the Zionsville, Ind., community. ple that True Value stores are open and ready to serve in whatever way is needed. Lower: True Value’s Shine-A-Light campaign “Shine-A-Light demonstrates our col- promotes how locally strong and essential lective spirit and readiness to help, while hardware businesses are serving as beacons of emphasizing how we’re locally strong,” hope in their communities. said Leigh Ann Akard, owner of Akard while raising awareness of local charities True Value Hardware in Zionsville, Ind. “People are loving the lights in our store to support during this time of need. “Independent hardware store ownfront and I encourage everyone to unite with us to illuminate positivity through- ers and staff represent some of the most hardworking, selfless and reliable people out their community.” After Akard got the ball rolling with her in communities across the country,” said store, the entire community of Zionsville John Hartmann, president and CEO of got involved with people putting back up True Value Company. “Let’s all shine a their Christmas lights. The town even lit up light with them to bring hope and cheer the big Christmas tree on the Main Street, into these challenging times.” ■ 70 ■ The hARDWARe Connection ■ April 2020
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Connection
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December 2019 Vol. 11, No. 8
THE INDUSTRY’S DIGITAL LEADER
RepoRt on Business Conditions ARound the CountRy
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LOOKING BACK AT 75 YEARS OF DO IT BEST CORP. HISTORY
IO
DI GIT
YEARS
I N N O VA
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CADE DE
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CELEBRATING A DECADE OF PUBLISHING INNOVATION
February 2020 Vol. 12, No. 1
THE INDUSTRY’S DIGITAL LEADER
Part II: How tHe Hardware Industry Is CoPIng wItH tHe PandemIC
March 2020 Vol. 12, No. 2
the industRy’s digitAl leAdeR
Retail RebiRth: Independents
Thriving in Former Chain Sites
April 2020 Vol. 12, No. 3
Restoring HOPE & PROSPERITY to a Dying But Resilient Town
tHe Industry’s dIgItal leader
How to ATTRACT the NEXT GENERATION of CUSTOMERS
ALSO INSIDE:
ALSO INSIDE:
LBM Category Trends Holiday Merchandising Displays
Q&A with Do it Best President Dan Starr Paint and Decorating Category Trends
CLICK HERE & SUBSCRIBE YOUR ENTIRE STAFF FOR FREE!
alSO iNSiDe: i NSiD De:
6 Planning Topics for Family-Owned Business Succession How is Coronavirus Impacting the Industry?
SPECIAL REPORT: Rising Up to Battle the COVID-19 Threat ALSO INSIDE: How Can Your Business Get Relief from the Coronavirus CARES Act? How to Retail During COVID-19
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E H T D N I NUMBERS H E B
43%
Percentage of consumers who find it reassuring to hear from brands they “know and trust” as COVID-19 pandemic spreads, per research from the American Association of Advertising Agencies, with 40% wanting to know how companies are responding to the coronavirus pandemic.
120.0
The Conference Board Consumer Confidence Index® for March, down sharply from 132.6 in February. The Expectations Index—based on consumers’ short-term outlook for income, business and labor market conditions— declined from 108.1 last month to 88.2 in March.
166.5 million
Number of masks (nearly all N95) 3M has committed to making and importing to the U.S. over the next three months that will be directed to frontline healthcare workers. 72 ■ THE HARDWARE Connection ■ April 2020
56%
Percent of U.S. small businesses who say that direct cash payments to Americans would be the most helpful form of aid from the government, followed by loans and financial aid (30%), and suspending payroll taxes (24%), according to the U.S. Chamber of Commerce.
92%
Percentage of U.S. small businesses that are negatively impacted by the pandemic, according to the National Federation of Independent Business.
43%
Percentage of consumers who believe coronavirus messages from retailers sound too similar and “are losing their impact,” according to the American Association of Advertising Agencies. www.TheHardwareConnection.com