Hardware Connection February 2015

Publisher/Principal: Tom Chasteen tom@thehardwareconnection.com 305-852-6126

Editor/Principal: Chris Jensen chris@thehardwareconnection.com 317-514-8864

Associate Publisher: Craig Cope craig@thehardwareconnection.com 804-690-0666

By Chris Jensen

Winning Retail Battle Starts at Local Level

The battle for customers’ hearts, minds and wallets is fierce and ongoing, but many independent retailers are starting to realize that it’s very much a local battle and more importantly, it’s winnable.

No matter whether your store is located in a city, a suburb or a small town, it’s all about getting customers to shop local. If they get in their car and drive to the next town or the next neighborhood to do their shopping, then the whole community loses, not just your business.

If you are a Main Street retailer, your business won’t thrive if all the other Main Street businesses are boarded up. When the local economy dries up, the snowball effect impacts jobs, tax revenue, schools and overall quality of life in a community.

projects be reserved primarily for independent businesses.

If your community does not have a “Buy Local” campaign underway, then perhaps you should take charge and start one.

A recent study by Civic Economics in Salt Lake City determined that local retailers return a total of 52 percent of their revenue to the local economy, compared to just 14 percent for national chain retailers. That’s because local, independent businesses spent more on local labor and services from local providers, plus profits are going into the pockets of local owners who reinvest in their communities. If your community does not have a “Buy Local” campaign underway, then perhaps you should take charge and start one. Talk to other local businesses and develop an action plan for involvement.

The “Buy Local” movement, which started in Boulder, Colo., in 1998, is gaining steam across the country. Cities such as Austin, Texas, are even mandating that downtown redevelopment

Local residents will be less inclined to get in their cars and drive to the next town to shop the big boxes if they are educated about the benefits of shopping local. Go to www.independentwestand. org for ideas on how to reach out to your community about the many benefits of buying local. n

Ethe way i see it

By Tom Chasteen

Paying Respect to One of the ‘Good Guys’

very hardware retailer I’ve known over the past 40 years has a favorite story about one of the “Good Guys” (man or woman) in the hardware industry, someone who has really influenced their career and helped them develop their business.

One of the very first “Good Guys” I ever encountered was a wholesaler salesman who took me to one of my first wholesaler shows as a “Keen Cutter Retailer.” I was 10 years old and had worked my first summer in the family hardware store.

Little did I know that that relationship would turn into almost 40 years of going together to hardware shows and advisory board meetings. I called him affectionately “Uncle Paul,” as did the other young retailers who were fortunate enough to be mentored by “Uncle Paul” Weintraub.

I will never forget the first time Uncle Paul introduced me to John Cotter, the founder of True Value. I was completely taken aback by Mr. Cotter’s firm hand shake and how he spoke with me as if no one else was in the room.

Even though our family hardware store was affiliated with Ace

Hardware, I would always try to go to the True Value Show with “Uncle Paul” and I was able to speak with Mr. Cotter on several occasions. He always remembered my name. To this day I don’t know how he could remember all those retailers’ names, but he always did.

Each of us retailers can recount industry “Good Guys” over the years that have influenced them. Names like Richard Hesse, one of the co-founders of Ace Hardware Corp.; Don Wolf, the longtime former president at Hardware Wholesalers Inc. (now Do it Best); Joe Orgill, who still greets retailers at the front entrance of the Orgill shows; and Don Hasson, whose family has owned House-Hasson for more than 100 years. These men are all legitimate “Good Guys” that most hardware retailers have either met or heard about during their hardware careers.

The people who have had the biggest influence in my business career all share similar traits. They are honest and sincere people who truly do care about the independent hardware retailer and their families.

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the way i see it

When they speak with someone they give them their full attention and they are excellent listeners. They also share one other trait that I find amazing. They have the ability to help and encourage the people around them to excel, sometimes with a gentle nudge or encouraging someone to pursue something with enthusiasm. Other times they just listen while the person they are talking to works out the solution to their problem on their own. What they really do more than anything is show they care about this industry, especially the people and families in this industry.

For the past 40 years another one of those “Good Guys” for me has been Doug Laird, the current director of hardware sales with Apex Tool Group (formerly Cooper Tools).

Doug is not flashy or one to brag about his accomplishments, but during the past 40 years I would be hard-pressed to think of anyone who has supported the independent hardware store owner more than Doug Laird.

Doug has literally attended every wholesaler show Apex Tool Group participates in, along with many other industry events and duties on an endless list of boards and committees. He has mentored countless young men and women looking to

Doug Laird

For the past 40 years another one of those

“Good Guys” for me has been Doug Laird, the current vice president of hardware sales with Apex Tool Group.

advance their careers in the hardware industry and he has gone out of his way to help any hardware retailer who has asked.

To me what is so amazing is that he has done all this with so much humility over the years. You would never know how many lives he

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the way i see it has touched during his career with Apex Tool Group.

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Doug is retiring at the end of this month to pursue his other three passions in life: his wife Ann, his grandchildren and his love of golf. He will certainly be missed by all of us who know him, but he leaves us with an enduring legacy and a very competent sales team in place at Apex Tools headed up by Pat O’Reilly, who all feel as strongly as Doug does when it comes to the independent hardware retailer.

On behalf of the hardware industry I would like to say thank you, Doug. Thank you for your support, patience and encouragement over the years; for helping to make all of us better retailers, for strengthening the foundation of our industry and for making me a better person, a better retailer and a better publisher. I look forward to spending time with you during your retirement.

Join us at this year’s Hardware Conference, September 11-13 in Marco Island, Fla., as we will be honoring Doug Laird with a muchdeserved Lifetime Achievement Award. ■

Tom Chasteen, publisher/principal of The Hardware Connection, owns Tavernier Hardware in the Florida Keys. Contact him at tom@thehardwareconnection.com .

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THARDWARE STORIES Amazing but TRUE

he other day, a guy brought back a bunch of bolts for a project he was working on. He said they were the wrong size. So, he goes back and picks out new bolts. They were the exact same size he’d returned.

Jim Hank Hank Brothers True Value Paducah, Ky.

We had a woman shoplifter who was in here in shortshorts and a crop top. She took a big flashlight, but we couldn’t figure out how the heck she got it out. We looked at it go right down the crack of her butt.

Steve Spradlin Lake Isabella True Value Lake Isabella, Calif.

We’re always playing jokes on employees. One time, we had a new girl just out of high school. We received our faxes from a printing shop next door. So, we gave her a dolly and asked her to get the fax. She thought she was getting some sort of machine, but it was just a piece of paper.

Doug Boston Boston’s True Value Page, Ariz.

Recently, we had some people run some credit card fraud on us. They got us for $27,000 worth of lumber. But when they were coming back to pick up another load, we’d received a call from the lady whose credit card was being used. The sheriff hid around the corner and when they came back, he hauled them in.

Jerry Shaw Shaw Building Supply Mt. Olive, Ala.

Built in America. Believing in America.*

Heather Jones

Assembly/Blowers

Tanisha Hyman – Assembly/Trimmers

Evens “Mo” Mompremier – Packing Lead

How’s

MIDWEST

Business?

Sales in 2014? We were up 17 percent for the year. The year started out with some strong weather-related sales. We had some heavy snows, so we had a lot of power equipment sales. That helped put our name on the map for people, so they kept coming back throughout the year. Smartest thing you did in 2014? Managed expenses. We reviewed our major expense lines and found where we could whittle away. We trimmed some payroll, specifically manager hours. Also, we refinanced and paid off debt and lowered our interest rate substantially.

Most effective methods to find new employees? Mostly it’s word of

mouth here, people we know. It’s a bring in a friend kind of thing. We’re a small operation with only three full-time employees. New initiatives for 2015? We’re going to bring in a lot of the new True Value True Blue assortments. We’re doing a significant remerchandising of the store. We’re redoing a lot of sections of the store, new paint thinner and a lot of new cleaning categories. We’re also advertising a lot more this year with the new True Value plan. They’re paying for five circulars, and we’re increasing advertising accordingly. We’re also putting new directional signs outside to let people know we’re here.

Dale Ter Haar

South Park Hardware South Holland, Ill.

Dale Ter Haar renamed the store South Park Hardware when he bought it in 2003.

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How’s Business? NORTHEAST

Sales in 2014? This is the first year we’ve owned the store and we had a good first year. We did about 60K a month. We were hoping for a little more, but that’s a good start. The store has been in existence since 1856 but we took over in March last year. We did a lot of small tinkering and that’s made a big difference. We increased the inventory and changed the appearance of the front end. Customers have responded positively, too.

Smartest thing you did in 2014? The smartest thing had to be increasing the inventory. Electrical and plumbing are big for us, because we have a fair number of contractors. We paid close attention to inventory turns and would reorder to keep high-turn items in stock. Also, we had some people with charge accounts with large balances, so we went after those aggressively.

Most effective methods to find new employees? We put a post on Facebook and use word of mouth. Since we took over, we’ve hired three people. Those methods seem to work well.

New initiatives for 2015? We’re going to add a lawn and garden center.

Pague & Fegan Hardware promotes locally made products.

Right now, it’s an old-line store like a bowling alley. We have lawn and garden scattered in different places in the store. So we’re going to put it all in one area. We feel that we’ll gain some impulse sales that way. We’re also putting in a True Value paint system.

Mike Fague

Pague & Fegan Home & Hardware Shippensburg, Pa.

SOUTH

Sales in 2014?

The store was just a little bit behind 2013, which was our best year. Still, we had a pretty good year.

Smartest thing you did in 2014? We got rid of obsolete products and brought in more new products. When I go to hardware shows, I spend half my time looking at new products. Whenever a customer comes in and asks for something

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we don’t have, we jot it down in a log book. Once customers ask for something two or three times, I know that it’s a product we need to have in my store. We have been using Facebook a lot. We’ll post information about items, such as faucet covers before a cold snap. You have to get customers to think that they need something before they need it. We always push the convenience of our store. We’re 15 miles away from the nearest big-box store, so people can stop by on their way home. I’ve even come in and opened the store after hours for people.

Most effective methods to find new employees? We don’t have a lot of turnover. We network and talk to people who come in the store. I knew our newest part-time hire because his daddy does home repairs.

New initiatives for 2015? I want to bring in at least 300 new products. There are 37 new products coming in this month. Right now, we have about 7,000 to 8,000 SKUs. We need to keep shedding obsolete products. I’ve been here six years and there’s some merchandise that hasn’t

turned. Also, we’re looking to have a better assortment mix—affordable products our do-it-yourselfers will buy along with higher-end products for professionals. We will expand our pet products, too. I’m looking to add a greater variety of dog collars and dog toys. We have a line of cast-iron cookware that does really well. It’s a fourfoot display and has a very good return. I want to keep looking for locally made products. I have this local guy who builds bird houses and paints them ungodly colors, but they sell like crazy.

Rufus “Duck” Duckworth Bladenboro Hardware Bladenboro, N.C.

SOUTHWEST

Sales in 2014? Sales were very good. We were up over 20 percent over last year. We invested in a new facility and that really paid off. And we also have a healthy local economy.

Smartest thing you did in 2014? We moved into a new building. It gave us more exposure and changed our image.

An attractive mural decorates the outside of Bladenboro Hardware.

How’s Business?

Now, couples come in to make buying decisions. It’s a much friendlier, more inviting environment. The store is now more welcoming and comfortable to women. Before, we didn’t attract women customers.

New initiatives for 2015? We’re going to do more employee training during the late winter and early spring. We do product knowledge. I schedule sessions in advance and plan them so they’re less than an hour long. We’ll review different types of products, such a decking, railings or door locks. This lets me see where the employee’s level of product knowledge is and provides a refresher.

Scott Glasscock

Mawson Lumber & Hardware Fort Collins, Colo.

Mawson Lumber & Hardware was established in 1979.

WEST

Sales in 2014? They were good. We added a second store 85 miles away. Comparing single-store sales, we were down a little in the original store. But overall, we’re up 20 percent. We’ve had a lot more business. We had 14 commercial jobs and some residential projects along with our do-it-yourself customers.

Smartest thing you did in 2014? I purchased the business from my dad. We also expanded our second store. We added more hardware and lumber along with building new lumber sheds. That’s helped us the most. We increased the amount of lumber we carry by about five times.

Most effective methods to find new employees? We’re in a little different situation where you know a lot of people. It’s as much recruiting as it is advertising and hiring. We did add two more employees in 2014. Advertised in the local paper and asked if they’d be interested.

New initiatives for 2015? My big plan for the coming year is to open a rental center and do a little expansion. We dabbled in rental a little. I did some homework. The closest rental center is 50 miles away. I called them and asked how busy they were and talked to contractors to see if they would support a rental center and what kind of machinery they’d need.

Greg Pace

Loa Builders Supply and Escalante Do it Best Home Center

Loa and Escalante, Utah

The Pace family opened their second Utah store in late 2013.

From Tom’s Shop

hardware products review

We are well into 2015 and I am excited about the future. Gas prices have dropped significantly and I am eagerly awaiting a significant drop in “fuel surcharges” on my weekly invoices. Unemployment continues to drop, and real estate values almost everywhere have bottomed out and are slowly improving. Interest rates continue to remain low,

product #1: screwdriver Line channeLLock inc.

Channellock is a remarkable company. They remain family owned and the fourth generation is firmly involved in day-to-day management of the company. The one thing Channellock has done that I think any manufacturing company would be envious of is they have developed such a strong brand that consumers and retailers trust.

Developing this trust is one of the major cornerstones to the Channellock name and anyone associated with Channellock will tell you it has not been an easy task. It

By Tom Chasteen

which undoubtedly helps in our economic recovery. Even more importantly, people believe that we have weathered the worst of the economic storm and see better prospects ahead. As I heard one economist say, “The economy is as much about a mindset as it is a condition.” Only time will tell, but all indicators seem to point to a greater confidence in our economy going forward.

begins with their dedication to quality both in raw materials and the finished products.

Recently, Channellock has added a complete line of quality screwdrivers

to their existing product assortment. This line of screwdrivers features a high-quality, four-sided acetate handle that is extremely durable, making the handle highly impact-resistant and resistant to most solvents. Each screwdriver comes with a precisionmachined tip that is heat treated for additional strength and durability and is then chrome plated for superior corrosion resistance.

This complete screwdriver product lineup includes regular slot and Phillips screwdrivers as well as Torx® and square head screwdrivers. The lineup also includes color-coded nut

drivers, 16-inch shaft screwdrivers, precision driver sets, hook and pick sets as well as screw starters.

The most important feature all of our field testers commented on was that each screwdriver has the Channellock® brand embossed into each handle. As one tester said to me, “That says a lot!” I would agree. For more information on Channellock’s new screwdriver lineup click on this link: https://www.channellock.com/screwdrivers.aspx

product #2: saFetY air Guns | Guardair corp.

Guardair Corp. has developed a high-end line of safety air guns that features OSHA-compliant nozzles, ergonomic grips and all-metal construction. These are some of the finest well-constructed air guns I have ever seen offered in the hardware channel. If you have a serious do-it-yourselfer or commercial customer base, then you need to take a few minutes and look over these products.

They come in two basic categories. The Lazer Series is more compact and would appeal to the serious DIYers. The Classic+ Series is a heavy-duty commercial air gun

that will stand up to just about anything it might encounter in a commercial setting.

Click on this video link to learn more about the Guardair air guns: https://www.youtube.com/ watch?v=lgpFfCf0dgE

EASY TO USE. EASY TO CONTROL. HARD TO KEEP ON THE SHELF.

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product #3: Mr. BeaMs

Motion sensor spotLiGht

Mr. Beams is on the cutting edge of battery-powered LED lighting. Go to any wholesaler show or Google LED lighting and you will see firsthand that there is no shortage of manufacturers claiming to have the latest and greatest LED light solutions for your house, garage, parking area, motor home or boat. I’m somewhat skeptical of marketing claims, partly because “this isn’t my first rodeo” when it comes to evaluating products for our store.

When I first looked at the Mr. Beams products a little over a year ago I admit I was more than skeptical when I was speaking with Steve Walters, the company’s sales coordinator. However, the product was well merchandised and it didn’t feel like it was poorly constructed when I picked it up, so I agreed to have our testers try out a couple of their products.

I am happy to report that all three of our testers were in agreement— the Mr. Beams motion sensor spotlights were first-rate. We have been testing these products for just over one year and I am amazed that not

one of the testers has had to change the batteries. In addition, the brightness and lighting area are as good as and maybe better than a traditional 75 watt flood light bulb. Our testers also reported that the motion sensors in the spotlights were excellent and in two of the three products exceeded the sensor range of 30 feet. Each spotlight comes with an easy-to-mount bracket and allows the light to be pointed in just about any direction you would like, totally eliminating the need to run electric to the light. Each spotlight requires three or four D cell batteries depending on the model.

To see the Mr. Beams light in action click on the links below: https://www.youtube.com/ watch?v=AajfefThN74

https://www.youtube.com/ watch?v=ebhvlKHcDoE

SEPTEMBER 11-13

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, ECi Advantage/ECi RockSolid and J-3 POS will offer full-day, hands-on training sessions for their 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 2015 Beacon Awards

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Hiring the Best employees

Most hardware retailers have horror stories to tell from their employee recruitment efforts. They have learned that it is better to attract those who already have a job than those who are unemployed, because those folks are usually unemployed for a reason.

One retailer tells the story of a memorable job interview, when the applicant said if hired, he would be unable to work Tuesday evenings because that night was reserved for an anger management class he needed to attend for waving a knife in his wife’s face.

Shane Athey (floor manager) and Camille Gibson (operations manager) walk the floor at Mark’s Ace Hardware in Tucson, Ariz., to make sure the staff is taking care of customer needs.

Alan Talman of Karp’s Hardware in East Northport, N.Y., recounts the time a 20-something guy walked in right out of the blue and asked for a job application. “We were not currently looking for anyone but I like that kind of initiative. Sadly, he was wearing his earpieces for his iPod at the same time, so he could not hear me ask him his name,” Talman says.

By Chris Jensen

Matt Fabian with Turner, Pierce & Fultz Ace in Navasota, Texas, remembers the job candidate who pointed out how much he could bench press, in addition to fluently speaking and reading English. You can’t make this stuff up.

Read on to learn how other retailers are facing the challenges related to hiring.

Finding new Hires

If you only recruit when you have an opening, then you will hire out of desperation. That is why it is better to adopt an always hiring policy.

“We put a post on Facebook and use word of mouth. Since we took over (in March 2014), we’ve hired three people. Those methods seem to work well,” says Mike Fague of Pague & Fegan Home & Hardware in Shippensburg, Pa.

Scott Glasscock, manager of Mawson Lumber & Hardware in Fort Collins, Colo., says their best candidates usually walk through the door—as customers.

“We have several who have been here more than 30 years. We don’t have a lot of turnover,” he says.

Finding delivery drivers is done through word of mouth or Craigslist, according to Glasscock. “In our Craigslist ads, we spell out the physical requirements and also mention that we’re only open five days a week.

Miranda Clift, an employee at Dave’s Ace in Milton, Wis., proudly shows off that she graduated this past May from the Dale Carnegie course on customer service and earned the Highest Award for Achievement in her class. Owner Dave Warren pays to have all employees undergo the Dale Carnegie training.

People applying see that as a benefit, so we put that in the ad,” he says.

“We don’t have a lot of turnover,” says Rufus Duckworth, manager of Bladenboro Hardware in Bladenboro, N.C. “We network and talk to people who come in the store. I knew our newest part-time hire because his father does home repairs.”

Here are some other ideas for attracting good help:

• Pass out your business card when you spot someone giving good service at another retail business.

• Place a job board by store entrance.

• Offer cash bonus to employees for referrals.

• Attach a help wanted flier to customer bags.

• Partner with local community college or vocational schools.

• Find older workers at seniors4hire. org or seniorjobbank.com.

• Contact companies who are laying off staff.

• Run a 30-second radio ad.

• Use company like Spherion (www. spherion.com) to recruit and screen candidates.

seeKing sTAr eMPLOYees

Qualified candidates can be hard to find, but high-performance retailers have learned how to master the art of separating potential star performers from slackers. So what attributes do retailers look for to find these star performers?

Scott Plummer of Plummer’s Do it Best Hardware in Farmington, Mo., looks for willingness to help, attention to detail and maturity. He was getting ready to cut loose a young staffer who lacks attention to detail and maturity.

2015 UNCOVERING SOMETHING NEW IN

Stop by our booth at the upcoming spring show to see what we’ve been working on.

Bob Brame of Cadiz Hardware in Cadiz, Ky., looks for honesty, willingness to work the shift needed, maturity, attention to detail and willingness to learn and remember. “We have two young people that came in as juniors in high school and are now in their second year of college. One was great from the first day, while the other was poor in the beginning but is now a pretty good employee. I hope we have been a part of that,” he says.

Attitude tops the list for Brandon Buckalew of Hardware Hank in East Grand Forks, Minn., but he also looks for willingness to go the extra mile to do what needs

to be done, attention to detail and knowing how to say “Help please” and “I don’t know but I’ll find out.”

Buckalew explains, “Nothing drives me nuts worse than a bad attitude. Everyone has bad days. Get over it! When an employee starts to complain about something, I ask them, ‘Would you like to trade your day for mine?’ All of a sudden they don’t complain so much. I have no problem with talking about how busy you are or how hard things are, but don’t complain about it. Don’t limit yourself because ‘you don’t feel up to it.’ This is a small hardware store; we’re not curing cancer. Sharing that with my staff has changed a lot of their attitudes.”

Whitney McKellar of M&M Lumber in Tulsa, Okla., looks for competence and

character. “If you have these two traits, you are trainable. You can’t teach these traits. You’ve either got them or you don’t,” she says.

Tim Pruitt of Avilla Hardware in Alexander, Ark., seeks out job candidates who show initiative. “There is nothing like an employee who does not have to be told what to do during slow times such as straightening and facing shelves,” he says.

Shawn Drillen of Drillen True Value in Portland, Maine, looks for honesty, attitude, initiative, willingness to learn and attention to detail, in that order. “Having a combination of all of these traits is what embodies the character of a good employee,” Drillen says.

eMPLOYee issUes

Hiring BiLingUAL eMPLOYees

The still-growing size of the Hispanic population in the United States, 53 million as of 2014, has created a need for hardware retailers to add more bilingual employees.

“It seems to me that associates with specific language skills could play a huge, defining role to the total customer experience in a hardware store, and could easily be another point of separation from the big boxes,” says Phil Brakefield of Unisource.

Matt Mazzone of Mazzone Ace Hardware in Brooklyn, N.Y., has quite a few employees that speak other languages, from Spanish and Hebrew to Hungarian. “They all get paid according to what they bring to the table, but the rapport they can bring is invaluable. I have some customers that refuse to let me help them and want an employee that speaks their language,” he says.

Buckalew has an employee that speaks both Spanish and English. “I didn’t hire her for this reason, so I don’t pay extra. Maybe once a year we get someone in here that doesn’t speak English and only then does it come in helpful,” he says.

“You might get more Spanish-speaking customers in your store if you had a Spanish-speaking staff member,” points out Talman of Karp’s Hardware. “Just like barbers and bartenders, our employees

have their own followings. We have Spanish-speaking customers that come in to speak to certain bilingual employees, because they need to ask complicated questions and are not comfortable trying to fight their way through with their limited English skills. They love to see a friendly Spanish-speaking face. Then they come back day after day,” he adds.

“We have a virtual Tower of Babel here, everything from Spanish, Russian, Arabic, Assyrian, Hebrew, Romanian, Bosnian and a few I haven’t thought of,” says Ken Walchak of Clark-Devon Hardware in Chicago. “I never would have thought of compensating them for this skill. Everyone gets paid for the value they bring to the store. It’s not like their job description is translator. Our customers look for their friends from their home country, and often have spirited discussions about soccer, politics, religion and more,” he adds.

For assistance in finding bilingual employees, contact local community colleges and universities and seek out programs for Teaching English as a Foreign Language. Ask current staff and friends if they know any bilingual candidates. You can post a job listing on www.bilingualcareer.com. Also, the Hispanic Chamber of Commerce has city and statewide chapters throughout the United States.

Hiring Teen eMPLOYees

We were all teenagers at one point, although we have trouble

remembering our own knucklehead behavior when we see it exhibited in today’s teens. Hiring teen employees can be equally parts frustrating and rewarding, but it can pay off as long as you understand you are not hiring a finished and polished producer but one that needs mentoring.

Doug Bowen of Ramsey True Value Hardware in Front Royal, Va., suggests screening teen job prospects through a teacher or guidance counselor. “Science, math or trade/technology teachers usually know the ones who can think or act appropriately in different environments,” he says.

Steve Sayers of Sayers Ace Hardware in Independence, Kan., has had some success finding teen employees on Facebook. It helps if your Facebook posts make it seem like your store is a fun place to work.

Larry Perry of Woodstock Home & Hardware in Woodstock, Vt., has been participating in a “job shadowing” program with the local high school for nearly 20 years. “These are kids that the school has identified as unlikely to succeed academically but have promise outside the traditional schoolroom,” he explains.

“Over the years we’ve hired around one-third for full-time seasonal and parttime year-round jobs. Most (but not all) have worked out. Through the ‘shadowing’ program they have had a chance to see what’s involved in working here and we’ve had a chance to observe their work ethic,” Perry adds.

The team at Downtown Hardware in Oak Ridge, Tenn., covers all ages. One of the original employees recently retired at the age of 93 after working in the store for 57 years.

Here are some tips on how to motivate teen employees once you have hired them:

Be patient with them. Gently point out their mistakes and tell them the right way to do it and understand their learning curve is steeper than that of an adult.

Listen to their feedback. Their ideas may not all be great, but they will definitely look at your business with a fresh perspective.

Don’t yell or scream at them. They get enough of that at home, so find a way to admonish them without blowing a gasket. Better yet, find ways for them to have fun on the job by letting them dress in costume for holidays. Give them responsibility. They want to feel useful, so get them involved in improving your web site, posting on the store Facebook page or conducting in-store contests.

Show them respect. Treat them like an adult and give them high expectations and they will be more inclined to work hard to meet those expectations. Set firm ground rules. They will quickly test you to see if you are a pushover, so set boundaries and don’t let missteps go unnoticed. ■

Driven by Customerfriendly Decisions

Click to Learn About Mark’s Ace Hardware’s Philosophy on Customer-Friendly Decisions

Mark Rios

Owner Mark Rios (left) leans on help from a strong staff led by Shane Athey (right), floor manager with 13 years of experience; and Camille Gibson (center), operations manager with seven years of experience.

started working at Al’s Ace Hardware in Tucson as a 19 year old in 1991, mopping floors and working the register. “I didn’t know the difference between a slotted and a Phillips screwdriver then,” he admits. “I just wanted to get a job anywhere. I ended up getting a job there through a friend.” Rios learned on the job and went on to purchase the business in January 2013, renaming it Mark’s Ace Hardware.

Mark Rios

Mark’s Ace Hardware

Tucson, Ariz.

Salesfloor square footage: 15,000

Sales %: 80% DIY; 20% Pro 2014 sales: $3.5 million, up 5% from 2013

Number of employees: 28

Top core categories: Paint, lawn and garden and hardware/fasteners. We sell Valspar and Clark+Kensington paint and are a huge Benjamin Moore dealer. We sell hard-to-find colors and unique brands for spray paint. Our extensive nuts and bolts aisle goes above and beyond what Ace recommends.

Most successful niches:

Evaporative cooling and outdoor living. We do really well with wild bird and we sell a lot of garden flags and yard art.

Biggest challenges facing business? Employee retention, e-commerce, and internal and external theft.

How do you ensure customer service stands out? We do a lot of training and hold regular store meetings. Ace 101 and 102 training has helped a lot. I like to lead by example

Dealer Profile

Mark’s Ace Hardware is one of the region’s top sellers of Benjamin Moore paint.

and show employees how to provide great customer service by being out on the sales floor doing it.

Our biggest effort comes from what we call Customer-Friendly Decisions or CFDs. Whenever there is a question about something the answer is to make a Customer-Friendly Decision. It encourages staff members to handle issues one by one right on the spot. I tell my people they will never get in trouble for making a CFD—I trust them. It empowers employees to make decisions. You can always coach them on a better way to handle a situation afterwards, but you’re not making the customer wait around to have their problem solved.

What are the most effective methods you use to find new

employees? Our best employees tend to come through word-of-mouth referrals from friends or employees. The advantage there is that they know them already and know whether their personality will fit in with our team. Help wanted ads with Craigslist are a roll of the dice.

What kind of employee incentive programs do you offer? I came up with a program called Mark’s Stars five years ago. When an employee goes above and beyond to serve our customers anyone—another employee or a customer—can write it up. Maybe they drove an order over to someone’s house for them. We hang up all the Mark’s Stars sheets on the wall for everyone to see. When an employee gets 10 we hand them a $100 bill in front of everyone. It’s neat to see a staff member nominate a teammate. We also do annual employee performance reviews.

What lessons have you learned about retailing over the years? The number one thing is you have to be

Left: Outdoor living products such as grills, garden flags and yard art help drive customer counts.

Right: A niche has been established in evaporative cooling, which is straw tied together with cheese cloth.

constantly evolving and changing. We’re always looking for fresh, new products and neat displays. You have to find ways to make the store more exciting, because you’re being judged and compared based on your store’s look, people and environment. This is a problem with retail in general. I’m looking at purchasing another existing hardware store that is in distress, because the owner has never changed a thing with the business. That is not a recipe for success.

What is the smartest thing you did in the past year? I recruited a great employee from a big-box store. She’s made a huge difference and brings a great deal of energy to our team. I’ve also educated all my employees on how margins work and how much profit is left from every dollar

Above: Employees are empowered to make Customer-Friendly Decisions on the spot.

Top Right: Wild bird is another popular niche category for Mark’s Ace.

Uppere Middle: The 15,000-square-foot sales floor features strong assortments in core categories.

Lower Middle: Paint is the top-selling core category.

Bottom Right: Theft is an ongoing concern, so high-risk products such as gloves are kept under lock.

of sales. It really woke up employees about waste and they’re now more conscious about saving the store money and operating more efficiently. Are other family members involved in the business? I have two sons who are 10 and 8. They come with me to the store on Sundays. I have little red vests for them and their own locker. They learn how to mop the floor and work the register and I’m getting them involved in learning how we make a profit. They absolutely love it. n

Dealer Profile

Be Part of the Hardware Industry’s Exclusive and Professional Women in Hardware Program!

Designed for professional women and men in the two-step hardware industry to exchange ideas, educate, network and provide support and access to opportunities to further careers and help grow the independent channel.

Who’s Eligible to Join?

• Independent Hardware Store Owners and Managers

• Vendors Involved in the Two Step Hardware Industry

• Service Providers Involved in the Two Step Hardware Industry

• Wholesalers/Distributors

• Industry Professionals

Activities

• Membership benefits include up to six networking events per year held in conjunction with other industry events.

• Each event will have a business focus offering direct and immediate benefits.

• Vendor and Service Providers will have the ability to interact with business owners and others in management positions sharing experience, concerns and solutions.

• While focus is on women and their opportunities, men are welcome and encouraged to participate to better understand and lend their perspective of the industry.

By John Fix III

Tracking Attendance &Keys

Winter has swept across the country so for a lot of dealers sales have slowed down slightly until spring arrives. What follows are two topics discussed during the past few months on Hardlines Digest.

aTTendance POlicy

Whitney McKellar of M&M Lumber in Tulsa, Okla., was looking for ideas for an attendance policy. “Does anyone have a good absentee and/or tardy policy that you’d be willing to share? What do you find to work the best in your company—a point system?” she asked.

Ken Stewart of Stewart Hardware in Southport, N.C., shared details of his policy. “We have been using a ‘wellness’ policy. It has virtually eliminated tardiness, and when someone calls in sick, I know they are near death. It does cost us a little payroll, but eliminating surprise

Whitney McKellar and Sean Stevens of M&M Lumber in Tulsa, Okla., turned to Hardlines Digest for advice on an employee attendance policy.

staffing problems has been worth it,” he said.

“Our philosophy has always been that if we didn’t need you every day, we wouldn’t need you at all. We want to be human enough to be compassionate, but business-like enough to strongly encourage consistent, on-time attendance,” he added.

Stewart Hardware’s policy is as follows: Effective immediately, there will be no pay for any sick leave. Instead, each full-time hourly employee will be paid one half day’s pay extra along with the first paycheck of each month, provided he/she has not missed work or been late to work during the previous month.

Steve Oberholtzer of Stauffers of Kissel Hill in Lititz, Pa., posted his company’s procedure. “We are 100 percent

hardlines digesT

hourly. Everyone punches a clock and you are paid for the hours you work. Clock records time to the second and we do no rounding. Being late or too many hours is a performance issue. We eliminated sick days and now just call them personal days. They are used just like any other personal time off,” he said.

Scott Plummer of Plummer’s Do it Best Hardware in Farmington, Mo., agreed with Steve. “The bottom line is you want to keep it simple to figure and simple to understand. We went hourly for everyone a long time ago. We also made it where all time off earned is the same—use however they want, vacation, sick or personal,” he posted.

Steve Beeson of Beemun’s True Value in Alaska tracks both vacation and personal days. “I offer both vacation and sick/personal days, but track them separately. Vacation time does not have a cap (although it rarely gets too big) but we have a cap on the amount of hours of personal time,” he posted, while also inquiring whether those that combine the two have caps on how many hours they can bank.

Oberholtzer posted a follow-up to address the carryover hours. “We have a variable amount that can carry over from one year to the next. Cap is four days. We believe employees need time off, so we only pay if they take the time off. Time off makes healthy families and healthy families makes better employees,” he said.

Retailers debated the merits of keeping track of each individual key in inventory.

Oberholtzer added, “We also have a strict no-work-from-home policy. When you are off the clock you should not be thinking about work. We cross train employees so that the person in charge can make decisions and does not need to contact a manager who is off work. If someone is contacted at home we pay for time spent.”

Carrie Dickey of four-store Dickey Bub Farm and Home in Missouri shared their policy. “We switched to an attendance policy from no policy about five years ago. It’s a point-based system and we really like how it works. Our time-clock system keeps track of your absents or tardies. My staff lets employees know quarterly where they stand so no one is surprised when they only have a point left. It is 1/2 point for tardy and one point for absence. We don’t offer sick time,

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• View Vendor Product Listings by Wholesaler

• Ability to Download Product Listings by Wholesaler Directly into Retailers’ Point-of-Sale Computer Systems

• Check Out Vendor Profiles, Informational Videos & Product Reviews

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hardlines digesT

just personal time off, but even if you are absent without advance notice you still get the point. You can turn in hours to keep your pay,” she posted.

Dickey added, “I switched to this policy after going to an employment law seminar in which the guy said let them fire themselves. It truly does—I have no control over whether they get points. If they come in = no point. If they don’t come in = point. I would highly recommend it.”

Tracking keys

Beeson of Beemun’s in Alaska wondered how stores handled their key inventory. “I have never kept track of inventory on our keys. I have the SKUs in the system but don’t keep an inventory since all of them are warehouse supported. I bought some new assortments that are not warehouse backed and am wondering what method others use with keys. I just glance at the spinner and pick out the ones we are getting a little short on and order. Is there a better way?” he asked.

Randy Patzer from Garden City Ace Hardware in Garden City, Mich., tracks keys in the POS system. “We have all of our keys inventoried and the system maintains inventory and reorders automatically. Makes life very easy. Keys can be scanned or the cashier can type in the blank ID off the key (built into the UPC file as an alt-sku). Mis-cuts are put in a box and taken care of once a week. We

check the holes occasionally to verify so we don’t stay out of stock on anything. Outside vendors are a lot harder—those we order manually,” he posted.

Jim Ertzman of South Hills True Value in Pittsburgh also tracks keys individually. “We also keep inventory same as Randy. Once the setup work is done it is a breeze. Each hook has a position and that position is in the sequence field. Key towers are at the checkout. We check the holes and try to inventory two times a year. The hook position in sequence allows someone, usually a cashier, to next item through the panels and fix everything during slow periods. Having them in inventory makes it easy to variable price, especially on the slower movers, higher security and six-pin. Having the history helps to keep you from reordering keys that have lost popularity and are not worth keeping,” he posted.

John Keely, a manufacturer’s rep, wondered whether the time involved could be better used on something more profitable and David Reines agreed. “Most stores just keep all keys lumped into one category code (or key) in the register so they know how many keys they cut a year, not how many of each of the couple hundred styles. What do you do with loose screws and bolts?” Reines asked.

Patzer responded, “Bolts are sold on the honor system to commodity groups (departments). We stock close to 800 different keys. I only have to mess with reordering some of the personality keys that

Hardware retailers sell more keys than any other individual item, but keeping track of this inventory varies by dealer.

we get from outside vendors and don’t have to mess with the other 725. Makes my life easier once the setup is completed. I like my life simplified. Isn’t that what computers were supposed to do for us?” he asked.

Todd Larson responded with the following posting. “Why do you even have a computer? I don’t need a POS to tell me how many lawn mowers I sold or need. Once it is set up the maintenance is no big deal. We had every single item that we stocked loaded onto the computer. Sold everything we stocked by a SKU. We even ordered our Hillman via a suggested purchase order with some input from our rep but he did not have carte blanche to order anything he wanted. I have a POS system to manage my inventory, so why not use it to the max?” he asked.

Larson added, “The proof was in the numbers for our store. We installed a Triad in the summer of 1981 and tweaked and cranked our sales and inventory to $1.25 million in sales at over 52 percent margin by the time we sold the store. We ‘touched’ every single record on the POS to maximize

sales and inventory levels and efficiency of handling that item. We developed an EOQ formula (Economical Order Quantity) that we applied to every single SKU in the store. Either Dad or I reviewed every house charge account invoice to see if we had enough for the customer and possibly tweak order points. We also reviewed every SKU sold every day. We would print off a detailed sales recap and review it the following day.”

He continued, “By honing this formula we were able to decrease lines ordered from 1,200 to 800 on a given generated purchase order. We gained huge efficiencies by minimizing the handling of merchandise when receiving. Why go to the shelf to put one or two of a given item every freight day? Instead we developed a formula to put away a given amount of a given item on an efficient time frequency. It would take more explanation, but the proof was reflected in our P/L. I applied our theory at another store I managed and pushed huge sales and margin increases. Bottom line, why have a computer system if you aren’t going to push it to its limits and use it to its max?” ■

John Fix III started the Hardlines Digest in 1996. The list was run for many years using servers in John’s hardware store, Cornell’s True Value in Eastchester, N.Y., but recently the list migrated to Google Groups. There are currently more than 1,500 subscribers reading the Hardlines Digest. To read more or subscribe, go to www.hardlinesdigest.com.

a growing community of thousands of

“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

The Hardware Conference is a Unique Event

With much of the country still suffering through frigid winter weather, it’s nice to think about soaking up the rays on a beach. You can do that and a lot more by attending The Hardware Conference, which is set for September 11-13 at the Marco Island Marriott in Marco Island, Fla. The industry’s largest gathering of independent retailers offers the perfect opportunity to gain ideas on how to improve your business while enjoying family fun.

Make plans to attend a unique event that can have a dramatic impact on your business. It’s the perfect opportunity to bring your whole family to a five-star resort right on the Gulf of Mexico with three miles of pristine white beaches.

FAMILY for the Whole

The Hardware Conference is held each September at the beautiful Marco Island Marriott right on the water in Marco Island, Fla.

Tom and Dale Chasteen, who operate Tavernier Hardware in the Florida Keys, will be marking the 27th anniversary of hosting the Conference. With a deft personal touch, they have developed a family-friendly, affordable event that brings independent dealers together, regardless of wholesaler affiliation.

“We feel it’s very important for dealers to get out of their stores and interact with fellow dealers and learn what’s

The Hardware Conference is truly a venue where long-lasting relationships are formed.

going on in the industry,” Tom says. “It makes sense to do that in a beautiful setting while having fun at the same time.”

The industry’s premier event for the independent retail hardware channel

Howard Miller of Hartville Hardware is shown making his acceptance speech for the 2013 Beacon Award, which honors the industry’s most outstanding retailers.

will receive all-expense paid trips for two to the 2015 Hardware Conference including conference registration, airfare, hotel and meals. They will also receive a special Beacon Award plaque and be featured in an article in The Hardware Connection.

offers an awards program that was developed two years ago to recognize the “best of the best” retailers. The Beacon Awards are co-sponsored by The Hardware Conference and The Hardware Connection. Additional sponsorship support last year came from Apex Tool Group, Sunnyside Corporation, Epicor, Sherwin-Williams Diversified Brands Division, 3M, Ace Hardware, Orgill and True Value.

In addition to Beacon Awards for each of the participating wholesalers, the awards banquet honors the industry’s best new stores. The 2014 winners for Best New Store were Geneva Ace Hardware in Geneva, Ill. (over 20,000 square feet) and Gecko True Value Hardware in Dallas (under 20,000 square feet). Whether it’s an existing retailer opening a branch store or a newcomer opening a ground-up business, these new stores represent the future of the industry.

The 2015 Beacon Awards banquet will be held Friday evening, September 11, at the Marriott Marco Island. Winners

Get your nominations in now for the Best New Store category—the entry deadline is June 1, 2015. For more information on the nomination process, contact Tom Delph, Beacon Awards program director, at tdelph@thehardwareconnection.com.

Leading vendors participate in the Conference with tabletop booths showcasing their latest new products. Dealers also have the opportunity to engage in informal conversations with manufacturers without the pressure of buying. Another popular feature of the event is the open dialogue sessions, where dealers join vendors and wholesaler representatives in a frank discussion of industry topics of concern to all.

“It is always a great time. There are lots of great people to interact with, lots of great info to be exchanged and lots of fun family time to be had,” says longtime attendee Bruce Phillips of Crowder Brothers Ace Hardware in Lakeland, Fla.

The Conference is designed for the whole family, with plenty of free time for fun activities such as golf, sailing, shelling and walking on the beautiful sandy beach. For more information, go to www.thehardwareconference.com. ■

PAINT & DECORATING TRENDS

Sales of Exterior Liquid Paint (Independent Hardware Channel) 12 Months % Change vs. Year Ago

Source:

Unit Sales Breakdown for Exterior Liquid Paint Total of 2,250 Items with Sales

Manufacturers and retailers use Vista’s retail POS and Consumer Panel data to better sell to their customers. Go to

Source: Vista Information Services, div. of Epicor Software Corp. www.vistainfoservices.com.

Paint anD Decorating Buying uPDate

The world of color is moving in vibrant new directions, according to 2015 color trends revealed by SherwinWilliams, although Agreeable Gray promises to remain a color in high demand by designers and homeowners.

“We’re seeing a more cheerful approach to design and have forecasted colors that will provide a range of inspiration for designers to create fresh, joyful interiors,” said Jackie Jordan, director of color marketing for Sherwin-Williams.

The 40 colors that make up the forecast are grouped into four palettes: Chrysalis, Voyage, Buoyant and Unrestrained.

As technology rushes ahead, the colors of Chrysalis evoke a calm oasis—a place to pause and find balance. The palette, with colors ranging from offblack to chalky neutrals and dusty blues, is designed to create a more comfortable interior.

The sci-fi dreams of past decades seem more viable than ever with the Voyage palette, which features hues that represent the color spectrum imagined while emerging from the water into the atmosphere — undersea teal, bright green kelp, light watery blue and deep space purple.

“The colors of Voyage are supernatural and magical” said Jordan. “The lighter colors of the palette create a

Central True Value in Moncks Corner, S.C., maintains a competitive assortment of spray paint. Keim Lumber in Charm, Ohio, stays in stock on paint items that are project starters.

space that is uplifting, while the deeper tones can be combined for a more dramatic design.”

The colors of Buoyant are reminiscent of vintage floral patterns—light and deep greens, violets and a pop of coral. In addition to renewed optimism, the palette is also inspired by the natural healing of botanicals, as well as the incorporation of green spaces into even the most densely urban environments.

From bold, ethnic-inspired colors and designs to the Bohemian lifestyle, the Unrestrained palette celebrates a carefree spirit and pulsing color. The palette features saturated primary hues, including sunny yellow, lively turquoise and bright blue, as well as black and white. Each can be used on its own for a pop of color, or combined, to create a vibrant, energetic space.

For the complete 2015 colormix forecast from Sherwin-Williams click here: http://www.sherwin-williams.com/architects-specifiers-designers/inspiration/ color-forecast/2015-color-forecast/. ■

Painting & Decorating ProDucts

sketch PaD™ Dry erase coating kit

• Formulated exclusively for application by pro paint contractors, Dry Erase Coating is ideal for a wide variety of settings, from classrooms, conference rooms and offices, to kitchen message boards and kids’ bedrooms in the home.

• Available in a pre-packaged kit, it can easily be applied to interior substrates and over any paint color, producing a durable, clear gloss finish that allows the wall color to show through.

• The Sketch Pad kit has two pre-measured parts: a clear and hardener that are mixed together to create the dry erase coating. Applicators in the kit include a mini-roller, tray and stir stick.

• The kit creates one quart of coating, capable of covering up to 50 square feet and just like a dry erase board, a Sketch Pad painted wall can be wiped clean with dry erase erasers, paper towels, baby wipes or damp cloths.

PoWer Lock™ extension PoLes

• Are extremely durable and versatile, featuring custom adjustment and an innovative combination quick connect/ threaded attachment.

• Handle features a shockabsorbent, rubber-based grip.

• Extension poles are made of fiberglass/ aluminum.

• Come three to a case in five sizes ranging from 1-2’ extension up to 8-16’ extension.

Dust-Free sPonge sanDer

• The Dust-Free Sponge Sander™ kit includes a lightweight hand sander with two medium-grit sanding sponge and a vacuum hose with adapter that fits all wet/dry hose sizes.

• It’s great for sanding windows, walls and door frames before a painting project.

• Cuts down on cleanup time by eliminating up to 95% of dust caused by sanding.

• Sander has a small profile and easyto-grip sanding head for use on flat surfaces, edges and corners.

Hyde Tools

www.hydetools.com 800-872-4933

carPenter’s coLor change WooD FiLLer

• It dries white although it appears purple when first applied to your interior wood projects. After the color change, you’re ready to paint, stain or sand.

• Patented formula is great for fixing holes, dents, scratches, gouges and any other defects on interior wood surfaces.

• After the wood filler dries to white, easily finish and stain or paint your wood to make it look brand new.

• Carpenter’s Color Change formula is Made in the USA. Elmer’s

www.elmers.com 888-435-6377

Painting & Decorating ProDucts

non-BeVeLeD suPer/FaB® FtP roLLer

• Beveled ends prevent creating thick lines on both sides of the paint stripe.

• The untrimmed fabric of Non-Beveled Super/Fab® FTP™ is another advantage, as the paint buildup on the overhanging material easily rolls into corners.

• The roller is an excellent choice for non-precision jobs such as new construction and apartment repaints. In those settings, this cover can help painters save time by skipping cutting-in with a brush.

• It quickly and smoothly applies flat, eggshell or satin paints, stains or waterproofing. The Super/Fab FTP fabric used for this new roller features Wooster-exclusive HydroFlow™ technology, which provides controlled paint release for faster and more efficient rolling.

The Wooster Brush Company www.woosterbrush.com 800-392-7246

Dry erase cLear sPray Paint

• Allows DIYers to transform virtually any surface into a dry erase space, producing a durable, clear gloss finish that wipes clean.

• Dry Erase Clear spray paint is recommended for use on a variety of hard surfaces such as wood, metal, plastic, glass, ceramic and pre-painted walls and surfaces, making it ideal for furniture, small projects and crafts.

• Because the spray paint is clear, users can apply it to any suitable surface without distorting its original color and appearance.

• Innovative formula sprays on simply and dries to the touch in a few hours. Krylon www.krylon.com 800-457-9566

By Fred Fischer technology update

Could You be HIJACKED?

When buying or maintaining a POS system, make sure you invest adequate money in a good business-class firewall, antivirus software and a means to back up your data. If not, this can end up like the old Fram commercial about oil filters for cars. You can pay me now or pay dearly later.

What are the bad guys doing out there in the internet world? One current really bad activity is called being Hijacked and then paying a ransom. Much like overseas, where the pirates hijack a ship and then hold the crew for ransom.

The following is a true story. A long-time hardware industry employee takes the plunge to go in business for himself and buys an existing hardware store. It has a POS system with more than 13 years of sales history.

On his 10th day of ownership when he started the computer, he gets a message “YOUR PERSONAL FILES ARE ENCRYPTED.” The message reads if he wants his data back, he should send $500 in bit coin to a particular website (usually not traceable) and upon approval from the bad guys, he will receive a

un-encryption key that will unlock his files. If he does not do this in 10 days the data will be lost.

He is told his computer has been hijacked by a program called KeyHolder. This particular malware version of the program started about the first week of December 2014 and is worldwide. Google the words “KeyHolder malware” and you see more information than you will care to read about “KeyHolder.”

Crypto Ransomware is actually malware and not a virus. Usually it will not spread through a network. It is usually delivered by email. The user receives an email with a link or an attachment. The link is typically a Dropbox link. Many of the file extensions are usually a zip, exe, vbs or a txt file. Once clicked, the file installs a program, but you do not realize this is happening. Then, several hours later, software runs to install another program using the Internet and then the original program destroys itself so no trace of its activity can be found.

That newly downloaded program then goes out on the internet at an even later time and gets an encryption key. The sad part is this process changes slightly, sometimes more than once a day or every couple of days. That makes it almost impossible to break the encryption process. You have been Hijacked!

How many times have you gotten an email that looks very official? It says they could not deliver a package, a bank needs additional information, please confirm your prescription, you have a criminal case against you from the IRS, your Amazon order is pending shipment and the list goes on. Anti-virus programs have a tough time detecting these programs, because the attachment itself is not the malware.

What kind of damage can KeyHolder do? One office lost six years of medical records; a professional photographer lost 10 years worth of professional pictures, to mention a few. As for the picture files, the encryption key restored the files to thumbnail size, which were worthless. Some waited seven to 14 days to get the encryption key, which worked some of the times and not other times.

The cost to you can be very expensive. Just the labor to recover or set up data again can be costly. Some invoice data and other records may never be recovered. The loss of your POS system

for several days cost in both labor and inventory management information. To say it could involve thousands of dollars is an understatement.

Why did this store get compromised? To save a little money, the previous owner’s son built two new computers. The computers were OK. To save additional money, they were using free antivirus software. If software is free, there is probably a reason. There was no firewall, only a router. The backup software was installed, but the scheduler had never been set up, so there were no backups for over 18 months. There was no recovery data.

How can you prevent this type of disaster? There is nothing that is 100 percent guaranteed. Good businessclass, anti-virus software with live updates is a must. These updates are sometimes downloaded several times a day. This type of software is usually about $30 per computer and then has an annual renewal fee.

A real firewall is mandatory, one that has a subscription service that comes with it. The first-year cost is typically in the $400 to $700 range for both the hardware and the subscription package. Renewals vary from $200 to $400. You need the subscription service, because the bad guys are always changing their programs to attack your computers and that firmware needs to be updated.

Next are backups. These should be done nightly and stored for several days (a minimum of seven days).

There are companies that offer backup services. These services can back up both locally and off-site. Beware of some that offer low prices for large storage capacity. These are geared for home use. You are running a business. The reason the price is so low is they throttle how fast you can download the saved files. In some cases, it could take two or three days to get all your data downloaded to restore your POS system. Again, you get what you pay for. You need to get your business back up and running now, not two or three days later.

In summary, the one sure way to know you are protected if your data gets hijacked is to have good backups and be using a business-class service. If you

have only a router and no firewall with a subscription service, or wireless that is not encrypted, no anti-virus software or are using the free version, and are not doing daily backups, then you are in trouble. If you are using a POS system, check out these things.

If you are considering buying a POS system and all they talk about is low prices and do not give you details about the equipment you are buying and what protection should be part of the package, then it may not be a very good deal. You can pay now or you can pay dearly later. n

Fred Fischer is president of J3 Point-of-Sale –Ganymede Technologies Corp. Contact him at fred@j3pos.biz.

IN THE NEWS

NEW STORES:

• Chadron Ace Hardware opened this past November in Chadron, Neb.

• The Hassett family opened its fifth Hassett Hardware store in Redwood City, Calif.

• Rocco Curro has reopened Scott True Value in Newark, Del.

• Chris Amir has purchased Gustafson Ace Hardware in Princeton, Ill., and is renaming it Neighborhood Ace Hardware.

• Tom Schmutz opened an Ace Hardware store in McLeansboro, Ill.

• Steve Barger and Mike Fleitz rescued Horton’s Hardware in Louisville, Ky., which was set to close, and renamed it Highlands Hardware.

• Rick Karp opened a new Cole Hardware store in the Rockridge area of Oakland, Calif.

• Taylor and Leah Baker have purchased Discount Builders Supply in Pilot Mountain, N.C., and renamed it Foothills Hardware and Builders Supply.

KUDOS TO:

• Home Hardware Stores Ltd. has been recognized as one of Canada’s 10 Most Admired Corporate Cultures.

• Epicor Software Corp. has achieved certification from the

Service Strategies Corporation

Service Capability & Performance Standards after an extensive audit of its Epicor Eagle business.

PEOPLE ON THE MOVE:

• Craig Menear has been named chairman of The Home Depot in addition to his titles as president/ceo.

• True Value Co. named Lars Hybel vice president-international.

• Ace Hardware Corp. promoted Dan Miller to vice president-retail operations and Brian Wiborg to vice president-retail development and supply.

• Matthew Moore has been promoted to president and CEO of Kabelin Hardware in La Porte, Ind.

• Great Lakes Ace named Jason Haley as chief operating officer.

• Do it Best Corp. promoted Bob Harville to regional sales and business development manager.

WHOLESALERS IN THE NEWS:

• More than 400 manufacturers and distributors attended the Distribution America/PRO Group 2015 Executive Planning Conference, held Nov. 18-20 in Palm Desert, Calif. DA’s Soaring Eagle Vendor Partnership Award went to Apex Tool

Group, while PRO Group honored Robert Bosch Tool Corp. as its Key Supplier of the Year.

• A broad range of engaging training seminars, along with a vendor showcase, product demonstrations and special buying opportunities, highlighted the 2015 Do it Best Corp. Winter Conference held Jan. 22-24 in Orlando. Training session topics include consumer engagement, retailing trends and improved marketing campaigns.

• Do it Best Corp. launched a new consumer website designed to provide an optimized online shopping experience for customers and help grow sales and store traffic for its member-owners. The new doitbest.com launched just before the Christmas selling season and brings with it a number of innovative new features and tools for consumers and members, including quicker and highly accurate product searches, an improved store locator

tool and a mobile-optimized design.

“The new doitbest.com provides a more robust shopping experience for online shoppers, while also helping to build a strong connection between these customers and their local Do it Best stores,” explains Rich Lynch, vice president of marketing for Do it Best.

OTHER NEWS:

• STIHL Inc. plans to relocate operations in Peoria, Ill., and Hayward, Wis., to a new single distribution site in the Village of Cottage Grove, Wis., to serve customers throughout the midnorthern region of the U.S. STIHL also announced plans to triple the size of its Pacific division facility in Visalia, Calif.

• Epicor Software Corp. has introduced the Epicor Data Security Review program, a new data protection initiative designed to help independent retailers mitigate the

risk of a data breach.

• ECi Software Solutions has acquired Spruce Computer Systems. Spruce President Rob Fitzpatrick will take over as president of ECi’s Lumber, Building Materials and Hardlines division, combining the Spruce, Advantage and RockSolid platforms under one business unit.

• Pacsoft announced it now offers an interface with Watcher Total Protection’s security camera and DVR system.

IN MEMORY:

passed away Dec. 5 at the age of 84. He founded the business in 1962.

• Floyd Overstreet, founder of Northwest True Value Hardware in Roanoke, Va., passed away Nov. 20 at the age of 95. He founded the business in 1947, growing it into an eight-store chain until retiring around 1990.

• Maynard Jones, who operated Ace Hardware stores in Salina, Clay Center and El Dorado, passed away January 26 at the age of 87.

FOR THE FULL STORY:

• John Sullivan, a former newspaper reporter whose distinguished 30year industry career included work for Hardware Age and Hardware Retailing as well as manager of corporate communications for True Value Co., passed away Nov. 21 at the age of 88. Sullivan served in the U.S. Army in World War II and served with the U.S. Air Force as editor of Pacific Stars and Stripes in Tokyo during The Korean War.

• Richard Ackerman, founder and owner of Ackerman True Value Supply in Beloit and Osborne, Kan.,

• Undercover Boss features True Value CEO and Carr Hardware. Click here.

• Nichols Hardware in Purcellville, Va., is marking 100 years in business. Click here.

• California lumber tax: More trouble than it’s worth? Click here.

ACE HARDWARE CORP. ACQUIRES JENSEN DISTRIBUTION SERVICES

Ace Hardware Corp. has acquired Jensen Distribution Services, a Spokane, Wash.-based, 131-year-old hardlines distributor.

Founded in 1883, Jensen Distribution Services has approximately $150 million in wholesale revenue from serving more than 2,000 customers in 11 western states.

“As the hardlines industry evolves

John Sullivan

and consolidates, Ace Hardware is faced with the options of simply letting the chips fall our way, or actively participating as a leader to shape this industry for the long-term benefit of Ace shareholders,” said John Venhuizen, president and CEO of Ace Hardware Corp.

“While Ace’s retail strategy continues to be a priority with the stated mission of being the best provider of products, services and operating methods to convenience hardware retailers, EmeryWaterhouse and Jensen Distribution Services will advance Ace’s wholesale strategy to be the best provider of hardlines products for independent lumber, paint, nursery, industrial and hardware outlets,” Venhuizen said.

“The Jensen organization looks forward to a bright future alongside Ace Hardware,” said Mike Jensen, CEO of Jensen Distribution Services. “I’m pleased that fifth-generation family members Chris Jensen and Micah Dunlap will play an active role in shaping the next chapter of the Jensen organization.”

As a result of the acquisition, Ace plans to provide measurable long-term financial benefits for its shareholders, including enhanced buying power for both Ace Hardware and Jensen Distribution Services. The acquisition also creates a platform for lower cost of goods driven by scale and price synchronization, as well as access to

IN THE NEWS

new categories, products and suppliers. After serving as Jensen Distribution Services CEO for more than 25 years, Mike Jensen plans to retire in 2015; his son and daughter Chris Jensen and Micah Dunlap will remain with the company and run the business as they do today. “Mike is a high-character individual and a genuine legend in the industry. We wish he would remain with Jensen for the next 25 years,” said Venhuizen.

With both Emery-Waterhouse and Jensen Distribution Services now under the Ace Hardware wholesale division, Ace Hardware announced the appointment of Hoyoung Pak to president of Ace Wholesale Holdings, reporting to John Surane, executive vice president of marketing, merchandising and sales. Pak joins Ace Hardware from IRI where he served as chief operating officer. He has also held executive roles with Groupon, Discover and McKinsey & Co.

The Hardware Connection interviewed Surane about this new acquisition.

THC: Are there likely to be additional acquisitions of independent distributors finalized in 2015 and if so, would you be targeting one more centrally located?

Surane: While we are not engaged in any discussions today and are not

strategically driven for additional acquisitions, we are not closed minded to potential opportunities, whether driven by geographic location or otherwise.

THC: What is the purchase price for the acquisition of Jensen Distribution Services and did this money come from Ace’s existing line of credit?

Surane: The purchase price was approximately $32 million. The purchase was made from existing access to capital/line of credit.

THC: How many of Emery’s customers chose to continue doing business with Emery after you acquired that company and do you expect a similar retention rate with Jensen customers?

Surane: I can only recall one customer considering Emery’s relationship (ownership) with Ace Hardware a conflict, and I expect the same with Jensen. We have already spoken to a large number of Jensen customers and the vast majority range from extremely excited for the potential to “show me the value of the relationship.” Our intention is to demonstrate value in the short-term through lower product costs, wider assortments and superior service.

THC: What measurable benefits or ROI have you been able to deliver

so far to Ace members and Emery customers as a result of that deal?

Surane: Our work with the vendor community in terms of synchronizing our pricing and programs has resulted in more than 5,000 product cost reductions to Ace retailers already. We expect an even greater number of reductions in 2015. Additionally, the product/assortment intelligence gained through working with Emery’s merchandising and sales team has resulted in significant improvements to Ace’s assortments, especially in pro/ contractor product categories.

THC: Jensen Distribution Services does a significant amount of business as a supplier to Amazon. This makes Ace’s new acquisition a competitor to its own members. Do you plan to continue or even expand Jensen’s involvement with Amazon or is this a practice that will be discontinued?

Surane: Obviously, Amazon has the reach, scale and means to source product through nearly unlimited channels—whether it be direct or through regional wholesale. Jensen is one of these sources today and we don’t expect this to change. Jensen’s distribution and channel strategy will not change with the acquisition. Their mission is to be the best wholesale supplier of hardlines products in the Western U.S. ■

FEBRUARY

Florida Hardware Spring Market

February 14-15, Double Tree Hotel at Universal Orlando, Orlando, Fla.

Northwestern Lumbermanʼs Association Iowa Lumber Convention

February 18-19, Cedar Rapids Convention Center, Cedar Rapids, Iowa

Orgill Spring Dealer Market

February 19-21, Orange County Convention Center, Orlando, Fla.

MARCH

Ace Hardware Spring Convention

March 18-20, Las Vegas Convention Center, Las Vegas, Nev.

Blish-Mize Spring Dealer Market

March 20-21, Overland Park Convention Center, Overland Park, Kan.

Hearth, Patio & Barbecue Expo

March 4-7, Music City Center, Nashville, Tenn.

International Home + Housewares Show

March 7-10, McCormick Place, Chicago

LMC 2015 Annual Meeting

March 4-6, Sands Expo Center, Las Vegas, Nev.

PACOA Spring Markeet

March 7-8, Queen’s College-Fitzgerald Gymnasium, Flushing, N.Y.

UPCOMING EVENTS

Reliable Distributors Management & Marketing Conference 2015

March 12-14, Embassy Suites Orlando/Lake Buena Vista, Orlando, Fla.

True Value Spring Reunion

March 6-8, Kay Bailey Hutchison Convention Center, Dallas

APRIL

Home Hardware Spring Dealer Market

April 18-21, St. Jacobs, Ontario

TruServ Canada Spring Market

April 11-13, Winnipeg, Manitoba

MAY

Do it Best Corp. May Market

May 15-18, Indiana Convention Center, Indianapolis

National Hardware Show

May 5-7, Las Vegas Convention Center, Las Vegas, Nev.

Send calendar dates to chris@thehardwareconnection.com

ATTRACTING THE NEXT GENERATION

OF CUSTOMERS

Your customers are not getting any younger, especially if your store does not make an effort to attract the next generation of customers. If you make your store a fun place for kids, then parents are more likely to shop there frequently.

Here are some tips to make your store a kid-friendly destination:

1. Offer free food. If kids know they can get a free cookie, popcorn or candy, then they will beg their parents to take them to your store.

2. Conduct kids clinics. Provide the supplies to build a birdhouse or model airplane, especially during the winter months.

3. Hold fun events throughout the year. Kids craft clinics are great for Father’s Day, Mother’s Day and Christmas, but make sure special events throughout the year include fun activities for kids such as face painting.

4. Offer kid-size shopping carts. Give kids a small cart to push around the store and they will be entertained, which allows parents to spend more time shopping.

5. Set aside space for a play station. All you need is a small table, a few chairs and some puzzles, coloring books and crayons.

6. Help kids groups with fund-raising. Let school groups and Scout troops use your store for fund-raising activities such as selling cookies, holding car washes and collecting coats for charity.

7. Sponsor sports teams. Sponsoring a local Little League team earns you goodwill with the community, so capitalize on that by posting team pictures on the wall and hosting a pizza party for the team.

Essex Home Hardware conducts an annual Kids Day each summer to help develop ties with the next generation of customers.

Carr True Value Hardware in Pittsfield, Mass., holds an annual carnival with lots of fun activities for kids.

Carolina Hardware in Marshville, N.C., merchandises John Deere toys by the store entrance.

Keim Lumber in Charm, Ohio, dropped candy out of a plane for a special store anniversary event.

Live chicks are a featured attraction at Gecko True Value in Dallas.

Hartville Hardware holds a Kids at Play event each summer.

Pinecar derby supplies are merchandised on a spinner rack near the checkout stations at Hartville Hardware.

McLendon Hardware regularly hosts kids clinics in its seven stores in Washington.

Old Forge Hardware attracts young tourists with its sporting goods selection.

Essex Home Hardware Building Centre in Essex, Ontario, features a huge selection of toys.

Hartville Hardware in Hartville, Ohio, makes sure that its store carries items that appeal to even the youngest of customers.

Hartville Hardware lets kids try out Road Tape, which is displayed on a special table.

A special Toyville section was on display at Hartville Hardware for the holidays.

Homepro in Westmoreland, Tenn., displays a convenience selection of toys in a prominent location.

Zettler Do it Best Hardware in Powell, Ohio, places Ertl die cast models and Thomas the Train accessories near the checkout as impulse items.

Behind the Numbers

$335

Amount of sales a retailer must make to recoup every $10 of merchandise that has been stolen, according to the National Association for Shoplifting Prevention.

25%

Percentage of shoplifters who are children under the age of 18, according to the National Association for Shoplifting Prevention. Fifty-five percent of adult shoplifters said they started shoplifting as teens.

27 million

Number of shoplifters in the United States, who steal more than $35 million of merchandise a day, according to the National Association for Shoplifting Prevention.

43.9%

Percentage of shrinkage due to employee theft, according to the National Retail Security Survey conducted by the University of Florida.

50%

1.41%

Percentage of retailers’ sales lost due to theft or shrink, according to the most recent National Retail Security Survey.

Percentage of time shoplifters are turned over to the police after being caught. They are caught an average of only once in every 48 times they steal, according to the National Association for Shoplifting Prevention.