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
Senior Business Advisor: John Hammond jhammond@thehardwareconnection.com
tdelph@thehardwareconnection.com
Paula Pasquale paula@thehardwareconnection.com 630-258-5666
Do it Best Corp. recently opened its newest state-of-the-art Retail Service Center (RSC), a 550,000 square foot warehouse, in Sikeston, Missouri. The new facility replaces the original Midwest RSC opened in nearby Cape Girardeau. Built in 1971, it has faithfully served Do it Best member-owners in Alabama, Arkansas, Illinois, Indiana, Iowa, Kansas, Kentucky, Mississippi, Missouri, Nebraska and Tennessee for more than four decades.
“We are very excited about the Sikeston RSC, not only because it will help us continue to meet our members’ current needs, it also puts us in a great position for future member growth,” said Do it Best Corp. President and CEO Bob Taylor. “We are very proud of the fact that Do it Best Corp. leads the industry in supply chain excellence, and this new facility helps us expand our services to members and ensures that we continue to deliver them as efficiently and cost-effectively as possible.”
Indeed, Do it Best Corp. continues to post impressive logistics numbers, including 99.81% order accuracy and 98.2% on-time delivery. “Most importantly,” adds Taylor, “more than 90% of the items in our RSCs are available on a 1-each basis — allowing our members to better manage their inventory and enjoy stronger cash flow.”
In addition to the increased size of the Sikeston RSC, the center also features a number of technological advances and initiatives. A stateof-the-art voice pick system virtually eliminates order filling errors and streamlines employee training and workflow. Similar systems are also in place in the co-op’s other RSCs across the country. Plus, pioneered at this location is a computer-controlled picking system that further improves operational efficiency in the handling of some of the 67,000 products stocked there.
“As a Do it Best member-owner, I appreciate the fact that my co-op invests in supply chain enhancements that have a positive effect on every member’s bottom line,” said Scott Akin, Akin Building Center. “Not only do I know that my deliveries will be on time and accurately filled, I know that my business is benefiting by partnering with a co-op that leads the industry with the lowest cost of operations.”
Adds Wally Bennett at Bennett’s Do it Center,® “With immediate access to the RSC’s inventory, the new warehouse in Sikeston is really an extension of my store’s sales floor. And it’s yet another way that Do it Best Corp. demonstrates its commitment to helping its members grow.”
By Chris Jensen
An industry is only as strong as its weakest link, and there are some who feel the hardware industry has too many retailers nearing retirement age and not enough young blood coming in to take their place. That may be the case, but don’t sell the next generation short just yet. There are some encouraging signs the industry is in good hands.
For the first time, True Value hosted a Young Retailer track at its spring show designed for owners, managers and associates under the age of 40. True Value initiated the Young Retailer track based on retailer feedback requesting the opportunity to network with other young retailers from different regions to exchange best practices and ideas on growing their businesses. An open forum was held to encourage ideas on how to more effectively market to younger shoppers.
As True Value CEO John Hartmann points out, millennials are a growing market, with Gen Y shoppers projected to outspend baby boomers with hardware purchases by 2017. “With the size and increased buying power of this generation, local, independent hardware stores have opportunities to build lasting relationships and gain loyal customers with millennial
shoppers,” says Hartmann. He plans to let the co-op’s young guns guide their strategy for becoming the store of first choice for millennials.
Shortly before True Value’s young retailers were gathering, a group of Do it Best young retailers (known as MOB for Move Over Boomers) was sharing ideas for best practices at Do it Best’s Winter Conference with a group of young retailers from Home Hardware, Canada’s largest dealer co-op. See more on that historic gathering in the news section on page 77.
“The young dealers in Canada and the USA are bringing new ideas and a new energy into the industry and these groups really make that apparent,” noted Tony Krotz, retail education and communications manager for Home Hardware.
Ace Hardware and other wholesalers have similar groups of young retailers who get together and network to share ideas. These efforts by young retailer groups should be applauded and supported by all segments of the industry.
The Hardware Connection is doing its part by co-sponsoring the Beacon Awards for Best New Stores—turn to page 53 for more information on the nomination process. n
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the way i see it
WBy Tom Chasteen
hether you like it or not, I’m afraid your life and business are an open book. The federal government, state government, social organizations, banks, credit bureaus and credit card companies are all tracking each of us in various ways, mostly through data we supply them.
Two weeks ago “60 Minutes” correspondent Steve Kroft did a piece on “The Data Brokers: Selling Your Personal Information.”
Collecting data is nothing new. Retailers have been collecting mailing addresses of customers since long before I joined the family hardware business 38 years ago, and now retailers collect email addresses and mobile numbers.
Going back to the “stone age” when we actually put postage stamps on direct mail pieces, I once purchased a list of registered boat owners in Florida from the state. I could request the data sorted by zip code, boat type, length of boat, type of construction or fuel type.
Word of mouth is one of the most effective marketing strategies, but it takes time and has a limited scope.
Marketing your business on Facebook is nothing more than an extension of “word of mouth” with the potential of a
much wider audience. Businesses use Twitter as another way to extend the “word of mouth” marketing concept. Texting offers another option and is not limited to characters and can include pictures and video—the possibilities are endless.
However, all of these options are limited by one common denominator—you must have access to the person or group of people with whom you are trying to communicate. Even back in the “stone ages” we could buy all the stamps we wanted, but if we didn’t have contact names and mailing addresses the stamps were worthless.
What the “60 Minutes” piece brought home to me is the fact that selling or bartering of this data is a multi-billion dollar industry. Whenever you fill out a request for information or participate in a survey you have to assume whatever you voluntarily supply in the way of personal or professional information could be sold at some point. However, I don’t think it is unreasonable to expect information supplied to state and federal agencies, as well as private organizations or associations would not be available for sale unless you expressly give your permission.
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I don’t think it is unreasonable either that information you voluntarily share with a business or organization can be used by that entity to continue to contact you about future programs, products or services. That, in my opinion, is not a breach of privacy.
However, when you share personal information and have a reasonable belief that it is not going to be shared or sold and you find out it has been shared or sold, then I believe that is a breach of privacy unless you expressly gave permission. I am only referring to data that can be traced to a specific person’s identity. I am not referring to data that is shared to create statistical analysis such as industry car sales or home sales, or even specific sales data like how sales of jeans and khakis are trending.
Where it crosses the line is when a credit card company or a retailer sells my personal purchase information such as the fact I’m 57 years old, live at 16 Long John Drive and purchased a pair of jeans on March 10 and have an email address of tom@anywhereUSA.com.
In Steve Kroft’s “60 Minutes” segment he points to “research firms, all kinds of internet companies, advertisers, retailers and trade associations” (in that order) as the biggest culprits. Except for the research firm I personally have ownership in or am a member of all these groups. Having said that, I can choose to actively participate and profit
in the “data brokerage” bonanza or I can choose to take a stand by not selling or bartering our company’s information.
We publish our privacy statement on our website and on our subscription form. It is very straightforward, as follows:
The Hardware Connection will not sell, rent, loan, give or share our readers’ personal information with anyone for any reason. We will only use the information our subscribers give us to communicate with them directly through The Hardware Connection magazine, and regarding programs and services expressly owned and managed by The Hardware Connection.
For us it is just common sense that to do anything that compromises this privacy policy is a breach of trust toward our readers who have trusted us with this information, something we are unwilling to do. We also include an “unsubscribe” feature on anything we send our readers so at any time they can unsubscribe from The Hardware Connection with one push of a button.
I would challenge companies in our industry to publicly publish their privacy policies so we as an industry can discourage the selling of personal data. I would also urge you to think twice about filling out any survey or subscription form that does not have a privacy statement clearly stated.
Let me know what you think, from one retailer to another, at tom@thehardwareconnection.com . n
Ihad a woman come in saying she needed a car chip key. We made her a car chip key and she came back after a few hours and said it didn’t work. Evidently, her friend told her that the car key was chipped, so she thought she dropped it and chipped it, like it was broken. That key wouldn’t have helped anyway.
Turns out, her car ignition lock was broken.
Matthew Abramsky Tony’s Ace Hardware Hazel Park, Mich.
IO’ve been asked for both protein gas and profane gas today.
Hannah Stewart Stewart’s Hardware, Southport, N.C.
ur entry in the ‘I can’t believe he was buying this’ contest is the guy in here a little while ago. He is a barber, and the heat was off in his shop. He was in line at the checkout with the following: a natural gas space heater and two 2.5 gallon cans of kerosene. Our store manager saw his shopping cart and asked what he was going to do with them. He said ‘I’m going to pour this in the heater.’ When asked where, he tried to find the tank on the heater and sheepishly returned the product to the shelf. It’s no wonder people blow themselves up.
Ken Walchak Clark-Devon Hardware | Chicago
Ihad a woman buy a heated dog bowl and return it because she said it didn’t work. I could see that there was still dust in the bottom of the bowl. I asked her where she’d placed the bowl. She told me that it was in a basement that must have been 68 degrees. I explained that the bowl keeps water from freezing, so try it out in the barn where it’s cold, and if it doesn’t work, then she can bring it back. I didn’t hear from her again.
Julia Carle Spencer Feed & Supply | Spencer,
Ohio
How have sales and customer counts been in 2014?
How have sales and customer counts been in 2014?
It’s better now; it seems to be picking up. I’ve got traffic, but during the winter customers don’t buy much, so sales are down compared to traffic. But with the break in the weather, people are coming in again.
Best niche categories?
Plumbing is about 25 or 30 percent of the business. We’re positioned well in the community and are very knowledgeable. Our customers are mostly do-it-yourselfers.
Greg Mancuso P&G Hardware
Parkville, Mo.
We’re up a little from last year, about 2 percent. Some of it could be weatherrelated. It’s been extra cold, so we’ve sold more cold-weather products because of it. However, we haven’t seen signs that people are spending more because of the economy.
Best niche categories?
Appliances, power equipment, and power equipment repair and parts. We’ve sort of progressed into the power equipment after we bought another business. Now, about one-third of our business is power equipment and repair. What employee incentives do you offer?
We haven’t done a lot with that. We’re a small, hometown hardware store. We pay a wage and offer a little vacation and paid holidays.
Kent Sinn Creston True Value | Creston, Iowa
How have sales and customer counts been in 2014?
We’ve had one of the hardest winters in Chicago history. That’s led to a lot of weather-related sales. So, business is up about 10 percent, and customer counts are up about 10 percent, too.
Best niche categories?
We do real well with light bulbs. It’s kind of funny, but we have a lot of different varieties of bulbs. With the change-over to halogen from traditional, it’s been an active category. Lawn and garden is always a big niche with suburban lawns, along with outdoor living. We had one of our best years in a long time with our Weber grills.
Bob Nugent Elmhurst Ace Elmhurst, Ill
How have sales and customer counts been in 2014?
We’re right about 8 percent ahead of last year. I haven’t really looked at customer counts. We’ve had some rough winter weather, and we provide a lot of what customers need. We’ve sold a lot of ice melt, snow shovels and home heating products, such as space heaters and wood pellet fuel. To boost our business, the number one thing we do is participate in the True Value advertising. We use the circular programs, coupons,
direct mail and the rewards program True Value administers for us.
Best niche categories?
My top niches are paint, lawn and garden, and furniture. Believe it or not we sell furniture, such as recliners, sofas and bedding. We’ve been the general store for town for 150 years, and they expect us to carry a variety of different products.
Do you have a succession plan in place?
I don’t have one yet, but I’m of age where I need to begin to discuss options. Right now, I’m not feeling a lot of pressure.
Doug Mingle
Roaring Spring Department Store True Value Roaring Spring, Pa.
Jo Ellen, Doug and Donald Mingle shown with a special cake to commemorate the 150th anniversary of Roaring Spring True Value.
How have sales and customer counts been in 2014?
We’ve had a slight increase in total sales. There seems to be more people coming in, so customer count is up, too.
Best niche categories?
It varies because we’re a small store. We spread it around.
Patti Wilson
Wilson Mobile Home Supply Lake City, Fla.
How have sales and customer counts been in 2014?
So far, we’re seeing a slight increase of about 5 to 10 percent over last year. However, our previous two years—2012 and 2013—were the worst years we’ve had in about 15 years. Both sales and customer counts are up about the same. We had an exceptionally mild winter and are having an early spring, so that’s helped. Our local economy was depressed more than the rest of the country, but we’re seeing that start to turn around. We had a high vacancy rate, and we’re seeing those homes become occupied again.
Currently, lawn and garden and lumber. Lumber is a strong niche for us, even though we don’t stock a lot of variety we do sell a lot of what we do stock. Lumber is about 10 percent of the business. In season, lawn and garden peaks at 25 to 30 percent of the business. Do you have a succession plan in place?
At this point in my life I don’t. I’m on my 20th year in business at this store. But I’m starting to look forward to retirement, even though I’m kind of young. I want to stay in business another eight to 10 years.
Steve Polm Apache Ace Hardware |
Pearce, Ariz.
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How have sales and customer counts been in 2014?
It’s been really good. The dry winter increased business.
Best niche categories?
Lumber and paint, with lumber being about 20 percent of the business and paint 10 percent. We’re the only one in town that has those, so that drives the business.
What employee incentives do you offer?
Sometimes, we’ll have sales contests and winners get a lunch or something.
Rindy Crawford
Lake Tulloch True Value Copperopolis, Calif.
How have sales and customer counts been in 2014?
We’re in a unique situation in California. We’re in the middle of a drought, and we’re in a semi-tourist town with a lake that’s literally dry. Ours isn’t indicative of most
of California retailers. Last year was a banner year, so far this year we’re off 14 percent.
Best niche categories?
We have a 35,000-square-foot store. We have room for several niches, so we’re big in power tools and outdoor power tools, lawn and garden, and pet supplies. We have a pretty good sized nursery with green goods. Lawn and garden accounts for 35 percent of store sales. We also have a niche in pot supplies, such as hydroponic growing. Most of it is related to the medical marijuana industry.
What employee incentives do you offer?
If you do a good job, you get to keep it. We don’t have an incentive plan in place. The majority of our employees have been with us 15 to 20 years. We treat them right and pay fairly. We do offer health insurance.
Do you have a succession plan in place?
Unfortunately, not a good enough one. We have children who are partially involved in businesses, and we have multiple businesses and different revenue streams. But as far as planning, nothing other than normal estate planning. But it’s something we plan to address in a year or two.
Steve Spradlin
Lake Isabella True Value
Lake Isabella, Calif.
014 is well underway and most of the United States had a brutal winter with many places recording record snowfall and record low temperatures. Hopefully, most hardware retailers in these areas have sold through most of their winter inventory and are ramping up for a busy and profitable spring selling season.
Many manufacturers are also gearing up for the National Hardware Show® in May and are getting ready to launch their new products and packaging for 2014. One of the things that I enjoy the most as publisher of The Hardware Connection is managing the product reviews in Tom’s
Minwax is what we call a “Blue Blood” in the hardware industry, meaning the company is synonymous with hardware stores and d-i-yers. Minwax has tremendous brand and product awareness within the hardware industry that continues to grow.
Minwax has just come out with a complete line of Wood Finishing
By Tom Chasteen
Shop each issue. I don’t know a hardware retailer who doesn’t enjoy previewing new products. In the next several issues we will be reviewing some pretty neat products.
Unlike other magazines that just publish new product releases (we do that as well), the products reviewed in Tom’s Shop are actually used by our “testers” and we take what they say about the products and write the product reviews. We don’t hold their hands and explain how the product is supposed to work; each product must stand on its own merits.
Click Here to Watch a Short Video of Minwax’s Wood Finishing Cloths
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We have vast experience with automotive keys. Also the cloning tools and key machines that enable them to start most of the vehicles on the road today. If you want to start an auto program, contact us to see how we can help rev up your sales.
Cloths in resealable packaging for those small jobs that don’t require a can of stain to finish. They are also great for touching up small dings and scratches when you don’t have the time or the desire to completely refinish the item. Each package comes with eight 7” x 8” cloths and they give you more than enough stain to go well beyond the life of the cloth itself.
The best part is that dry time is one hour and you clean up with soap and water. Each package also comes with a pair of disposable gloves. If you have a
strong paint department or sell a lot of storage products where people don’t have a lot of room, this is a great product. It can easily be displayed in the paint department along with your other Minwax stains, but it could also be displayed around the checkout counter as an impulse item.
Either way the Minwax disposable Wood Finishing Cloths are a great idea and I think will do well in a hardware or paint store. They come in natural oak, maple, chestnut, dark mahogany and walnut. To see Tom Kraeutler’s YouTube review click here.
Safety Works is always coming up with something new and their new line of safety glasses that fit over a person’s regular glasses is a simple but very good idea. Safety glasses that fit over regular glasses are often similar in size to safety goggles but bulky and hot.
Safety Works’ new OvrG™ Clear Safety Glasses are designed for small and medium framed regular glasses. They meet the OSHA and ANSI requirements and have anti-fog lenses. The lenses themselves are very clear and the safety glasses are light and comfortable to wear, even for an extended time.
The thing I found so unique about these safety glasses is that they were not uncomfortable to wear. As one of our testers said, he didn’t feel like he needed to take them off as soon as he finished cutting a piece of tile—they are small and comfortable to wear. One of our other testers mentioned how nicely they fit around his regular
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glasses and they didn’t fog up while wearing them.
On a scale of one to 10 all three of our testers gave these safety glasses a score of 10. When you have a
chance stop by the Safety Works booth at an upcoming show and try on a pair and you will see firsthand why our testers were so high on these safety glasses.
Safety Works has also come out with a Multi-Purpose Respirator that pretty much covers any job even a serious d-i-yer would take on. Each of our testers mentioned how comfortable the mask was to wear and noted that the head strap was firm plastic, which made it very easy to take off and put back on.
The Safety Works Multi-Purpose Respirator is an all-around respirator that works with chemicals such as muriatic acid and ammonia; it can also be used when working around asbestos and pesticides.
And like with most respirators you can use it when spray painting. One word of caution here because the filters are so fine paint-over spray may clog the filters quicker than respirators that don’t have such fine filters. I personally shoot quite a bit of two-part commercial epoxy paints such as AWLGRIP and I’ve never minded changing out filter cartridges since they are cheap compared to changing out a lung.
Click Here to Watch a Short Video of Safety Works’ Respirators
Two other interesting features of the Safety Works Multi-Purpose Respirator is the low-profile respirator cartridges, which make it much easier to see what you are doing especially when looking down. Safety Works also provides free online training if the user needs more information.
If you are looking to stock a multipurpose respirator that can cover most anything a hardware customer needs to do you need to take a look at Safety Works Multi-Purpose Respirator. To see a complete video on all Safety Works respirators click here.
By Chris Jensen
f your business does not have an employee incentive program in place, chances are it’s because you are too busy interviewing, hiring and training new employees due to high turnover. Not only do employee incentives pay off when properly devised, they are a necessity to keep your staff motivated and happy. A 2013 survey by Right Management revealed that 86 percent of employees planned to look for a new job last year. If you think about how challenging it
would be to replace just 20 percent of your staff, then that should motivate you to beef up your incentive program. When it comes to employee incentives and rewards, many owners and managers believe that all their employees want is more money. “More times than not, what is more important to workers are such intangibles as being appreciated for the work they’ve done, being kept informed about things that affect them and having a sympathetic manager who takes time to listen to
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Seright’s Ace Hardware in Idaho offers a monthly bonus program based on weighted metrics.
them,” says Dr. Bob Nelson, a leading expert on employee motivation and author of “1501 Ways to Reward Employees.”
Nelson advises business owners to match the reward to the person and to the achievement, and be timely and specific. Let’s say you have a department manager who worked long hours to reset his whole department, which led to a double-digit sales increase. Tell him to take Saturday off and treat him and his wife to dinner at a local restaurant.
“Employees are my biggest asset, I can’t pay them big bucks, but I can treat them well,” says Rick Heuser of Handyman Do it Best Hardware in St. Cloud, Fla., who notes that most of his employees have been with him for more than 10 years. “We’ve been providing good health coverage at no cost to full-time employees for years. We also pay them a percentage on special orders and provide a bonus for training each month,” he says.
Heuser allows employees to purchase items for their personal use at the
cost shown in the catalog. “They can charge it to their store account or use a credit card. Between invoice discounts and my rebate, I still make a few percent on the purchase. More importantly is the fact that it is a perk for employees,” he says.
John Gavin of Gavins Ace Hardware in Fort Myers, Fla., came up with a creative incentive three years ago. The store runs a special coupon promotion for the Saturday after Thanksgiving. The first year they ended up doing 1,600 transactions that day, so Gavin gave away $1,600 at that year’s holiday party.
“We did 2,000 transactions last year, so we gave away $2,000 including two $500 winners,” Gavin says, adding that everyone wants to attend the holiday parties now.
Brett Seright of Seright’s Ace Hardware has 30 employees between his two stores in Post Falls and Coeur d’Alene, Idaho, with 70 percent full time.
Seright offers up to a 10 percent bonus each month to all of his employees, and bonuses average out regularly to 5-6 percent just on the mystery shop portion. For managers the incentive program metrics include: net sales increase, items per transaction, average transaction size, product of the month increase, secret shopper score,
Dept. 1 (Paint, Sundries, Cleaning Supplies)
This chart shows the points the employees in Seright’s Ace Hardware’s Post Falls store can earn for meeting various levels toward monthly goals.
Ace Rewards percentage, shrinkage and efficiency of the small engine department (labor hours/labor billed). “Each category is weighted differently and can be changed as our focus shifts,” he points out.
Seright has a main “Hardlines Bonus Program” spreadsheet that draws on the data from a series of other files that are generated monthly through Compass analytics software. “Our inventory
Shore True Value in Somers Point, N.J., keeps an experienced staff by providing a pleasant working environment and recognizing achievement.
accuracy and outs are done twice a month by using a Compass report that is completely random for each store,” he says.
Each month Seright prints out sheets showing the goals and how the goals are weighted so employees can see the goals for the upcoming month. “We try to keep the metrics simple,” he says.
“Realize that your incentive program won’t be a magic bullet. Employees are motivated by different things, and dollars in the bank is just one of them,” Seright advises. “You need a manager that is effective and can coach to these areas daily so the employee can see how they can influence these numbers. The only measure we have that is individual to the employee is the Ace Rewards percentage and we’ve seen a great impact there,” he adds.
1.
1. Items Per Transaction Increase Over LY (%):
2. Avg. Transaction Size Increase Over LY (%): 5
3. Small Engine Shop Efficiency: 30
4. Ace Rewards % (Personal): 20
5. Inventory Accuracy: 30
6. Shrinkage (% of Sales): 10 Total 100
These are the weighted goals for incentives for various positions at Seright’s Ace Hardware’s Post Falls store.
Probably the best incentive is I offer merchandise at my cost to employees. That offers some pretty substantial savings on some items. That can be a pretty good perk for them. Some employees, more than others, make use of it.
Steve Polm Apache Ace Hardware Pearce, Ariz.
Our policy reflects a 15% gross margin (or the sale price) whichever is less, a maximum use of $2,500 per year without the president’s approval, and is limited to those who live in the same household as the employee. Eligibility begins six months after hire date. All purchases, regardless of whether cash or house charge, must process through the employee’s account. Finally, the merchandise is held at the front counter until the end of day for pickup by staff on their way out the door.
Mike Mayfield
Mendo Mill Home Center and Lumber Company 5 stores in northern California
I have it set up so that employees must use their cash or charge account to get their discount. That way, there is a record of what they have purchased, even if they pay cash or with a credit/debit card. I also have it set up so that those accounts email an invoice to a dedicated
email account, which is forwarded to my phone, so that I can track purchases as they happen.
Lex Stevens
Back Bay Hardware | Boston, Mass.
We let employees purchase items at 10% over cost. We run into issues with employees thinking that their parents, kids, son-in-laws, aunts, uncles etc. are eligible for a discount.
Dave Sem Sebo’s Do it Best Hardware Anacortes, Wash.
We offer 10% over cost but we let our employees use it for their spouse and children as well. No other family members or friends allowed.
Mitch Willis
Strickland’s Hardware Bristol, Fla.
We no longer set up employees with in-store charge accounts (learned that lesson the hard way). We now issue an Ace Rewards card to employees that is coded with cost plus 10% using category pricing. Because our discount is so generous, we regulate it with strict rules and then review employee purchases monthly. I have a report that prints employee purchases by highest spenders first. When an employee misuses the discount then we either take away the privilege or terminate their employment if it is really bad.
Christi Turner
Johnson Lumber Ace Hardware | Morgan Hill, Calif. ■
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Gavins Ace has been serving customers in Fort Myers, Fla., since 1987.
Gavins Ace was founded in 1987 by Larry and Rita Gavin along with their son, Ron Gavin, with the acquisition of a 6,200-square-foot store in Fort Myers, Fla. Larry Gavin served as president of Ace Hardware Corp. beginning in 1982 until his retirement in 1986, the culmination of a 37-year career with the co-op. He helped Ace reach $1 billion in sales for the first time in 1985.
In 1991 tHe GAvIns purCHAsed tHe 28,000-square-foot Gadddies true value and moved the business to its present location on san Carlos Boulevard. ron’s brother, John, is currently the president of the business, and he responded to the following questions.
Wholesaler: Ace Hardware Corp.
Salesfloor square footage: 23,000 sq. ft.
% Sales: 70% dIY and 30% pro/ commercial.
Upper Left: John Gavin (right) and his brother Ron are second-generation owners of Gavins Ace in Fort Myers, Fla.
Upper Right: A spinner rack of greeting cards is placed near the front entrance.
Lower: Up to eight checkout registers are used so customers can get in and out quickly.
Number of employees: 50—30 full time and 20 part time
Top core categories: paint and lawn and garden followed by plumbing, electrical and hardware.
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Above top: All 50 employees have undergone Ace’s Helpful 101 certification program to ensure the store continues to offer exceptional customer service.
Above lower: Outdoor living products such as grills and patio furniture are top sellers.
Right: One of the store’s most successful niches is the Power House, which includes outdoor power equipment sales and service.
Most successful niches: Outdoor living (grills and patio furniture) and what we call our power House, which includes outdoor power equipment and a repair shop with a three-man crew. We service 20 different companies with outdoor power equipment, so we really service what we sell. We also have $80,000 in rental items.
How has business been so far in 2014? We’re up about 5%.
What are biggest challenges facing your business? dealing with seasonal changes. We do less than half of our business in the summer but don’t have the luxury of getting rid of half of our employees.
How do you ensure customer service stands out? We spend a higher percentage of our sales on payroll and we take part in Ace training. We recently implemented Ace’s new Helpful 101 training program. We’ve always believed service is our number one weapon against the boxes.
Whether it’s repairing screens or fixing lawn mowers, Gavins Ace aims to stand out with its service offering.
We were one of the first stores to become certified with the new training program. every employee has to go through the training modules and the store has to get an 80 percent approval rating from customers and we scored in the high 90s. Ace’s Helpful 101 program is making a difference. We thought we had good service before and now we realize that there was a lot of room for improvement. It’s important that we not rest on our laurels and keep raising the bar on our service performance. It’s exciting and challenging at the same time.
Are customers more price-conscious today? they are value-conscious but time-conscious too. We turn them around with eight pOs registers, as customers really see value in getting in and out quickly.
What’s your pricing philosophy? We utilize Ace’s suggested prices as a guideline. t he nice thing about being a small store is we can react fast to pricing, whether you need to go up or down. It’s a gut
Gavins Ace stays busy in the winter but it’s more of a challenge to maintain business in the slow summer months.
feeling, but you can’t have too much of a premium. When people complain we need to listen.
lessons have you learned about retailing over the years?
Hardware stores take a while to develop, so don’t try to get rich quick. My dad’s history with Ace corporate in the early days of the big boxes taught us that you have to be your own competition. If you’re high-priced when someone comes in they’ll never let you forget.
Are there other family members involved in the business? My mom and dad, Larry and rita, are still involved, and my brother ron helps me run the business. My two boys have worked as floor help as have ron’s kids, so the third generation is getting exposure to the business. n
As most hardware retailers know, the weather plays a very important role in sales and seasonal purchasing decisions. To help retailers make more informed buying decisions for seasonal products, The Hardware Connection has introduced the Weather Monitor. Using forecasts from the National Oceanic and Atmospheric Administration (NOAA), we will keep bringing you short-term and longterm weather projections throughout the year. The Hardware Connection Weather Monitor will also be posted and updated on our website, so you have the latest weather forecasts available to keep you informed.
• The continuation of winter weather, above-average snowpack, frozen ground and thick ice coverage on streams and rivers will delay spring flooding into April in the upper Midwest eastward to New England. The intensity of the flooding will depend on the rate of snow and ice melt, and future rainfall.
• The National Weather Service predicts moderate flooding in
Source: National Oceanic and Atmospheric Administration
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parts of southern Wisconsin, southern Michigan and portions of Illinois, Indiana, and Iowa. At risk are the Mississippi River and the Illinois River as well as many smaller rivers in these regions. Small streams and rivers in the lower Missouri basin in Missouri and eastern Kansas have already experienced minor flooding this year and the threat of moderate flooding will persist through the spring.
• There is a risk of moderate flooding along the Red River of the North between eastern North Dakota and northwest Minnesota, and along the Souris River below Minot, N.D.
• Minor flooding is likely in the northern Rockies, parts of the Midwest and the Great Lakes region. Minor flooding is also possible in the Northeast, the lower Mississippi River basin and across the entire Southeast up to Virginia, including east Texas and parts of Arkansas, Tennessee, Kentucky, West Virginia and the Florida panhandle. In these areas, spring flood risk is highly dependent on rainfall
Drought outlook
• Significant and widespread drought conditions continue in California, which experienced its warmest and third-driest winter on record. Drought is expected to persist or intensify in California, Nevada, most of interior Oregon and Utah, Arizona, New Mexico, southeast Colorado,
western Oklahoma, and most of west Texas because of below-average rain or snow this winter and the onset of the dry season in April.
• If the drought persists as predicted in the West and Southwest, it will likely result in an active wildfire season, continued stress on crops and livestock due to low water levels, and an expansion of water conservation measures. Drought removal expected for the Big Island of Hawaii.
• Drought improvement is likely in Washington, southeast Idaho, extreme northern and coastal Oregon, western and central sections of Nebraska and Kansas, central Oklahoma, and the Midwest. Drought is not expected east of the Mississippi River during the next three months.
• Below-normal temperatures this spring are favored for an area from Montana eastward across the northern Plains to the Great Lakes region, while warmer-than-normal temperatures are most likely for western sections of Washington and Oregon, California, the desert Southwest, the southern Plains, the Southeast and all of Alaska.
• For precipitation, odds favor drier-than-normal conditions for the Alaska panhandle, western Washington and Oregon, California and parts of Nevada and Arizona.
Hawaii is favored to be both warmer and wetter than normal this spring.
• An El Nino watch was issued in March indicating that conditions were favorable for an El Nino system developing in the next six months. El Nino typically favors below-normal temperatures across the South.
• The period from May-June-July into July-Aug.-Sept. 2014 should see abovenormal temperatures for the Western and Southern continental U.S, along the Eastern seaboard and Alaska.
• During the late autumn and winter seasons through Jan.-Feb.-March 2015, the area of elevated above-normal
temperatures was extended westward to the northern Rockies.
• Below-median precipitation predicted for parts of the western Gulf Coast from June-July-Aug. through Aug.-Sep-Oct. 2014.
• The dry signal across parts of the Southeast has been removed during the period beginning November 2014 and lasting through March 2015. El Nino conditions favor abovemedian precipitation during this timeframe for that region.
Click here to see maps showing the temperature and precipitation outlook for July-Aug.-Sept. 2014.
Click here to see maps showing the temperature and precipitation outlook for Oct.-Nov.-Dec. 2014. n
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Click to Watch a Brief Overview of the 2013 Beacon Awards
The 2013 Beacon Award winners and sponsors included, from left to right: Howard and Marsha Miller, Hartville Hardware, Jason Peterson, Do it Best Corp.; Beth and Pat Sullivan, Sullivan Do it Best Hardware & Garden; Bob Lueders, Sunnyside Corporation; Doug Laird, Apex Tool Group; Tina and Scott Andrews, Lutz Ace Hardware; Dave Atkins, Ace Hardware Corp.; Tonia and Ronnie Boland, Boland’s True Value; Tim Hanna, True Value Co.; and Jim Holden, Epicor.
This year’s Hardware Conference, set for September 5-7 at the Marco Island Marriott in Marco Island, Fla., promises to be better than ever. The industry’s premier event will again be highlighted by the Beacon Awards, a new recognition program that was introduced last year.
The Beacon Awards, which are co-sponsored by The Hardware Conference and The Hardware Connection, are designed to honor the “best of the best” independent hardware/home improvement retailers while encouraging a new generation of retailers to make their mark.
Premier Beacon Award Sponsors for 2014 include Apex Tool Group, Epicor Software Corp. and Sunnyside
• Retail Beacon Award: Sullivan Do it
Best Hardware & Garden, Indianapolis, Ind., owned by Pat Sullivan
Scott Andrews of Lutz Ace Hardware in Lutz, Fla., was a Best New Store winner last year.
Corporation. Additional wholesaler sponsorship support comes from Ace Hardware Corp., Do it Best Corp., Orgill Inc. and True Value Company.
The Beacon Awards honored the Retail Beacon Award winners for each of the participating wholesalers, plus the Best New Stores in two categories: under 25,000 square feet and over 25,000 square feet. Whether it’s an existing retailer opening a branch store or a newcomer opening a ground-up business, these new stores represent the future of the industry.
“We heard nothing but positive comments last year from the winners and our sponsors, and we are looking forward to putting on an even better awards banquet at this year’s Conference,” said Tom Delph, who serves as Beacon Awards program director.
Here are the five Beacon Award honorees for 2013:
• Best New Store, over 25,000 square feet: Hartville Hardware, Hartville, Ohio, owned by Howard and Wayne Miller
• Best New Store, under 25,000 square feet: Lutz Ace Hardware, Lutz, Fla., owned by Scott, Todd, Tina and Andrea Andrews
• Retail Beacon Award: Boland’s True Value, Chapin, S.C., owned by Ronnie and Tonia Boland
• Retail Beacon Award: Marmac Ace Hardware, Maui, Hawaii, owned by Bill Marrs
Get your nominations in now for the Best New Store award, as the deadline of June 1 is fast approaching. The nomination process is outlined below.
Category: Best New Store
Nominations: Any dealer can nominate his store and nominations also accepted from wholesalers.
Qualifications:
• Store must have been open at least one year, to a maximum of 4 years.
• New ground-up store or it can be a substantially expanded existing store.
• Can also be a store built to replace store destroyed by natural disaster.
• Store must feature all the core departments: electrical, plumbing, tools, hardware, paint and lawn & garden.
• Can also be new to business owner, if substantial changes are made.
• Can be a branch store.
Judging will be based on any or all of the following criteria:
• Financial performance (sales, profits, margins, etc.)
• Community involvement
• Store design
• Merchandising displays
• Promotion activities
• Specialized product areas/niches
• Employee training/recognition programs
• Innovative retailing concepts
Beacon Awards Banquet:
To be held Friday night, Sept. 5, 2014 at the Marriott Marco Island, Marco Island, Fla.
Honoree(s) will receive:
• All-expenses paid trip for two to 2014 Hardware Conference in
Marco Island including conference registration, airfare, hotel and meals.
• Beacon Award plaque
• Feature article in The Hardware Connection
To complete nomination: include detailed information for each of the judging criteria, attach any relevant pictures, list the date of new store opening and also provide retailer name, store name, square footage, address, phone number and email address. Email nominations to Tom Delph, Beacon Awards Program Director, at tdelph@thehardwareconnection.com. Entry deadline: June 1, 2014
By John Fix III
Hope everyone made it through what was a very cold and icy winter for most of the country. As most of us wait for the bustling spring selling season let’s take a look at some Hardlines Digest discussions from the past few months.
PickuP Truck or Van?
Most stores offer delivery of merchandise to their customers, but the type of vehicle used can vary widely.
Matt Mazzone of Mazzone Hardware in Brooklyn, N.Y. is in the market for a new delivery vehicle.
“We are in the process of looking for a new delivery vehicle,” Matt commented. “We have always used pickup trucks but are considering getting a van now. Just curious what others think. Keep in mind, we are in the city and probably should use roller skates instead.”
Amy Earls of Page Hardware & Appliance in Guilford, Conn., offered her thoughts. “We switched from pickup trucks to box trucks about five years ago and never looked back. A van would
allow you better security in the city, merchandise is protected from the elements and there is no risk of boxes flying out of the back of the truck. Our delivery guys appreciate the ability to prep appliances for delivery in the shelter of the truck, out of the rain and sometimes away from the curious eyes of the customer. I doubt you are delivering bulk mulch in the city that is easily dumped in the pickup truck bed. That is the only reason we briefly considered staying with pickup trucks,” Earls said.
Melissa Brett went in the opposite direction. “Many years ago, we had a van, but went to a pickup with a modified flatbed for three reasons: 1. ease of unloading from all three sides; 2. multiple tie-down options for all sorts of power equipment and grills (we sell and repair); 3. We have two businesses about 20 minutes apart, and we can load larger loads of equipment to either location without being restricted with width or height, and we have done it many times. We used to have an old Ford F150 (loved the 8-foot bed and low bed height). When that died, we just got a Dakota, had a local shop but the flatbed on it and modified the suspension, and along with a winch, it’s terrific.”
Brett added, “The decision between a truck and van truly depends on what type of deliveries you make and what equipment you need to haul, along with security. We don’t have security issues. We
all weekend in our parking lot and it’s safe.”
Ken Walchak of Clark Devon Hardware is in Chicago, so his market is similar to Matt’s. Ken noted, “We too are in the middle of the city. Anything sitting open in the back of a pickup is fair game around here. I can’t even imagine our drivers carrying in an order, or even stopping for lunch with an open truck. It would be cleaned out in a minute. Plus, keeping the rain and snow off of merchandise seems like it would be impossible. We have a van and box trucks with lift gates. After this endless winter, if we had a semi-trailer, I think we could have paid it off hauling ice melter.”
Walchak added, “I can still remember driving down to the Cotter warehouse to pick up the weekly True Value order in the station wagon. Lengths of pipe sticking out the back and ready to crash through the windshield
with any sudden stop. Ah, the good old days.”
Lenny Goldfarb of Cedar Center Hardware in South Euclid, Ohio, also had security concerns. “I never could understand open pickups with no security of load. We have a 1999
Chevy Express 1500 van (only 51,000 miles). It has hauled everything from rock salt and lumber to water heaters and just about everything else. Sometimes it may not get started for a week or more, but on the days we use it, it is worth its
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weight in gold. More sheet metal on the sides for billboard size advertising of store location, phone number, etc. My vote is a closed van.”
James from Durst Lumber in Berkley, Mich., uses open vehicles of various sizes. “Our small delivery vehicle is a beat-up old Dakota. The large is a Ford F-450 stake truck with a 12’ bed. If you
deliver pallets of things, particularly when the delivery location has a hi-lo, a stake truck is the way to go. We have used tarps on occasion if it’s raining.”
Finally, Larry Perry of Woodstock Home & Hardware in Woodstock, Vt., offered another idea. “We’ve had a fullsize panel van and a Dodge Caravan, a 7’ wide x 15’ long x 11’ high box truck, but the most efficient vehicle so far has been our Honda Element with the back seats removed. Not terrific in weight capacity, but we’ve fit two full-size assembled Weber grills, hoods removed but they still fit inside on the floor. It gets 22 -26 mpg.”
Brandon Buckalew of East Grand Forks Hardware Hank wondered
whatever happened to QR codes. “I was thinking of getting a business card with a QR code on it so that if someone wanted, they could just scan the info into the contact list in their phone. I don’t think I would scan a vendor’s info into my phone. However, I try to give my card to every customer that has a question. I did put a QR code in our yellow pages ad that would put the store’s contact info right into their contacts. Maybe I should make a business card for me and get a QR contact card to give to customers. Has anyone else done something like this?” he asked.
Buckalew said he was watching Shark Tank on TV, and Mark Cuban said that QR codes are dead and that they were only a trend. “I tend to agree, but I live
in northern Minnesota, where we are about five years behind on everything,” he added.
Andy Darnell of Howard Brothers in Georgia offered some thoughts on business cards and QR codes. “My experience is that not many people use QR codes. My only suggestion would be to use a QR code to link to a video that was hosted on YouTube but that was embedded on your website. This video would tell the person about your business. I could see using it from an ad to go to a specific product video.”
Darnell added, “Either way it is important to look at your analytics to
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see how effective it is. Cards are so cheap to print now through companies like gotprint.com that you can try something now and then try something again six months from now. I’ve also seen QR codes used to link to Yelp for reviews.”
Phil Brakefield of Unisource had some additional thoughts on the technology. “I tend to agree with Andy, though I do find QR codes are still pretty useful for furnishing product knowledge if the prospect is on a mission. Looks like the next generation of QR codes might be MVS, which stands for mobile visual search, which will allow a customer/ prospect to simply snap a picture of a product and the software will automatically provide product or company information in a matter of seconds, and even offer the opportunity to buy right from the smart device screen.”
Brakefield added, “As far as business cards are concerned, I am convinced there is a huge opportunity to really promote your business far beyond the typical, one-sided style that regurgitates contact information. There is most often a completely blank, unused piece of marketing real estate on the back of most cards. I use the backs of my “regular” cards to carry testimonials, and have designed different formats over the years that can deliver massive amounts of information and offers. Business cards are really inexpensive to produce, so it makes sense to print some up for very specific occasions like a trade show
and devote them purely to marketing/ selling something that pertains exclusively to that event.”
Darnell followed up with some final thoughts on QR and other technologies. “There are uses for QR codes. I use them all the time when I product shop. The stuff that is coming with the MVS that Phil talks about is amazing. I’ve played around with some videos in our store.
I think the problem with it will be the sheer number of apps that will compete for this technology. If someone can figure out how to make these type apps ‘core’ to the device, or if they can get it to function better within a browser, it will more likely take root and be more largely used.”
He added, “I love going to conferences and hearing ‘experts’ talk about them like they are the lowest common denominator of any marketing strategy. Cards are so cheap that you can tailor to the event and to the audience.”
These are two of the many topics discussed during the past few months on Hardlines Digest. To read more or subscribe, head to www.hardlinesdigest. com. Hope to see you on the list! n
John Fix started the Hardlines Digest in January 1996. The list was run for many years using servers in John’s hardware store, but recently the list migrated to Google Groups. There are currently more than 1,500 subscribers reading the Hardlines Digest.
a growing community of thousands of
“I created Hardlines Digest in 1996 as a way for my fellow retailers to swap tips about the nitty-gritty of running an independent hardware store. Today, it’s grown to a community of thousands of independent hardware store owners just like you. I hope you’ll join today and start sharing your own expertise.”
John Fix Owner, Cornell’s
Hardware Eastchester, NY
Sales of Fastener Tools (Independent Hardware Channel) 12 Months % Change vs. Year Ago
Source:
Unit Sales Breakdown for Fastener Tools Total of 1,325 Items with Sales
• Brushless cordless power tool technology is emerging as the leading trend impacting the tool category, according to Jeff Frazier, power tools merchandising manager for Do it Best Corp. “Brushless cordless tools feature a changed motor that generates more power and requires minimal maintenance while the reduced heat build-up leads to longer life,” he says.
• Although the brushless technology has been out almost four years, it’s only in the last 10-12 months that the category has taken off, notes Frazier. “All the manufacturers are now coming out with brushless cordless models,” he says, adding that manufacturers are visiting job sites to demonstrate the tool technology’s innovation and build awareness with pro customers.
• Lithium battery technology has been around for awhile, but the number of amps is on the rise. Battery power has gone from the 1.5 amp NiCad to 2 and 4 amp lithium batteries, and now 5 amp lithium batteries have been introduced for circular and reciprocating saws, giving them longer run time, points out Frazier.
• Cordless technology will continue to dominate the power tool category over the next three years, according to Frazier, who predicts cordless will account for 60 percent of the category while continuing to rise. “Cordless
The Fastener Solutions area at Cole’s Home Solutions in Millington, Tenn., includes a demo station.
Keim Lumber in Charm, Ohio, serves as a destination for power tools and accessories that meet the needs of contractors, woodworkers, carpenters, cabinet shops and do-it-yourselfers.
models always dominate our power tool promotions,” he adds.
• Larger tools like miter saws will increasingly feature cordless technology as manufacturers improve run time and motor speed, Frazier says.
• The industry is going toward more impact-ready accessories designed for use in impact drivers. Standard bits couldn’t deal with the extra power, and Frazier points out that he’s seeing Torx bits gain momentum. The Torx design allows for a higher torque to be exerted than a conventional hex socket head without damaging the head or the tool.
• The first motion-activated rechargeable screwdriver has been introduced to the industry, which uses gyroscopic technology to enable variable speed.
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• Magnesium construction remains rigid under load and effectively dissipates heat. Five ball bearings provide added stability, strength and life to the motor and worm drive gears.
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• Interchangeable blade head change-out is easy. Simply unlock two quick-change pins, insert the new blade, return the pins to locked position and begin work.
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• The Strong-Drive® SDWS wood screw is specifically designed for structural wood-to-wood applications and is also ideal for a wide variety of projects where a highstrength attachment is needed.
• This 0.220” diameter fastener requires less torque to install than comparable fasteners, making it easier to drive, and the corrosionresistant coating makes it suitable for many interior or exterior applications.
• The Strong-Drive® SDWH screw is ideal for structural and general-purpose fastening applications where a hex-head drive is preferred.
• This 0.195” diameter fastener requires less torque to install than comparable fasteners, making it easier to drive; while the corrosionresistant coating makes it suitable for many interior and exterior applications.
By Doug Smith
With spring right around the corner, what’s the best way to get a breath of fresh air? A good place to start is by freeing up your prime retail space. If you’re like other retailers I work with on a daily basis, then you’re likely facing challenges such as fierce competition, increasingly complex needs and costs associated with managing inventory, and lack of time caused by slow, manual methods that exist in spite of the use of technology.
With inventory being one of a dozen areas to attend to, retailers often have no choice but to spend more time putting out daily fires than on refining their inventory mix. Many are still relying on their gut instinct instead of business system data to get them through the day.
Retailers that do not rely on business system data have an average of 65 percent of their inventory value invested in the bottom 15 percent of sales. For every $500,000 in inventory, retailers could take 10 percent (or at least $50,000) of the inventory value out without losing customers or profitability.
Carrying $50,000 worth of unprofitable inventory is costing you more than you think—actual carrying costs are far greater than the value of shelf space and the cost of the item is costing your business more than it should.
An important first step to better inventory management is to identify and eliminate unprofitable items. It’s a tough job, but someone has to do it.
Here is my first suggestion for dusting off the cobwebs and putting those money-losing products on clearance. First, don’t hang on to items that aren’t making you money now and won’t make you money in the future. Unprofitable items, or dead items, garner little to no sales activity and do nothing to invigorate or enrich the bottom line. As I mentioned, they can even cost you prized customer service hours, valuable retail space and substantial cash flow. That’s why you must clear the clutter to get a handle on your inventory.
What are your top 20-25 dead items per department? My next suggestion is to determine the value of your inventory and whether you have dollars invested in the wrong items. Look at each department and the items’ gross margin return on
investment (GMROI). GMROI is a key financial indicator that measures movement against margin. Did your items achieve or fail to meet expectations for generating profit?
Another way to decide whether you need to clear out your inventory is to analyze quantity on hand (QOH) versus order points. If your QOH is greater than the order point, you’re probably sitting on excess product and dollars. Identify underperforming items or items that have outlived their popularity by running a product performance report.
Free capital? Put underperformers on promotion. Require each department to put a plan together to move inventory out and not repurchase it. Donate extra inventory and take the tax breaks. It will free up cash and prime retail space. Once you clear out the top 20 dead items on your list, move to the next 20 dead items. Your cash will increase as you move these items out and then you can focus on eliminating items at the bottom 5 percent of sales.
Going forward if you have a lot of dead items, the rule of thumb is: for every one new product in, three items should be targeted for closeout. Put a plan into action so that your items generate more profit. For every SKU ask is the item not performing because there are too many similar products? Is it overpriced? Is it outdated? Consider remerchandising the store so customers can discover items that have always been there.
You know you cannot rely solely on intuition to make buying decisions. Those making purchasing decisions must be able to seamlessly anticipate future demand, understand the relationship between QOH and cash flow, source reliable suppliers and execute the best purchasing strategies for company profitability.
Purchasing directs the flow of goods in a company. To manage it well you’ve got to have these two elements:
1. High-quality, accurate and reliable suppliers—maintaining an accurate inventory has as much to do with the quality of your suppliers, and the accuracy of their shipments, as it does with the quality of your own inventory processes. Don’t immediately jump at your suppliers’ incentives. Meet with prospective suppliers at their plants whenever possible, review suggested orders before meeting with a product sales representative so you get the product and quantity you need, not what the rep wants to sell. Optimize order cycles to prevent stockouts and reduce shipping costs. Use vendor EDI communications to reduce ordering mistakes, receiving errors and possibly gain discounts on orders.
2. Accurate inventory data and finetuned forecasting capabilities—use technology to streamline purchasing and gain fine-tuned forecasting capabilities. Leverage a retail management solution,
like Epicor, for calculated and weighted order points to reduce seasonal spikes, stock-outs and overstock, and trim inventory costs. Use smartphones at buying markets to instantly access your inventory and determine the quantities you have in inventory and what you need to purchase. This prevents you from overbuying and eventually having to put your overstock on clearance. Set safety stock high for popular items in the system. Review QOH regularly for popular items to ensure you won’t be at risk for stockouts. Lower the safety stock level for less popular items that also have longer vendor order cycles. These elements are crucial for making smarter buying decisions that reflect seasonal changes, trends in the market
and products your customers want to buy. It’s a tall order. If you get it right, you’ve reached the inventory all-stars. However, if you get it wrong, that’s money out-of-pocket tied up in stale stock. As I mentioned previously, your inventory is the heart and health of your business. Keep it in tip-top shape and you will be rewarded with improved turns and dollars to the bottom line. Mismanage it, and your business and bottom line will suffer. As your customers’ needs change and new products are introduced into the marketplace, remember your inventory selection and management should be readjusting to match those needs. n
Doug Smith is a senior product manager for Epicor Software Corp.
■ Jeremy and Les Melnick are opening their sixth store, Fox Lake Ace Hardware, in Fox Lake, Ill.
■ Viktor Prozapas has opened a new Ace Hardware store in Reynoldsburg, Ohio.
■ Family Do it Best Hardware is opening a second store in North Fort Myers, Fla.
■ John Wheeler and Celia Vigil have opened Ace Hardware of Townsend in Townsend, Tenn.
■ Niemann Foods has opened its seventh Ace Hardware location in Vandalia, Ill.
■ E&H Hardware Group has opened its 13th Ace Hardware store in Avon Lake, Ohio.
■ Kimal Lumber & Hardware has opened a new drive-through lumberyard in Sarasota, Fla.
Kimal Lumber & Hardware
■ Stone’s Home Centers opened a new store in Quitman, Ga.
■ Ace Hardware Hillyard has opened in Spokane, Wash.
■ The Hess family has opened their third Johnny’s True Value in Edinburg, Texas.
■ Herb and Gwen Velazquez have opened Ace Hardware Crabapple in Alpharetta, Ga.
■ Lynn and Bruce Camp, owners of Attica Ace Hardware, are opening Ace Hardware of Warsaw (N.Y.).
■ Ace Hardware in Petal, Miss., has reopened a little more than a year after the store was destroyed by a tornado.
■ Henry and Sue Nesmith are celebrating the 30th anniversary of Los Altos True Value Hardware in Menlo Park, Calif.
■ Dave and Cindy Coie, the owners of Ace Hardware of Columbiana (Ohio), were honored with the Columbiana Chamber of Commerce’s President’s Award for their dedication and commitment to the community.
■ True Value Company announced 13 retailers were winners of the
■ Cliff and Craig Newby, owners of Newby’s Ace Hardware, have opened a new 13,000-square-foot store in Bowman, N.D.
“Best Hardware Store in Town” program for 2013: Kenny Yuja and Kenny Jose Yuja, Agencia La Mundial, San Pedro Sula, Honduras; Adam Schoelkopf and Douglas Childs, Bedford True Value Hardware, Bedford, N.Y.; Rick and Glenda Billman, Billman’s True Value, Cut Bank, Mont.; Scott Clifton and Jim Fontana, Canon City True Value, Canon City, Colo.; Brenda Burke and Zack Mullen, Carey’s True Value & Rental Outlet, Penn Yan, N.Y.; Jeff and Al Bunge, Cedar Lake True Value Hardware, Cedar Lake, Ind.; Chris and Jason Cleaver, Cleaver Farm & Home, Chanute, Kan.; Monica Evans, Troy Foster and Melissa Swank, Foster True Value Hardware, Mariposa, Calif.; C.C. and Julie Gibbs, Gibbs True Value Hardware, Grayson, Ky.; DeWayne and Melia Tripp, Hinton Hardware, Hinton, Okla.; McRae True Value Hardware, Ashland, Wis.; Jimmy Gilchriest and Ed Iveson, Ransom Brothers True Value, Ramona, Calif.; Mitch and Randi Epstein, True Value Hardware, Denville, N.J.
■ Rick Stanits is retiring at the end of March from his position as national sales manager of Vista
Information Services, a division of Epicor. Ruben Muruato has been promoted to take his place.
■ Do it Best Corp. has announced the retirement of Vice President of Retail Logistics John Snider, effective June 30, after 29 years with the company. Vice President of Marketing Tim Miller will move into that position. Do it Best also promoted John Branigan and Tom Morgan to retail performance managers.
■ Ace Hardware Corp. reported a record $4.2 billion in sales for 2013, up 8.2% from the prior year. Net income rose 27.8% to $104.5 million.
■ Distribution America has announced the addition of distributor PACOA to its membership. Headquartered in Port Washington, N.Y., PACOA services independent hardware, paint and lumber retailers in New York, New England, Pennsylvania and New Jersey.
■ True Value Company reported fourth quarter gross billings increased 1.3% to $457.3 million, while earnings decreased 57% to $12.5 million. True Value Foundation announced a national
partnership with the Boys & Girls Clubs of America.
■ The PRO Group announced that BTL Distributors, based in Monsey, N.Y., has joined the buying group. BTL serves hardware and paint stores in New York and New Jersey.
■ Do it Best Corp. execs joined leaders from the City of Sikeston, Scott County and the State of Missouri to celebrate the grand opening of the co-op’s new Retail Service Center (RSC) in Sikeston, Mo. Do it Best CEO Bob Taylor and Sikeston Mayor Jerry Pullen cut the ribbon on the 550,000-squarefoot, state-of-the-art facility, which serves members throughout the Midwest and central U.S. “Although our Cape location allowed us to effectively serve our members for more than four decades, we knew we could do even better. This new Sikeston facility brings additional efficiencies as we look to accommodate future growth in the region and serve even more independent entrepreneurs,” said Taylor.
■ ECi Software Solutions has been acquired by The Carlyle Group, a global alternative asset manager. ECi also reported yearover-year sales of hardware retail software increased 24% during 2013.
■ The American Hardware Manufacturers Association conducted the AHMA/USA Pavilion for the 27th time at the International Hardware Fair, held March 9-12 in Cologne, Germany.
Ace Hardware Corp., the industry’s largest co-op, has acquired Emery-Waterhouse, a 172-yearold independent distributor based in Maine. The purchase price was disclosed to be $33 million.
Emery-Waterhouse will move forward as an independently operated, majority-owned subsidiary of Ace Hardware. The EmeryWaterhouse brand will continue operations as a separate business with a distinct management team that provides distribution services to independent retailers.
The leadership team of EmeryWaterhouse, including CEO Steve Frawley and COO Don Dickson, will remain and continue to manage the
business. Emery-Waterhouse’s longtime majority owner, Charlie Hildreth, will continue to have a presence in the organization.
“The acquisition of EmeryWaterhouse serves as a tremendous catalyst to leverage wholesale purchasing power,” said Ace President and CEO John Venhuizen. “We are confident that both Ace retailers and Emery-Waterhouse customers will benefit from the additional scale and expanded assortments.”
“As a leader in the hardlines wholesale distribution industry, aligning with Ace Hardware—the nation’s largest convenience hardware leader at wholesale and at retail— simply makes good business sense,” said Frawley. “Knowing that we are part of a changing and consolidating industry, this is the right decision for Emery-Waterhouse and our customers.”
In a letter to customers, Hildreth said, “Ace will bring enormous clout to the buy side of our business when it comes to dealing with our suppliers. This should be good for our customers, hopefully allowing us to grow even faster.”
Venhuizen said the move is a test for a business strategy they hope to roll out to the rest of the country, giving prospects a choice between staying independent or being part of a co-op. “Our focus will not be of geographic depth but breadth with expanded assortments,” he said, adding that this strategy will be targeted to five channels: independent
lumberyards, hardware stores, nurseries, grocery and farm & ranch stores.
Venhuizen stressed that not only will Emery customers not be forced to buy Ace stock, they won’t be allowed to be Ace shareholders. “Emery is not a cooperative and their customers will not have access to Ace-exclusive items like Craftsman tools. One of the most important considerations for Emery customers is that they will receive uninterrupted service without change. Our goal is to show incremental value,” he said.
There are no plans to close either of Emery’s two distribution centers, said Venhuizen, who added that the three key areas of collaboration will be efficiency of DC operations, merchandising and price optimization.
For more than two decades, Do it Best Corp. and Home Hardware have partnered to benefit their members in the U.S. and Canada, respectively. Since 2005, the two co-ops have jointly reviewed more than $1 billion in purchases and generated millions in documented savings.
The Alliance partnership also extends to sharing best practices, most recently at the 2014 Winter Conference in Orlando, where Do it Best welcomed about 50 young retailers from Home Hardware and
facilitated special meetings for the two co-ops’ young retailers.
The young retailers broke up into groups to discuss best practices in inventory management, niche markets, local advertising/community involvement, increasing employee engagement and what they are doing to make more money. “Everyone had a chance to add to the list of best practices in these areas, and the final lists were later compiled and sent to all attendees,” says Dustin Kaehr, territory manager for Do it Best who works regularly with the co-op’s young retailer group.
“The goal was not just to speak to them but to allow them to interact,” Kaehr points out. Store bios were compiled detailing store size, square footage, niches, key departments and contact information, and this was sent to all the young retailers in advance to give them as many ways to connect as possible.
“It went even better than expected. Everyone loved the interaction and we found a lot of synergy,” Kaehr says. “Just because these retailers operate in a different country doesn’t mean they don’t face the same challenges.”
“The feedback was very positive. They felt they learned a lot in the learning sessions, shared a lot of good ideas and best practices in the Young Leaders discussions, and
Young retailer groups from Do it Best and Home Hardware gathered at Do it Best’s Winter Conference to share best practices.
really enjoyed the entertainment and networking opportunities during the social events,” said Tony Krotz, retail education and communications manager for Home Hardware. “It was a great opportunity to step back from the day-to-day business and look at their business through different eyes, and most had a list of action items to take home with them by the end of the conference.”
“The Alliance started as primarily a buying association allowing both organizations to maximize their buying power. It has also grown into an information sharing partnership that both organizations benefit from,” Krotz says. “This includes sharing info on different services and programs. The Winter Conference is the first event that brought dealers from both organizations together.”
Kaehr plans to visit some of the Home Hardware young retailers in April and then attend their spring market in Canada, with the Home Hardware group reciprocating again to attend the Do it Best May Market. “We are already talking about the opportunities to do more. Our members are excited,” he adds.
Home Hardware Spring Dealer Market
April 6-8, Henry Sittler Building, St. Jacobs, Ontario
Lumbermen’s Association of Texas and Louisiana Annual Convention
April 23-24, Sheraton Convention Center, Austin, Texas
Kentucky Building Material
Association Convention & Expo
April 23-25, Hilton, Lexington, Ky.
TruServ Canada Spring National Buying Market
April 12-14, Winnipeg Convention Centre, Winnipeg, Manitoba
Do it
Best Corp. May Market
May 17-19, Indiana Convention Center, Indianapolis
Mid-America Lumbermens
Association Swing-into-Spring
May 1-2, Lake of the Ozarks, Mo.
Mid-South Building Material Dealers Association Trade Show and Convention
May 1-2, Grand Hotel Resort, Point Clear, Ala.
National Hardware Show
May 6-8, Las Vegas Convention Center, Las Vegas, Nev.
North American Wholesale Lumber Association Leadership Conference
May 4-6, Evergreen Marriott Conference Resort, Stone Mountain, Ga.
Wallace Hardware Company Spring Market
May 13-15, Gatlinburg Convention Center, Gatlinburg, Tenn.
House-Hasson Hardware Summer Dealer Market
June 19-21, Sevierville Events Center, Sevierville, Tenn.
PRO Group Merchandising Conference
June 16-18, Embassy Suites Hotel at Centennial Olympic Park, Atlanta
United Hardware Fall and Winter Buying Market
June 13-15, Minneapolis Convention Center, Minneapolis
West Coast Lumber & Building Material Association Golf Tournament
June 5, Rancho Solano Golf Course, Fairfield, Calif.
July
World Pet Association SuperZoo
July 22-24, Mandalay Bay Convention Center, Las Vegas, Nev.
Send calendar dates to chris@thehardwareconnection.com
Jeff Tilem has been selling hardware products to famous people for so long that he’s accepted the fact he will never be as rich and as famous as his customers. He is the owner of Pioneer Hardware, a Do it Best member that has been operating just blocks from Rodeo Drive in Beverly Hills, Calif., since his grandfather founded the business in 1926.
Although Tilem did not think it was appropriate to name any current customers who are stars, Pioneer Hardware’s past customers include Gene Kelly, Charlton Heston, Johnny Carson and Sammy Davis Jr. “Gene Kelly once said in an interview that he bought the roller skates for his tap dance on skates in ‘It’s Always Fair Weather’ down the block from his house at Pioneer Hardware,” Tilem points out.
Beyond being a hardware proprietor to the stars, Tilem has made a name for himself as one of the foremost authorities on Beatles memorabilia. In fact, he is a serious
A check signed by
The housewares section includes everything from elegant glassware, placemats and disposable partyware to candles, bread baskets and kitchen gadgets.
Pioneer Hardware rents post office boxes for customers who want to maintain a 90210 zip code in their address.
collector who owns one of the largest collections of authentic documents signed by the Beatles, and he is one of a handful of experts who can authenticate Beatles signatures.
“It started as a hobby when I was a kid and I just kept buying as many autographs as I could,” Tilem recalls. “The value of these autographs jumped when John Lennon was killed in 1980. It’s pretty amazing to realize you’re holding a piece of paper that was signed by John Lennon or Paul McCartney.”
Tilem decided to start selling some of his Beatles and other music memorabilia about 15 years ago. He has a website that details all his music items for sale, including pieces from KISS, Queen, Elton John, Pink Floyd and Bob Dylan—click here.
He bought Beatles items such as checks and contracts primarily from a source at Apple Records, the record label
This is a still shot of Ozzy Osbourne in the store during a taping of “The Osbournes” show that never aired.
founded by the Beatles in 1968. “I have the original stock book that the Beatles used to create the group and I have the original name registration sitting in my house,” he says.
Tilem’s collection also includes the last legal document John Lennon signed in his lawyer’s office hours before he was killed and the signed document that dissolved the Beatles. “I’m selling everything now,” says Tilem, who estimates he has sold 400-500 pieces over the years.
Some of his music items are on display in the store, providing an eclectic look to a business that offers housewares, paper goods, handyman service, small tool rental, computer repair and in-store post office boxes. “We’re an oldfashioned hardware store that just happens to give advice to a lot of famous people,” Tilem says matter of factly. “Hardware is the same everywhere.” ■
2.1%
Percentage retail comp-store sales increased for True Value in 2013.
1842
Year Emery-Waterhouse was founded in Maine.
880,000
Number of privately-owned housing starts in January 2014 (seasonally adjusted annual rate), according to the U.S. Census Bureau. This is 16.0% below the revised December 2013 estimate of 1.048 million starts.
18 Average amount of minutes spent of Facebook for each user visit, including 680 million mobile users.
When businesses with between 50 and 99 employees will have to comply with the employer mandate portion of the Affordable Care Act. The mandate takes effect in 2015 for companies with more than 100 employees. $68
Amount returned to the local community when someone spends $100 at an independent business, compared to $43 returned to local community when the same amount is spent at a big box, according to Independent We Stand, a movement of independent business owners.
