Issuu

Serving Hardware, Home Center & Building Material Retailers

Selling Next Door

How Woodstock Hardware’s Wholesale Supply Program Supports Local Businesses Page 68

VOLUME 217 • ISSUE 2 • AUGUST 2019 • HARDWARERETAILING.COM

What’s Your Loss Prevention IQ? Page 38

On a Scale of 1 to 4: When to Suggest an Electrician Page 48

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Why We Like Working With Orgill: • Flexible, comprehensive retail programs • Broad product selection • Impressive retail knowledge • Supportive of our independence

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Selling Next Door

5 Google-Approved Tips to Get Customers Fast

How Woodstock Hardware’s Wholesale Supply Program Supports Local Businesses Page 68

Free Masterclass This August In this webinar, you’ll pick up tips on how to get ahead of your competitors and attract more shoppers into your store. Panelists include Ajay Arora of Google, Cheryl Brown of Knudson Lumber Co. and Matt Dockrell of Pointy, NRHA’s newest business services partner. Join the masterclass on any Tuesday in August. During every session, Pointy will be giving away a free device.

VOLUME 217 • ISSUE 2 • AUGUST 2019 • HARDWARERETAILING.COM

FOR MORE INFORMATION OR TO REGISTER, VISIT POINTY.COM/NRHA.

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AUGUST SPONSOR We understand that health insurance is a headache. The NRHA Health Insurance Plan offers an affordable solution with great benefits. Providing flexibility, low group rates and numerous perks, NRHA’s plan is worth considering for your insurance needs.

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Serving Hardware, Home Center & Building Material Retailers

Selling Next Door

How Woodstock Hardware’s Wholesale Supply Program Supports Local Businesses Page 68

VOLUME 217 • ISSUE 2 • AUGUST 2019 • HARDWARERETAILING.COM

What’s Your Loss Prevention IQ? Page 38

On a Scale of 1 to 4: When to Suggest an Electrician Page 48

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Headquarters OUR MISSION

The North American Retail Hardware Association (NRHA) helps independent hardware stores, home centers and lumberyards, regardless of wholesale affiliation, become better and more profitable retailers. @NorthAmericanRetailHardwareAssociation

136 N. Delaware St. #200 Indianapolis, IN 46204 317-275-9400 nrha@nrha.org nrha.org

North American Retail Hardware Association @nrha_official

PUBLISHING

PRESIDENT AND CEO Bob Cutter

EXECUTIVE VICE PRESIDENT AND PUBLISHER Dan Tratensek

EXECUTIVE COORDINATOR Marci Taschler

NRHA BOARD OF DIRECTORS

MANAGING EDITOR Melanie Moul SPECIAL PROJECTS EDITOR Liz Lichtenberger

CHAIRMAN OF THE BOARD TJ Comstock, Northwest Hardware LLC, Billings, Montana

ASSISTANT EDITORS Kate Klein Chad Husted Todd Taber

EXECUTIVE VICE CHAIRMAN Greg Schlecht, Greg’s True Value, St. Francis, Wisconsin

SENIOR DESIGNER Lynnea Chom

DIRECTORS Daniel Harris, Palos Ace Hardware, Palos Heights, Illinois; Lemont Ace Hardware, Lemont, Illinois Will Aubuchon, Aubuchon Hardware, Westminster, Massachusetts Jared Smith, Jared’s Ace Hardware, Bishopville, South Carolina David Dishke, Grand River Home Hardware, Caledonia, Ontario SECRETARY-TREASURER Bob Cutter, NRHA President and CEO IMMEDIATE PAST CHAIRMAN Megan Menzer, Newton’s True Value, Cherryvale, Kansas

SALES AND PRODUCTION ASSISTANT Freda Creech

MARKETING DIRECTOR OF MARKETING AND COMMUNICATIONS Whitney Daulton WEB DEVELOPER Kevin Trehan

SALES AND NRHA VENDOR PARTNER

TRAINING MANAGER AND EDITOR Jesse Carleton, 317-275-9418, jcarleton@nrha.org

DIRECTOR OF SALES Lowell Huffman

RETAIL OUTREACH COORDINATOR Renee Changnon, 317-275-9442, rchangnon@nrha.org

MIDWEST REGION MANAGER Brad Lyons, 317-275-9424, blyons@nrha.org

EVENT MANAGER AND RETAIL SUPPORT Katie McHone-Jones, 317-275-9426, kmchone-jones@nrha.org

NORTHEAST REGION MANAGER Lowell Huffman, 317-275-9443, lhuffman@nrha.org

RETAIL LEADERSHIP INSTITUTE

CANADA John Magner, 500 Queens Quay W., #101W Toronto, ON M5V 3K8 416-598-0101 x220; Fax: 416-598-9191, jmagner@yorkmedia.net

NRHA CANADA Michael McLarney, +1 416-489-3396, mike@hardlines.ca 330 Bay Street, Suite 1400, Toronto, ON, Canada M5H 2S8

SOUTHEAST REGION MANAGER Nick O’Connor, 317-275-9409, noconnor@nrha.org

STATE AND REGIONAL ASSOCIATIONS MIDWEST HARDWARE ASSOCIATION John Haka, 201 Frontenac Ave., P.O. Box 8033 Stevens Point, WI 54481-8033; 715-341-7100; 800-888-1817; Fax: 715-341-4080 PACIFIC NORTHWEST REGION Ronald F. Moore, 3857 Wolverine NE, Suite 20, Salem, OR 97305 (UPS, FedEx); P.O. Box 17819, Salem, OR 97305 (U.S. Mail); 503-375-9024; Fax: 503-375-7980; AK, ID, OR, WA SOUTHWESTERN REGION Jeff Flora, 638 W. 39th St., Kansas City, MO 64111; P.O. Box 419264, Kansas City, MO 64141 816-561-5323; Fax: 816-561-1249 AR, KS, LA, MO, NE, NM, TX

HARDWARE RETAILING | August 2019

Hardware Retailing’s final installment of the distributor profile series covers how the PRO Group is helping retailers succeed through a diverse vendor base and a progressive marketing plan.

PRODUCTION MANAGER Nancy A. Vondersaar

136 N. Delaware St. #200, Indianapolis, IN 46204 Fax: 317-275-9400

NRHA CANADA

Supporting Independents

GRAPHIC DESIGNER Kelsey Truex

MEMBER SERVICES

EXECUTIVE DIRECTOR Scott Wright, 317-275-9417, swright@nrha.org

PRO Group

@nrha_official

EXECUTIVE STAFF VICE PRESIDENT OF FINANCE AND BUSINESS SERVICES David Gowan

COMING IN SEPTEMBER

CIRCULATION, SUBSCRIPTION AND LIST RENTAL INQUIRIES PHONE 314-432-7511 FAX 314-432-7665 CIRCULATION DIRECTOR Richard Jarrett Hardware Retailing (ISSN0889-2989) is published monthly by the North American Retail Hardware Association, 136 N. Delaware St. #200, Indianapolis, IN 46204. Subscription rates: Hardware Retailing (Payable in advance): U.S. & possessions $50.00 year. Canada $75.00 year. All other countries $100.00 year. (Air Mail $60.00 year additional). Single copy $7.00. The Annual Report issue can be purchased for $30.00. Periodical postage paid at Indianapolis, Indiana, and additional mailing offices. POSTMASTER: Send address changes to Hardware Retailing, P.O. Box 16709, St. Louis, MO 63105-1209. All editorial contents copyrighted 2019 by the North American Retail Hardware Association. No editorial may be reproduced without prior permission of the publisher. REPRINTS: Contact the Editorial Department at 317-275-9400 for price quotations. Printed in the USA.

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Contents AUGUST 2019 | VOLUME 217 | ISSUE 2

74 MARKETING Guiding Light Creating a social media guide can give your posts purpose and professionalism. Monster’s global social media manager gives tips on how you can create a policy that empowers employees.

2 4 1

OPERATIONS

Wholesale Opportunities

Woodstock Hardware established a wholesale supply program to serve its retail customer base in a new way. Learn more about how the Woodstock, New York-based business expanded its reach by enhancing its opportunities to sell.

38 OPERATIONS Shutting Down Theft Dishonest staff and shoplifters can harm your business. Learn how you can protect your operation from these types of loss.

$753.20 The average dollar loss per shoplifting incident last year. Source: 2019 NRF National Retail Security Survey

“Our friendship is

beyond business. I lean on him. He leans on me. It’s a good thing. —Raffaelo Cianfaglione, Norridge Ace Hardware

”

56 PROFILE Beyond Business Read how Norridge Ace Hardware owner Raffaelo Cianfaglione went on a journey to purchase and revamp his hometown hardware store with the help of his friend and fellow retailer Brian Kabat.

48 CATEGORY SPOTLIGHT

62 OPERATIONS

Don’t Get Your Wires Crossed Even the most experienced DIYer, should take electrical work seriously. Know when you can give a few pointers or when to recommend a pro.

Product Pillars Brand recognition can be crucial to distinguish an operation. Learn how you can use anchor brands to increase foot traffic and boost sales.

HARDWARE RETAILING | August 2019

78 OPERATIONS Problem-Solving, From A2Z Transforming a struggling business may be challenging, but it can be done. Learn how Jeff Van Well at A2Z Home Center revitalized his lumberyard to grow sales exponentially.

Departments 06 . . . . . . . . . . . . . . . . . On the Web 08 . . . . . . . . . Independent Thinking 10 . . . . . . . .Taking Care of Business 12 . . . . . . . . . . . . . . . . NRHA News 20 . . . . . . . . . . . . . . . . . . . . . Trends 22 . . . . . . . . . . . . . . . New Products 34 . . . . . . . . . . . . . . . . . . Checkouts 80 . . . . . . . . . . . . . . . . Newsmakers 84 . . . . . . . . . . . . . . . . . . Last Word

On the Cover Woodstock Hardware owner Vince Christofora developed a wholesale supply business to serve local businesses in his hometown of Woodstock, New York, and to expand his operation’s reach. Photo by Franco Vogt

On the Web

PRODUCTS

Stay in the Know Hot Products Hub is your guide to the latest home improvement products and trends influencing the industry. Visit TheRedT.com/hot-products-hub to register for the free e-newsletter today.

PODCAST

Now Streaming

MARKETING

A Social Media Chain Reaction Creating a social media policy for your operation can be a direct way to ensure your employees represent your business professionally. A thorough guide can also help your business avoid potentially harmful public pitfalls. Check out a few tips from the social media guides of international chains like Starbucks, Target and Lowe’s at TheRedT.com/social-chain to get pointers as you develop your own guide.

OPERATIONS

3 Way to Instantly Improve Your Cybersecurity Cybersecurity is a growing concern in retail, especially for small businesses. Read the ways you can protect your business from cybercrime threats at TheRedT.com/data-breach.

$32,000 The average loss for small businesses from a data breach. Source: 2015 End of Year Economic Report, National Small Business Association

Bay Area Traditions Jamie Gentner, chief operating officer of Center Hardware & Supply in San Francisco, explains how her business has evolved through four generations in the latest episode of the “Tell Me More...” podcast. You can stream all episodes now by visiting TheRedT.com/tell-me-more.

CONNECT WITH US

@HardwareRetailing @hardwareretail

HARDWARE RETAILING | August 2019

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Independent Thinking

Do You Truly Offer Good Customer Service?

“Shop your store

and honestly assess how well your employees provide customer service.

”

’ve often asked retailers how they compete with big boxes. Time and again, the most common response is with customer service. And while I don’t disagree that big boxes have nonexistent customer service, I often wonder if these retailers truly have exceptional customer service or if they are just the lesser of two evils in the consumers’ eyes. When we owned our Wendy’s stores, I always knew we had a superior product over the competition, and I thought our customer service was top-notch. That was because we could measure components like pickup window speed of service, inside speed of service and whether our employees smiled and said thank you. What was difficult to grasp was when a customer reached out with an issue. Whether it was poor service, a wrong order or some other problem in their mind, did we find a solution to satisfy them or did we make matters worse? Customer service is more than just saying, “Can I help you?” or “What project are you working on?” It’s more than just acknowledging customers when they get within a certain radius of an employee. It’s about solving their problems and making it convenient for them to shop at your store or online. I keep telling my wife that I am going to write a book on customer service and make it a real-life account of how frustrating customer service has become. It would really be about customer “nonservice” and contain real company names and examples of the runaround I seem to get often. At this point, I haven’t won the lottery, so I can’t withstand all the lawsuits by using real company names, but it has become enormously frustrating to be a consumer lately. I have nine examples from just last week where I, as the consumer, had to follow up with a company to try and give them my money. Maybe I’m an idiot for continuing to use these companies. My wife is tired of hearing me ask, “What do people do with emails and voicemails, because obviously they don’t respond to them?” For example, I responded to an email from my dentist about a minor surgery with a couple of questions. After not hearing anything, I, the customer, followed up because the coordinator dropped the ball. In another instance, the chip in my credit card was bad, and after being trapped in voicemail jail for 11 minutes, I was able to electronically order it. After two weeks of not receiving it, I had to reach out to them again and discovered that their automated system never placed the order. Even in our own industry, I couldn’t give my money away. I had a rotted deck board that I needed to replace and I wanted to match the wood. I took a foot-long section into my area hardware store and had to track down an employee. After getting three people involved, none of them could tell me exactly the type of wood it was. Ultimately, one of them suggested I might try Home Depot! No, that is not a typo. All in one week, there were nine instances where I as the consumer had to take the initiative to make the sale. In a world where people think they offer superior customer service, I would say that each one of these examples is abysmal service. My challenge to you is to shop your store and honestly assess how well your employees provide customer service. People want to spend money; are you doing everything you can to help them spend it?

David Gowan, Vice President of Finance and Business Services

dgowan@nrha.org

HARDWARE RETAILING | August 2019

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Taking Care of Business

Getting to Know Your Next-Gen Customers

“One thing young

people value about the independent experience is the relationships they build.

”

ust a few weeks ago, my youngest daughter, Melissa, got married on the beach in Key West, Florida, to a fantastic (and decidedly brave) young man named Derek. My wife and I could not be prouder, and we are excited to watch them start their lives together. On the surface, while this event is incredibly important to me, it has very little impact on the home improvement retailing industry. Melissa and Derek getting married will not stop Amazon from doing what they do or help any of you better understand merchandising best practices or employee management. So, beyond the blatant self-indulgence, why would I decide to write my column about Melissa and Derek? Well, the answer is pretty simple. Melissa and Derek aren’t just important to my wife and me. They should be pretty important to you as well. They are exactly the people you will have to know and understand if you want your business to be successful over the next 10 to 20 years. This young upwardly mobile (I hope) couple just formed a new household together, and they are heading into their prime home improvement years. They are both in their 20s. Melissa is a member of Generation Z, and Derek is a millennial. Even with these labels, they are far from the stereotypical image most people conjure when they think of the archetypes of those generations. They currently live in an apartment, but are in the market to buy their first home. They are incredibly loyal pet owners and between school, work and their social lives, they don’t have a lot of time for much else. They have grown up online. In fact, neither one of them has known a time when they didn’t have instant access to information on the internet. They don’t pay for cable television (just Netflix and Hulu), and they don’t have a landline telephone. Melissa and Derek are responsible. In fact, they have contests to see who can have the best credit score (not exactly what I was focused on when I was in my early twenties). Because of this, they are cautious with how they spend their money, but they also aren’t afraid of making investments in things that are important to them. They both shop online, at big boxes and yes, at independent retailers. In fact, if you were to ask them, Melissa and Derek would tell you that they actually prefer to patronize independent businesses whenever possible. One thing young people value about the independent experience is the relationships they build with the people they do business with. They like going to the coffee shop where the barista knows their orders and their names. They like going to the restaurants where the staff warmly greets them and asks about their dog. So for all the consternation I hear from retailers about how the younger generations are going to bring the end of independent retailing and change the housing market, I encourage you to get to know the Dereks and Melissas in your own market. I think you’ll find that they are actually eager to do business with you, especially if you take the time to know little things about them… like the fact that they just got married on the beach in Key West!

Dan M. Tratensek, Publisher

dant@nrha.org

HARDWARE RETAILING | August 2019

Beautiful products to inspire your customers.

Hangers

Gable Plates

Ties

Fasteners

Post Bases

Angles

Straps

Simpson Strong-Tie offers an eye-catching display in three sizes (2', 3' and 4') to increase visibility and sales of the new Outdoor Accents decorative hardware line. Featuring black powder-coated connectors and screws, Outdoor Accents provides both design elegance and structural strength, giving your customers the inspiration to build custom outdoor living structures. Visit go.strongtie.com/outdooraccents or call us at (800) 999-5099.

4' Display

NRHA News

NRHA Plan Makes Health Insurance Easy

ffering competitive insurance benefits can help a small business stand out in a field of employers. While there is plenty of time before renewal season in January, use the next few months to look at your current insurance offerings and see what is available. As you research what options are available in group insurance, make sure you take time to learn about what your association can provide. The North American Retail Hardware Association (NRHA) offers the NRHA Health Insurance Plan, which is managed by Custom Benefits Insurance Group. Hardware Retailing spoke with Bob Chiesa, president and CEO of Custom Benefits Insurance Group to highlight three reasons you might want to consider utilizing the NRHA Health Insurance Plan. To learn more about the plan, visit nrha.org/business-services.

Save money by planning in advance.

Benefits help your operation compete.

Remember, there’s power in numbers.

While January seems far away, you know you should be thinking ahead. Use the rest of the year to research insurance options so you’re not scrambling and evaluating costs a month before a decision needs to be made. Just as consumers shop around for better deals, you should prioritize how you can save on operational expenses, including employee health insurance options. Plus, it doesn’t cost you anything to look at your options, Chiesa says.

Providing benefits like health and dental insurance ensure you retain talented, hardworking employees, especially as the need for benefits has become even more imperative among the workforce. According to Chiesa, health care reform made it so every individual has to have health insurance, which means job-seekers look for employers that offer comprehensive benefits. Offering benefits shows your staff that you care about investing in their wellbeing.

What makes the NRHA Health Insurance Plan a viable option? NRHA’s thousands of retail members help bolster it, Chiesa says. Before the plan was created in 2013, Chiesa says he spoke with carriers about the volume of retailers that would want and need insurance benefits. Instead of carriers looking at an independent store as a small operation, they approach the industry as individuals in a large group. The strength of NRHA gives you a much better deal, Chiesa says.

HARDWARE RETAILING | August 2019

If you want to create a more immersive, engaging paint buying experience for your customers, The Color Bar isn’t just a great choice – it’s the best choice. Just ask the mother-and-daughter owners of Petersburg Do it Best® Hardware – Sherry Bishop and Robin Smith. They use The Color Bar’s modern design workstation, eye-catching room visualizers and one-stop project stations to spark inspiration and conversation, creating opportunities to sell more than just cans of paint. Customer response has been nothing short of amazing. In the first year after they added The Color Bar, month-over-month paint sales increased an average of 26%. Last year, they were up another 10%.

» Discover how The Color Bar can help you connect to your customers in an entirely new way. Call us today at 888-DO IT BEST (364-8237). independentsdoitbest.com

“The Color Bar gives us the opportunity to talk to our customers about their next project — not just sell cans of paint.” Robin Smith Petersburg Do it Best Hardware

NRHA News

Turn Up the Volume on 2 Podcast Series

re you an avid listener of podcasts? If you haven’t listened to a podcast or aren’t sure what a podcast is, think of it like a radio show or interview conversation you can download and listen to anywhere, anytime. Would you listen to a podcast that focuses on the home improvement industry? Then make sure you are subscribed and listening to Hardware Retailing’s two podcast series.

Check out the episodes now to see if there is a topic or industry leader you’d like to learn more about. Once you’ve subscribed, you’ll be notified when a new episode is available. Subscribe at TheRedT.com/pod to listen to “Taking Care of Business” and “Tell Me More...” today. If you’ve got a great idea for a podcast episode for either series, send your suggestions to Renee Changnon at rchangnon@nrha.org.

Tell Me More...

Taking Care of Business

On this podcast, NRHA’s retail outreach coordinator Renee Changnon talks to retailers who bring unique perspectives to the industry through unique events, engaging social media practices and other operations innovations. Listen to These Episodes of “Tell Me More...” Now • Cody Goeppner, Bleyhl Co-op • Tasha Hilderman and Sarah Rurka, Home Hardware Building Centre—Lloydminster • Pat Sullivan, Sullivan Hardware • Jamie Gentner, Center Hardware & Supply

Hardware Retailing publisher Dan Tratensek hosts this podcast, which highlights a variety of guests, including high-profile retailers, industry experts and wholesaler executives. Take a seat at the table with leading members of the industry. Listen to These Episodes of “Taking Care of Business” Now • Jim Robisch, senior partner, The Farnsworth Group • Gary Pittsford, president and CEO, Castle Wealth Advisors • John Hartmann, president and CEO, True Value Co. • Dave Gowan, vice president of finance and business services, NRHA

Trainer’s Corner: Spot a Shoplifter

mployees can be one of your biggest assets to discourage shoplifters. But first they need to know how to identify the signs that a thief is at work. This month, NRHA has two resources designed to help. Use the exercise on Page 44 to discuss how your team might react to a suspicious customer. Then download an all new Trainer’s Toolbox, “Spot a Shoplifter at Checkout,” to learn how cashiers can help prevent someone from stealing. Download it at nrha.org/trainers-toolbox.

More Loss Prevention Resources • Loss Prevention. NRHA’s course in Loss Prevention covers the different types of loss that commonly affect independent home improvement stores. • Selling Skills. One of the best ways to deter shoplifters is through customer service. NRHA’s Basic Training Course in Selling Skills teaches employees how they can excel. Trainer’s Toolbox is a free resource, but to access these other courses, you’ll need to become an NRHA Training Member. To learn more, visit nrha.org.

HARDWARE RETAILING | August 2019

REACH FOR THE RIGHT SEALANT TO

FINISH STRONG.

Whatever your window or door project may be, either GE Silicone 1* All Purpose sealant or Silicone 2*+ Window & Door sealant can help you get the job done right the first time. With a 100% weatherproof seal, mold resistance1 and excellent flexibility, these sealants offer the exceptional performance you need to Finish Strong. Before purchasing or using any Momentive products, please visit www.momentive.com/salesdisclaimer to view our full product and sales disclaimer. For additional performance and warranty information, see product packaging or visit www.GEsealants.com. 1

Cured sealant is resistant to stain-causing mold and mildew. Regular cleaning of the cured sealant is required however, as soap or other residue can cause secondary mold and mildew growth.

GE is a registered trademark of General Electric Company and is used under license by Momentive Performance Materials Inc. * Silicone 1 and Silicone 2 are trademarks of Momentive Performance Materials Inc. Copyright 2019 Momentive Performance Materials Inc. All rights reserved.

NRHA News

NRHA Goes International at the Global DIY Summit

Bear Tough Carts Retailers nationwide are helping their communities with solutions to the human-bear conflict with Toter Bear Tough Carts. With a bear-tight lock, double-walled lid and steelreinforced rim, Toter Bear Tough Carts are strong enough to prevent the toughest bears from getting inside. Made with Advanced Rotational Molding™, Toter Bear Tough Carts withstand clawing and chewing. So, you can tell the toughest bears to grin and bear it.

To learn more, visit try.toter.com/beartoughcarts

HARDWARE RETAILING | August 2019

arlier this summer, members of the home improvement channel from around the world gathered in Dublin at the 7th Annual Global DIY Summit. The three-day event, which is jointly hosted by the European DIY Retail Association, the European Federation of DIY Manufacturers and the Global Home Improvement Network, was held June 5-7. The event creates a forum for the world’s leading retailers and manufacturers in the home improvement and garden industry to exchange ideas and views on the global market. NRHA’s executive vice president and Hardware Retailing publisher Dan Tratensek attended the event to meet with delegates from around the world to discuss issues impacting the home improvement market and the retailers serving it. The event began with a store tour that led conference delegates on visits six of Ireland’s leading home improvement retailing operations, including TJ O’Mahony and Woodie’s. See a photo gallery of these stores at TheRedT.com/ireland-retailers. Ace Hardware Corp.’s president and CEO John Venhuizen kicked off the summit with a keynote presentation on what it takes to be a more engaged leader. Another notable speaker at the event was marketing and business professor Barbara Kahn from the Wharton School in Philadelphia who shared how business disrupters, like Amazon, changed the way retailers have to connect with their customers. “I don’t think retail is dead,” Kahn says. “I don’t think physical stores are dead. I do think bad retail is dead.” For more information about next year’s event in Amsterdam or any of the hosting organizations, go to diysummit.org or edra-ghin.org.

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WHITEPAPER

Cash Is King Improving Cash Flow with Efficient Accounts Receivable The relationship between a company’s profitability and its cash flow, while straightforward, isn’t always fully understood. Many businesses, especially salesoriented companies, tend to manage operations from the bottom line, believing that if sales are increasing, the business is profitable and success is guaranteed. The problem with this thinking is that businesses don’t pay their vendors from the bottom line, they pay from positive cash flow. Too often, sales-oriented businesses are so eager to get new clients, that the structure required to get paid for current work isn’t fully fleshed out. Suddenly, the funds needed to pay current invoices are not available, and the company is at risk of selling themselves out of business by not properly managing cash flow.

Get a grip on accounts receivable The best course of action is to get a firm grip on accounts receivable before it becomes a problem. This will give you enough cash on hand to stay ahead of bills and still have funds left over to invest in the future. Until payment is received (positive cash flow generated) any transaction can’t really be considered complete. Too many outstanding customer payments lead to cash flow problems. Getting paid should always be a priority, but before any receivables get collected, several actions are required to help guarantee receipt of that payment. When customers owe you money, there shouldn’t be a major investment of time and manpower on your part to get paid. For any accounts receivable process to work, it starts with accurate data collection.

This includes information regarding the product or service rendered, price with tax, any discounts that might apply, expected payment date, and any other information relevant to that specific transaction. If this is a manual process or data needs to be applied to different programs, the process can be time consuming and prone to errors.

Automation makes the process more streamlined Part of the success of any accounts receivable effort is the ability to establish the right payment terms. The amount of time you offer customers to make their payment should be considered carefully. The longer the payment term, the more credit you are extending to your customers. Conversely, the shorter the term, the quicker you get your money—theoretically. The typical payment cycle for goods or services ranges from 30 to 90 days. The best approach is to set terms that work financially for you, but also are fair to your customer. Perhaps you want to include an incentive, such as a discount, to clients who pay early. For example, you could offer a 2% discount on an invoice if paid within 10 days. Whatever term works best—say it is a 30-day deadline—be sure to include that data on all future invoices. The biggest obstacle to positive cash flow is customers who don’t pay on time. When that happens, instead of having capital available to pay your own vendors or make your own payroll, your money is tied up on your balance sheet. One of the first steps to speed payments is to set clear and concise credit policies. Set responsibilities with your

sales or finance department about when to extend credit, how much credit to extend, and what penalties to impose on overdue accounts. Then commit to process all credit applications within a specified time frame. Think carefully about the wording of terms you decide upon—a little bit of courtesy can go a long way to speed payments. For instance, asking politely for payment within 21 days always beats a statement such as “due in full on receipt.” Knowing your clients well, as you do, and understanding what motivates their operations and payments can help you choose the best strategies to get paid while still appearing friendly. Just as important as the information that goes into creating the invoice is the data that determines who will receive it. You need to keep track of contact information for key accounts payable contacts. You probably want to verify this information monthly to keep up with any changes. Equally important for

larger businesses, is the need to have at least one additional manager’s contact information, or an owner for smaller businesses, should be there ever be a need to escalate communications. When payment is overdue you will also need an accounting department contact. The collection process undoubtedly runs smoother when your customers understand payment terms completely so there are no obstacles to receiving payment.

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Trends (Possibly) Surging Electrical Problems Power surges can cause permanent damage to the broad array of electronics people use in their homes, says the Electrical Safety Foundation International (ESFI).

Applied to Retail When customers make a significant investment in appliances, let them know they can prolong appliances’ life spans by installing permanent surge protectors. Turn to Page 48 to learn about common electrical projects your staff can guide customers through safely.

U.S. electrical wiring best practices are changing, and built-in surge protectors are an increasing priority in new home construction and remodeling, according to ESFI. The National Electrical Code has an update coming in 2020, and new standards for surge protectors are a key part of it, the organization says. The dollar value of the electronic devices used in houses makes electrical surges—which happen regularly and often unbeknownst to homeowners— costly and unnecessary threats, the National Electrical Manufacturers Association (NEMA) reports.

Impacting Electrical Investments Reliance on electronics makes surge protectors vital.

80%

of electrical surges have internal causes, like faulty wiring.

Power Surges Can Affect the Life Spans of Heating and Air Conditioning Units

The average value of appliances affected by power surges:

$15,000

Washers and Dryers Water Heaters Ranges and Refrigerators

20%

of surges are caused by outside sources, like lightning.

Source: National Electrical Manufacturers Association

HARDWARE RETAILING | August 2019

Lighting Entertainment Systems

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Please contact missy@poopourri.com or your Preferred Co-Operative.

New Products

“We’ve had enormous sales

from the Spartan Eradicator. We’ve had it for a couple of years now, and customers will come and ask for it by name.

”

—Lynzi Kleist, Ag Partners Town & Country

1 “We saw the Pullsaw Pro at a recent buying show and tried it out in a demo video for them. That was the easiest cut I've ever made with a saw.

”

—Robert Gann, Yeagers Hardware & Lumber

1. Mosquito Repellent

2. Pull Saw

Spartan Mosquito Eradicators “catch” hunting mosquitoes by emitting the same attractant triggers that draw mosquitoes to people and animals. Once mosquitoes feed on the water solution, they will die before they can breed again. The eradicators don’t require batteries or electricity, just water.

The Roamwild Multi Pullsaw Pro is capable of cutting large pieces of sheet material as well as trimming delicate hardwood. The saw can also be used on plastic. The three-point sharpened teeth are hardened, with a minimal set and made from high-quality steel.

Spartan Mosquito 844-625-2742 or spartanmosquito.com

HARDWARE RETAILING | August 2019

Roamwild 614-985-5600 or roam-wild.com

Retailer Picks These four products were selected by retailers like you! Share your favorite products by contacting Chad Husted at chusted@nrha.org.

“Direct wire LED Greentek

bulbs for fluorescent fixtures have been a hit because they bypass the ballast, last for many years, use a fraction of the energy and are shatterproof. —Daryl Hurst, PaulB Hardware

”

3 “We brought Craft a Brew

into our store three years ago as a holiday item. It did so well we’ve invested in a whole section of brewing and now teach classes on it.

”

—Mark Shaw, Shaw Hardware Store

3. LED Lights

4. Home Brewing Kit

The VersaT8 LED tube light works with most T8 electronic ballasts, but can also work without a ballast by being directly wired into AC100-277V. The power consumption of these LED lights ranges from 12 to 20 watts. These bulbs have a life span up to 50,000 hours or more and can save users up to 60 percent in power consumption.

Craft a Brew’s Craft Beer Kits include reusable fermenting equipment, instructions and packed-to-order ingredients. The beer recipes feature the same hops and grains used by the American craft beer industry. Recipe Kit refills are also available and include ingredients to brew another batch. There are 18 beer styles available, including hefeweizen, American pale ale and Irish stout.

Greentek 888-635-4448 or greentekes.com

Craft a Brew 407-440-2905 or craftabrew.com

August 2019 | HARDWARE RETAILING

New Products

5 5. Smart Mailbox The Parcel Guard is designed to securely store packages until the recipient can retrieve them. A delivery person can stow a package where it will remain until the mailbox is opened using the mailbox app. Parcel Guard also includes a motion-sensing camera and a built-in alarm. Danby Products Limited 800-263-2629 or danbyparcelguard.com

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Eliminates white heat rings, water marks, sun fade, oxidation, smoke damage, etc. • Restor-A-Finish is a unique finish-penetrating formula that restores wood finishes while blending out minor scratches, blemishes, and abrasions • With a simple wipe-on, wipe-off process, most finished wood surfaces that seem to need a complete refinishing job can be restored in a few minutes • Removes white heat rings and water marks, sun fade, oxidation, smoke damage, etc. • Available in Neutral, Maple-Pine, Golden Oak, Walnut, Mahogany, Dark Walnut, Dark Oak and Ebony Brown

~ Available Through Most Co-Ops and Distributors ~ For Wholesale Pricing Call Howard Products, Inc. 800.266.9545 Or Visit Our Website www.HowardProducts.com

HARDWARE RETAILING | August 2019

New Episodes Now Streaming Discover two Hardware Retailing podcast shows featuring the latest ideas and expert insights into the industry. Listen and Subscribe TheRedT.com/pod

Brought to you by

6 6. Drawer Organizer The SpiceLiner Spice Drawer Organizer mat is a nonslip drawer mat that can separate and organize various jars. The liner keeps the spice labels pointed up for easy access when cooking. SpiceLiner is available in a 10-foot roll or in six 18-inch slips. YouCopia Products 888-973-9288 or youcopia.com

MIGHTY POWERFUL | RELIABLE | EFFICIENT

THE BRAND YOUR CUSTOMERS WILL ASK FOR BY NAME

7. Aerating Garden Beds Smart Pots are fabric garden beds that develop root structure in trees and plants while giving the plants access to water drainage and heat release. Each Smart Pot bag can be washed and reused multiple times with any potting mix.

3200-PSI Cold Water Pressure Washer

www.mitm.com 800-553-9053

Made in

USA

with Globally Sourced Components

Mi-T-M manufactures: Cold & Hot Water Pressure Washers Air Compressors • Portable Generators Air Compressor/Generator Combinations Air Compressor/Generator/Welder Combinations Wet/Dry Vacuums • Jobsite Boxes • Portable Heaters Water Pumps • Water Treatment Systems

HARDWARE RETAILING | August 2019

Smart Pot smartpots.com

8. Air Fryer The Power Air Fryer 360 has five heating elements to offer superheated air all around cooking food. It comes with 12 preset options for items like roasting, slow cooking and dehydrating food. It has a capacity of 930 cubic inches and a removable rotisserie. Tristar Products 973-287-5149 or emerilairfryer360.com

9. Taco Holders Prepara taco products are decorated for festive meals that keep tacos upright and filled. The holders and taco filling spoons can work with many sizes of tortillas and with either soft or hard shells. Prepara 888-878-8665 or prepara.com

10. Dog Houses These Barn-Shaped Dog Houses offer unique designs that can be assembled without tools. Suitable for indoor and outdoor use, the dog houses are UV-protected and well insulated. The houses are available in Jumbo and Mini. Boost Online Stores 570-266-7883 or boostonlinestores.com

August 2019 | HARDWARE RETAILING

New Products

12 11 NEW for 2020* *pending state registrations

botanical ®

WEED & GRASS KILLER • KKills ills aallll ttypes yype pes ooff ggras grass rass & w weeds eeddss with itthh iinn hhours • FFast ast aacting, ouurrs cttiing, kkills kiills w proovved ffor • AApproved pppr or OOrganic-Gardening rrgganic-GGar ardeenning makes • CConcentrate-1 oncentrattee-1 qquart es 8 ggallons uart m akkes allons • LListed isted ffor oorr uuse se iinn vvegetable eeggetable ggardens aarrdens ttoo oooo

11. Tree Stand Eazy Treezy Christmas tree stand allows users to drop in their tree for quick setup with one person. No screws are required. The check-and-fill spout allows for easy monitoring of the water level. The stand can hold trees up to 10 inches in diameter. Eazy Treezy 818-527-2499 or eazytreezy.com

12. Insulated Pliers CHANNELLOCK® insulated pliers are OSHA-compliant pliers that feature knife-and-anvil style cutting edges to ensure solid mating and longer cutting edge life. The cutting edges are laser heat-treated to last longer and are made with high-carbon U.S. steel and a rust-preventive coating. Channellock 800-724-3018 or channellock.com

HARDWARE RETAILING | August 2019

13 14

13. Grease Gun The LNL261 grease gun features a toggle switch that allows a user to switch between a metered “single-shot” delivery at up to 6,000 psi, or a continuous stream at 5 ounces per minute. These features come in a lightweight grease gun designed to reduce fatigue when greasing for long stretches. LockNLube 603-795-2298 or locknlube.com

14. Durable Disposable Gloves Venom Steel has created disposable gloves with heavy-duty, 6 mil, 2-layer nitrile integration. This design makes for a glove that is puncture and chemical resistant and micro-textured for stronger grip. Venom Steel disposable gloves are also powder free and fully textured for a better grip than standard medical gloves. Medline Industries 847-643-4396 or venomsteel.com

Our magnets attract customers and profits. You can rely on over 40 years of experience and 250 products to support your continued success. Let us show you how the retail power of magnetic attraction can work for you. Call 888.293.9190 or visit magnetsource.com/retailsupport

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August 2019 | HARDWARE RETAILING

New Products

Professional Grade Grease Guns A Grease Gun Designed to Suit Every Application!

15. Clamp Meters The Extech MA44x series of 400A clamp meters offers multimeter and current measurement functions along with a built-in noncontact AC voltage detector to meet the needs of electrical contractors and HVAC technicians. FLIR Systems 877-239-8324 or extech.com

16. Fermentation Kit The Kilner® Fermentation Set provides an easy way to create your own fermented foods containing vitamins, minerals and probiotic cultures. It can create live cultures for sauerkraut, kimchi, pickles and more. Users only need to add their favorite vegetables, water and salt. Recipes and a how-to leaflet are included with the kit.

WORLD’S BEST Quick Release Grease Couplers

Lumax.com 30

Typhoon Homewares 866-598-0309 or typhoonhomewares.com

Info@Lumax.com

HARDWARE RETAILING | August 2019

844.660.6876

17. Lump Charcoal

American Made & Profitable For Over 80 Years

Fire & Smoke Society Charcoal is lump charcoal that burns clean and hot allowing for food to be naturally transformed by its heat and release a clear blue smoke. This charcoal creates very minimal ash and can be recycled as BioChar fertilizer. This charcoal is also USDA-certified organic. Fire & Smoke Society 501-680-0975 or fireandsmokesociety.com

18. Power Washer The WORX® 40V Power Share Hydroshot™ Portable Power can shoot water up to 450 psi on its high setting and can draw water through a garden hose or its 20-foot accessory hose to draw from lakes, rivers or buckets. It includes a lance; two 20-volt 2.0 Ah MAX lithium batteries; a 1-hour dual-port charger; a 20-foot hose; and a carrying bag. Worx 855-279-9505 or worx.com

With a variety of clearly marked spring assortments, Ajax offers your customers ease of selection for their specific needs. Each assortment comes in their own unique case. Our storage cabinets and kits, provide assortments of Steel Lock, Brass Lock, Music Wire, Stainless Steel, Extension, Compression and more, each making dispensing efficient and economical. Ask for our Product Catalog which provides product descriptions and size specifications.

Toll Free: 855-966-AJAX (2529) www.ajaxwire.com ajaxwire@aol.com 119 Bloomingdale Road, Hicksville, NY 11801

August 2019 | HARDWARE RETAILING

Exceeding Expectations. One Fastener Destination at a Time!

“Crescent Ace Hardware sees our customers as our most valuable commodity. As their needs changed, we saw an opportunity with Midwest Fastener to expand our fastener department and to also meet the ever increasing needs of those customers.” -Joel “Barney” Wienecke, Co-Owner -Two of Crescent City Ace’s avid Midwest Fastener fans -Steve Rosenberger, Department Manager

For your very own fastener destination, contact Glen @ 800-444-7313 x 120

800.444.7313

fastenerconnection.com

Checkouts COMMUNITY EVENTS

Hardware Is for (Animal) Lovers

ochard Do it Center is for the dogs—and cats. The business, based in Sidney, Ohio, holds several events to benefit the Shelby County Animal Rescue Foundation (SCARF) throughout the year. “We invited SCARF to host adoption events at our store,” says hardware manager Deb Peters. “SCARF goes to many organizations here in our area, and we’re a very pet-friendly place, so it made sense for us to be one of them.” Lochard Do it Center hosts three to four events a year focused on the animals. The rescue organization brings in adoptable animals for customers to meet and get the process started for adoption. Customers also drop off goods to donate to the shelter, including blankets, food, cleaning supplies and toys. For another event, Lochard Do it Center staff actually bakes homemade treats for animals in the community.

“Mr. Lochard himself comes from a long line of animal lovers, and he loves this community, too,” Peters says. “He loves to do anything to help out the people and the animals who live here.” And if any customers want to see animals at the store, they don’t even need to wait for a shelter event. Animals are welcome at Lochard Do it Center every day. Some dogs even know when they’re about to make a trip to the local hardware store. “We have a lot of pet owners in the community, and there are many pets out there who know us,” Peters says. “They know when they leave home with Dad that they’re coming here. We keep treats at the front so there’s something for them when they come in. We’re all animal lovers here, so do what we can for them.”

“ We’re all animal lovers here, so do what we can for them.” —Deb Peters, Lochard Do it Center The local animal shelter that serves the area around Sidney, Ohio, works closely with Lochard Do it Center.

Looking for creative ways to engage customers? Whether it’s promotions, merchandising or special events, we cover it here. Have an idea? Contact Kate Klein at kklein@nrha.org to have your story considered for publication. 34

HARDWARE RETAILING | August 2019

Checkouts

MERCHANDISING

Pesky Reminders

lear signage can be the difference between a lost, frustrated customer and a sale. So what better way to suggest a pest control product than to put a lifelike pest right under foot? Customers in the pest control aisle at Elliott’s Hardware in Dallas may look twice. The floor mat shows them they’re in the right place, and the shelf signage further directs them to the information they need to tackle any home invaders.

Give your customers a reason to grab an extra can of pest control spray with some realistic merchandising. The floor mat and shelf signage at Elliott’s Hardware in Dallas help customers quickly find what they need.

For over a century, we have insured the lumber and building material industries. A long time has passed since we first started insuring the unique risks of wood-based businesses in 1895, but our core values remain the same – we are committed to bringing our policyholders the most comprehensive and current coverages along with sophisticated risk management practices to keep their businesses safe and prosperous. Put our time in the building material industry on your side. Contact us or your broker for a competitive quote. It’s about time you moved your insurance to PLM.

800.752.1895 | www.plmins.com 36

HARDWARE RETAILING | August 2019

AMERICA’S OLDEST AND LARGEST MUTUAL INSURANCE COMPANY DEDICATED TO THE WOOD PRODUCTS AND BUILDING MATERIAL INDUSTRIES. WE INSURE HARDWARE STORES, HOME CENTERS AND BUILDING MATERIAL DEALERS.

MERCHANDISING

Setting the Scene

un in the sun and on the water is a part of life for residents and visitors in Titusville, Florida, and the local hardware store offers extensive niche categories to meet their needs. At Titusville Ace Hardware, customers can see how deep the opportunities are thanks to creative and eye-catching merchandising in the sporting goods department. “We started out kind of small like everybody else, but then it just kept getting bigger and bigger,” says owner Bill Pastermack. “It’s really worked out well for us.” Pastermack says a key for building a niche is to be dominant in the category so your customers don’t have to go anywhere else. Due to their approach to building a comprehensive fishing niche, Pastermack says customers from outside their traditional market come to the store to find the tools and gear they need to support their hobby. Titusville Ace Hardware also expanded into sunglasses as a complement to the fishing category, which has driven traffic. “Word-of-mouth is totally priceless, and it brings people down here,” Pastermack says. Go to TheRedT.com/titusville-niches to hear more from Pastermack about how his operation earned a reputation for unique niches.

Show off your depth to make an impression in a niche category, like Titusville Ace Hardware does in its fishing department.

August 2019 | HARDWARE RETAILING

By Jesse Carleton, jcarleton@nrha.org

Locked Out Shut Down Criminals Before They Break Into Your Business

reventing loss at your business requires a holistic approach that involves everything from the customer service you provide on the salesfloor to the sophistication of the POS system that keeps track of your sales. That approach is similar whether you are facing down a shoplifter or investigating a thief on your own staff. In this article, Hardware Retailing takes a look at two retailers who have faced what may be extreme cases of criminal activity, both inside and outside their companies. Brandon Ford, manager at Albertsons Home Center in Parksville, British Columbia, discovered an employee had been stealing thousands of dollars through return fraud.

HARDWARE RETAILING | August 2019

Stephanie Van Ness, president and owner of Andy’s Ace Hardware in Anchorage, Alaska, has been dealing with a sharp spike in shoplifting. Each of these retailers has tightened security at their stores. They’ve found that the best loss prevention tactics are based on using the latest technologies to catch criminals in the act paired with a consistent dose of old-fashioned customer service. By reading what these two retailers have learned, you may spot areas where you can improve security at your own operation and shut down criminals before they can do their damage. If you want more insights into loss prevention, check out a video from the Hardware Retailing archives at TheRedT.com/buchheit-security.

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Case Study: Albertsons Home Center

Employee Theft

lbertsons Home Center manager Brandon Ford has a staff any retailer would idealize. The majority are full time, with many long-term employees, some with 15-year tenures. They work hard and care about the success of the company. Still, there can always be an exception. That truth hit home hard two years ago when Ford discovered one of his trusted, full-time cashiers, Kim (not her real name), had been slowly stealing money from the company. Discovering Kim’s dishonesty was a watershed moment for Ford, forcing him to rethink employee accountability and oversight while preserving the company culture of trust that is so important to the success of his operation.

The Problem: Return Fraud Ford’s first clue that something was wrong came after a phone call from one of his employees. A customer wanted to purchase an 8 ¼-inch circular saw. According to the store’s point-of-sale system, there should be one in stock, said the employee, but it wasn’t on the shelf. Puzzled, Ford did a quick search on the POS. A few days earlier, Kim had returned the saw in question. That return raised a red flag, so Ford started digging deeper to see if Kim had made any other unusual returns. Kim had been with the company about four years, and Ford trusted her. She was going to school part time, and Ford was coaching her through her business class. “We thought that after we helped her through school, we could create a position for her to develop her career,” he says. Then more returns started showing up. With his POS software, Ford began looking for recent return invoices generated by Kim’s cashier ID and noticed a disturbing trend. Most of the returns were made with the same credit card. They were also mostly small dollar amounts with a high inventory count where it would be easy to overlook that an item was missing. Ford cross-referenced the credit card number with a transaction Kim had made on her staff account. The cards matched. Ford got a report from his POS provider showing all returns Kim had made with her personal credit card. Over a nine-month period, Kim had processed more than $10,000 in fraudulent returns.

Average dollar loss per dishonest employee: (at retail stores with 500 or fewer locations)

$1,377.12 Source: 2019 NRF National Retail Security Survey Brandon Ford, manager at Albertsons Home Center, says averting internal theft involves balancing accountability and mutual trust among employees.

HARDWARE RETAILING | August 2019

Read more about the survey results at TheRedT.com/lp-survey.

Ford’s next move was to call the police. After seeing the evidence, the officer agreed Ford had a case. “When she arrived for her shift, the officer and I took her up to my office, and of course she denied everything,” he says. “But at that point, I terminated her employment, and the officer escorted her off the property.” Fortunately, Ford carried internal theft insurance and recouped most of the money lost. The local government proceeded with a criminal prosecution and conviction because of the sizable dollar amount stolen. Ford was finished with the crime. Now he had to deal with the aftermath.

What You Can Do Ask Questions

Ford runs a regular report that shows him return histories and alerts him to irregularities or worrisome patterns. Don’t be afraid to ask questions about even minor discrepancies in your records.

“Where there’s smoke, there’s fire. You might have to think like a criminal to catch a criminal. If you see something that’s off, investigate,” says Ford.

The Cleanup: Preserving the Team “Every person in the company felt violated,” says Ford. “And it was critical for me to continue to have faith in our team.” Ford had to work both inside and outside the company to divert further disaster. During the two years it took for the case to make its way through the court, Kim continued to deny any wrongdoing. Ford started hearing around town that he must have made this up just to get rid of Kim. No one seemed to think she would do something like that. “I decided it was best to take the high road and remain fairly tight-lipped about the whole incident,” he says. “We didn’t want the family to think we were gloating or coming after them. This is a small community, and I didn’t want to create divisions.” While Ford decided it was important to be cautious about what he said to the community, he was more open with his staff. “It was important to have complete transparency with my staff,” he says. “I told them, ‘I’m going to be on edge for a while. Don’t take it personally. It will take some time to deal with this.’” Employees can tell when you are hiding the truth from them, so be honest and treat them like adults, he advises. Doing that will strengthen your relationship with them, it will promote a culture of trust, and it will go a long way to generate goodwill. Let your staff know you care about them, and more than likely, the feeling will be mutual. “My birthday came up shortly after this incident,” he says. “I came into my office to find it packed with balloons and streamers. That gave us all the opportunity to have a good laugh in the morning and start trying to get back to normal.”

Follow Up on Returns Ford now collects more information with each return. Each return must include a reason for the return, along with the customer’s name and phone number.

“We might call a customer if something looks strange with the return,” he says. “We can also follow up and ask if there’s anything we can do better next time.”

Empower Employees Ford’s investigation into this case started with a call from a concerned employee who understood the inventory procedure enough to realize something was amiss.

“Teach associates to understand the POS system, and tell them it’s important to raise a question when they see something that doesn’t make sense,” he says.

Build the Team Employees who don’t think you care about them may feel that you owe them, which may prompt some to steal. Even then, a trusted employee can change.

“The relationship is important,” Ford says. “If you know something is happening in a person’s life, then you can be more aware of how that might change their behavior.” August 2019 | HARDWARE RETAILING

Case Study: Andy’s Ace Hardware

Shoplifting

hoplifting at Andy’s Ace Hardware has spiked over the past few years. Company president and owner Stephanie Van Ness believes that rampant drug abuse in the area combined with a new state law, which weakened penalties for shoplifting, have made criminals bolder. While shoplifting was already a problem for area merchants, it’s gotten a lot worse. “We are getting hit between two and four times a day,” she says. That’s despite 100 security cameras surveilling the 20,000-square-foot store and locks on most of the high-value merchandise. She says the law is likely to be reversed soon, but there’s no guarantee what effect that will have on overall shoplifting rates. To cope, Van Ness has raised loss prevention awareness among all employees and boosted customer service levels so her store can continue to be a safe place to shop.

The Problem: Shoplifters Battling shoplifting can be like trying to hit a moving target. It’s difficult to know what will be the next hot item that will get stolen. Smaller items have always been vulnerable, says Van Ness. She’s had to move much of the store’s smaller impulse items to the front register where they’re more visible to staff. Flashlights are frequently stolen, but sometimes the theft of larger items hits the store in a wave. Thieves are different, too, and Van Ness has seen them all. One perpetrator cut the lock on a chainsaw, setting off the alarm. He made a dash for the back door, jumping over a pallet of soil and then a fence in a dramatic exit. Another criminal cut the chain securing a generator before returning to the store a couple of hours later to retrieve it. Other potential shoplifters can be deterred, with patience. Van Ness says a tell-tale sign of a shoplifter is spending hours in the store while nervously watching the staff and filling a shopping cart only to abandon it and leave. More than likely, those customers intended to steal, but gave up thanks to the attention they received from the staff. Some criminals just have less sense than others. “One woman interviewed for a job here,” she says. “On her way out after the interview, she stole from us. Of course, we had all of her personal information. We invited the police to her second interview.”

Average dollar loss per shoplifting incident: (at retail stores with 500 or fewer locations)

$753.20 Source: 2019 NRF National Retail Security Survey A customer coordinator at the front door of Andy’s Ace Hardware greets each person coming in the door and is the first defense against suspicious activity.

HARDWARE RETAILING | August 2019

Read more about the survey results at TheRedT.com/lp-survey.

The Cleanup: Managing Theft Dealing with theft has become top of mind for every Andy’s Ace employee, every day. The store has a well-defined policy on how to deal with a shoplifter. Van Ness has one employee designated as the loss prevention officer who is the point person for all cases, but all staffers know how to spot potential shoplifters and fill out the necessary police reports. Deterrence begins at the front door. Van Ness designates an employee as the customer coordinator who greets every customer at the front door. The position is non-negotiable, she says, meaning that employees cannot leave their post unless they have found someone to replace them, even if it’s for a brief break. “That person is our eyes and ears on the salesfloor,” says Van Ness. The store maintains a record, called the trespass book, of every theft incident. Thanks to a high-definition camera system, they have photos of everyone who has shoplifted. Employees are required to review that book frequently, so if the customer coordinator sees someone in the book returning to the store, they can pass the word to the rest of the staff. Staff shares information about potential shoplifters using code words. Another employee monitors the cameras, so they can generally spot a suspicious customer trying to hide merchandise in their clothing or a bag. When it’s evident a shoplifter is on the move, Van Ness says their procedure is to wait until that person has passed the last point of purchase before taking action. “Our No. 1 rule is to never put yourself in harm’s way,” she says. Employee safety is always a top priority, and every situation is different. If they determine it’s safe to confront a shoplifter, they will detain them, fill out the forms and contact the police. Other security measures throughout the store include an electronic keypad on the employee entrance at the back of the store. There’s a lock on the dumpster. Bathrooms are locked, but every night employees check them for empty boxes, usually evidence a shoplifter has been at work. After an armed robbery, Van Ness started closing the store an hour earlier in the evening, as there were a higher number of incidents occurring later in the evening. “We’ve learned to just start doing everything better,” says Van Ness. “We now have the best personal service in town.”

What You Can Do Give Overwhelming Customer Service Sometimes, personal attention through customer service frustrates the would-be thief enough that they leave empty-handed. Van Ness has had to increase staff on the floor to provide adequate coverage.

“Customer service is the No. 1 deterrent of shoplifting,” says Van Ness. “We often become our customers’ personal shoppers, walking through the store with them.”

Collaborate With Area Businesses Van Ness is part of a group of retailers that meets periodically to discuss crime in the area. They share trends or information on repeat offenders.

“While we might be competitors, we all get along when it comes to discussing crime,” she says. “The group has been helpful in learning how others are fighting crime.”

Scan Out-of-Stock Items Shooting the outs, or scanning for out-of-stock inventory, on a weekly basis will help you determine shrinkage rates and what areas of the store are shoplifted.

“We keep a well-faced and fronted store,” she says. “It’s easier to spot where someone might have stolen something if all the shelves are properly fronted.”

Keep Thorough Records Whenever Van Ness calls local law enforcement to report a shoplifting incident, her incident reports have all of the information the officer will request.

“Our incident reports are easy to fill out and every staff member is trained on how to use them,” she says. “This has made getting information to the police more efficient.” August 2019 | HARDWARE RETAILING

What’s Your Loss Prevention IQ? Does your staff know how to react to a suspected shoplifter? Read through the red questions in this hypothetical scenario and have your staff discuss their answers before moving on to the next step. Talk through your store’s specific policy regarding shoplifters.

How to Spot a Shoplifter In the middle of summer, a man walks in wearing a large jacket and carrying a backpack. You’re at the register. You say hello, but he doesn’t return your greeting. He avoids eye contact and heads straight toward the power tool department. What should you do?

You tell your manager you’re going to the tool department to stock the new drill bits.

What question should you ask the customer?

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You see the customer browsing drills, so you ask what kind of drill he’s looking for.

What can you do to help browsing customers? He says he’s just browsing. You tell him that you’ll be close by if he has any questions.

What should you do if you need to leave the area? You need to return to the register. Your manager takes your place to keep an eye on the customer.

HARDWARE RETAILING | August 2019

How can you keep yourself and customers safe? The customer runs past you and out the door before anyone can stop him. What do you do now?

What’s Next? The customer exhibited behavior in line with shoplifters, so at this point, you should review the security footage, and if warranted, call law enforcement. By filling out an incident report as soon as possible, you can give them all the information they need so they can be aware of similar reports. Find another exercise like this at TheRedT.com/shoplifting. For more loss prevention resources, consider becoming a North American Retail Hardware Association (NRHA) Training Member at nrha.org/training.

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Your manager radios that the customer opened his bag, but she couldn’t see if he had stolen anything.

What customer details do you write down? You note the customer’s clothing, facial features, hair color and style and his demeanor.

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What should you do back at the register? You find the incident report sheets at the register. You write down all the details you can remember.

August 2019 | HARDWARE RETAILING

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By Chad Husted, chusted@nrha.org

for Success How to Approach Common Electrical Projects With Customers

iscussing home projects dealing with electricity likely puts a charge through any retailer. When helping customers tackle these projects, retailers should consider how difficult the project is and how a customer is planning to take it on. Some, like installing a new ceiling fan, can likely be accomplished by most homeowners with a little guidance from a knowledgeable sales associate. Other projects, like changing a breaker, need more skill and require a bit more instruction from a retailer. Find out how employees at Weaver’s Ace Hardware in Pennsylvania help customers through common electrical projects. Across three locations, Weaver’s Ace Hardware encounters a variety of electrical projects, and approaching each question with an open mind and a strong knowledge base is essential for achieving the right results. “Our focus is on helping our customers take care of and be comfortable in their homes,” says Ed Shenk, owner of Weaver’s Ace Hardware. “Our customer base is about 75 percent homeowner and DIYer, so we have a lot of experience working through common household projects that involve electrical work.”

HARDWARE RETAILING | August 2019

The employees at Weaver’s Ace Hardware offered advice on four common electrical projects of various difficulty to share what they pay attention to when discussing electrical components with customers. While there are certain skills retailers and sales associates should be familiar with, the most important areas for retailers to focus on are customer skills and knowledge when approaching potentially hazardous projects. When it comes to helping customers tackle potentially dangerous projects, be careful not to make suggestions that could open up your business to liability. Train employees to always recommend a professional if a customer has a question they can’t answer. “The most important thing we do is ask good questions of our customers, Shenk says. “This really is the key to helping the customer—asking questions, listening and giving them our full attention.” The following four projects cover some of the most common electrical issues facing DIYers looking to enhance their homes and add functionality. From a simple light fixture to changing a circuit breaker, they progress through levels of difficulty most DIYers would face.

SIMPLE

Installing a Light Fixture or Fan Since ceiling fans and overhead light fixtures often come with clear instructions and standardized parts, installing these products can be a simple project for many consumers.

INTERMEDIATE

Installing an Electrical Outlet Electrical outlets require a bit more knowledge of electrical systems as well as skills with other tools like voltage meters and drywall saws. Having the right tools can be important for a customer to get the best results.

MODERATE

Installing a Smart Door Bell Smart home systems are becoming more prevalent, and doorbells wired into a home’s electrical system offer tougher challenges due to their location and lack of off switches. Exterior materials like brick can also present challenges.

DIFFICULT

Working on a Breaker Box For retailers, one of the hardest parts of working with a customer is determining their level of skill. Working with a breaker box can be dangerous for an inexperienced homeowner or DIYer. August 2019 | HARDWARE RETAILING

SIMPLE

Installing a Light Fixture or Fan Light fixtures and ceiling fans usually come as kits, ready for assembly, making this project an entry point for a homeowner taking on electrical work. Sales associates can suggest different products based on their first assessment of the scope of the project. How large is the room where this fixture will be installed? What are the most important product features for the customer’s goals? Is the customer capable of safely assembling the fixture and anchoring it in a ceiling? Sales associates can check with customers on their installation plans and offer suggestions, such as enlisting a helper to assist with lifting and mounting the fixture. Does the retailer offer installed sales services that can assist a customer? A simple project like installing a fan or light is also a good entry point to introduce basic electrical safety. Associates need to be sure the customer knows that the electricity should be turned off both at the light switch and at the breaker box. Associates can also use projects like these to make sure customers have basic electrical tools and safety equipment. A voltage tester helps the customer ensure they’re working safely, and wire cutters and strippers are necessary items when installing electrical fixtures. Other more common items customers will need include a ladder, a battery-powered drill to mount the fixture and electrical tape. “It’s key that our associates feel equipped themselves so they can equip the customer when they’re learning about a project,” Shenk says. “We’re lucky to have many long-tenured employees in our electrical department, and they feel confident they are in the best position to help our customers.” Assisting customers interested in installing these products also gives employees the opportunity to introduce basic electrical safety knowledge. For new homeowners or customers less accustomed to handling their own repair or installation work, stepping into this kind of project can be intimidating. To allay these fears, Weaver’s Ace Hardware assistant store manager Glenn Keeler suggests every customer get a quick rundown of basic safety procedures associated with projects involving wiring. Does the customer know how to shut off power at the breaker panel? Can the customer identify the ground wire compared to wires carrying a current? These are questions an associate should be ready to ask, Keeler says. “As with any project involving electricity or not, if the customer is still feeling unsure or uncomfortable, we point them toward a qualified professional,” he says.

HARDWARE RETAILING | August 2019

Project Tips • Size It Right Not all fans and lights are created the same. A small fan designed for a hallway will do nothing to circulate air in a large living room area, just as a large fan might turn a bedroom into a wind tunnel. Associates should be trained to recommend the right fan size based on square footage and be able to guide a customer in determining the size of the space involved. • Helping Hand Is the customer planning on attempting this installation on their own without any assistance? Any time you’re working on a ladder and with electricity, it helps to have someone to bear some of the load. If a store offers in-house handyman services or knows a local, trusted professional, this could be a good chance to suggest their services. • Shocking Reminder Sales associates don’t always have to be selling to assist customers. For a customer working on their first electrical project, a quick reminder to check their connections can be a lifesaver. A quick primer from an associate on how to twist wires into correct connections is a great way to add value to a sale.

Sales associates can be a great help for customers interested in changing their lighting while being safe around electricity.

INTERMEDIATE

Installing an Electrical Outlet Whether a customer is trying to install a new outlet or diagnose issues with one that refuses to work, retailers can help. The basics of working with electricity still apply (make sure the breaker is turned off and the customer is using a voltage tester), but installing an outlet can involve a bit more work. For retailers, the ability to diagnose a problem based on customer feedback is vital. Since customers do not always know what signs they are looking for, it falls to the associates to pull as much information from the customer as possible to help diagnose the issue. “Is the outlet not working at all, or is a light flickering or going dim unexpectedly? If performance is declining, it could be a loose wire that just needs retightening, while other issues require more serious repairs,” Shenk says. “Once you have a better idea of what the customer is dealing with, you can give them better advice. This can come down to a detailed description of what they’ll see when they get home, like which wire is the ‘hot’ wire, which is neutral and which is the ground wire.” This can extend to more detailed explanations of pre-existing wiring, such as what should be checked when detaching an old outlet before installing another. Retailers can teach customers to recognize worn wires and how to use a wire cutter and stripper to create a new and better connection, Keeler says. This also provides an opportunity for add-on sales.

Project Tips • New Installation Electrical projects aren’t just about products needed to safely work with wiring and other components. Given how integrated electrical systems are in modern homes, working on an electrical outlet can be a great opportunity for sales associates to increase transactions sizes with add-on sales. A stud finder can assist customers by giving them the confidence to cut into their wall without worrying they’ll hit a stud. • New Tech If a homeowner is installing a new outlet or updating a faulty one, it’s the perfect opportunity for sales associates to update them on new technology on the market. Smart products can connect outlets to wireless devices for remote use. Homeowners might be interested in adding components like USB charging ports to their wall outlets. • Circuit Care Customers should be made aware of problems that could arise with outlets tied to dedicated circuits. Often, larger appliances like refrigerators and washing machines are on dedicated circuits so they can be isolated from the rest of the house when replaced or repaired.

For customers replacing an electrical outlet or switch, create an add-on sale by asking if they need a new outlet cover as well.

HARDWARE RETAILING | August 2019

MODERATE

Installing a Smart Doorbell While working inside a home to add electrical products might be in many homeowners’ skillsets, working outside can be a more difficult prospect. But, with skills imparted from a skilled employee, understanding the basic installation of smart doorbells can help homeowners overcome common hassles. One of the more significant challenges with installing items like doorbells is working with more durable building materials found on a home’s exterior. With specialized masonry tools, surfaces like brick can be conquered, but customers might not be as familiar with these tools. That’s where your team can add value and use their knowledge to shine. Weaver’s Ace Hardware employees are trained to identify not just the tools necessary to accomplish a project to the customer’s satisfaction, but to assist in gauging how prepared customers are to take on the electrical tasks. If a customer is comfortable working on a ladder with certain tools, they can likely take on the task of setting up a camera and light above the garage door. Other options you can recommend are battery-powered lights and doorbells. These products still require certain skills to properly mount them to exterior surfaces, but they don’t require the same electrical commitment as hardwiring a new product into a home’s existing electrical grid. Certain products that can make these kinds of outdoor projects a bit easier include electrical tape to keep wires in place on the wall while handling the doorbell and any mounting needed. Another tip retailers can offer with doorbells is that, unlike other electrical projects, there is no need to match specific wire colors to precise connection points. Some other strong add-on sales relating to outdoor projects like doorbells are the special drill bits and fasteners needed to work with siding and brick exteriors. Retailers and associates can take advantage of their sales training when working on projects like smart doorbells to look beyond the primary product a customer needs and see the entire project from start to finish. “It all starts with the right associates who are the right fit. We take time to make sure that members of the team share our mission and our desire of taking care of customers. Weaver’s helps associates maintain this level of customer experience by providing tools that allow them to be helpful, such as customer experience training, certification and retraining in areas that need to be refreshed,” Shenk says. “Our associates are equipped with the knowledge to help customers find solutions, and we feel supported by each other. An area expert is always there to answer the question or step in to help if the associate is unsure of the answer.”

Project Tips • Prep Ahead The homeowner should make sure the new product is charged, even if they plan to wire the doorbell into their home. This means initial installation steps can be taken care of before the product is mounted and no longer accessible. Also, the homeowner should be sure their wireless internet signal can reach wherever the new device is being installed. If it doesn’t, the homeowner needs to explore other locations or signal boosting options. • Breaker Danger The actual wiring of a doorbell isn’t the most complex project. But, with no switch to toggle off at the installation site, it is likely a customer can forget to cut the power beforehand. That’s a shocking surprise, and one associates can be sure to caution customers against. • What’s Your Angle While final installation on these kinds of exterior products isn’t permanent, many are constructed to be resistant to theft or tampering once completed. This means that checking on camera angles and connection speeds before the final screw is turned and wire attached is critical.

Glenn Keeler (right) of Weaver’s Ace shows a customer some outdoor security products. Associates should be ready to guide a customer in electrical safety when selling these kinds of products.

August 2019 | HARDWARE RETAILING

DIFFICULT

Working on a Breaker Box Anyone involved in home improvement retail has at some point assisted a customer and wondered if the customer truly understood the scope of the project. Maybe it was the answers the customer was giving that showed a lack of understanding of the task or the equipment the customer planned to use. No matter the cause, determining the customer’s abilities and offering the best advice possible are key areas for successful retailers and employees to shine. As the difficulty of projects escalates, retailers and associates should rely on their training to ward against suggestions that could put their business at risk of liability. Employees should always refer a pro if the project is beyond their knowledge. For inexperienced DIYers, opening up a breaker box can be a dangerous proposition. Some tasks, like switching off a breaker, are straightforward and necessary in order to accomplish electrical work around a home. Other tasks, such as adding a new circuit to the system, call for digging a bit deeper into a home’s electrical hub and can pose dangers.

Associates can suggest a few products as well as safety precautions customers can take when dealing with their breaker box. A rubber mat or piece of plywood to stand on when working with the box prevents the customer from being grounded. Associates can also go into detail on how most breakers are removed, Keeler says, by suggesting they grasp a breaker on the inner-center and turn it toward the outer edge. It should snap free easily. No matter the project, retailers must emphasize to customers that electrical projects pose unique dangers and they must take caution. “Based on the customer’s comfort level, we can go into greater detail or suggest they consult an electrician. We are not licensed electrical contractors, but we can give advice and offer a variety of solutions,” Shenk says. “Our team always works together to find a solution for customers, and if we don’t have the product they need or the knowledge to help the customer, we refer them to another business that can help.”

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Project Tips • Still Live Properly identifying different parts of a breaker box, including the most dangerous areas to touch, is something every homeowner should be able to do if they are attempting electrical work. Retailers should make sure their associates are familiar with these components and possibly include displays or signage that can be used for instruction. Some areas of the breaker box are live even when the main breaker for the house is turned off, making those areas particularly dangerous. • Same Old, Same Old When installing a new circuit breaker, DIYers might not know that the new circuit breaker must match the brand, make and model of the old breaker being replaced in order to fit and work properly. • A Second Opinion Sometimes a DIYer needs an outside perspective to see that they might be out of their element on a project. Even more than electrical knowledge, employees with strong sales and customer service skills can help steer an unprepared customer toward a safer solution. Changing a breaker requires working with the nerve center of a home’s electrical system. Retailers can help customers do so safely.

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August 2019 | HARDWARE RETAILING

By Kate Klein, kklein@nrha.org

Hardware Brothers Friendship Strengthens 2 Retail Operations

4:16 PM

Kate Klein

12:15 PM

Hi, Brian and Raffaelo! You've told me that your friendship makes your retail businesses better. Would you share more about that with Hardware Retailing’s readers?

Raffaelo Cianfaglione

1:28 PM

Absolutely, Kate! I call Brian my hardware brother because we met in one of his stores in Arizona and he mentored me as I bought and remodeled my store.

Brian Kabat

1:42 PM

My family has been in home improvement retail for decades, so I have a lot of experience to share. But our friendship goes beyond business and is mutually beneficial.

Kate is typing... Turn to Page 58 to read more.

HARDWARE RETAILING | August 2019

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Building a Brotherhood On a recent FaceTime call, Raffaelo Cianfaglione gave his friend Brian Kabat glimpses of his store in Norridge, Illinois. “He’s my hardware brother,” Cianfaglione says with a grin. Cianfaglione and Kabat are both independent home improvement retailers, but the laugh-filled conversation was one someone could have had with a sibling.

Learning From His Experience Making friends with Kabat opened up resources for Cianfaglione he wouldn’t otherwise have had. Kabat shared lessons he's learned, as well as his company policies, employee handbook, knowledge of his POS system and financial data. Learn from Cianfaglione's store yourself at TheRedT.com/norridge-ace.

The two men chatted about Kabat’s family vacation and Cianfaglione showed off signage behind Norridge Ace Hardware’s service counter. They didn’t have to say much to catch up— they talk on the phone every other week or so and text each other in between. Kabat owns three Kabat’s Ace Hardware Stores in Apache Junction and Mesa, Arizona. His family-run home improvement business started in 1987. Kabat and Cianfaglione met 1,700 miles away from Illinois in Frontier Ace Hardware, Kabat's Apache Junction store. Cianfaglione owns a second home in Arizona and was Kabat’s customer. In 2014, Cianfaglione walked into Kabat’s office at Frontier Ace and began quizzing him about how to run a hardware store. Kabat’s first thought was that he was facing a potential competitor. However, by the end of that initial conversation, Kabat was committed to helping Cianfaglione become a retailer. Cianfaglione already operated a construction business in Illinois, so entrepreneurship wasn’t new to him. He was also sincere, enthusiastic and eager to learn about home improvement retailing, Kabat says. His personality and experience helped, too. “He’s such a savvy business person. I don’t know many people with the energy he has,” Kabat says. “His smile is electric.” Kabat promised to share the hard lessons he’s learned and the successes he’s seen in many years of retailing and also show Cianfaglione all of his stores’ financial records. That’s when the hardware brotherhood began. “Our friendship is beyond business,” Cianfaglione says. “I lean on him. He leans on me. It’s a good thing.”

Finding the Right Store

Raffaelo and Jackie Cianfaglione own and operate Norridge Ace Hardware, the store Raffaelo grew up visiting with his father.

HARDWARE RETAILING | August 2019

Cianfaglione had shopped at the Kabats’ Apache Junction location for several years before he decided that buying his own home improvement store would be a solid investment. He thought owning a store would be helpful for supplying his construction business in Illinois and good for the DIY work on his house in Arizona. Kabat listened to Cianfaglione’s story and they began an ongoing conversation about store locations and what area made sense for Cianfaglione to buy a store. They tossed around several ideas, including that of Kabat selling Cianfaglione one of his stores in Arizona. But when Kabat visited with Cianfaglione and his wife Jackie in Illinois to finalize details about selling them a store, Kabat asked Jackie what she thought of Arizona. She said she liked it,

Gaining Insight and Support

Raffaelo Cianfaglione (left) met up to play golf with Brian Kabat on a recent trip to Arizona. Cianfaglione owns a hardware store in Illinois and Kabat owns three locations in Arizona.

but wasn't enthused about the state, so Kabat stopped the conversation and the deal. “We were making a mistake,” Kabat says. “I told them, ‘You need to find a store locally, and I will help you.’” Kabat was convinced that a location where everyone in the Cianfaglione family could be involved and that wouldn’t separate the family frequently was the best idea. Based on Kabat’s redirection, Cianfaglione began looking for stores in 2016 in the Chicago area. During the search, he checked out the store where his father used to take him in Norridge, his childhood hometown. Cianfaglione's visit to Norridge Ace Hardware was a revelation. “Raffaelo called me at 4:30 in the morning and said, ‘I’ve found a store,” Kabat says. Cianfaglione was one of multiple retailers wanting to buy Norridge Ace Hardware, but his story and timing were the right fit.

Both Kabat and Cianfaglione rely on each other to talk through business struggles and stressors. Kabat calmed Cianfaglione down when he second-guessed buying Norridge Ace and gave advice when he was training the staff to embrace changes that came with new ownership.

The owner, who was in his 80s and ready to retire, took Cianfaglione seriously because of his personal history with the business. “He’s Korean and I started talking to him in Italian,” Cianfaglione says. “He asked me, ‘How do you know I speak Italian?’ and I told him, ‘I used to come here as a kid with my father.’”

Becoming a Retailer Kabat was ready to help Cianfaglione with his due diligence prior to buying the store. Norridge Ace had a good location, a solid existing business and opportunities for growth. Cianfaglione and the former owner struck a deal. In May 2016, Cianfaglione took ownership and called Kabat. He had big emotions and full-blown buyer's remorse, which are normal, Kabat says. “I just said, ‘Raff, take a deep breath,’” Kabat says. “‘You did the right thing. You’re fine.’”

August 2019 | HARDWARE RETAILING

Kabat was right. Currently, Cianfaglione, Jackie, their daughter and niece all work at the store. Cianfaglione juggles oversight of both of his businesses, but Jackie is at the store daily, working at the cash register, rearranging displays and curating the lawn, garden and housewares products Norridge Ace sells. They have remodeled the 24,000-square-foot store, expanded the salesfloor, updated the product mix and begun the renovations necessary to add a 3,700-square-foot sporting goods department. Cianfaglione also has plans to upgrade the outdoor garden center eventually. Norridge Ace Hardware was strong when Cianfaglione bought it, but he’s grown both sales and foot traffic since taking ownership. Kabat has helped Cianfaglione develop store processes and made himself available for late night and early morning phone calls when Cianfaglione has pressing questions. They also attend distributor buying shows together. But what began as a mentorship is now mutual, Kabat says. Their friendship involves fun, like afternoons golfing. Cianfaglione is still one of Kabat's loyal customers. Whenever he heads to his home in Arizona,

he expects to see Kabat many times, between plans to meet up socially and his repeat supply runs to the Apache Junction store. Business is still a major part of their friendship; they regularly problem-solve together and share ideas. For example, creating a military veterans-only parking spot in front of Norridge Ace Hardware was Kabat’s idea. And a tagline that Kabat’s employees use for thanking customers, “There is no us without you,” was Cianfaglione’s brainchild. Both retailers are proud of Norridge Ace. Cianfaglione enjoys serving his many customers, including the local people who remember him from childhood, he says. Kabat takes particular pride in having helped guide Cianfaglione to the location that is close to home and works well for his family. Plus, the ways Cianfaglione serves the city and has adapted his product mix in response to customers are assets, Kabat says. “He’s been such a good thing for the city of Norridge,” Kabat says. “He knows a lot of people there and he’s been such a significant addition to the community.”

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Celebrating Together Cianfaglione’s store is doing well—and Kabat, who has been a friend and adviser since the beginning, understands the effort Cianfaglione has poured into it. In Kabat, Cianfaglione has a friend who can celebrate and be proud of the store in a heartfelt, invested way.

Brian Kabat operates Kabat's Ace Hardware Stores, the company that owns a store in Apache Junction, Arizona, and two locations in Mesa, Arizona.

By Chad Husted, chusted@nrha.org

Missing Something? How to Take Advantage of Well-Known Brands

here are often multiple factors that drive consumers to make a purchase. Sometimes price points, durability and convenience are the main motivation. Then again, sometimes pure brand recognition can secure a sale and let them show off to their friends. Whether it’s a new grill in the backyard or a shiny new drill in the toolbox, top brands often command a certain respect among consumers. These anchor brands can define certain departments in a store, draw customers based

HARDWARE RETAILING | August 2019

on their name alone and serve vital roles in sales and marketing for retailers. In addition to name recognition and broader advertising benefits that come with stocking well-known brands across multiple categories, these products often have added benefits like regional exclusivity and price controls. On the following pages, find out how two retailers have used name-brand products to enhance their own operations. Learn how they addressed some of the challenges that can come with stocking such sought-after product lines.

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Community Spirit Part of the value of a brand name that draws crowds to events or the salesfloor is that loyalists love discussing them with other people who share their interest. Anyone who has attended a grilling event sponsored by a popular manufacturer or visited a fan page dedicated to a particular outdoor apparel line has seen how fandom can drive interest and sales. Retailers who invest in well-recognized brands can take advantage of consumer communities and treat them like built-in customers who want to be informed of their favorite product’s availability. For John Fix, co-owner of Cornell’s True Value in Eastchester, New York, this rabid fan base comes out in droves during a popular grilling event and stays a reliable customer base throughout the year. Cornell’s True Value carries a variety of recognizable brands across its product inventory, including in lawn and garden, grilling, outdoor power equipment and sporting goods. “These are consumers who know maybe before we do what the next big thing is for their brand. They’ve subscribed to newsletters, they’re talking online with other fans and they’ll be asking us

about a new product before it even ships,” Fix says. “It’s hard to find that kind of loyalty, so we try to use it by having the products available, in stock and available with plenty of add-on items.” The possibility of add-on sales with top brands can also open the door for a smaller but still vital use of brand power. While larger manufacturers are likely to produce and ship their own accessory items, there are smaller manufacturers that work exclusively on accessories meant to work with one or more high-volume brand. For grills, accessories can range from pizza stones to high-end tongs. The accessory manufacturers may not have the kind of advertising power the main anchor brand products can take advantage of, but there’s plenty of word-of-mouth advertising within the larger consumer community. “We find it important to be included in those conversations. Usually the truly committed fans are eager to discuss a new discovery or a specific item they’re looking for, so we keep ourselves open to possibilities,” Fix says. “These are products that are used in leisure time and as conversation starters, and people want the eye-catching product for their homes.”

The grilling section of Cornell’s True Value is designed to showcase the diversity of its brands as well as accessories that dedicated consumers might be looking for. The business has been able to tap into brand loyalty for a number of its product lines.

HARDWARE RETAILING | August 2019

“There are a number of

factors that come into play with larger brands. They might require a minimum opening order or have certain dollar amounts attached to reorders.

”

—John Fix, Cornell’s True Value

Leisure items can go beyond grilling to include beverage and barware, home goods, kitchen appliances and even tools from highly recognizable brands. The brand can carry more weight with customers than the actual purpose of the product, Fix says. While there are products on the market that are designed to replicate the most expensive grills on the market, sometimes the prestige of having the brand-name item is worth the extra cost for a consumer. Deciding when to choose the most-recognized brand in a category and when to go with a less established product line can be difficult, says Brenda Rexford of Rex Hardware. However, it’s a necessary piece of her business in Canton, New York. She not only sells hardware essentials, but also a large variety of men’s and women’s clothing and electronics. Some brands do all the work for her, Rexford says, especially in men’s clothing and footwear. But in women’s clothing, she has seen shoppers be more discerning. This has led her to explore brands that might not draw the same attention with their signage and merchandising, but can stand up to larger brands in quality. “Everyone considers having ‘good’ and ‘best’ options with items on the shelf, but sometimes you have to be creative to find the right price point for each. If ‘good’ is too high in price for your customers, you find something with the quality you need and use your sales experience to show a customer what they’ll be buying, since they won’t automatically know,” Rexford says. “That comes down to sales skills from your staff and trust from your customers.” In this way, some brands that customers don’t initially know have become name brands, Rexford says. One New York manufacturer of athletic apparel has become a large draw at Rex Hardware due to its proven quality compared to national brands Rex Hardware carries.

Rex Hardware in Canton, New York, has built a reputation for having the top brands in several departments. Clothing and footwear have become major categories for the store.

Making Room While having recognized brands in multiple categories can be a boon to business, retailers should keep in mind that there are certain requirements that come with carrying some brands. While not universal across the industry, these requirements might alter how a retailer approaches stocking certain items or could force changes in other areas of a business to accommodate the products. Cornell’s staff has had to work around merchandising requirements set by manufacturers on previous occasions. “There are a number of factors that come into play with larger brands. They might require a minimum opening order or have certain dollar amounts attached to reorders,” Fix says. “These are all things retailers have to consider when making decisions with some of the top brands.” Fix had been looking to bring in a prominent power tool and outdoor power equipment manufacturer, especially to pair with his rental department. However, the business didn’t have enough square footage available near its rental equipment to stock the minimum inventory the manufacturer required in a first-time order. Fix chose to reset the store in order to find that space, moving a department entirely and incrementally changing others to make room for the new product lineup. August 2019 | HARDWARE RETAILING

The reorganization allowed the staff to alter the makeup of the store and bring in an exciting new line. Other factors can include how the anchor brand line is sourced. Some products might not be able to be ordered individually from a warehouse, making bulk orders the only way to resupply. “You don’t want to sell two items and then you’re sold out, but you might not be able to order just those two items. You have to bring in a whole line,” Fix says. “You have to know that sometimes you’re going to have to take a hit at margin or order more than you need to carry that anchor brand. Sometimes you have to go all in.”

“I do believe that if you roll a product in only halfway, it’s only going to sell halfway. So if you bet on a product, it only pays to make it a big one.

”

—Brenda Rexford, Rex Hardware

HARDWARE RETAILING | August 2019

It’s a Dog’s World At Rex Hardware, name recognition isn’t as important as having the right mix for its customer base, Rexford says. However, she isn’t against altering her salesfloor if she thinks the change is warranted. Along with clothing and footwear, pet products are a large component of overall sales at Rex Hardware. Unlike clothing, brand recognition in the pet category isn’t a huge factor for most customers, Rexford says. What she has seen bring in customers has been a focus on brands that manufacture their pet products in the U.S., and she has adjusted accordingly. “What you find is that Made in USA is the first draw, and the customer learns the name of the brand after that. There are certain brands that we simply have to have in the store now because that following has built itself,” Rexford says. “We have dog treats that have healthier ingredients and better packaging than snacks for people.” If one area of pet products does have strong brand allegiance, Rexford says, it’s in dog food. She makes sure to carry the top three brands she has learned her customers want, which normally covers the majority of her market.

However, when an opportunity arose to bring in a different brand, and the manufacturer was willing to prove its worth in her store, she decided to take a chance. The dog food manufacturer asked for a certain amount of linear feet on the salesfloor, and its representatives merchandised it and selected the products to display. While Rexford admits she is normally averse to altering her store layout to fulfill the requirements of a manufacturer, the fact that the display came at no cost to her and required only a small amount of time for her employees to assemble it inspired her to give it a chance. The display proved to be a strong draw for customers, Rexford says, opening up another brand to pet consumers at Rex Hardware. “It showed me the confidence they had in their own brand. I’m willing to gamble a bit when a manufacturer says, ‘I’ll improve your sales and be an important product for you, and I’ll prove it,’” Rexford says. “It’s always a gamble, and just like gambling, sometimes you lose. But I do believe that if you roll a product in only halfway, it’s only going to sell halfway. So if you bet on a product, it only pays to make it a big one.”

Rex Hardware’s pet department has grown its brand variety based on customer preference. Customers now ask for certain brands by name.

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By Melanie Moul, mmoul@nrha.org

Making the Whole Sale Reaching New Customers With a Wholesale Supply Program

ocal business owners in small communities often need to go out of their way to stock up on items like toilet paper, cleaning supplies and other business necessities. These types of items are generally in stock at independent home improvement stores or they are easily tacked on to a retailer’s weekly order, with prices and delivery speeds that are competitive with Amazon. So how can retailers capture those sales? Woodstock, New York—where Vince Christofora operates Woodstock Hardware—is 20 minutes from the nearest Sam’s Club and big-box stores and 90 minutes from the closest Costco. Those stores, along with office wholesale outlets and online stores, are common places business owners shop for bulk goods. As a small business owner, Christofora recognizes how valuable the time is that he spends in his store. Making supply runs during business hours or on the weekends isn’t always feasible. He also tries to support local businesses in his community as much as possible. To provide a cost-effective, local solution, Christofora developed a wholesale supply business as an extension of his hardware store. Read on to learn more about how Christofora runs this complementary operation and hear from one of his customers about the impact.

HARDWARE RETAILING | August 2019

Something on the Side Woodstock is only about 100 miles north of New York City, but that distance is enough to make Woodstock feel like a true small town. When Christofora and his wife Diane bought Woodstock Hardware in 1994, most small businesses in the area purchased their supplies through regional supply houses or warehouses who serviced them using an outside sales force. “Retail stores like mine met their immediate needs and charged retail prices,” Christofora says. About 15 years ago, a formidable group of opponents entered the landscape: big-box stores. Christofora says the combination of those stores’ large advertising budgets and proximity to small communities forced many of the previous suppliers to close shop. “Back then, everyone seemed to have ‘expendable hours’ in their business to send someone shopping to save on consumables they needed for their business,” he says. “These business owners were trained to drive to the big boxes to buy cases of toilet paper and gallons of cleaning spray, somehow thinking they were saving money. In reality, they were neglecting the value of their time and the wear and tear on their vehicles to make the 20-mile round trip.”

Woodstock, New York, residents are 19 minutes away from the nearest wholesale or big-box store.

August 2019 | HARDWARE RETAILING

When those same customers unexpectedly ran out of everyday business necessities— toilet paper, for example—they would stop by Woodstock Hardware while they were shopping for their personal DIY projects and grab a small package for the office at retail prices. “I would often hear, ‘Oh, $4.99 for six rolls of toilet paper. I get a case of 45 rolls for only $18,’” Christofora says. “Of course, they were comparing apples and oranges: Quality of name brand versus generic and wholesale versus retail pricing.” Many retailers prefer to earn the margin on slow-moving convenience items that customers grab when they know they’re running low at home. While those margins still come in through Woodstock’s retail customers, Christofora saw an opportunity to capture sales and support local businesses.

Scores of SKUs Wholesale customers have access to more than 65,000 SKUs, more than double what they can find on the shelves at Woodstock Hardware.

Vince Christofora bought Woodstock Hardware in 1994. He launched the wholesale supply company to grow his business and help local businesses.

HARDWARE RETAILING | August 2019

“The natural solution seemed to be to create the wholesale supply program and start showing our customers that they did not need to drive anywhere to buy large quantities or purchase commercial-quality products,” he says. “We started the program as an avenue to create new business and to offer our existing customers a competitive price on larger quantities of products.”

Pricing at Wholesale The Woodstock Hardware wholesale program wasn’t part of the Christoforas’ original plan for their business. The opportunity didn’t come up until they had owned the store for about 15 years. “We always only considered ourselves a retail store,” Christofora says. “We just thought our customers came in to buy their retail needs, and they were buying everything else at other places and getting better prices. We have to protect our margin, and we can’t sell our retail products any lower.” Around the time big-box stores started popping up in his area, Christofora saw a new opportunity. He realized consumers were buying in bulk from those stores at wholesale prices, which meant he could offer similar products at similar prices without hurting his retail margins if he created a wholesale wing of his business. The wholesale margins at Woodstock Hardware are about half that of the retail margins, and the business rarely sells wholesale products at cost. Woodstock Hardware has nearly 25,000 SKUs in stock, but not everything is priced for wholesale. Instead, the business finds the right items at the right prices for each customer’s needs through its Customized Supply Plan. The products that are priced through that plan often extend beyond the store’s in-stock inventory. “When we have an interested customer, we take time to sit down with them and identify any products or supplies they do not currently buy from us,” Christofora says. “We then create a wholesale price for those items to be competitive with what they are paying now. We actually provide a price-match guarantee, and we always try to be a few pennies less.” One benefit of the Customized Supply Plan is that it offers Woodstock Hardware an in with customers who may not know about the program and may not believe they will get similar or lower pricing. “I like to focus on using the wholesale program to increase our existing customer sales,” Christofora says. “We all know some version of the 80-20 rule: 80 percent of your sales come from 20 percent of your customers. That’s true for the wholesale program, too, that our current customers were previously retail customers.”

Supporting Small Business, the Wholesale Way

When Christina Brady opened her mixed-media art studio, Fiberflame, in 2011, she purchased supplies from a variety of wholesale supply companies and online retailers. Woodstock Hardware owners Vince and Diane Christofora often brought their children into the studio to make their own craft projects. During one of her visits to Fiberflame, Diane mentioned that Woodstock Hardware was starting its wholesale supply program, and Brady says she was immediately interested. “I was so excited to hear about the program. It’s a pretty creative format,” Brady says. “Finding places to purchase the supplies we need, like toilet paper, and items specific to our business, like foam paintbrushes, can be challenging and expensive. It’s a dream come true to be able to call up our local hardware store to get those kinds of supplies.” Brady places a regular order twice a month for consumable paper products, but she also relies on the team at Woodstock to help her source specialized items. “If we have a workshop coming up, I know we’re going to need a particular kind of foam paintbrush, so we’ll place an order outside our normal ordering window,” she says. “They are willing to work with me on finding special items that I’ve seen somewhere else, and they bend over backward to find out if they can price-match it for me.”

“There is nothing better

than walking into an actual brick-and-mortar store to talk to someone about my specific wholesale needs.

”

—Christina Brady, Fiberflame Brady appreciates being able to source items for her home and her business in one place. “There is nothing better than walking into an actual brick-and-mortar store to talk to someone about my specific wholesale needs,” she says. In addition to saving time and money buying her supplies through Woodstock’s wholesale supply program, Brady says she likes supporting local businesses. “As local business owners, we try to hold hands as much as we can,” she says. “We know how important it is to support each other. We have to make sure we have each other’s backs to keep our businesses moving and growing. Without that, the community will break down.”

August 2019 | HARDWARE RETAILING

Build Your Dream Team Some projects require the help of a strong outside sales team. For tips on how to assemble a team that can help grow your business, visit TheRedT.com/outside-sales.

About 60 percent of Woodstock Hardware wholesale customers request local delivery, while the other 40 percent is split evenly between drop-ship and in-store pickup. Many customers purchase more items when they come in to pick up their wholesale orders.

The program also works in reverse: It helps boost retail sales because people who are wholesale customers first often become retail customers. “Once we get a little bit of their wholesale business, we try to become their retail store of choice,” Christofora says. “The wholesale program starts with earning lower margins to market yourself to then capture regular retail dollars.” Christofora also offers price-matching for customers who already purchase goods through a big-box store or other source. “We actually set a lot of prices based on what the customer pays now. We use the price-match guarantee as the tool to open up that conversation,” Christofora says. “We usually start the process with just a few key products, and then once the customer sees how much time and money they save, we add more items.”

Selling the Program Christofora doesn’t have the budget for a large outside sales team like many supply companies and big-box stores do. He relies on his staff and his regular marketing to get the word out about the wholesale supply program.

HARDWARE RETAILING | August 2019

“You have to get your cashiers and other associates to recognize the opportunities with the customers who are already walking in the door,” Christofora says. “If one of my staff members discovers that a customer works at the local manufacturing facility, they should be telling them about the wholesale program. It takes some additional sales knowledge and expertise, but since you’re already working with these other businesses, you have your foot in the door.” The process of having sales staff talk about the program as part of regular conversation with customers has led to significant opportunities that Christofora didn’t even know were in the area. “We have a fair number of small business owners who shop in our store for their retail hardware needs, so why wouldn’t we pursue them to provide the supplies they need that they don’t typically think we can provide?” Christofora says. “We were focusing on consumables, but that can mean different things to different people.” Two of Woodstock’s retail-turned-wholesale customers now purchase items they need for their businesses in significant quantities: 50 gallons of primer and 500 lightbulbs at a time.

“They had businesses 5 miles down the road, and we never knew,” Christofora says. Without a dedicated team to promote the wholesale program, Christofora uses standard marketing initiatives to spread the word. “Anything we put out—monthly emails, circulars—includes information about the program,” he says. “We don’t do special mailings to addresses that aren’t already part of our circulation.” Woodstock’s wholesale customers include industrial or commercial operations, local churches, nursery schools, landscapers, general offices and fire departments. Christofora is open to hiring a part-time outside salesperson who can be dedicated to discovering other potential customers. “We have a fair amount of opportunities here, but we’re not in a high commercial, small industrial business area,” he says. “We have about a 10-mile radius for opportunities before we start to bump into stiffer competition with electrical, plumbing and restaurant supply houses.”

they need and they have seen how the online ordering system works. “We have to make sure the wholesale system places the order so we have receipts and purchase orders,” Christofora says. “If that means we need to place an order for the customer in the system, we’ll do that for them.” On the receiving end, Woodstock does offer local delivery for about 60 percent of orders, while the remaining 40 percent of orders are about evenly split between drop-ships and in-store pickup. In-store pickup often results in additional sales at retail prices, which is another benefit. “Initially, our customers are happy to save money through the program and use the store pickup service, but they quickly opt to save even more time and money by having us deliver,” Christofora says. “Regardless of how they receive the product, the program shows them how great it is to not have to drive 15 miles to get a case of toilet paper.”

Through the Supply Chain Woodstock Hardware doesn’t have enough storage space on-site to hold backstock for the retail operation and the wholesale business, so most of the products that wholesale customers order arrive at the store each week. Some products, like cases of toilet paper, are kept on hand for the few customers who miss the ordering window. Otherwise, all Woodstock Hardware wholesale customers submit orders through the company’s online ordering system. Setting up an online ordering system is a must for retailers who are interested in starting their own wholesale program, Christofora says. “Most customers expect that they’re going to be able to order online late at night, early in the morning, whenever they have time, so you have to have the technology to do that,” he says. “We had an e-commerce site already set up, so we molded that to provide the wholesale services.” It’s important to offer capabilities that are similar to the competition. In addition to online ordering, customers want to be able to check purchase history, see past invoices and other account details. “One thing we learned is that it has to be easy for them,” he says. “In some cases, even telling someone to go to our site, search for a product, put it in the cart, let us know and we’ll price it for them is too difficult. To make it a success, there can’t be too many requirements on their end.” To alleviate some of those initial challenges, Christofora or his store manager often visit first-time wholesale customers to walk through the ordering process. By the end of the meeting, the customer has a cart full of the supplies

Top Items Sold • Paper goods: Toilet paper, paper towels, etc. • Cleaners • Specific bulk items: Lightbulbs, primers, etc.

Every Woodstock Hardware team member is trained to recommend the wholesale program to retail customers who are also local business operators.

August 2019 | HARDWARE RETAILING

By Todd Taber, ttaber@nrha.org

Social Responsibility The Benefits of Creating a Social Media Policy

etailers have seen the lightning-fast rise of social media over the past decade. What was once an online diversion has become a key element of marketing strategies and community involvement. Within seconds, anyone with a social media account can broadcast their thoughts and feelings to the world. A business operator must keep a sharp eye on how their company’s online strategy and their employees’ posts affect their business’s reputation in the community.

If your business doesn’t have a social media policy, you could be in line for embarrassment and potential liability. Learn the benefits of crafting a policy for your social platforms. Discover what Stacey Furtado, global social media manager of hiring website Monster, says you should consider when creating your own internal policy. Don’t let poorly managed social media undermine years of diligence to establish your business. Safeguard your assets with a comprehensive social media policy.

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HARDWARE RETAILING | August 2019

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5 Steps to Better Social Outreach Furtado says it’s important for every business, regardless of industry, to implement a social media policy. Establishing one for your operation can streamline social management, helping you connect with your customers quickly and efficiently. Furtado worked to define Monster’s social media policy and shares some of the principles that helped shape it so you can adopt best practices for your own social media guide.

She recommends assigning a few people on your team the power to post through your business account. Remind other employees not to post as the company in response to customer comments. “Determining who can post online for your business helps avoid awkward situations like a customer commenting about poor service by a particular employee and that employee responding directly,” she says.

4. Plan for a crisis of any size. 1. Clearly establish guidelines. A social media policy should fit your business’s needs and goals. If you permit employees to post through your business’s social media accounts, it’s important to establish basic posting rules. A few clear examples for responsible posts are to never trash-talk competitors, never use hateful language and for employees to clearly indicate thoughts and comments they post as their own. “Having a few ground rules will create a clearly defined policy that leaves no question for employees on how they should conduct themselves online,” Furtado says.

2. Enable employees, don’t handcuff them. Furtado says that while it’s important to safeguard proprietary information about your business, you should encourage employees to share good news about the company. “Think of your employees as a powerful extension of your company and approach your social media policy with respect and appreciation for their efforts,” she says. The Pew Research Center says 72 percent of U.S. adults use at least one social media platform, meaning many of your employees likely have a social account and want to share the hard work they’ve invested. Don’t discourage positive, promotional posts from employees.

3. Determine who can speak to customers. Considering how your business will react to posts made by customers and community members is a critical part of establishing your social media policy. It’s especially important for small businesses,” Furtado says.

As social media’s influence on retail grows, it’s important to strategize and create a plan of action for unexpected events, Furtado says. What’s the protocol if your business closes temporarily due to inclement weather? How do you communicate information about product recalls? How will you respond to bad press about your operation? Furtado says these are all times when a preconsidered social media response is key. “Preparing the language for all these scenarios ahead of time means you only have to worry about the specific nuances of the crisis when it hits,” Furtado says. Any crisis communication should aim for honesty and a promise to follow up, according to Furtado. “Customers will forgive many things, but dishonesty tends to be at the top of their list of unforgivables,” she says.

5. Take it to the next level. Employee advocacy programs can encourage positive, on-brand social media messages about your company. These programs distribute preapproved images and text to employees across an organization to make it easier for them to share company news with their friends and family. “The more proactive you are about getting content to your team, the easier it will be for them to share information about your brand,” she says. Monster’s internal data shows promotional content is shared 24 times more frequently when posted by employees, not the business itself. Furtado says it’s important to not mandate employees share information, but encouraging them to do so and providing them with the necessary materials can be a positive step in social media outreach.

A Social Media Chain of Command Now that you’ve learned what a social media policy should look like to guide your business, take a moment to review social media plans for international chains like Target, Starbucks and Lowe’s at TheRedT.com/social-chain.

HARDWARE RETAILING | August 2019

Your Social Media Policy in Action Social media is a critical component for promoting your business, so it’s important to establish some ground rules on how your business should represent itself online. Once you’ve drafted your social media policy, take a look at how those rules work in the real world. Use this example to get do’s and don’ts to help your employees understand the best way to interact with customers.

Mum’s the Word Ensure employees never reveal confidential information. Posting about new hires, unannounced company news or acquisitions is against protocol.

Joe’s Hardware Friday at 11:30 AM

Know Your Rights The National Labor Relations Board says company social media policies should not prevent workers from engaging in conversations protected by federal labor law, including discussing wages or working conditions.

I can’t believe we’re adding a new location! HARDWARE

Assign a Social Team

Respond to All Comments

Assigning just a few people to your social media team streamlines the process of responding to customer comments and promotes a consistent brand voice. It also encourages team accountability.

Retailers should respond to all questions and comments posted online. Addressing negative comments gives you the opportunity to explain company policy or a second chance to make things right.

2 Comments John Smith

Where is the new location? 25m

Joe’s Hardware

It’s right on Main Street. 5m

Joe’s Hardware

Encourage Accountability You can’t control what your employees post to their own accounts, but you can recommend they uphold your business’s standards. Remind employees their posts could have real-life implications for your business and for their livelihood.

Friday at 11:30 AM

That customer was a real !$&#!

Never Use Hate Speech Those representing your company must never post anything derogatory regarding age, religion, gender, sexual orientation, race or any other divisive topic.

Give It a Goal Define a goal for your social media outreach. Having a purpose for your social media accounts enables your team to understand what kind of posts advance the goal and which may fall short. A stated, actionable goal can give your social media outreach drive and direction.

August 2019 | HARDWARE RETAILING

By Chad Husted, chusted@nrha.org

HOW I DID IT ...

“Stagnation is actually the first step backward, so we’re still learning from our customers and finding new ways to serve them every day.” —Jeff Van Well A2Z Home Center

HARDWARE RETAILING | August 2019

Increased Sales From $1M to $6M Annually

aving started in lumberyard management early in his career, Jeff Van Well is in a fairly ideal position to turn a struggling lumberyard around. He found that opportunity in 2016 at A2Z Home Center. The Chino Valley, Arizona, operation was struggling when Van Well purchased it from its previous owner. Over the course of three years, through diligent leadership, culture improvements and a keen eye for business, Van Well led the store to grow

from $1 million in annual sales to over $6 million. The result today is a bright, inviting lumberyard and hardware store. “I had gained experience with underperforming businesses from my previous role at a regional chain. There, within three years of working in lumberyards we were in the company’s top 10,” Van Well says. “I’ve always operated with great teams who enjoy working with customers, and that’s what we were able to build again at A2Z Home Center. You can’t do it alone.”

A2Z Home Center currently has 22 employees, 16 who are full time, running a 7,500-square-foot hardware store on 2.7 acres of combined hardware and lumberyard space. While the business serves a heavy contingent of DIY and homeowner customers, A2Z Home Center does 66 percent of its sales with contractors and builders. But it didn’t start out that way. After selling a successful business with three lumberyards, Van Well had been away from retailing for 10 years. He was “bored and ready to get back in.” That was when Van Well took over A2Z Home Center, an operation that had become known for having a poor setup and high prices. Van Well used his connections from previous lumberyards to learn what building materials they needed for the communities around Chino Valley. He also updated signage and brought in new vehicles to replace the previous delivery fleet. “Trucks make great billboards,” Van Well says. “Getting the word out starts the process, and builders begin to notice the quality we’re bringing in.”

Inside the hardware section, products also needed to be refreshed. Since the business had been operated by an owner looking to leave the industry, product selection had grown stale. There were also opportunities to improve workplace culture. As the store was neglected, the established workforce had soured on management and the business itself. Van Well worked to retain the current base of employees, laying out the changes he planned to make under his ownership. “When we first got here, the outside crew was very removed from the inside sales associates. It caused a real problem with team dynamics,” Van Well says. “That was a priority for us to fix. The team is now built on our mold of customer service. We have many employees who stayed on from the beginning, and they’ve seen that with a successful store, it’s a lot easier to make better wages. People like working with positive people.” Even as A2Z Home Center has seen success in sales, the true turnaround never ends, Van Well says. “Stagnation is actually the first step backward, so we’re still learning from our customers and finding new ways to serve them every day,” he says.

Jeff Van Well A2Z Home Center Chino Valley, Arizona

Problem Resolved When Van Well took over A2Z Home Center, it was a poorly lit and badly stocked business that had struggled to maintain connections with professional contractors and builders. With a new culture and updated products, the business is now seeing new sales records.

Key Takeaway “Having worked in the industry for my whole life, I knew how to go about retooling the business and updating it for our customers. But nothing happens without a team, and building a team that wanted to work with each other and make the business successful was the most important thing,” Van Well says.

Future Plans A2Z Home Center is still a work in progress, Van Well says. While the business won’t be expanding to new locations in the near future, it continues to expand its selection of hardware and building supply products according to customer demand. The A2Z Home Center team is also working to further develop its ties with local builders and professionals. Prior to Jeff Van Well buying the business in 2016, A2Z Home Center was a declining lumberyard. Since, the store’s employees have helped the business reach $6 million in annual sales.

August 2019 | HARDWARE RETAILING

Newsmakers

An Evolution in Customer Experience

Upcoming Events August

ffering a standout in-store experience is a rapidly evolving competition between independent retailers and national or global chains. That experience is also stacked against the convenience of online retailers. But what should differentiation, especially for small businesses, look like? Regular employee training plays a massive part, as does constant data collection, says Russ Haswell, vice president of retail for Medallia, a firm that specializes in gathering customer and employee feedback. Consistently using shopper feedback as a training tool is key to an experience that strengthens staff and customer loyalty, he says. Haswell offers the following suggestions for acquiring and using feedback in an independent retail operation.

13-15

Collecting Feedback • Find noninvasive ways to solicit customer opinions regularly. Stores don’t have to be aggressive to collect feedback. They can ask for input using online surveys, questions embedded in e-receipts, questions that pop up on credit card readers, e-newsletters, rewards program emails and store mobile apps. A short survey can collect a lot of information without frustrating shoppers. • Lead off with a starter question. The most useful survey questions allow for comments. One yes or no question that is followed by a comment box can provide actionable data. A question is most effective if it unobtrusively draws in shoppers and leads them to the option to answer more questions or provide additional thoughts. • Ask questions to check if training is effective. A retailer who has a method for soliciting regular feedback can use surveys to check if employee training is working. For example, a one-question survey could ask customers their opinions of an employee’s product knowledge in a particular department.

16-18

Using What You Learn • Link feedback to specific employees. If a retailer has a way to connect shoppers’ survey responses about customer service to specific workers who served them, the data becomes valuable for individual coaching or affirmation. It also tips you off if you have a problem employee. • Offer feedback individually. Employees who receive customer feedback regularly are happier in their jobs, since most evaluations of specific employees tend to be positive. If staffers get regular affirmation of what they’re doing well, then criticism is less offensive and more likely to motivate change. • Share input with the team—daily, if possible. Many retailers who work with Medallia gather employees in staff huddles to share feedback with the entire team before the store opens for the day. Doing so provides opportunities to applaud success publicly and reinforce the company values to the whole staff.

Independent Garden Center Show McCormick Place, Chicago • Independent Home Improvement Show—Powered by NHS • 2019 NRHA State of Independents Midyear Review • NRHA STIHL Foundations of Leadership Conference

Florida Hardware Fall Market Orlando, Florida

22-24 Orgill Fall Dealer Market Chicago

September 1-3 spoga+gafa Cologne, Germany

6-8 Ace Hardware Fall 2019 Convention & Exhibits Atlanta

6-8 Horizon Distribution Inc. HDI Trade Show & Conference Expo Yakima, Washington

7-8 PACOA Fall Market Flushing, New York

13-15 Monroe Hardware Fall Market Greenville, South Carolina

Russ Haswell is vice president of retail for Medallia, a company that helps businesses collect and use feedback on customer and employee experiences to improve their operations. Haswell currently oversees Medallia’s retail practice, working with a variety of retailers seeking to grow the connection between the customer, employee and brand.

HARDWARE RETAILING | August 2019

Find more events online at TheRedT.com/calendar. To have your event added, contact Kate Klein at kklein@nrha.org.

5 Google-Approved Tips to Get Customers Fast

FOR MORE INFORMATION OR TO REGISTER, VISIT POINTY.COM/NRHA.

Newsmakers UNITED STATES Ace to Open 11 Stores in Former Orchard Supply Hardware Locations Ace Hardware Corp. announced plans to open 11 new stores in former Orchard Supply Hardware locations. “Ace is delighted to fulfill a need by bringing back the local, neighborhood hardware store in 11 California communities,” says CEO John Venhuizen. “Ace intends to honor the tremendous legacy Orchard Supply Hardware established in these communities while infusing them with Ace’s unique culture and helpful service.”

Orgill to Add New York Distribution Center Orgill Inc. will be expanding its network of distribution facilities with the addition of a 780,000-square-foot distribution center in Rome, New York. The new facility will be Orgill’s eighth full-service distribution center, in addition to locations currently operating in Inwood, West Virginia; Tifton, Georgia; Sikeston, Missouri; London, Ontario; Hurricane, Utah; Kilgore, Texas; and Post Falls, Idaho.

Ace anticipates opening most of the new locations this summer and will be creating more than 600 new jobs in the communities.

Now Open!

Sales Continue Strong at United Hardware Fall and Winter Dealer Market Independent retailers who gathered for United Hardware’s recent buying market reported solid sales in the first and second quarters. They were looking for new ways to invest in their stores and continue the momentum into the second half of the year. Product sales have grown 6 percent year over year, according to president and CEO Steve Draeger.

AD INDEX

Ajax Wire Specialty Co. ............................................ 31 www.ajaxwire.com; 855-966-2529

Howard Products Inc................................................ 24 www.howardproducts.com; 800-266-9545

PRO Group Inc. ........................................................ 63 www.pro-group.com; 303-792-3000

Allway Tools Inc. ......................................................BC www.allwaytools.com; 718-792-3636

Imperial Blades......................................................... 54 www.imperialblades.com; 800-743-9844

Quikrete ....................................................................5 www.quikrete.com; 404-634-9100

Ancra Cargo.............................................................. 66 www.ancracargo.com; 800-626-8353

Impress Art............................................................... 37 www.impressart.com; 631-940-9530

Red Lion ................................................................... 55 university.redlionproducts.com; 844-250-4981

Apex Tool Group LLC ................................................. 1 www.crescenttool.com; 800-650-8665

IPG.................................................. French Door Cover www.itape.com; 888-898-7834

Sakrete....................................................................39 www.sakrete.com; 866-725-7383

Big Green Egg .......................................................... 35 www.biggreenegg.com; 800-793-2292

Ironclad Performance Wear Corp............................. 25 www.ironclad.com; 844-200-5664

Sashco .................................................................. IFC www.sashco.com; 800-767-5656

Bonide ...................................................................... 28 www.bonide.com; 315-736-8231

Lumax....................................................................... 30 www.lumax.com; 844-660-6876

Sika ........................................................................... 67 www.sika.com; 201-933-8800

Coles Wild Bird Products Co. ..................................... 9 www.coleswildbird.com; 877-426-8882

Master Magnetics Inc. ............................................. 29 www.magnetsource.com; 888-293-9190

Simpson Strong-Tie Company.................................. 11 go.strongtie.com; 800-999-5099

Designer Greetings .................................................... 7 www.cardsmartstoreinastore.com; 800-654-6960

Metaltech Scaffolding .............................................. 27 www.metaltech.co; 800-363-7587

Stihl USA .................................................................. 17 www.stihlusa.com/dealers; 800-467-8445

Do it Best Corp......................................................... 13 www.independentsdoitbest.com; 888-364-8237

Mi-T-M Corp ............................................................. 26 www.mitm.com; 800-553-9053

SureCan USA............................................................ 61 www.surecanusa.com; 801-827-0500

ECI Solutions .......................................................18-19 www.ecisolutions.com; 800-588-5128

Midwest Fastener ............................................... 32-33 www.fastenerconnection.com; 800-444-7313

Taiwan Hardware Show 2019 ............................. 46-47 www.hardwareshow.com.tw; +886-2-2595-4212

Franmar .................................................................... 60 www.franmar.com; 800-538-5069

NRHA Foundations of Leadership Program ............. 83 www.nrha.org/fol

True Value Company ................................................ 75 www.truevaluecompany.com; 888-291-7229

GE Sealants & Adhesives......................................... 15 www.GEsealants.com; 877-943-7325

NRHA Pointy ............................................................ 81 www.pointy.com/nrha

Wastequip ................................................................ 16 www.toter.com; 800-424-0422

Gordon’s ..................................................................... 3 www.gordonsusa.com; 816-421-4070

Orgill Inc. ............................................................86-IBC www.orgill.com; 800-347-2860

Wayne ...................................................................... 45 www.waynepumps.com; 800-237-0987

Halex......................................................................... 44 www.halexco.com; 800-749-3261

Paladin Data Corporation .......................................... 51 www.paladinpointofsale.com/nrha; 541-803-6060

Wooster Brush Company ......................................... 57 www.woosterbrush.com; 800-392-7246

Hardware Retailing Podcast ..................................... 24 www.TheRedT.com/pod

Pennsylvania Lumbermens Mutual Ins. Co.............. 36 www.plmins.com; 800-752-1895

Hillman Group Inc..................................................... 85 www.mykeyhero.com; 800-242-9934

Poo-Pourri ................................................................. 21 www.poopourri.com; 972-818-8200

HARDWARE RETAILING | August 2019

*This index is provided for the convenience of our advertisers and readers. The Publisher assumes no liability for errors or omissions.

CANADA

Canadian Tire Connects Online Experience Back to Brick and Mortar

WRLA to Move Buying Show to Winnipeg

The online retail experience should be an integrated part of a journey by the customer to find the right product for their needs, says Shawn Stewart, vice president of loyalty and customer insights at Canadian Tire Corp. Stewart spoke at the Retail Council of Canada’s recent annual convention. A significant hurdle for Canadian Tire, as it tested e-commerce, was figuring out how to sell products online while including local brick-and-mortar retailers in the sale, Stewart says. The company has found a way to augment traditional retail experiences for local business owners with the increased shopper visits and add-on sales that online selling can generate.

The Western Retail Lumber Association (WRLA) has announced it will be moving its annual trade show from Calgary, Alberta, to Winnipeg, Manitoba, in 2021. The show will be hosted in Winnipeg in 2021, 2022 and 2023. The 2020 show will be Jan. 22-24 in Calgary’s BMO Centre. The WRLA is currently working with Economic Development Winnipeg to help support the transition in locations.

The WRLA serves the lumber, building materials and hard goods industry in western Canada and comprises nearly 1,200 members.

Want to Read More? For the full story on these briefs, head over to TheRedT.com/0819-news. To read the Canadian briefs, visit hardlines.ca/hardwareretailing. For the latest independent home improvement news, interviews, trends and videos, visit hardwareretailing.com.

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