Issuu

PREVIEW OF THE HARDWARE CONFERENCE IN MARCO ISLAND

July/Aug 2015 Vol. 7, No. 5

THE INDUSTRY’S DIGITAL LEADER

Great Service

Unlocking the Key to

ALSO INSIDE:

Winning Strategies for Store Operations Hardware Dealer Launches New Product Trends in Lawn & Garden/Outdoor Living

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CONTENTS

July/Aug 2015 ■ Vol. 7, No. 5

DEALER PROFILE: THOMAS DO IT CENTER

Editor’s Note: Chris Jensen The Way I See It: Tom Chasteen Digby’s Hardware cartoon: Scott Jensen Amazing But True Hardware Stories How’s Business? Regional Reports on Business Conditions From Tom’s Shop: Hardware Products Review Bottom Line: Winning Strategies for Store Operations Dealer Profile: Thomas Do it Center Preview of The Hardware Conference Hardlines Digest: Sales Tax Audits and Summer Hours Category Report: Lawn & Garden/Outdoor Living Technology Update: Are You Ready for the Coming Tech Changes? In the News Upcoming Events Behind the Numbers The Hardware Connection app is available for iPhone, iPad, Android and Amazon. Download here.

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BOTTOM LINE: STORE OPERATIONS

6 8 14 16 18 26 34 43 50 59 63 67 71 77 78

Connection

THE HARDWARE Connection ■ July/Aug 2015 ■ 3

Jim Lehrer

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ADVERTISER’S INDEX Apex Tool Group | www.apextoolgroup.com . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Big Time Products | www.bigtimeproducts.net . . . . . . . . . . . . . . . . . . . . . . . . . 29 Channellock Inc. | www.channellock.com . . . . . . . . . . . . . . . . . . . . . . . 2, 32, 33 Char-Broil | www.charbroil.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 Convenience Products | www.convenienceproducts.com . . . . . . . . . . . . . . . . 27 Do it Best Corp. | www.independentsdoitbest.com . . . . . . . . . . . . . . . . . . . . . . 4 ECi Software Solutions | www.ECiSolutions.com . . . . . . . . . . . . . . . . . . . . . 7, 49 Elmer’s Products | www.elmers.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 Epicor Software Corp. | www.epicor.com . . . . . . . . . . . . . . . . . . . . . . . . . 17, 52 Flame Engineering | www.flameengineering.com . . . . . . . . . . . . . . . . . . . . . . 31 Ganymede Technologies Corp./J3 Point-of-Sale | www.j3pos.biz . . . . . . . . 12 Hardlines Digest | www.hardlinesdigest.com . . . . . . . . . . . . . . . . . . . . . . . . . . 70 Hyde Tools | www.hydetools.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 Jack Link’s Beef Jerky | www.jacklinks.com . . . . . . . . . . . . . . . . . . . . . . . . . . . 36 Kaba Ilco | www.ilco.us . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 Leviton | www.leviton.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58 Louisiana Grills | www.louisiana-grills.com . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 Minwax | www.minwax.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .38, 41 Pacsoft | www.pacsoft.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 Purdy | www.purdy.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Simpson Strong-Tie | www.strongtie.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45 STIHL | www.stihlusa.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13, 47 The Hillman Group | www.hillmangroup.com . . . . . . . . . . . . . . . . . . . . . . . . . 42 The Vendor Center | www.thevendorcenteronline.com. . . . . . . . . . . . . . . . . . 21 WD-40 Company | www.wd40.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11, 54 Wooster Brush Company | www.woosterbrush.com . . . . . . . . . . . . . . . . . . . 15 X-ACTO | www.xacto.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40

Connection

91900 Overseas Highway | Tavernier, FL 33070 | www.thehardwareconnection.com Publisher/Principal: Tom Chasteen tom@thehardwareconnection.com 305-852-6126 Editor/Principal: Chris Jensen chris@thehardwareconnection.com 317-514-8864 Marketing & Creative Director/Principal: Dan Akers dan@thehardwareconnection.com 317-797-6609 Associate Publisher: Craig Cope craig@thehardwareconnection.com 804-690-0666

Senior Business Advisor: John Hammond jhammond@thehardwareconnection.com Director of Vendor Programs: Diane Allen diane@thehardwareconnection.com 317-432-9177 Beacon Awards Director: Tom Delph tdelph@thehardwareconnection.com Contributing Writers: John Franklin, John Fix III, Doug Donaldson

The Hardware Connection is published eight times a year by The Hardware Connection, Inc. All editorial contents copyrighted 2015 by the publisher. No editorial may be reproduced without the prior permission of the publisher.

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THE HARDWARE Connection ■ July/Aug 2015 ■ 5

editor’s note By Chris Jensen

Gaining a New Respect for the Vendor Side

ince Christofora, owner of Woodstock Do it Best Hardware in Woodstock, N.Y., is not your typical hardware retailer. That’s because for the past year he has put down his retailer hat and put on a vendor hat, working long hours to develop and market an All-Natural Insect Repellent product called BugMeNot. When he wasn’t working with labs to develop and test the product, he was figuring out how to package it and securing shelf space in the right markets. In other words, he discovered how difficult life is as a vendor. “Once you start going down the road of developing a product you learn steps you never knew existed. We had to find a lab that specialized in creating formulas. We’re fortunate to be two hours from New York City, so we were able to connect with a private lab that specializes in this area,” explains Vince. He adds, “Once you’re crazy enough to take the steps we did, you better be ready to go the distance. You want to make sure you have enough time and financial resources to be successful. If you’re not actively involved in every step it won’t pan out.” 6 ■ The hARDWARe Connection ■ July/Aug 2015

Vince says he learned two important lessons: how much time it takes to develop and bring a product to market and how expensive it is. “There are a lot of unforeseen costs. You can’t launch a product like this for less than $100,000,” he says. Next year he plans to start talking to distributors to expand nationally. He says Do it Best has been really supportive and is working to get it into their system, but they are not showing him any favoritism. “We have to earn the business with them, which is how it should be,” he says. BugMeNot is a great impulse item to place by the checkout and is available in a 24-count counter display unit. “Being a retailer I understand how it should be displayed. The product sells itself, particularly with customers who spend a lot of time outdoors,” he says. After a large pre-selling period, BugMeNot has nearly 5,000 orders that Vince and his team are prepared to fill. “It’s been an overwhelmingly positive response from retailers and customers, which does not surprise us because we did our homework,” he proudly notes. See page 64 for more about this retailer’s product launch or visit www.bugmenotspray.com. n www.ThehardwareConnection.com

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the way i see it

By Tom Chasteen

Who From the Next Generation Will Fill Our Shoes?

ore and more of us retailers are beginning to think about the thorny issue of business succession, especially when none of our children express an interest in taking over the family business. Over the past 40 years I have seen some truly heartwarming, successful succession transitions, as well as some tragic endings to a family business. As I begin the final chapter of my retail hardware career I have several objectives I would like to achieve. The most important personal objective for me is to see a smooth and orderly succession of our family business to the next generation so they may continue to be successful, hopefully for the next 20-30 years. If you are at that same stage of your hardware career as I am (I’m 59) you are probably starting to think over what you will do with your business when you are ready to retire. I would be remiss if I didn’t share with you that, unless a family member is capable and willing to take over your business as is, you should start cleaning up your business now. Don’t wait a year before you are ready to retire or health issues force you to retire to start getting your financials in order.

8 ■ The hARDWARe Connection ■ July/Aug 2015

What I mean by “cleaning up” your business is start with your financials, because that’s the first thing any prospective buyer (family or non-family member) is going to want to see. Part of that process is cleaning up any loose ends, like outstanding family loans, equipment loans, eliminating equipment on the books that no longer is a part of your business, reviewing your lease agreements, insurance policies and retirement funds, to name just a few. Part of the process is also acknowledging that very few hardware store owners will be able to cash out. If you are lucky enough to cash out, then the sale price will probably favor the buyer, as it should. Most of us will probably have to hold a mortgage on the sale to help the new owner get established. Having a clean and up-to-date set of books helps this process along if you are looking at holding a mortgage. If you own your building as we do you will need to take a realistic look at the amount of square feet your store is occupying and if the rental amount you are charging yourself is consistent with other commercial rental rates that are similar in size, location and condition in your area. www.ThehardwareConnection.com

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the way i see it I know of many hardware store owners that have worked with their accountant to limit their tax liability, but what limits our tax liability now may not always benefit the new buyer or you in a sale situation. Make sure you understand the issues as they relate to your specific business. It is very difficult to negotiate a mutually satisfactory and profitable purchase of a business if you aren’t aware of all the issues beforehand. Inventory is probably a hardware retailer’s biggest tangible business asset after their physical building. One thing to keep in mind is anyone and I mean anyone can buy the same merchandise you currently have at probably 10 percent below your current replacement cost of merchandise. Every wholesaler in the industry today has some kind of opening stock order with significant cost savings and/ or dating for retailers wanting to start a new store. So it is important to start getting your inventory in shape to sell at least 24 months before you hope to sell. Part of this process is eliminating as much of your D and X movers as possible. Talk with your accountant and discuss various tax strategies you may consider as well to accomplish this. Equipment is another area to take a look at. Remember that a lot of your equipment may already be depreciated off your books, which means you could have a higher taxable net gain than you

may have thought. This is where your accountant will be invaluable in helping guide you through the maze of tax regulations. You may elect to keep or sell some equipment yourself. A word of caution here: check with your accountant to determine if you will have any sales tax implications if you decide to sell some of your equipment. Next, and the hardest part of the equation—trying to determine what the business is worth aside from of all the tangible assets. As one business broker said to me recently, “Tom, remember the only real proprietary (unique) value any business has is the parts of the business that are not easily replicated.” He suggested one way to arrive at an asking price for a business is the replacement cost method. Factors like business location, customer base, brand recognition and “good will” are very hard to evaluate effectively, but he suggested giving it my best and most honest effort. Remember at this stage you aren’t negotiating with anyone, you are trying to honestly determine the value of the business for yourself, he said, reminding me that “if you can’t be honest with yourself you have bigger issues than selling a business.” Finally, no one should know more about your business than you do, and you will eventually arrive at the most honest value for your business that you can. Now reverse the process and

10 ■ The hARDWARe Connection ■ July/Aug 2015

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THE WAY I SEE IT see if you were to buy your business for the value you’ve established could you make a go of it? Again, your accountant will be helpful here as well. The bottom line is if there is no way your business could return even a very modest 1 percent or 2 percent return on the purchase price the chances are very slim you will find someone willing to pay what you think the value of your business is. So be prepared to either postpone your retirement plans or accept a lower purchase price. Now we are at the point where all of us run headlong into the reality that our business may not be worth what we thought or hoped it is worth. We’ve all

been there at various times of our lives, selling a car, house or boat. However, not all is lost and now is not the time to panic. At the very least you know the areas you need to work on to improve while your business is for sale or before you even list it. And remember, it’s not so much what you sell your business for as it’s the amount you net after taxes that really matters. As my wife Dale and I continue down this path I will continue to share our experiences in the same spirit other retailers have shared their experiences with me over the years. Let me know what you think, from one retailer to another, at tom@thehardwarestore.com. ■

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HARDWARE HUMOR

14 ■ THE HARDWARE Connection ■ July/Aug 2015

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Hardware HUMor

Amazing but TRUE

Hardware

StorieS W

ication had a guy turn in an appl “get shit where his main skill was ter experidone.” Then for compu w to do most ence he put: “I know ho ter, so maybe everything on a compu ld be, what the better question wou don’t I know how to do?” John Keely Re-Source | Olathe, Kan.

ometimes we nickname customers. There’s one guy we call Fondler Bob because he likes to touch everything that’s in the store.

Steve Beeson Beemun’s Variety and True Value Soldotna, Alaska

16 ■ THE HARDWARE Connection ■ July/Aug 2015

e had someone want a female end for a wire. We asked what size is the wire? Answer: 12 inches on this side and 12 inches on that side and it’s blue. Maurice White White Do it Best Hardware McCormick, S.C.

n a regular basis I get asked for PCP pipe. The other day ment. I was asked for PCP ce should Then I was asked if he e use the glue first or th day. cement. It was a long Matthew Abramsky Tony’s Ace Hardware Hazel Park, Mich.

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How’s Business? NORTHEAST

Sales and customers counts so far in 2015? It’s been steady overall. We had a busy winter due to the weather and February was big, but it’s been a wet start to the summer so far. Business continues to trend upward as it has for the past few years. Best niches? Pet supplies, survival gear, disc golf and YETI coolers are all doing well for us. We brought in bicycles for the first time and they are selling surprisingly well.

Dennis McCarthy is manager at Mayer Paint & Hardware.

Dennis McCarthy Mayer Paint and Hardware Rochester, N.Y.

SOUTH

Sales and customer counts so far in 2015? They’ve both been excellent. A lot of it is related to weather.

New store initiatives planned? We’re working on an online website portal for commercial customers that we hope to launch by the last quarter.

Best niches? We carry a big assortment of outdoor power equipment and that’s done really well for us.

18 ■ THE HARDWARE Connection ■ July/Aug 2015

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Danny Ferguson points to outdoor power equipment as a sales leader.

New store initiatives planned? We’re planning an expansion by next February. We’d like to add some new niches but mainly expand our existing categories. Danny Ferguson Rogersville Hardware | Rogersville, Ala.

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MIDWEST

Sales and customer counts so far in 2015? Sales and customer counts have been flat so far this year. Weather has not cooperated with us. Our commercial sales have been strong these last couple of months and our online sales continue to grow. www.TheHardwareConnection.com

K&K True Value Hardware is celebrating its 75th anniversary in 2015.

New store initiatives planned? We are planning on a Destination True Value remodel this winter when things slow down. It has been over five years since the last remodel.

Other family members involved in business? I have been blessed to have all three of my kids want to be in the business. So we have myself, my wife, oldest daughter and her husband, my son and youngest daughter all working together in the same store. It can be interesting but it is fun most of the time.

Most effective advertising methods? We have cut way back on paper, television and radio. We are using direct mail pieces, e-mail and social media. I still think Don Keller the circulars are the best, but who really K&K True Value Hardware Bettendorf, Iowa knows when it comes to advertising.

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How’s Business?

SOUTHWEST

Sales and customer counts so far in 2015? We’re up 35 percent across the board. We bought two stores in 2012 that were distressed and we brought up the inventory levels in those stores. We’ve had a great economy in South Texas and we keep growing the business as we keep raising inventory. Best niche categories? Fishing and marine products and we also sell boat lifts and beach-related stuff due to our coastal location. New store initiatives planned? We just bought a 51,000-square-foot former Walmart store in Rockport that is being converted to a new, larger store for us. We had been using 25,000 square feet of leased space. Hope to be in there by October. We just outgrew our old space. That Walmart location has been an eyesore in the community, so we’re building a lot of local goodwill by fixing it up and making it look nice. Most effective advertising methods?

22 ■ THE HARDWARE Connection ■ July/Aug 2015

Beach supplies bring in customers to Ace Hardware in Rockport, Texas.

We only do the Ace fliers with the newspaper. They offer a pretty good value in a small market, reaching 4,500 homes twice a month for $1,200 per store. We’re not currently doing much with social media, because we don’t have anyone dedicated to it. We are building a website with automation features that will link posts directly to social media sites. Phil Salemi Ace Hardware Rockport and Port Lavaca, Texas

WEST

Sales and customer counts so far in 2015? We’re flat on sales, customer counts and margins. All retailers are www.TheHardwareConnection.com

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How’s Business? Pedrotti Ace Hardware was founded in 1922.

flat property with an acre—it’s a trailer park—but we’re running into obstacles and may be forced to kick the can down the road. My main goal is to be seeing a softening of margins due to the in a new building by the time the company turns 100 in 2022. change to LED bulbs, which generate a much lower margin. In some areas LED Most effective advertising bulbs are heavily subsidized through methods? utility company programs, because it Ace does all our advertising for us, does benefit the environment. which does a good enough job. It’s a struggle trying to run an independent Best niche categories? business in a competitive market and I Paint and lawn and garden are tradidon’t have the time or money to spend tionally our best-selling categories, but on advertising that won’t deliver much there’s no water anywhere in California impact. Social media is an entertainso people stopped gardening. I underment method that does not help prostand there’s an El Nino coming in this mote your business. Our group of Ace winter that is predicted to be the worst dealers tested digital marketing with in nearly 20 years, which means it will coupons for a year, but you can’t put in bring wet weather. products so that’s limited. You end up doing deals with dollars off and that’s New store initiatives planned? We’re in the unique position of trying expensive and hard to measure. to move from a shopping center with an Gene Pedrotti awful landlord to a property we would own. It took two years to find a suitable, Pedrotti Ace Hardware | Benicia, Calif. 24 ■ THE HARDWARE Connection ■ July/Aug 2015

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UCTS D O R P E R DWA

REVIEW

must admit that I’ve got one of the best jobs in the hardware industry writing From Tom’s Shop. I get to work with some great products and then listen to serious d-iyers, tradesmen and everyday hardware customers say what they think of the products I gave them to try out. As a matter of policy we do not give testers any more explanation about the product(s) they are given than they would get if they went into a hardware store and purchased the

By Tom Chasteen

item. What we do is try to pick the items to be tested that we feel have the best opportunity for success in the hardware channel. In this issue we tested Bosch’s line of laser tools, all of which have excellent packaging, good graphics and POS signage. The lineup was a good representation of Bosch’s whole laser tool group that ranged from the entry-level laser measuring tool to the self-leveling cross-line lasers.

PRODUCT #1:GLM15 LASER MEASURE ROBERT BOSCH TOOL CORP. GLM 15 is Bosch’s entry-level laser measuring tool. This tool easily fits in the palm of your hand and can be carried in your pants pocket. All of our testers liked the size of the tool and how easy it was to use right out of the package. The GLM 15 will measure distances up to 50 feet within 1/8”. The laser is very bright, easy to see and the one-button operation makes this tool convenient to use for anyone measuring interior rooms such as realtors, HVAC contractors, remodelers and interior designers. For more information on the GLM 15 click on this link. 26 ■ THE HARDWARE Connection ■ July/Aug 2015

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Do More With Less.

PRODUCT #2: GMS120 WALL SCANNER ROBERT BOSCH TOOL CORP. GMS120 is a wall scanner and to be honest with you I thought it was one of the coolest tools I’ve ever had in my hand. Our three testers all were impressed as well. The Wall Scanner has three settings: one for wood, one for metal (steel or copper) and one for electrical. The size of the scanner is just a little larger than an ice cream sandwich, which makes it easy to handle. All you do is put in the battery and press the red “on” button and then select the material you are looking for and slide the unit over the surface of an interior wall or exterior wall. Now comes the great features of this product. Not only will it detect what you are looking for but it will begin to alert you both visually with lights on the face of the unit but also by audio sound when you are getting close to the material you are looking for. In addition to that there is a ½” hole at the top middle of the scanner so you can mark precisely where the target is. The unit also has the ability to detect live wires (electric) while in the other modes as well. If your customers are looking for an all-in-one wall scanner, then the GMS120 is the unit to stock. For more information click on this link. www.TheHardwareConnection.com

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PRODUCT #3: GLL2 SELF-LEVELING CROSS-LINE LASER ROBERT BOSCH TOOL CORP. GLL2 is an all-purpose, self-leveling cross-line laser that will meet the basic needs of any serious d-i-yer or craftsman. It comes with a clamping bracket that will easily clamp on to a 2 x 4 stud and is accurate up to 30 feet to within 3/16 of an inch. This all-purpose unit is very easy to use and with one click of the button on the top of the unit you can light up only the vertical laser or press it again and only light up the horizontal laser for those jobs that don’t require using the cross lines. Another really nice feature of this unit, as with all of the Bosch units, is its size. The GLL2 can easily be held in one hand and the clamp can be attached to the laser using a threaded stud on the clamp. In my opinion as a retailer, this unit will handle 95 percent of the retail consumer needs and probably 80 percent of the craftsman needs. For more information click on this link. Click Here to View Our Profile

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GLL2-15 is the more professional self-leveling cross-line laser. This is a larger unit and is significantly stronger with a range of up to 50’. The GLL2-15 comes with a hard traveling case as well as an adjustable positioning device and a clamp for drop ceiling work that really comes in handy. This unit is a little larger and is packed with professional features like projection of the vertical and horizontal lines independently plus an indicator when the unit is no longer level, which is really nice if you are working alone. The GLL2-15 is the perfect unit for tradesmen who make their living using straight and level lines. It seems durable enough to stand up to the Elmers Page NHSFor Special Ad Hardware Connection.pdf 1 click 6/16/15 on 2:41this PM taskPBWFasHalfwell. more information link. Click Here to View Our Profile E-mail

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PRODUCT #5: BT150 COMPACT TRIPOD ROBERT BOSCH TOOL CORP. Bosch offers a compact tripod BT150 that makes using their laser tools a snap in just about any situation. It will extend from 22” to 61” and comes with a swivel base as well as independently adjustable legs for uneven surfaces. I couldn’t find an angle it couldn’t adjust to and stay put when locked down. All of our testers agreed that these Bosch lasers, wall scanner and measuring tools significantly exceeded their expectations. The two features they kept mentioning were the ease of use and the compact size of the tools. If you haven’t seen these tools in person make a point to stop by the Bosch booth at the next show and look them over, I think you will be as impressed as we were.

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COMPANY PROFILE

Channellock Helps Retailers Manage Their Inventory

ne of the most time-consuming tasks retailers face is managing inventory. Unless a retailer has a limited variety of products, owners and operators spend a good amount of time tracking inventory while trying to keep inventory levels at a minimum. Keeping up with inventory will help meet the needs of your customers and the bottom line.

Hardware and home improvement retailers are always trying to balance carrying enough products on the shelves while never being out of any stock. The exact amount of stock can vary depending on the size of the store, the type of products and the demand. In many cases, products are simply allocated shelf space based on package size. But what if there was a better approach to the amount of shelf space each item is given? How much money in sales is lost when fast selling items are not on the shelf? Instead, reallocate additional shelf space to the small number of faster moving items that 62 ■ THE HARDWARE Connection ■ July/Aug 2015

are able to be shipped to the store in time to restock. To do this, it is important to work with manufacturers and suppliers that can help balance keeping just enough products at the retail location while filling orders on time to keep the shelves stocked. Channellock Inc., a worldwide leader in the manufacture of high-quality pliers and assorted hand tools, including the iconic, American-made CHANNELLOCK® tongue-and-groove plier, prides itself on being a supplier that understands the challenges of independent retailers.

“By owning the manufacturing processes in Meadville, Pennsylvania, we’re able to fully control the quality of every plier we produce – from design to production to shipment,” said Ryan DeArment, vice president of sales & marketing, Channellock Inc. “Thanks to our associates’ commitment to lean manufacturing practices and continuous improvement we can fill orders to completion at a very high success rate.” DeArment said that CHANNELLOCK®’s orders are able to ship consistently within three days of order receipt and that fill rates are consistently at 98 to 99 percent, beating the industry average of 90 percent. “This helps lower costs of inventory because our customers can depend on us to get them what they need, when they need it and that supports a greater gross margin ROI,” DeArment said. With nearly 300 SKUs available, the CHANNELLOCK® brand is one that sells. For more than 129 years, Channellock Inc. has been manufacturing tools that professionals and serious DIYers seek out. Put them on the shelf and they will sell. In addition, Channellock Inc. offers POP materials and brand support through its national marketing and advertising programs. This brand support drives customers to their local retailers to get the tools they want with the iconic CHANNELLOCK BLUE® grips. In addition, seasonal promotions and sweepstakes, such as the Opening Day of Fix-It Season and the Gridiron Garage Giveaway, create excitement around the

brand and help to keep CHANNELLOCK® top of mind of the customer. While sales are important, another factor that impacts retailers is the return rate for any products they sell. The low return rate for CHANNELLOCK® is a testament to the quality of the tools it offers. While the hand tool industry average is about two percent, CHANNELLOCK® tools’ return rate is only .25%. This means less return stock to handle and more satisfied customers. When customers buy CHANNELLOCK® tools, they know what they’re going to get in terms of performance and durability, whether it is tongue-and-groove pliers, high-leverage linesmen’s pliers or new American-made Professional Screwdrivers. When retailers work with CHANNELLOCK®, they know what they are going to get — consistent fill rates, exceptional customer service, on-time shipping and an American company that understands what retailers need to help manage their supply of products. ■ THE HARDWARE Connection ■ July/Aug 2015 ■ 63

Winning Strategies By John Franklin

for Store Operations

Do Not

t a h W y l r o o P o D Others Do Well

a fair and smooth-running operation, then customers leave with fond memories of your service and are eager to return. Decades ago when all business took tore operations are place in brick and mortar stores, a poor store could still have a virtual lock on a critical cog in the a market. The mere fact that they were life of every business. there got them most or all of the busiOperations are the sum ness in that market. They could be total of all the things that mean or nasty, overpriced, constantly you do to make your store run quickly, out of stock and provide poor customer fairly, profitably and especially to take care of your customers. Your store oper- service but still get the business. Well, those days are over. Now, with ations are a combination of the people you employ and the systems and equip- lots of stores out there and the internet offering availability of product from a ment that you use to handle your custhousand sources with the click of a tomers, your employees and to keep mouse, customers don’t need to put up track of your business. with poor store operations. How well you do in your everyday With this dynamic shift in retailoperations determines both your boting comes another less perceptible tom line as well as how your customchange—the local effect of remote or ers perceive your store. If you have

34 ■ THe HARDWARe Connection ■ July/Aug 2015

www.TheHardwareConnection.com

bottom line Pay attention to your store’s curbside appeal.

distant competition. Store owners can no longer just judge themselves by the store down the street but must be compared to all available outlets. If you expect to survive today, you can no longer do poorly what every other competitor does well. Since there are some very well-run businesses out there, you must become as good as you can. The best retailers have already begun to address this conundrum. They have looked at their store operations and worked to improve every facet of the business with an eye on measurable customer service. You need great operations and legendary customer service to be able to compete with internet outlets that are convenient and very sharply priced.

Curbside AppeAl It may be time to sharpen your focus, and the best place to start is right in www.TheHardwareConnection.com

the street in front of your store. I call your street view your home page. What does your brick and mortar home page look like? First impressions are lasting impressions. What customers see at the street level gives them a good idea of what to expect inside the store. What does your street sign look like? Is it bold and shout quality and service? If not, talk to your wholesaler for help with a new sign. How is the access to your parking lot? Can customers safely and easily enter and exit? How many parking places do you have? Do your employees take the best ones? Do you have an overflow plan for busy days? The best operating stores make the first impression a good one. What does your foyer look like? Is it a clean and inviting entrance or is it really just a messy stock room in the front of your building? Is your sales floor clean and well merchandised? The best operating stores provide a clean and organized store and a place where women do not have to worry about getting dirty while they shop. Is the light level in your store at the proper level for the type of business you THe HARDWARe Connection ■ July/Aug 2015 ■ 35

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bottom line have? Most hardware stores are convenience stores. Customers are in your store just briefly. They cannot come in from a parking lot brightly lit by the sun and see anything in your dark store for a few minutes. The best operating stores don’t make customers squint in the dark. It your store properly staffed? Can a customer clearly identify the employees at a distance? To stand out, every employee must have a uniform and a name badge. The best operating stores never make a customer ask: do you work here? Are your employees crosstrained to do everything they may be called upon to do in a day’s work? Do you have a program for contractors and other professionals? The best operating stores work to increase professional customer sales through customized services, such as enhanced ordering programs and same-day deliveries. They know they must provide more individualized attention and that time is money for professional customers. When customers pile up at the door before you open, do you make them wait until the last possible second or do you let them in early? Do you chase customers out at the end of the day or do you help them complete their transaction? Customers love attention at both of these times. Is your store priced throughout with signs, stickers or bin tags? The best operating stores never make a customer ask how much an item costs. Do you set www.TheHardwareConnection.com

up for sales on time with proper signing and then remove all signing after the event? Customers hate it when they cannot find an advertised item. They also hate to find old signs that you left up but don’t want to honor any more. Is your inventory level maintained, well displayed, neat and replenished as necessary? Do you follow the seasons carefully with the right item in the right place at the right time? Do you file for defective merchandise in a timely manner or do you let them pile up in the backroom? Do you keep track of your old merchandise and have a plan to liquidate it or do you just hope it goes away on its own? The best operating stores keep a tight control on inventory. Do you tolerate long lines at the cashier, even for short periods of time? The best operating stores use headsets for communication or have a “code” to announce for extra help at the checkout station when they get overloaded. They do not lower operating standards that directly affect customer service because they have a cashier in the restroom or out to lunch. We all talk about good customer service, but what defines good customer service? My definition of good service is something customers will talk about when they sit down to dinner.

FoCus on Customer retention Even good customers occasionally have problems with your store and may need

THe HARDWARe Connection ■ July/Aug 2015 ■ 37

Make sure you do what is necessary to retain your customers.

to return a product or register a complaint. For that reason, I believe that the most important operating function in your store is the service and retention of your existing customers. Without them the rest of your store operations are pointless. The key to customer retention is a fair return policy. The best operating stores make sure that the store return policy is not too rigid for their customers. So, what is your return policy? It is posted? Is it clear? Does your policy

empower every employee to give a customer what they want or do you make the employee and the customer wait until a real manager arrives to resolve a problem? Set a limit if necessary, but don’t call a manager for peanuts. Customers like working with employees that can get the whole job done. The best operating stores allow many employees to resolve customer complaints to the satisfaction of the customer. It is possible to spend tens of thousands of net profit dollars in advertising every year to attract new customers and then scare off a long-time customer because they got mad about something your company did. It happens more frequently than most store owners want to admit. We as retailers often trivialize customer complaints, but customers sure

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bottom line don’t. We can make them so mad over $10 that they won’t ever come back. Case in point: Many years ago I remember talking to a woman I worked with at a local non-profit. I asked her why I never saw her in the store even though I knew she lived nearby. She told me that a year before I became the store manager, she had a very bad experience with an employee and would never come back. I assured her that we provided high customer service, but that did not sway her in the least. She said even though I was now the store manager, she still would never come back to the store. That day, I learned that poorly serviced customers

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can keep a deep and sometimes permanent resentment of stores. How much does it cost to save an unhappy customer? It is surprisingly low when compared to the advertising expense of getting new customers. I know this because years ago I did a test. I asked our store owner the same question and we agreed to find out. I created an account in the system we called “adjustments.” We used this account when we made a mistake or failed to do what we said we would do and ended up with an unhappy customer. Every time we had an unhappy customer my employees were required

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to ask what the customer wanted. Sometimes they asked for the salesman to be drawn and quartered, but after calming down, they always gave a reasonable request. Almost every time it was a small amount, like $25 or $50. What we did was use the adjustment account to bill out a store gift certificate for the amount the customer requested. If I was the one involved, I gave them the gift certificate and then apologized for the delivery truck running over the tulips or whatever we had done wrong. The reason we gave a gift certificate instead of cash was simple. First, in order to use the gift certificate the customer had to come back into our store and be a customer again. I wanted another chance to do right by this customer and hopefully turn them into a happy customer. If you give cash to a customer, then they can spend it at a competitor’s store and maybe never come back to you. Second, a gift certificate usually costs out at less than 50 percent of the actual face value when they make a purchase, so our actual net cost of retaining the customer was greatly reduced. How much did this program cost us? At the end of the first year we had more than 30 uses of the account but it totaled less than $1,000 for the year. This meant that we had potentially saved 30 or more unhappy customers www.TheHardwareConnection.com

bottom line and spent less than $1,000 at face value to keep them. I guessed that our actual costs were about $500. I believe this is a far better use of store assets than spending 50 to 100 times this amount hoping to get a new customer to replace a good one we just chased away. The overall impression presented by your store operations will determine how well you resolve customer complaints and keep your current customers. It is bad enough that some customers die or move away. It is more regrettable if we carelessly drive them out with poor operating policies. Let your customers remember your store by how much better you take care of them than the other choices they have.

Your competition used to be limited to just those brick and mortar stores in your geographical area, but your true competition today is every store or internet site that sells your products. Now customers will judge your customer service and store operations not just by the store down the street, but by every other outlet on earth that sells your products. Your bottom line will remain fine if you do not do poorly what any of them do well. ■ John Franklin has over 40 years experience in hardware retailing, most recently as merchandise manager at Williams Lumber & Home Centers in upstate New York. He is available for retail consulting or you can contact him with questions at john@thehardwareconnection.com.

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Dealer Profile

Jim Thomas

Owner Thomas Do it Center Gallipolis, Ohio; and Pt. Pleasant, W. Va.

Unlocking the Key to

Great

Service Jim Thomas

founded Thomas Do it Center in Gallipolis, Ohio, in 1988. A second store was added in Pt. Pleasant, W. Va., in 1997. The company’s goal is to “Make each customer’s shopping experience the best it can be.” This dovetails into the business’ management philosophy: “If we take care of our customers, they will take care of us. If we respect our employees, they will respect us.” www.ThehardwareConnection.com

Jim Thomas has built a successful twostore business in southeastern Ohio.

THE MAIN STORE IN Gallipolis features a two-story house on the sales floor that serves as a showroom display for building materials. Thomas focuses on making slow and steady improvements every year to his business to stay ahead of the competition.

The hARDWARe Connection ■ July/Aug 2015 ■ 43

Dealer Profile

Thomas Do it Center’s main store in Gallipolis, Ohio, features a 40,000-square-foot sales floor.

Wholesaler: Do it Best Corp. Salesfloor square footage: 40,000 sq. ft. for Gallipolis; 18,000 sq. ft. for Pt. Pleasant Sales % Pro vs DIY: 65% pro/35% DIY for Gallipolis; 35% pro/65% DIY for Pt. Pleasant 2015 sales: Up 8% Number of employees: 60 full-time and 15 part-time Top-selling categories: Building materials is number one, while plumbing and electrical departments are very strong.

Top Right: A fleet of delivery vehicles offers delivery service in an 80-mile radius. Lower Right: A two-story house built on the sales floor serves as a showcase for LBM products.

44 ■ The hARDWARe Connection ■ July/Aug 2015

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Dealer Profile

Jim Thomas oversees a business that continued to thrive even during the recession.

Best niches: Special orders especially for millwork, plus a 3,000 sq. ft. kitchen and bath showroom staffed with two full-time kitchen designers. We also set ourselves apart with a dedicated delivery service that delivers materials to contractors in an 80-mile radius. What are the keys to ensure your customer service stands out? We strive for a clean, well-stocked store. Right Upper: Excelling in customer service starts by having a store that is easy to shop. Right Lower: Both stores were recently updated with new signage, shelving and lighting.

46 ■ The hARDWARe Connection ■ July/Aug 2015

www.ThehardwareConnection.com

REAL PEOPLE. STIHL PEOPLE. Rick Cantelmi I Cantelmi’s Hardware JOIN US. #RealSTIHL

“We’ve been selling STIHL since 1977, and the dependability of their products is legendary.” In an era of mass merchants, Rick Cantelmi credits his family’s legacy of success to quality customer service and investment in premium products. “Customers have to come to independent dealers, like us, to buy STIHL products. That gives us a definite advantage over big box stores,” says Cantelmi. Exclusive dealer support and training programs like STIHL MasterWrench Service® technician certification also provide a competitive edge. “STIHL plays a big part in helping me service my customers efficiently. I don’t get this kind of service and support from most manufacturers.” To become a dealer: STIHLusa.com/dealer *“Number one selling brand” is based on syndicated Irwin Broh Research as well as independent consumer research of 2009-2014 U.S. sales and market share data for the gasoline-powered handheld outdoor power equipment category combined sales to consumers and commercial landscapers. ©2015 STIHL

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Dealer Profile Upper: Owner Jim Thomas emphasizes having a clean, well-stocked store. Lower: Lumber and building materials is the top-selling department at the main store, which attracts 65 percent of sales from pros.

We’ve always strived to keep a clean sales floor and warehouse along with well-stocked inventory. You can’t meet customers’ needs without inventory and no one wants to shop in a store that’s not clean. We divide up the different departments so specific employees are responsible for maintaining and cleaning a particular department and staying on top of back stock. What are the biggest challenges facing your business? Health insurance costs like everyone else. Also, finding and retaining quality 48 ■ The hARDWARe Connection ■ July/Aug 2015

employees. We do have a lot of longtime employees in our contractor division, but we have more turnover with sales floor positions. We don’t feel we’re losing any of our LBM business to online sellers like Amazon, but we are in areas like lighting fixtures and faucets. What is your most effective method of advertising? We do the Do it Best circulars five times a year, which is all we need since we’re in a rural area. We don’t do much with social media. Any new initiatives planned for the near future? We completed updates with Do it Best’s Signature™ Store Design program within the last two years with new signage, shelving and lighting. We try to do a major update for our stores every five to seven years. Next up is some exterior updating to LED lighting at both locations. Are other family members involved in the business? My daughter, Autumn Thomas, handles all the advertising and oversees the sales floor. n www.ThehardwareConnection.com

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Hardware conFerence Join your fellow dealers in beautiful Marco Island, Fla.

The Hardware Conference

unites the

Industry S

tart making plans to attend an event that can have a dramatic impact on your business. The 2015 Hardware Conference will take place September 11-13 at the Marco Island Marriott in Marco Island, Fla. It’s the perfect opportunity to bring your whole family to a five-star resort right on the Gulf of Mexico with seven miles of pristine white beaches.

Key vendors participate in the event with tabletop exhibits.

For the past 27 years, The Hardware Conference has provided a forum for independent retailers to gather with wholesaler and vendor colleagues to discuss solutions to common retail challenges. Lasting friendships are made, but more importantly attendees come away re-energized and filled

50 ■ THe HARDWARe Connection ■ July/August 2014

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Left: Join your fellow dealers for fun in the sun. Upper Right: The Hardware Conference is held at the beautiful Marco Island Marriott right on the beach. Lower Right: Conference attendees get to hang out in the penthouse hospitality suite overlooking the beach and water.

with new ideas to take back to their stores. The Hardware Conference was started by a small group of hardware retailers in 1988 and has been retailrun and operated since then. Craig and Shanti Cope along with Tom and Dale Chasteen are your hosts for the only industry event held exclusively for independent retailers regardless of wholesaler affiliation. Key vendors participate in the Conference with tabletop booths showcasing their product lines, and dealers get a chance to have informal conversations with vendors without the pressure of buying. In addition to two open dialogue sessions where no topics are off limits to frank exchange, dealers will have many formal and informal opportunities to network with other attendees. “Dealers, vendors and wholesalers get together to discuss a variety of issues pertinent to our industry. The facility is wonderful and very www.TheHardwareConnection.com

THe HARDWARe Connection ■ July/August 2014 ■ 51

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Get there. Download the Retail Success Guide, Five Ways to Outservice Your Competition and explore Eagle N Series today at www.epicor.com/GetThere. For the fourth consecutive year, IHL Group has named Epicor #1 vendor for POS software among specialty hard goods retailers. Copyright © 2015 Epicor Software Corporation. Epicor, the Epicor logo, Business Inspired, and Eagle N Series are trademarks or registered trademarks of Epicor Software Corporation registered in the United States and certain other countries.

Hardware conFerence

Technology Forum Sponsors

include 18 holes of golf, a shelling excursion or private beach access to Epicor sail boats and water hammocks • Saturday evening’s cocktail ECi Rock Solid reception • Saturday night’s Key West buffet dinner J-3 Point-of-Sale • Sunday morning’s private breakfast under the date palms on the patio • Kids’ program Saturday night affordable. The meals are superb and The Hardware Conference is open to the entertainment outstanding,” says Matt Noonan III of Noonan’s True Value any independent retailer, regardless of wholesaler affiliation. Ace, Do it Best, in Springfield, Ill. Orgill and True Value all support the There’s still time to take advantage Conference and hold dealer luncheon of the early bird discount of $109 for meetings. dealer registration until July 24. The fee covers: • Friday’s wholesaler luncheon Hardware TecHnology Forum meeting Kicking off the event is a Hardware • Friday night’s cocktail reception Technology Forum that starts the day and Beacon Awards Banquet dinner • Access to the hosFriday afternoon’s dealer seminar pitality suite all tackles key industry issues. weekend • Saturday morning’s private breakfast under the date palms on the patio • Exhibit area and open dialogue sessions on Saturday and Sunday mornings • Saturday afternoon’s social activities that www.TheHardwareConnection.com

THe HARDWARe Connection ■ July/August 2014 ■ 53

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Hardware conFerence

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Two open dialogue sessions provide a forum for retailers to exchange ideas on key industry issues.

before the Conference officially opens on Thursday, September 10. For the third consecutive year, Epicor, ECi RockSolid and J-3 POS will offer a fullday, hands-on training session for their retailers. Bring your tablet or laptop so you can log right into your store as you learn new tips and tricks to make your POS software more productive. To attend the Technology Forum and the Conference the cost is only $299 per person and includes all training programs for one day plus breakfast, lunch and cocktail reception on Thursday in addition to the other Conference meal functions and activities the rest of the weekend. The registration fee for attending just The Hardware Conference is $149 per person after the early bird discount date.

“The roundtable discussions bring the retailers, vendors and distributors together. This forum is usually an eyeopening experience. Retailers and distributors gain a better understanding of why vendors institute certain policies and procedures.” — Casey Mathews, The Wooster Brush Co. “The resort is beautiful, the hotel price is at off-season rates and a bargain, and meeting dealers and vendors in a relaxed setting without the buying focus of a market allows time to exchange ideas and suggestions.” —John Fix III, Cornell’s True Value, Eastchester, N.Y.

One of the signature events of the Conference is the Beacon Awards,

which will recognize the industry’s Best New Stores, as well as Retail Beacon Award winners from participating wholesalers Ace Hardware, Do it Best, True Value and Orgill. The Beacon Awards are co-sponsored by The Hardware Conference and The Hardware Connection with special sponsorship support from Apex Tool Group, Sunnyside Corporation, Epicor, 3M and SherwinWilliams Diversiﬁed Brands. The Beacon Awards banquet will be held

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THe HARDWARe Connection ■ July/August 2014 ■ 55

Beacon award wInnerS

Hardware conFerence Friday evening, September 11, at the Marriott Marco Island. Beacon Award winners will receive all-expense paid trips for two to the 2015 Hardware Conference including conference registration, airfare, hotel and meals. They will also receive a special Beacon Award plaque and be featured in The Hardware Connection.

SIgn uP Today Vendor booths are auctioned off during Saturday night’s banquet with the proceeds benefiting the Miami Children’s Hospital Foundation. The Conference is designed for the whole family, with plenty of free time for fun activities such as golf, sailing, shelling and walking on the beautiful sandy beach. Attendees enjoy special room rates of $171 per night—a significant savings from regular rates of $250+. To make your room reservations, call the Marriott at 239394-2511 and be sure to mention you are a part of The Hardware Conference. For more information on attending the 2015 Hardware Conference, call Craig Cope at (305) 853-0049 or go to www.thehardwareconference.com.

Sponsors:

Co-Sponsors:

This year’s banquet on Friday evening will showcase a ﬁrst-class awards ceremony featuring the winners of the Beacon Awards program.

56 ■ THe HARDWARe Connection ■ July/August 2014

www.TheHardwareConnection.com

SCHEDULE OF EVENTS

Marquee Sponsors

Wednesday, September 9

The Hardware Conference would like to thank and recognize its Marquee Sponsors for their support over the years. It is with their cooperation and that of all of our sponsors, vendors and retailer attendees that The Hardware Conference has become the largest annual dealer event in the independent channel. The following companies are Marquee Sponsors of this year’s event:

10:00 a.m. - 3:00 p.m. . . . . Vendor Only Meeting, sponsored by The Hardware Connection 2:00 p.m. - 4:00 p.m. . . . . . Technology Forum, Vendor and Dealer Registration

Thursday, September 10

8:00 a.m. - 9:00 a.m. . . . . . ECi RockSolid, Epicor, & J-3 POS Breakfast 9:00 a.m. - 5:00 p.m. . . . . . ECi RockSolid, Epicor, & J-3 POS Technology Forum 8:00 a.m. - Noon . . . . . . . . Technology Forum, Vendor and Dealer Registration 9:00 a.m. - 4:00 p.m. . . . . . Vendor Set Up 2:00 p.m. - 4:00 p.m. . . . . . Vendor and Dealer Registration 6:30 p.m. - 8:30 p.m. . . . . . All Industry Cocktail Reception, sponsored by ECi RockSolid, Epicor & J-3 POS

Friday, September 11

8:00 a.m. - Noon . . . . . . . . Vendor Set Up 8:00 a.m. - 5:00 p.m. . . . . . Dealer and Vendor Registration 10:30 a.m. - 2:00 p.m. . . . . Ace Hardware Meeting & Luncheon – Dealers only 10:30 a.m. - 2:00 p.m. . . . . True Value Meeting & Luncheon – Dealers only 10:30 a.m. - 2:00 p.m. . . . . Do it Best Meeting & Luncheon – Dealers only 10:30 a.m. - 2:00 p.m. . . . . Orgill Meeting & Luncheon – Dealers only 2:30 p.m. - 3:30 p.m. . . . . . Beacon Award Winner Private Reception 4:00 p.m. - 5:30 p.m. . . . . . Dealer/Owner Seminar - Vendors Welcome 6:00 p.m. - 7:15 p.m. . . . . . Cocktail Reception, Palms Foyer, sponsored by Hyde Tools 7:15 p.m. - 9:30 p.m. . . . . . Beacon Awards Banquet Dinner, Palms Ballroom At conclusion of dinner, Hospitality Suite is open, sponsored by Duracell

The Hardware Connection magazine

The Hillman Group

Saturday, September 12

7:00 a.m. - 8:00 a.m. . . . . . Breakfast, sponsored by Hillman Group 8:15 a.m. - 10:00 a.m. . . . Exhibit Areas Open 10:15 a.m. - 11:30 a.m. . . First Day of Open Dialogue Noon . . . . . . . . . . . . . . . . . Trolleys leave for Krylon Golf Outing, The Rookery Golf Course 12:30 p.m. - 2:00 p.m. . . . . Women in Hardware, Private Luncheon 12:30 p.m. - 4:30 p.m. . . . . Day at the Beach, sponsored by Wooster Brush, Marriott Beach. 1:00 p.m. - 5:30 p.m. . . . . . Hospitality Suite is open, sponsored by Duracell 2:30 p.m. - 4:30 p.m. . . . . Shelling Excursion, sponsored by Minwax, Marriott Beach 5:45 p.m., . . . . . . . . . . . . . Trolleys will return from Krylon Golf Outing 6:15 p.m. - 10:30 p.m. . . . . “Kids Night Out”, sponsored by Miami Children’s Health Foundation, (Ages 5-12) 6:15 p.m. - 7:15 p.m. . . . . Cocktail Reception, sponsored by 3M 7:15 p.m. . . . . . . . . . . . . . Key West Buffet Dinner Party and Auction, Palms Ballroom 10:30 p.m. - 1:00 a.m. . . . . Hospitality Suite is open, sponsored by Duracell

Sunday, September 13

7:00 a.m. - 8:00 a.m. . . . . . Breakfast 8:15 a.m. - 10:00 a.m. . . . Exhibit Areas Open 10:15 a.m. - 11:30 a.m. . . Final day of Open Dialogue, sponsored by WM Barr 11:30 a.m. - Noon . . . . . . . Closing Remarks www.TheHardwareConnection.com

Krylon

Louisianna Grills

Miami Children’s Health Foundation

The Wooster Brush Company

THE HARDWARE Connection ■ July/August 2014 ■ 57

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By John Fix III

hardlines digest

Sales Tax & W

Summer Hours

hile retailers around the country wait for a break in the rain (except out West), they have been busy checking out what’s being discussed on Hardlines Digest. What follows are two topics kicked around recently.

sales taX audits Dean Impey of Tri-B Hardware and Supply in Rockford, Ill., wondered about other retailers’ experiences with a sales tax audit, since his business has been randomly selected to participate in one. Wayne Youngblood of Youngblood’s True Value in Mayfield, Ky., responded that sales tax audits can be longer and more disruptive than income tax audits. “Just depends on the auditor. Our last auditor spent 15 full work days in our office. They will usually choose one random month out of each of the previous four years, and they will review copious amounts of paperwork in those months. All the mistakes they find in the sample months are multiplied by 12 under the assumption that you made similar mistakes in the nonsample months,” he posted. Youngblood added that auditors are checking: 1. Your bookkeeping system for reporting sales tax collections, 2. Your sales tax exemption certificates for every exempt sale. www.ThehardwareConnection.com

3. Resale, charity, government exempt sales must have exemption certificates on file but responsibility is now largely shifted to the buyer for proper use. 4. Exempt sales for AG sales can be especially bothersome because no two people (or auditors) agree on what is exempt. Taxability for AG sales is dependent on use of the product and neither the auditor nor the cashier knows how they are using it. Guess whose opinion rules. Missing paperwork or without signatures is a problem. 5. They love to look at your credit card statements because that is where many items for store use are bought (ink toner, printers, computers, etc.) All those items for store use are taxable if you didn’t pay sales tax on the invoice, then they are subject to use tax at the same rate. 6. They look closely at your system and record of reporting items taken out of

The hARDWARe Connection ■ July/Aug 2015 ■ 59

hardlines digest store inventory for store use (ballasts/ bulbs/paper towels/tissue, etc.) 7. They look closely at inventory items you give to charity (It is assumed to be advertising, thus a benefit to store, thus taxable). 8. If you have any soft drink machines, they will look to see if and how you are reporting and remitting sales tax on those vending sales. 9. If you have a POS system that tallies how much sales tax you collected, then you most likely are unable to complete the sales tax return and arrive at the exact amount. On a $10,000 sales tax return, you probably can’t get closer than $100 to the amount shown by your POS system (plus or minus). I think our auditor used the larger of the two amounts— no credit for overpaying but we owed the difference on underpayments. 10. Kentucky taxes advertising (but exempts newspapers). They taxed us on all our Reward mailings, including e-mails, under the theory that ink, paper and even postage were subject to sales tax. Out of the $0.47 we paid for each Rewards mailing, approximately half was for U.S. postage. We fought that for a year and finally lost. That amounted to about $7,000 of additional tax. I still think the Department of Revenue was wrong and I doubt that other states will take this approach. (Be aware that True Value collects sales 60 ■ The hARDWARe Connection ■ July/Aug 2015

Dean Impey of Tri-B Hardware & Supply needed advice on how to handle a sales tax audit.

tax from you on circulars, but they do not on Rewards mailings). Retired retailer Dick Beal agreed with Youngblood, pointing out that sales tax auditors are snoops by nature. “Ask your CPA to provide the auditor a desk. The last thing you want is the auditor talking to your staff and snooping into areas other than sales tax. According to my CPA, it is a good way to get a parade of state inspectors visiting your business. The auditor can then request whatever documentation they deem necessary from your CPA’s office. In my case, she picked three months at random over the past years and I brought her bags full of detail tapes and more than a few bugs.” Beal added, “A word of caution: they check your store use account to see you paid fair market value sales tax on items you sold the store. Another biggie was if you privately own the real estate and pay yourself rent it is taxable. Make sure your computer is set up to make the correct sales tax calculation. I know of a store on Triad since the 1970s that was charging a flat 6 percent rate, which was set up by Triad personnel. The State of Florida uses a manual repeating tax table; rounding yields an effective tax between 6.14 percent and 6.17 percent, www.ThehardwareConnection.com

although everybody refers to our sales tax as 6 percent. The store paid several thousand in fines and penalties. Beal pointed out that any fines and penalties are negotiable. “After any negotiation it is best to pay them rather than to fight them in court even if you are right and they are wrong. The cost of a tax attorney is usually more than the fines and penalties.” Impey replied that he has a small list of what they ran through the system but never kept any receipts from the register. “We were on a manual system. In the last year we put in a POS system,” he said. Youngblood suggested, “If you did not keep any records of items used in the store, the auditor will likely estimate using established parameters. For the future, I would recommend our system. We came through clean on this aspect of the audit. We set up a customer account for store use (Epicor in MCR). The account is set to sell at average cost and to charge tax. Once a month, we actually write a check to pay the statement. That satisfies the sales tax auditor. And we book the check amount in general ledger to Store Supplies, which satisfies the financial and income tax requirements.”

summer hours Tim Pruitt at Avilla Hardware in Arkansas wondered when dealers start and stop summer hours. “We have not done this in the past but are giving it a go this year with results to be monitored. www.ThehardwareConnection.com

Retailers shared how they have experimented with summer hours.

We will start the second week of May but in the future will consider starting on Memorial Day and running through Labor Day.” Lenny Goldfarb of Cedar Center Hardware in South Euclid, Ohio, posted their hours as: 9-8 weekdays, 9-5 Saturday, 10-5 Sunday for most of the year; then 9-6 weekdays, 9-5 Saturday and 11-4 Sunday from Thanksgiving to the end of March. Goldfarb added, “We started the shorter winter hours three years ago and it did not affect sales at all. On days of snowstorms if it is still busy at closing we just stay open later. The first 17 years we did not shorten hours, but now we save 12 hours of payroll per person without losing sales. It works for us.” Randy Patzer of Garden City Ace in Michigan posted, “We used to do it for the weekends, but it caused chaos in our customers’ minds. They never knew when we were open or closed. We finally stopped and it still took years before they started getting it straight.” Diane DeRonne of DeRonne Hardware in Eastpointe, Mich., added, “We only change by one hour on the week days once it starts to get nice and stay light The hARDWARe Connection ■ July/Aug 2015 ■ 61

hardlines digest out later. We looked at our sales for the 8 p.m. to 9 p.m. hour during the winter and it was terrible—too dark and cold for people to come out after work or dinner. So we cut back in the winter and went back to the extended day in the spring. We were doing it with daylight savings, but that was too early (March) and too late (November). Jim Ertzman of South Hills True Value Home Center in Pittsburgh posted, “In January-March we get our True Value truck early on Monday and Thursday, so although not posted we are open at 8 a.m. those two days. If we are here we might as well unlock the door. In May through mid-June, although not posted, we are open at least an hour earlier and stay later on Sunday because of the garden and bedding plant business.” Trey Kiper of Kiper Hardware & Lumber in Winnsboro, La., said they change when Daylight Saving Time begins and ends. Summer hours this year (March 8-October 31) are: MondayFriday 7 a.m. – 6 p.m.; Saturday 8 a.m.-4 p.m. and closed Sunday. Winter hours are Monday-Friday 7 a.m.-5 p.m.; Saturday 8 a.m.-4 p.m. and closed Sunday. Kiper added, “When it gets dark earlier, we find it works to close earlier. We don’t have lights in the lumberyard and it becomes a safety issue. As soon as the days begin to get longer, customers start coming in more after work, so the extra hour takes care of those.” 62 ■ The hARDWARe Connection ■ July/Aug 2015

Cedar Center Hardware promotes its longer summer hours on the store website.

Shep Hayes of Hayes True Value & Rental in Bridgton, Maine, posted, “Our normal hours for the longest time have been 7 a.m.-6 p.m. MondaySaturday and 8 a.m.-3 p.m. on Sunday. Rental opens and closes a half-hour earlier and later. We’re exceptionally seasonal and for the past two summers we’ve added an extra hour on Sunday from Memorial Day to Labor Day for retail only. It’s worked out okay and we could probably add an extra hour on top of that. Melissa Brett of Welden Hardware in Simsbury, Conn., pointed out that they started closing on Sundays in July for a six-week period. “Normally we are open 9-1 on Sundays and didn’t miss the extra revenue, since there was overtime, air conditioning, electricity, etc. Since we are a small business, we only have two to three on staff on Sundays and most of our regular customers gave us kudos when we opted to close Sundays in the summer, as they recognized the need for us to get time off.” n www.ThehardwareConnection.com

cAtegorY rePort

LAWN & GARDEN/OUTDOOR LIVING TRENDS Sales of Insect Repellents (Independent Hardware Channel) 12 Months % Change vs. Year Ago Insect Repellents: Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.8% Insect Repellents: Dollars . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.7% Source: Vista Information Services, div. of Epicor Software Corp.

Unit Sales Breakdown for Insect Repellents Total of 460 Items with Sales Total Category Top 5 Items % of Unit Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28.8% Top 10 Items % of Unit Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39.4% Top 20 Items % of Unit Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53.7% Top 30 Items % of Unit Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63.5% Source: Vista Information Services, div. of Epicor Software Corp.

Seasonality of Sales of Insect Repellents (Index=100) 350 350 311 299 280 210 140 70 0

280

167

165

210

39140 Apr. May June July 2014 70 2014 2014 2014

Aug. Sept. Oct. Nov. Dec. Jan. Feb. March 2014 2014 2014 2014 2014 2015 2015 2015

Source: Vista Information Services, div. of Epicor Software Corp. 0

Insect Repellents Share of Sales by Type (Latest 12 Months) Aerosol/Spray for Personal Use Candle/Lantern 0 5Other 10 15 Personal Citronella Oil Hose End Aerosol/Spray for Yard Use Coil Other Area Torch Other Remaining

32.2% 20

15.8%

35 15.3%

14.2% 7.8% 4.2% 4.1% 2.8% 2.4% 1.2%

www.ThehardwareConnection.com

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

Manufacturers and retailers use Vista’s retail POS and Consumer Panel data to better sell to their customers. Go to 35 www.vistainfoservices.com.

The hARDWARe Connection ■ July/Aug 2015 ■ 63

cAtegorY rePort

lAwn & gArden/outdoor liVing BuYing uPdAte • Lawn and garden companies have a mostly positive outlook on business, according to a survey by GE Capital. Sixty percent of respondents expect to see growth of 5 to 15 percent in 2015, with 22 percent anticipating growth of 15 percent or more, as reported by the National Hardware Show Industry Edge. • Ornamental trees and shrubs with vibrant colors are in demand this year. • Gray remains an emerging color of choice for patio furniture, especially charcoal gray. • Vertical gardening systems enable homeowners to grow plants and herbs in a decorative manner inside their kitchen, or on trellises, balconies and walls outside. • Outdoor areas have become an extension of homeowners’ interior decorating, with careful attention paid to furniture, statuary, accessories, yard art and related products such as patio heaters and fire pits to add comfort and style to outdoor gatherings. • Native plants are in vogue as the first step toward an eco-friendly garden, along with low-irrigation gardening. • Edible landscaping in the front yard is a growing trend for gardeners, according to MRT Garden Center in Venice, Fla. 64 ■ The hARDWARe Connection ■ July/Aug 2015

McLendon Hardware in Woodinville, Wash., merchandises outdoor living products in a vignette setting.

Harleysville Ace Hardware in Harleysville, Pa., has established a strong wild bird niche.

retAiler eXPAnds into mAnufActuring ArenA witH l&g Product Vince Christofora, owner of Woodstock Do it Best Hardware in Woodstock, N.Y., began selling an all-natural bug repellent a number of years ago made by a local business. His customers loved the homemade product and he saw potential in growing sales, but the maker wasn’t interested in expanding the business. “We began brainstorming solutions and talked to her about infusing her product with time and energy, but she wasn’t interested. So we, perhaps a little foolishly, decided to make our own from scratch,” recalls Vince. For the past year, Vince, with help from his wife Diane, improved the formula through extensive testing and has begun

www.ThehardwareConnection.com

marketing BugMeNot Natural Insect Repellent along the East Coast. “As we ventured into this process, we discovered there are a lot of homemade witch’s brews out there that are all-natural remedies,” Vince says. The EPA says any product needs to meet certain requirements for human use, but there is a list of all-natural ingredients that can sidestep the EPA registration process, which can take five to six years and cost hundreds of thousands of dollars. “Most of these all-natural products don’t meet the EPA requirements and they slip under the radar,” he adds. Vince came up with several formulas to test and found a great environmental testing company that specializes in products for human use. He sent them a variety of formulas plus some existing products to test against. “It was a rigorous, expensive process to conduct these tests to determine the formula we wanted to use,” he points out. It took six to seven months at the testing stage and there were a lot of surprises along the way, but they discovered a formula that outperforms DEET products for swarming gnats and also repels mosquitoes, ticks and biting ﬂies. Now their company, Green Outdoor Technologies LLC, works with a lab company that makes the product in 55 gallon drums. Next they needed to find a packaging company and come up with packaging design graphics that meet labeling requirements. “Once you’ve got a label company, then you’ve got to coordinate shipments between them and the lab that www.ThehardwareConnection.com

Right Upper: BugMeNot Natural Insect Repellent is available in a 24-unit counter display as an impulse item. Right Lower: Vince Christofora spent a year developing a new product to sell in his store.

produces the product,” Vince points out. Then there are the quality control issues, like making sure you bottle it without the product foaming, that the label doesn’t smear and that bottles are not rubbing together when you send out shipments to dealers. They started selling on May 5 and sales have been great so far, according to Vince. “A big part of the whole process is the brand. In addition to coming up with a product name, you have to decide what the product is going to look like with color and logo and how it is going to be displayed at retail,” he says. Vince’s business partner, Jimmy Tuccillo, is on the road selling to retailers. So far they have signed up 150 retailers in the Northeast and are starting to get reorders. Sales in the first six weeks almost eclipsed what Vince was selling annually with the old product. For more information, go to www.bugmenotspray.com or call 888-721-2847.

The hARDWARe Connection ■ July/Aug 2015 ■ 65

lAwn & gArden Products

All-PurPose Potting Kit • Products are 100% natural and organic, safe for pets and people and odor free. • Premium Gold fertilizer produces remarkable results because nutrients are released quickly, yet continue to feed for several months. Ultrapremium scientific formula provides optimum levels of primary essential plant nutrients, including micronutrients and multi-minerals. • Infused with ProBiotic™, which ensures organic nutrients are thoroughly broken down and then released in the soil for plant roots to absorb them as they are needed. Great for every plant in the garden. • Pot of Gold potting soil, good for indoor and outdoor use, features handcrafted blend containing aloe vera and yucca extract. Dr. Earth 707-448-4676 www.drearth.com 66 ■ The hARDWARe Connection ■ July/Aug 2015

ProfessionAl Hedge trimmers • The new STIHL HS 82 and HS 87 topof-the-line hedge trimmers provide a low stroke rate, more cutting power, greater tooth height and wider tooth space for bigger jobs. • New fuel-efficient engine uses 20% less fuel than previous models, allowing for longer run times and reduced costs. • Lightweight, well-balanced design allows for longer work hours with reduced fatigue as well as easy maneuverability around large shrubs or hard-to-reach spaces. • Low-vibration technology and swivel handle provide improved comfort. • Convenient multi-function control handle makes it easy to start and stop the trimmer and all of the throttle controls are in one central location. STIHL 800-467-8445 www.stihlusa.com www.ThehardwareConnection.com

By Fred Fischer

Are You Ready for the Coming Tech Changes?

ctober is fast approaching. Are you ready for chip and pin (EMV)? If you don’t know what I am talking about you are in real trouble. If you have heard the terminology, that is a little better. If you have a plan in place, you get an A-Plus. Starting October 1, 2015, for general retail there is a big change taking place in credit card processing. There is going to be a shift in who is liable for a fraudulent credit card transaction. It could be you. Until October 1, banks will eat the cost of fraudulent credit card transactions. After that date, that liability can be charged to you, the retailer. The new rules state that if you are able to accept chip and pin and process using chip and pin, you will not be liable. If you cannot process chip and pin credit cards, your store will be charged back the amount of the fraudulent transaction. In the United States, we are only going to be using the chip, as the customer will not have to enter a pin number. If a customer, after October 1, tries to swipe the magnetic strip on a chip and pin processing device, the customer will get a message to process the card using the chip reader (located on the front of www.TheHardwareConnection.com

technOlOgy update most new card readers). They will not be permitted to process the card using the mag strip. Mag strips on credit cards will be around for several years as the gas pump industry has until October 2017 to adopt chip and pin technology, as it will require all new credit card hardware. The bottom line is that the old card sleds do not meet the new standards. Make sure your POS software provides an “out of scope” solution that uses tokenization. This minimizes the liability to you and your POS software company.

Malware The single biggest threat to computers worldwide is malware. Trojans that hide in picture files, ransomware, key logging software, along with software that can get into the bios of your computers are but a few of the problems. As I write this, investigators in our government have shut down an online marketplace that cybercriminals used to buy and sell hacked databases that involved millions of citizens. It involves more than 20 countries and up to 300 individuals. You need strong anti-virus software and a good firewall with a subscription service, plus you need to keep computers updated with security patches. Not being proactive can be very expensive in terms of lost data, time spent to recover, getting your POS system back THe HARDWARe Connection ■ July/Aug 2015 ■ 67

Be Part of the Hardware Industry’s Exclusive and Professional Women in Hardware Program! Designed for professional women and men in the two-step hardware industry to exchange ideas, educate, network and provide support and access to opportunities to further careers and help grow the independent channel.

Who’s Eligible to Join?

• Independent Hardware Store Owners and Managers • Vendors Involved in the Two Step Hardware Industry • Service Providers Involved in the Two Step Hardware Industry • Wholesalers/Distributors • Industry Professionals

Activities

• Membership beneﬁts include up to six networking events per year held in conjunction with other industry events. • Each event will have a business focus offering direct and immediate benefits. • Vendor and Service Providers will have the ability to interact with business owners and others in management positions sharing experience, concerns and solutions. • While focus is on women and their opportunities, men are welcome and encouraged to participate to better understand and lend their perspective of the industry.

For more information: Diane Allen diane@thehardwareconnection.com • 317.432.9177

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technOlOgy update up and running, and the lost sales or inventory tracking information.

Windows 10 is Microsoft’s phase 2 of testing. Leave this to the folks that play on their computers at home. You are running a business. You cannot afford to wIndOw Xp be a test site for Windows 10 when your Are you still running a Windows business may be on the line. XP computer? It is time to shut down All the drivers for all the peripherals those old computers. Windows XP is in your POS system (receipt and invoice now approaching being 14 years old printers, signature capture and credit card as an operating system. In April 2014 Microsoft discontinued security patches devices, display post and more) may or and the Microsoft anti-malware updates may not work on Windows 10. Give it some time. We are advising our customended on July 14, 2015. ers to wait until at least January 2016. Many new programs will not run on There is a big change in Windows 10. Windows XP. One Windows XP computThe famous “Patch Tuesday” (the secer in your network is like the weak link ond Tuesday of every month) is going in the chain. You are in trouble and it is time to update those computers. It is not away. Now patches will be released as worth the risk to continue using such an required, much like your smartphone. And in the future, there will no longer be outdated operating system. a major update to Windows with a new release. Ultimately when your computer wIndOwS 10 hardware is too old to function, you will There are many articles about buy a new computer. You will be able upgrading to Windows 10 and you will start seeing all kinds of ads. If you have to port over your currently installed software to the new computers that will a Windows 7, Windows 8 or Windows 8.1 computer, it is going to be free. Hold have Windows 10 installed. The new your horses. Don’t upgrade yet. To date model of Windows will come with the hardware, just like smartphones. Microsoft has used well over a million There is a lot of change coming in people to test Windows 10. With the the world of technology. It is time to put July 29, 2015 release of Windows 10, together a plan and start to upgrade the ﬂood gates open. those old computers. Be proactive and All of your computers are going be prepared. ■ to display notifications about reserving your spot to get into the Windows Fred Fischer is president of J3 Point-of-Sale – 10 update cycle. This is one time you Ganymede Technologies Corp. Contact him at want to be at the back of the line. The fred@j3pos.biz. first six months of the public release of www.TheHardwareConnection.com

THe HARDWARe Connection ■ July/Aug 2015 ■ 69

Real-World Advice from Independent Hardware Store Owners

Join a growing community of thousands of independent hardware retailers Practical tips from fellow retailers delivered fresh daily to your email inbox Share your expertise and learn from your peers

Get in on the conversation at

www.hardlinesdigest.com

“ I created Hardlines Digest in 1996 as a way for my fellow retailers to swap tips about the nitty-gritty of running an independent hardware store. Today, it’s grown to a community of thousands of independent hardware store owners just like you. I hope you’ll join today and start sharing your own expertise.” —John Fix Owner, Cornell’s Hardware Eastchester, NY

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IN THE NEWS NEW STORES: Zeeland Lumber reopened a store in Wyoming, Mich., that had been destroyed by a tornado. • Rocky’s Ace Hardware is reopening a store in Dover, N.H., that was built with green technology. • SW Collins opened a new store in Lincoln, Maine. • PMC Building Materials opened a new store in Lawrenceville, Ga. • Adam and Jon Wynbissinger are opening a second Ace Hardware store this fall in Clyde, Ohio. • Gina Schaefer and Marc Friedman have opened their 10th store, Old Town Ace in Alexandria, Va. • Leonard, Robin and James Lee opened L.G. Lee & Sons in Almonte, Ontario. • Johnny Boyle is opening Lakehills True Value Hardware in Lakehills, Texas. • David Marshall is opening Norwood True Value Hardware in Norwood, Colo. • Tom Tognetti has purchased his fourth store, Hollywood Hardware in Sacramento, Calif., from the Messner family. • Orchard Supply Hardware, a division of Lowe’s, has opened its first store in San Francisco. • Hi-School Pharmacy is opening a

pharmacy in Vancouver, Wash., with an attached 6,200-square-foot Ace Hardware store.

•

www.TheHardwareConnection.com

KUDOS TO: •

•

• •

•

Ron Williams, who owns four Ace Hardware stores in Houston, and Scott Schlapkohl, who manages Steamboat Springs Ace Hardware in Colorado, were recognized with the Ray A. Griffith Retail Leadership Award by Ace Hardware Corp. Chubby’s Hardware, owned by Joe DiPieto Sr. in Pound Ridge, N.Y., is celebrating its 35th anniversary. True Value Home Center, owned by Charlotte Rives, Cindy and Christina Shaban in Simi Valley, Calif., is celebrating its 40th anniversary. K&K True Value Hardware in Bettendorf, Iowa, owned by the Keller family, is celebrating its 75th anniversary. Lanier’s True Value in Lexington, N.C., is celebrating 75 years. Weber’s Wadena Hardware, owned by Tom Weber, in Wadena, Minn., was honored for 100 years of continuous membership in the Midwest Hardware Association. Bible Hardware & Builders Supply, owned by Jennie and Bobby Bright and Carol Purser,

THE HARDWARE Connection ■ July/Aug 2015 ■ 71

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IN THE NEWS

•

was named 2015 Small Business 2001, including Persons of the Year by the Lubbockservice as a West District of the SBA. director on the national board Hot Springs Ace Hardware, Do it Best CEO from 2004-10 owned by Gary and Terry Slagel Bob Taylor receives and helping raise award from Big in Hot Springs, S.D., and celebrating Brothers Big Sisters $2.1 million for its 80th anniversary in 2015, was the organization. of America. named “Small Business of the Year” by Black Hills Community Economic Development. ON THE MOVE Epicor Software Corp. announced that Epicor® Eagle N SeriesT retail • STIHL Inc. President Fred Whyte business management software has announced he will retire at the end of been named a Gold winner in the the year, with Bjoern Fischer named 2015 IT World Awards in the category as his replacement. of Best New Product. • Danze and Gerber have hired Andy Hansen as national sales manager– Mac’s Hardware, with 12 stores builder segment. based in Moorhead, Minn., is marking its 50th anniversary. Cato Hardware, owned by John WHOLESALERS IN THE NEWS: and Paul Bramble in Cato, N.Y., is celebrating its 50th anniversary. • Ace Hardware Corp. will begin constructing a new 400,000-squareThe J.D. Power 2015 U.S. Home foot, $27.5 million expansion of its Improvement Retailer Store Wilton, N.Y. distribution center by the Satisfaction StudySM ranked Ace end of this year. Hardware “Highest in Customer • Ace Hardware Corp. and the Satisfaction among Home PGA Tour announced a multi-year Improvement Retail Stores” for the marketing agreement that designates ninth year in a row. Ace as the “Official Hardware Store of Big Brothers Big Sisters of America the PGA Tour and Champions Tour.” (BBBSA) presented Do it Best Corp. Earlier this year, Ace announced a President and CEO Bob Taylor with multi-year sponsorship of PGA TOUR the Charles G. Berwind Lifetime member Hunter Mahan. Achievement Award. Taylor has served as a key leader, volunteer and • True Value Co. has signed National Lumber and Hardware, which is the fundraiser for BBBSA since becoming largest hardware retailer in Puerto involved with the organization in www.TheHardwareConnection.com

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CONFERENCE2015 SEPTEMBER 11-13

3 Days of Networking, Relaxing and Learning Meet colleagues and new friends at the industry’s largest conference for independent hardware retailers. Share ideas with top retailers on how to grow your business, interact with key vendors on how to increase sales in your store and attend educational seminars, all-industry cocktail receptions and dinners in an exclusive 5-star resort setting.

Learn More About Your POS System at the Hardware Technology Forum Epicor, ECi Advantage/ECi RockSolid and J-3 POS will offer full-day, hands-on training sessions for their retailers. Bring your tablet or laptop so you can log right into your store as you learn new “tips and tricks” to make your POS software more productive in your store.

Honor the Industry’s Best Retailers at the 2015 Beacon Awards The Beacon Awards are an important recognition program that honors the best of the best dealers who represent the future of the industry. Sponsors:

Co-Sponsors:

FOR MORE INFORMATION ABOUT ATTENDING THE BEACON AWARDS ALONG WITH ALL OTHER EDUCATIONAL SEMINARS, OPEN FLOOR DISCUSSIONS AND SOCIAL ACTIVITIES AT THE HARDWARE CONFERENCE, VISIT WWW.THEHARDWARECONFERENCE.COM

IN THE NEWS Rico with more than 50 stores. that day in 1945 when • House-Hasson Hardware, the Arnold Gerberding largest regional hardware distributor incorporated in the U.S., has acquired LongHardware Lewis Hardware Company, a PRO Wholesalers Inc. in Do it Best Corp. Group member distributor based Fort Wayne with 96 celebrates its 70th anniversary. in Birmingham, Ala. House-Hasson, original members. based in Knoxville, Tenn., expects to The company’s name gain about $30 million in sales from changed to Do it Best Corp. in 1998. Long-Lewis’ 500 dealers, pushing “It’s incredible to think about how the company’s annual revenues much has changed since our founding. above $200 million. “Long-Lewis has From those humble beginnings as a long and distinguished history of a regional hardware co-op, we’ve serving its hardware and lumberyard grown to serving more than 3,800 dealers,” said Don Hasson, member-owned locations throughout House-Hasson president. “This is the United States and in 54 other a transaction that improves Housecountries,” said Do it Best President Hasson, and it enables Long-Lewis’s and CEO Bob Taylor. dealers and their customers to benefit from our technology and systems.” OTHER NEWS: Long-Lewis will contribute about 18,000 inventory line items to House- • Sunshine Ace Hardware Hasson’s warehouse. “House-Hasson has acquired Morton’s Ace is a tremendously respected name Hardware of Port Charlotte, Fla., in this industry. It’s a family-owned from the Waksler family, giving the company, and we’re a family-owned company seven stores. company,” said Vaughn Burrell, • Central Network Retail Group has owner of Long-Lewis. “House-Hasson purchased Lumberjack Building has remarkable history, talent and Centers, with five stores in Michigan. systems that make sure dealers have • BMC and Stock Building Supply, what they need to be successful. two of the largest pro dealers in the Everyone benefits.” U.S., announced plans to merge in • City leaders from Fort Wayne and New a $1.5 billion deal that is expected Haven joined current and former Do it to close by the end of the year. BMC Best Corp. employees in celebrating CEO Pete Alexander would be CEO th the company’s 70 anniversary June of the new company, which would be headquartered in Atlanta. 24 at its world headquarters. It was on www.TheHardwareConnection.com

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IN THE NEWS • William Tell True Value Hardware in Hopewell Junction, N.Y., was destroyed by fire over Memorial Weekend. • The Wooster Brush Company has unveiled a redesigned website (www.WoosterBrush.com) that features a sortable catalog, an advisor for selecting the correct paintbrushes and roller covers, a retailer locator, an enhanced search feature and more. • Big C Lumber has acquired Stevenson Lumber Co. in Adrian, Mich.

Knoxville, TN 37909; or The Wounded Warriors, 7020 AC Skinner Pkwy, Suite 100, Jacksonville, FL 32256. • Oliver Branneky passed away May 24 at the age of 89. After serving in the U.S. Army during World War II, he returned home to work in the family business, Branneky True Value in Pattonville, Mo. In 1969 he moved to Orlando, Fla., where he opened Branneky True Value, a business he operated until selling to Walter Toole in 2000.

FOR THE FULL STORY:

IN MEMORY:

• ECi Software Solutions announces first annual Everyday Hero Contest to recognize outstanding community • Allen Winn, vice service among its customers. A president-merchandising donation of $5,000 will be given to at House-Hasson the grand prize winner’s charity of Hardware, passed away choice and the winning company or July 5 at the age of 58. Allen Winn individual (to be announced at ECi’s Winn, who spent 32 years Connect Conference in Orlando in at House-Hasson, served November) will receive $500. For as an inspiration to others through his more info on the contest, go to: courageous battle with cancer, always www.eci-connect.com/everydaymaintaining a positive outlook. Allen, hero-award.aspx. who loved hunting and fishing, was • Dark store tax tactic makes bigknown for his booming voice and box-stores terrible deal for cities. as a proud supporter of the military. Click here. He is survived by his wife Karen, • Tennessee hardware store owner son Weston, step-son Clay with wife posts no gays allowed sign. Click here. Lora, parents Gerald Sr. and Loretta • Aptos Inc., formerly Epicor Retail Winn, sister Leann with husband Solutions, has been spun off into Dwayne, and two grandchildren. an independent company and new Donations may be made to American brand. Click here. Cancer Society, 871 Weisgarber Road, 76 ■ THE HARDWARE Connection ■ July/Aug 2015

www.TheHardwareConnection.com

UPCOMING EVENTS AUGUST Ace Hardware Corp. Fall Convention August 20-22, McCormick Place Convention Center, Chicago Florida Hardware Fall Market August 8-9, Double Tree Hotel and Convention Center, Orlando, Fla. Handy Hardware Fall Market August 6-8, Henry B. Gonzalez Convention Center, San Antonio HDW Fall Market August 7-9, Shreveport Convention Center, Shreveport, La.

Home Hardware Fall Dealer Market September 19-22, Henry Sittler Building, St. Jacobs, Ontario Monroe Hardware Fall Dealer Market September 19-20, Myrtle Beach Convention Center, Myrtle Beach, S.C. PACOA Fall Market September 19-20, Queen’s College-Fitzgerald Gymnasium, Flushing, N.Y. The Hardware Conference September 11-13, Marco Island Marriott, Marco Island, Fla. www.thehardwareconference.com

Independent Garden Center Show- True Value Fall Reunion September 18-20, McCormick Place Convention IGC Chicago Center, Chicago August 18-20, Navy Pier, Chicago Independent Garden Center Show- OCTOBER IGC East Do it Best October Market August 4-6, Baltimore Convention Center, October 9-12, Indiana Convention Center, Baltimore, Md. Indianapolis Orgill Fall Dealer Market House-Hasson Hardware Fall August 27-29, Ernest N. Morial Convention Dealer Market Center, New Orleans October 8-10, Lexington Convention Center, Lexington, Ky. spoga+gafa 2015: Garden Trade Fair August 30-September 1, Koelnmesse, Cologne, Germany

SEPTEMBER

Send calendar dates to

chris@thehardwareconnection.com

Blish-Mize Fall Dealer Market September 18-19, Overland Park Convention Center, Overland Park, Kan.

www.TheHardwareConnection.com

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E H T D N I H E B NUMBERS

67% 25%

Percentage of renovating homeowners who rank smart home tech as a very to extremely important consideration for recent renovations, according to a Houzz & Home survey conducted by The Farnsworth Group.

35 million

Number of householders age 65 and over in 2020, up from 26 million in 2010, according to the Joint Center for Housing Studies of Harvard University.

Median turnover rate for part-time retail employees, according to the Hay Group.

$10.16

Wage earned per hour by the average retail sales employee in the U.S., according to the Bureau of Labor Statistics.

$3,328 Cost to find, hire and train a replacement for a $10/hour retail employee, according to a CAP study.

1.6

Times per week the habitual shoplifter steals something, according to the National Association of Shoplifting Prevention. 78 ■ THE HARDWARE Connection ■ July/Aug 2015