HBSD - April 2019 by ensembleiq

Vol. 45 No. 4

TIME IS

MONEY

These job-site labor solutions are building business

APRIL 2019

Larry Huot La Valley/Middleton Building Supply New Hampshire

â&#x20AC;&#x153;Our business is a relationship business. We try to do the right thing for all of our customers, suppliers and employees. Orgill radiates these same values in everything they do.â&#x20AC;?

It’s Our Business Orgill Understands Our Company and Our Customers

Why We Like Working With Orgill: • Strong product selection • Variety of retail programs • A solid understanding of our company

Watch the video to see how Orgill’s services have helped LaValley/Middleton continue to grow!

1-800-347-2860 ext. 5373 • information@orgill.com • www.orgill.com

HBSDEALER HARDWARE + BUILDING SUPPLY

HIGH TECH REPORT 24 Is your website still lame?

Here’s some high-quality advice on how to make it better.

26 That’s a good question: “What kind of support can you expect?” and other questions from the frontlines of IT investment.

ACE HARDWARE REPORT 32 Two very cool hardware

COVER STORY LABOR-SAVING SOLUTIONS

stores are recognized for service, convenience and quality.

33 Ace by the numbers

• More than ever, time is money on the job site. And manufactures are embracing the roles of problem solvers and solution providers.

IN EVERY ISSUE 36 People in the News

• A showcase of Super Savers — products that make the job faster, smarter or simpler.

37 Product Showcase 38 Quikrete Industry Dashboard

FROM THE EDITOR 8 More than a few goose bumps in Las Vegas

NEWS & ANALYSIS A lawsuit erupts over Craftsman’s Ultimate Collection.

IMAGE 28 BIG 100 YEARS AND COUNTING Spahn & Rose of Dubuque, Iowa, is part of a club that measures its success in centuries.

The chart of the month illustrates a slow-growth industry

your 24 Iswebsite

still lame?

News Map: Washington, Wisconsin, New York and Massachusetts BMC “flattens” its organizational structure.

Hardware + Building Supply Dealer (ISSN 2376-5852) is published monthly, except for July/August and November/December, which are double issues, by EnsembleIQ, 8550 W. Bryn Mawr Ave., Suite 200, Chicago, IL 60631. Subscription rate: $119 per year in the United States; $139 in Canada and Mexico; $279 in all other countries (air mail only). Periodical postage paid at Chicago,IL, and additional mailing offices. POSTMASTER: Please send address changes to HBSD, Circulation Fulfillment Director, P.O. Box 3200, Northbrook, IL 60065-3200. Subscription changes also may be emailed to hbsdealer@omeda.com, or call 847-564-1468. Canada Post: Publications Mail Agreement #40612608. Canada Returns to be sent to Bleuchip International, P.O. Box 25542, London, ON N6C 6B2. For change of address, six weeks notice to Hardware+Building Supply Dealer, P.O. Box 3200, Northbrook, IL 60065-3200 is requested. Give old and new address and zip code. If possible, enclose address portion from cover on previous issue. Vol. 45, No. 3, March 2019. Copyright © 2019 by EnsembleIQ. All rights reserved.

APRIL 2019 HARDWARE + BUILDING SUPPLY DEALER

HBSDealer.com

Charlotte Pipe. The brand customers ask for by name.

We’re the most trusted name in ABS, CPVC CTS, PVC, Pressure and Drainage pipe and fittings. Customers love us and buyers do, too. Why? We have seven distribution locations across the U.S. and world-class customer service. Known for great fill rates, on-time delivery, planogram signage and more. It’s a part of a system you’ve come to trust, and it can’t be beat. charlottepipe.com/retail

HERE’S WHAT’S ONLINE

@HBSDealer

Tweet Central

Take the Poll, Digest the Results HBSDealer.com publishes a weekly poll question on pressing industry matters. Here are two recent polls:

Has your business ever been targeted with an unjustified lawsuit, or the threat of an unjustified lawsuit?

17%

Yes (76%) No (17%) This topic doesn’t interest me

(8%)

76%

The NAHB forecast 1.27 million total housing starts for 2019. What’s your prediction? 1.1 million to 1.2 million

(25%)

1.0 million to 1.1 million

(22%)

1.2 million to 1.3 million

(22%)

Under 1 million

(14%)

1.3 million to 1.4 million

(8%)

More than 1.5 million

(5%)

1.4 million to 1.5 million

(4%)

25%

14%

22% 22%

HBSDealer Daily Newsletter: Features Every Day The HBSDealer Daily Newsletter, the industry’s leading news source, features news, analysis, videos and commentary — plus these regular, weekly features. Sign up to receive your daily news at hbsdealer.com.

Want to be featured in Tweet Central? Send us a tweet using #HBSDealerTweets

Monday

Tuesday

Wednesday

Thursday

Friday

Quikrete Industry Dashboard

HBSDealer Poll Question

RISI Crow’s Market Recap

Throwback Thursday

Eye on Retail

Participate in a new poll question each week on HBSDealer.com

APRIL 2019 HARDWARE + BUILDING SUPPLY DEALER

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FROM THE EDITOR

A Spirit of Life Rundown

HBSDEALER HARDWARE + BUILDING SUPPLY

Hardware + Building Supply Dealer An EnsembleIQ Publication 8550 W. Bryn Mawr Ave., Suite 200, Chicago, IL 60631 hbsdealer.com HBSDealer On The Web • HBSDealer Info Services SENIOR VICE PRESIDENT (HBSDealer, Drug Store News, Chain Store Age) John Kenlon, jkenlon@ensembleiq.com, 212-756-5238 EDITOR IN CHIEF Ken Clark kclark@ensembleiq.com, 212-756-5139 LBM EDITOR Andy Carlo acarlo@ensembleiq.com, 845-891-5108 CONTRIBUTING EDITOR Ken Ryan ryankgr@aol.com, 516-567-3034

There were goose bumps. There were lumps in throats. There were tears and there were efforts to hold tears back. And there was some laughter. And a lot of hope. In other words, it was the annual gathering of the hardware and homebuilding industry to celebrate the work of the Duarte, Calif.-based City of Hope cancer research

Bowman, second from left, and the big check.

hospital. It all took place in Las Vegas on the eve of the International Builders’ Show. This year’s Spirit of Life honoree and fundraising leader was Giles Bowman, The Home Depot’s senior VP — merchandising, building materials. And he rose to the occasion. There was a silence in the room when Bowman reported the grim statistics — 1.7 million people will be diagnosed with cancer this year alone. And lumps formed in throats when he put a human face on the cold numbers. “My mother passed away eight years ago today from ovarian cancer,” he told

the audience of industry leaders. “And I know everyone in this room has family members who are either battling cancer today or have battled cancer. “City of Hope’s mission statement has four sentences and the most powerful is the shortest: ‘We turn hope into reality.’” he said. “I want us to look back at 2019 and say we made a difference.” Message received. There were some goose bumps when Bowman, on behalf of the hardware and homebuilding industry, handed over an oversized novelty check written out to the City of Hope to the tune of three million one hundred thousand dollars. Some of the inspiration served that night was priceless. Jaylon Fong, an 18-year-old-year-old high school baseball player from West Covina, Calif., shared his story and his courage. “In the beginning I didn’t really understand what leukemia was,” said Fong. “My mom and dad cried for me. But we believed the doctors and nurses at City of Hope would make me better.” And so they did. And the two-time cancer survivor is back on the mound. “Playing baseball is a lot like battling cancer,” Fong said. “You have to take it one pitch at a time. One dose at a time.” Thanks for the goose bumps, Jaylon. And thanks for the hope.

Editorial Inquiries: Direct questions to Editor in Chief Ken Clark. ADVERTISING SALES

Midwest & Southeastern States SENIOR REGIONAL MANAGER Amy Platter Grant agrant@ensembleiq.com, 773-294-8598 Northeast and Great Lakes States REGIONAL MANAGER Greg Cole gcole@ensembleiq.com, 317-775-2206 PRODUCTION/ART

VICE PRESIDENT, PRODUCTION Derek Estey destey@ensembleiq.com, 877-687-7321 PRODUCTION MANAGER Michael Kimpton mkimpton@ensembleiq.com, 647-557-5075 CREATIVE DIRECTOR Colette Magliaro cmagliaro@ensembleiq.com ART DIRECTOR Bill Antkowiak bantkowiak@ensembleiq.com PRODEALER INDUSTRY SUMMIT OCT. 8TH TO 10TH, COLORADO SPRINGS, COLO. WWW.PRODEALER.COM IN PARTNERSHIP WITH THE NLBMDA, WWW.DEALER.ORG CONTACT: AMY PLATTER GRANT agrant@ensembleiq.com, PDIS DIRECTOR OF SPONSORSHIPS PUBLISHER OF HARDWARE + BUILDING SUPPLY DEALER, DRUG STORE NEWS, CHAIN STORE AGE. CIRCULATION LIST MANAGER: ELIZABETH JACKSON, MERITDIRECT (847) 492-1350 X318. PERMISSIONS: MATERIALS IN THIS PUBLICATION MAY NOT BE REPRODUCED WITHOUT WRITTEN PERMISSION. TO ORDER REPRINTS CALL PARS INTERNATIONAL AT (212) 221-9595, EXT. 435, OR EMAIL LF-REPRINTS@PARSINTL.COM. CONTACT COPYRIGHT CLEARANCE CENTER, 222 ROSEWOOD DRIVE, DANVERS, MA 01923, (978) 646-2600 OR (855) 239-3415, OR ON THE WEB AT COPYRIGHT.COM FOR IMMEDIATE AUTHORIZATION TO PHOTOCOPY FROM HARDWARE + BUILDING SUPPLY DEALER (ISSN 2376-5852).

Corporate Officers EXECUTIVE CHAIRMAIN Alan Glass CHIEF EXECUTIVE OFFICER David Shanker CHIEF FINANCIAL OFFICER Dan McCarthy CHIEF OPERATING OFFICER Joel Hughes CHIEF INNOVATION OFFICER Tanner Van Dusen CHIEF HUMAN RESOURCES OFFICER Ann Jadown EXECUTIVE VICE PRESIDENT, EVENTS & CONFERENCE Ed Several

connect with us

Ken Clark Editor in Chief

APRIL 2019 HARDWARE + BUILDING SUPPLY DEALER

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YellaWood® brand pressure treated products are treated with preservatives (the “Preservatives”) and preservative methods, and technologies of unrelated third parties. For details regarding the Preservatives, methods, and technologies used by Great Southern Wood Data Sheet (SDS), please visit us at www.yellawood.com/warranties or write us at P.O. Box 610, Abbeville, AL 36310.

YellaWood ® brand pressure treated pine is sought after by all the best builders, especially those with leather tails, buck teeth and nature’s highest building standards. Our proven reputation for having high quality products drives demand for the Yella Tag. The five-star service and unrivaled support of the YellaWood ® brand puts dealers in position to meet their customer’s specific needs. See how the YellaWood ® brand delivers at YellaWood.com.

IF IT DOESN’T HAVE THIS YELLA TAG, YOU DON’T WANT IT.

Preserving, Incorporated, see www.yellawood.com/preservative or write us at P.O. Box 610, Abbeville, AL 36310. Ask dealer for warranty details. For warranty or for important handling and other information concerning our products including the appropriate Safety YellaWood® and the yellow tag are federally registered trademarks of Great Southern Wood Preserving, Incorporated.

IT’S NOT A TREND. IT’S A REVOLUTION. Visit ZIPRevolution.com to learn how easy it is to make the switch.

© 2019 Huber Engineered Woods LLC. ZIP System, the accompanying ZIP System logo and design are trademarks of Huber Engineered Woods LLC. Huber Engineered Woods’ ZIP System® products are covered by various patents. Please see ZIPSystem.com/Patents for details. HUB 16509 03/17

NEWS + ANALYSIS

Tale of two brands erupts in lawsuit

Stanley objects to the Craftsman Ultimate collection (above)

When Stanley Black & Decker bought the Craftsman tool brand from Sears in early 2017, the $900 million deal allowed the struggling Sears to continue to make and sell Craftsman, while Stanley brought the iconic Craftsman brand to new markets. Looking back, it seems like an unusual arrangement. And on Feb. 6, it descended into a lawsuit, as Stanley claimed a breach of contract and trademark infringement in a case brought in the U.S. District Court for the Southern District of New York. In the complaint, Stanley said Sears had the “limited right” to continue to make and sell some Craftsman products. But on Feb. 21, shortly after Sears filed for bankruptcy protection, Sears produced a press release touting the “Craftsman Ultimate Collection” professional-grade mechanics tools. In the press release, Peter Boutros, chief brand officer for Sears and Kmart said: “Sears is the real home of the broadest assortment of Craftsman.”

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Those were fighting words to Stanley. According to the complaint, “New Sears falsely implies that only products carried in New Sears’ retail stores and other retail platforms are genuine Craftsman products, or that the sale of Craftsman products elsewhere is somehow illegitimate.” The Sears advertising caused confusion, and is in breach of the license agreement, Stanley says. It also tarnishes “the value of the famous Craftsman trademarks for which Stanley paid hundreds of millions of dollars to acquire,” the complaint reads. Stanley is seeking a restraining order and further injunctive relief. Through a company spokesperson, Sears declined to comment on the lawsuit. In February, Sears Holdings was given new life when a Federal Bankruptcy Court judge approved Edward Lampert’s bid through his ESL Investments hedge fund to purchase the struggling retailer’s assets for $5.2 billion. It was the only submitted offer that would have kept Sears alive and in business.

Chart of the Month It’s official. Following a government shutdown and some early-estimate revisions, the final tally of total housing starts for 2018 is 1,242,300. That’s up 3.3% from 2017. Let the record show that back in January of 2018, the National Association of Home Builders forecast 1,247,000 starts for 2018 – that’s pretty close. The NAHB’s total-starts forecast for 2019 is 1.27 million, which would be a 2% gain over the official 2018 figure.

Housing Starts Single Family

Multi-Family 1,173,800

1,200,000 1,111,800

392,300

1,203,000 354,100

1,242,300 371,700

397,300 1,000,000

848,900

800,000

870,600

781,500 714,500 600,000

400,000

200,000

2015

2016

2017

2018

Source: U.S. Commerce Department

HARDWARE + BUILDING SUPPLY DEALER APRIL 2019

â&#x20AC;&#x153;Expanding the aisle of Midwest Fastener products has been very helpful in servicing our customers. Our customers are extremely pleased with the selection in our new Bolthouse area!â&#x20AC;?

- Carol and John Bolthouse Owners Hastings Ace Hardware, Hastings, MI

Exceeding Expectations. One Fastener Destination at a Time!

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

800.444.7313

fastenerconnection.com

NEWS + ANALYSIS

A ‘Pipe Dream’ with concrete potential Of the many exhibits observed at trade shows in recent months, one of the biggest impressions was made by a 30-ton tiny home in the Quikrete booth at the International Builders Show. The home is the brainchild of architectural student Sandra Guillen. The native of La Paz, Bolivia and the single mother of a 12-yearold son, Guillen tapped personal experiences to win the Rinker Materials/AIAS Pipe Dream tiny home design contest. Rinker is a subsidiary of the Quikrete Companies. The project is promoted as a potential solution for homelessness, disaster relief or unsafe living conditions around the world.

A lofty vision led to this concrete design.

The wooden-frame, four-section modular tiny home design — kitchen, a bathroom, living area and combination bedroom/office — can be

assembled in a Rinker Materials concrete pipe in less than a day (excluding electricity and plumbing). The 30 ton fireresistant concrete pipe can be easily transported on a flatbed truck and simply requires eight commercial-grade rubber wheel chocks to stabilize the tiny home. While amenities will dictate the final cost of a tiny home built from concrete pipe, the prototype revealed at IBS was about $35,000. The core cost for the concrete pipe is about $14,000, so the overall tiny home could be more or less expensive depending on how it’s customized. “Exploring our concrete pipe as a tool to fight homelessness and overpopulation alongside the AIAS has

News Map: Openings, Closings & Acquisitions Illustration of stores in various stages of coming and going. For more retail news, visit HBSDealer.com.

washington

Puyallup

At Home Group Home décor retailer At Home opened in Puyallup, Wash., — marking the home décor retail chain’s first West Coast location. The company now operate 180 locations in 37 states.

massachusetts OPENING

CLOSING

wisconsin

Lake Geneva

Spahn & Rose Dubuque, Iowa-based Spahn & Rose is the new owner of Dunn Lumber, founded in 18904 by Edward F. Dunn. Brothers Mike and Terry Dunn will retire following the sale.

APRIL 2019 HARDWARE + BUILDING SUPPLY DEALER

ACQUISITION

Gardner

Aubuchon Hardware The 103-store U.S. chain with deep New England roots acquired Lynde Hardware and Supply, a traditional Main Street hardware store, which like its new owner, emphasizes community service.

new york

Yorktown

Lowe’s A few lingering regulatory hurdles didn’t stop the opening of a 120,000 sq. ft. Lowe’s store on Crompond Road. The town gave its approval contingent upon some future landscaping work.

HBSDealer.com

At BMC, the COO Is out. Continued from page 16

already proven to be a viable prospect,” said Tom Hartley, vice president of sales & marketing for Rinker Materials. “Sandra’s unique perspective resulted in a smart, repeatable design that could truly make tiny concrete pipe homes accessible to anyone. Combine that with our national distribution and there isn’t a community we couldn’t potentially help. Ultimately, our longterm goal is partnering with HUD, FEMA and similar organizations to make tiny concrete pipe homes a reality for those in need.” Challenged to transform concrete pipe traditionally used for underground storm water management from Rinker Materials into a tiny home, Guillen bested other AIAS members by focusing on function and comfort. She also leaned on her dream of becoming an architect to reconstruct the 8-foot diameter, 16-foot long concrete pipe into a mobile, stackable, durable, sustainable and relatively inexpensive alternative to traditional housing.

Fine for flooring giant Lumber Liquidators agreed to pay $33 million in penalties to resolve a charge of securities fraud from March 2015. The Toano, Va.-based company is paying a fine of $19.1 million and a restitution of $13.9 million in a deferred prosecution agreement with the Justice Department’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Virginia.

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BMC eliminated the position of COO “to flatten the organizational structure and bring its executive team closer to its field operations.” The move pushes COO Mike McGaugh out of the company. McGaugh was third-highest ranking executive at BMC behind President and CEO Dave Flitman — who joined the company last August — and Executive Vice President and Chief Financial Officer Jim Major. BMC named McGaugh to the position of COO in January 2017. At the time, this was a newly created position for the company. During his tenure, McGaugh was responsible for the day-to-day administration and operations of the pro dealer. Prior to joining BMC, McGaugh spent more than 20 years in leadership roles at Dow Chemical. “Mike has been a valuable member of our leadership team as we have advanced our four strategic pillars,” Flitman said. Last month, BMC Stock reported fourth quarter 2018 sales increased 2.2% to $859.5 million while sales

The Securities and Exchange Commission also announced charges against Lumber Liquidators Holdings for making fraudulent misstatements to investors. The Department of Justice agreed to credit $6 million in fines paid to the SEC as part of its agreement. The SEC said the charges stem from Lumber Liquidators’ false public statements in response to media allegations that the company was selling laminate flooring that contained levels of formaldehyde exceeding regulatory standards. The SEC also said that Lumber Liquidators made public statements in response to a “60 Minutes”

for the full year rose more than 9% to $3.68 billion. The Raleigh, N.C.based company also posted a net income of $28.1 million for the fourth quarter, nearly a 60% increase from a net income of $17.6 million during the same period a year ago. “We recently announced exceptional results for 2018 and remain focused on driving operational excellence, delivering outstanding customer service, building a highperformance culture, and advancing our organic and inorganic growth strategies,” Flitman said, while announcing McGaugh’s departure. “We believe that leveraging our existing team of experienced leaders with a flatter organizational structure will enable the company to be more agile in our decision making and accelerate our ability to execute our McGaugh strategy.”

news program episode that showed undercover video of Lumber Liquidators’ suppliers stating that they provided the company with products that did not comply with regulatory requirements. Lumber Liquidators CEO Dennis Knowles said the company has made sweeping changes and will continue to take steps with the new executive team to better Lumber Liquidators. Lumber Liquidators operates more than 400 stores across the country. “While we will continue to improve our compliance processes, having these matters behind us allows us more resources to focus on our customers, great product lines, and our strategic vision,” Knowles said.

HARDWARE + BUILDING SUPPLY DEALER APRIL 2019

NEW STYLES NOW AVAILABLE!

INNOVATIONS THAT SAVE TIME

Explore our innovative one-piece and four-piece column wraps, which easily fold around a structural post with pre-mitered, interlocking joints. Available in four styles, VERSATEXÂŽ Versawrap PVC column wraps save installation time and provide a beautiful, low maintenance finish that lasts much longer than wood. Our Classic, Timber Ridge and Raised Panel products fold around a structural wood post and lock together with friction fit lockmiter joints, while our Tapered wraps are designed as four panels with pre-cut locking joints. No more measuring and cutting each angle and joint! Looking for more aesthetic appeal? Dress up the column with our attractive, moisture resistant accent wraps, post caps, and moulding kits. Expect innovation that works. Versatex @versatex @versatex_trimboard

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Cover Story

THE

SOLUTION PROVIDERS Big LBM manufactures are increasingly becoming problem solvers. By Andy Carlo

ast month LP Building Products announced that it was changing its brand identity and overall focus to “LP Building Solutions.” The move put an exclamation mark on an industry trend. Companies today are doing more than just producing products — they’re solving customers’ problems. With labor and cost issues hindering the accelerated expansion of home building, some of the biggest brands in the industry have become all-in-one solution providers. They’re deploying new technology and techniques in addition to rolling out new labor-saving products. Given the number of obstacles the industry faces — from housing affordability to an abundance of building codes and regulations — helping to speed up the building process with quality solutions was one of the catalysts behind LP’s branding change. “LP is a dependable name amongst building professionals, so it only makes sense to expand our branding to encompass the entirety of the building process,” Cameron Bailey, corporate brand manager for LP Building Solutions, told HBSDealer. “We recognize that the building industry is facing several challenges, such as labor shortages. “To address these issues and contribute to industry growth, we’re focused on providing solutions to help professionals build better. More than that, LP Building Solutions is focused on pursuing innovation that will transform the way we build,” Bailey added. LP isn’t alone when it comes to this type of outlook. “Manufacturers are more than suppliers. Today, we observe manufacturers blending products and services, adding

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significantly more value that materials alone,” says Todd Tomalak, senior vice president of John Burns Real Estate Consulting, an independent research and consulting firm focused on the U.S. housing industry. MiTek continues to be one of the industry leaders when it comes to connecting builders, architects, and dealers through software and solutions. “Our customers’ success is our success,” said Kristi Campbell, vice president of supply for MiTek Residential North America. “We sit down with the customer in a collaborative way to see how customers can succeed, how to make a business run better, deal with the labor shortage, and estimating and controlling costs. We also look to improve communication in the industry and improve the processes to take waste out of the whole system.”

HARDWARE + BUILDING SUPPLY DEALER APRIL 2019

Cover Story MiTek is doing much more than selling joist hangers. The company views its strategy as one that is supported by “four pillars,” — building products, software solutions, automation, and services such as helping builders through the home plan process. According to Campbell, the automobile industry provides an example of how these pillars could change the way an industry operates. “How manufacturers used to build a car and how they build a car today has changed dramatically,” Campbell said. “But if you look at our industry, we’ve kind of been doing the same thing for a long time — there hasn’t been that many changes in how we build things. It’s ripe for opportunities for these types of improvements.” In March, MiTek announced that it plans to commit “substantial new resources” to its home builder software group and “aggressively accelerate the technology solution offerings it provides home builders.” MiTek will add 35 new employees in the areas of software development, documentation, support, product management, and implementation services. Through the company’s

“... If you look at our industry, we’ve kind of been doing the same thing for a long time — there hasn’t been that many changes in how we build things. It’s ripe for opportunities for these types of improvements.” — Kristi Campbell, Vice President of Supply, MiTek Residential North America

MiTek’s Sapphire Structure Design Software provides solutions for builders and dealers.

Sapphire Suite, MiTek connects with just about every aspect of the supply chain. The company provides Sapphire Structure, for use by component manufacturers; Sapphire Supply, for building material dealers; and Sapphire Viewer, for anyone viewing BIM models. MiTek also offers Sapphire Build for home builders along with BuilderMT, Sales Simplicity, Wrightsoft, and DIY Technologies, among other industry software solutions. Simpson Strong-Tie, the Pleasanton, Calif.-based structural connectors and fasteners kingpin introduced its new “Builder Solutions” program at the most recent International Builders’ Show in Las Vegas this past February. The program provides customized training, technology and customer support to help builders and contractors manage design options more efficiently. The goal is to get homes on the market faster, with fewer surprises, according to Simpson Strong-Tie. The company’s software portfolio was bolstered by the acquisition of CG Visions in 2017. Now that the two companies have integrated into one, CG Visions will adopt the Simpson Strong-Tie name while delivering solutions that help customers build more predictably and more efficiently, the company said. Simpson recently unveiled the next stage of its Construction Document Management solutions in both 2D and 3D building information modeling (BIM) for the residential construction market. “We continue to deepen our partnership with top builders, architects, engineers, and the construction supply chain throughout the country by offering scalable software,” said Simpson Strong-Tie Director of Customer-Facing

APRIL 2019 HARDWARE + BUILDING SUPPLY DEALER

Software Tim Beckman. Boise Cascade recently introduced the 2.1E Versa-Lam LVL beams and headers with increased Modulus of Elasticity (MOE). This signals Boise Cascade’s shift to a common approach for assigning MOE grades as it simplifies the process for designing wood structures. The Boise, Idaho-based company also provides SawTek saw services for more than 60 LBM locations. The SawTek machines are located at pro dealers in major housing markets nationwide with some dealers serving as saw hubs for other area yards. The automated system helps lumber yards better manage offcut inventory, improve overall efficiency and be more competitive. “Builders like SawTek because it cuts down on errors that can delay projects,” said Tim Debelius division marketing director for Boise Cascade Wood Products. “The system also ensures builders receive job packs that are cut to the specific lengths they need; are pre-routed for plumbing lines, electrical wiring and other mechanical systems; and are labeled accurately for easy placement at the jobsite. Debelius describes the program in familiar terms. “We have a vested interest in our customers, so providing them with the tools, data and speed to be more profitable is another way we can help them achieve their business goals and stand out from their competitors.”

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SPONSORED BY

PRODUCTS

CAMO Drive tool

The new CAMO Drive tool from National Nail was created to address challenges facing professional deck builders, including the absence of fastener versatility and the cost and lack of flexibility in the deck fastening tools in use today. Installing decking at speeds up to 5-times faster than current methods, the CAMO Drive tool allows the user to attach their own drill in a standing position. They can then use any of three CAMO Drive attachments to secure decking with CAMO EdgeClips (for grooved boards), CAMO Edge screws or traditional face screws. For grooved decking, the CAMO Drive tool can be used with the new CAMO EdgeClip. For use with any grooved wood, capstock or PVC board, users can insert the clip into the deck board groove, slide the next board or boards on and then fasten the clip in one easy motion, with the CAMO Drive tool. camofasteners.com

TandoShake Derby Building Products has introduced Cape Cod Perfection, the latest offering in the TandoShake line. The product features an aesthetically pleasing profile with crisp, square edges, proven resistance to extreme weather, and is available in five rich colors with the look of painted wood. TandoShake’s Cape Cod Perfection is a high-performance answer to today’s common building challenges such as labor shortages, job site delays, and moisture management, Derby said. Cape Cod Perfection is easy to install because it is lightweight and comes in panels — not individual shakes that need to be nailed. And, because it won’t split, an installer can use a pneumatic nail gun. tandobp.com

Simpson Strong-Tie LSSR Simpson Strong-Tie has introduced a patent-pending LSSR slopeable and skewable rafter hanger. The product is designed to allow retrofit installation after rafter systems have been assembled in place, helping contractors accelerate job sequencing for improved productivity. The field-adjustable LSSR features an enhanced flange design allowing for skew adjustments from 0-degrees to 45-degrees, is easier to install than predecessor rafter hangers, and features an easily adjusted swivel stirrup that attaches to both sides of an I-joist for a stronger connection. The product allows for retrofitted installs while improving jobsite efficiency. With the LSSR, installers can cut all the rafters and tack them into place, then use a retrofit approach to nail hangers to the roof assembly. simpsonstrongtie.com

APRIL 2019 HARDWARE + BUILDING SUPPLY DEALER

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visit nationalhardwareshow.com

Bosch Max Connected lasers The Bosch GCL100-80CG 12V Max and Bosch GCL100-80C 12V Max Connected Cross-Line Lasers with Plumb Points deliver versatility that combines cross-line laser precision and two laser plumb points. Each laser projects visible lines up to 100 feet; the green beam option offers a line that’s 4x brighter than standard red beams. Both units have red points. The lasers feature Boschexclusive VisiMax technology, which monitors tool temperature and power consumption to deliver the brightest line for the job. In addition, the two lasers feature Bosch 12V Max Lithium-ion power for extended runtime. Users can connect the laser to their smart phone with the free Bosch Levelling Remote App to increase precision and productivity on the jobsite. boschtools.com

LP WeatherLogic system

PUReWall by Hunter Panels

LP WeatherLogic Air & Water Barrier system gives builders an easy-to-install weather-resistant barrier (WRB) option that will help protect homes during construction, promote a clean jobsite and help secure energy efficiency for years to come. The system consists of two products: a 4-by-8 structural OSB with an integrated, weatherresistant overlay, and the LP WeatherLogic Seam & Flashing Tape, a specially formulated acrylic tape with squeegee for ease of installation. The panels install just like regular sheathing. After the panels are fastened, the seams are securely taped using an advanced pressuresensitive acrylic tape featuring one of today’s highest quality acrylic adhesives. The WeatherLogic Air & Water Barrier system provides builders assurance that the home has a continuous exterior air and water barrier for a tight building envelope that is also vapor permeable to allow moisture to escape. lpbuildingsolutions.com

Hunter Panels, in partnership with Covestro, has launched PUReWall by Hunter Panels. Designed for use in residential construction, PUReWall by Hunter Panels is a panelized wall assembly with a proprietary combination of PUReWall Polyiso continuous insulation on the exterior and PUReWall Structural Foam (SPF) in the wall cavity. The product is preassembled with both products and 2”x4” studs, up to 24” on center, in a controlled panelization facility, and is offered as a complete solution to streamline installation. The system’s continuous insulation and taped joints allow it to function as a weather-resistant barrier, eliminating the need for house wrap. hunterpanels.com/purewall

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HARDWARE + BUILDING SUPPLY DEALER APRIL 2019

High-Tech Report

Is Your Website Still Lame? Here’s high-quality advice from an expert on how to make it better. Editor’s note: Back in 2016, HBSDealer released its first installment of the “Your Website is Lame,” series. Three years later, we can say with confidence that web sites across the hardware and building supply industry are improving. (Check out Zeeland Lumber; or McGuckin Hardware, just to name a couple.) Still, there are websites that need improving. That’s why HBSDealer turned to an experienced digital strategy expert for his thoughts on what retailers are doing wrong, and how they can step up their digital game. In my career, I have seen it all when it comes to web design. There has been great, there has been bad, and there has been ugly. And I have done all three myself. Through these successes and failures, I have learned the following keys to making a successful website. A successful website starts like a successful business — you see a need in the market, and you fill it. And for filling that need, you are rewarded. The same is true of your website. We have all been sold a fairytale about websites that can magically take off and sell millions worth of products and services, but that simply isn’t true. A great website bolsters a company’s ability to conduct their current business. So your web design should reflect what you already do. One of the most successful websites I have ever built is also the simplest. A client who runs a two-man barbershop

APRIL 2019 HARDWARE + BUILDING SUPPLY DEALER

in my hometown contacted me about building a website for his business. When we sat down and discussed his website we quickly came to the agreement that his site really only needed four things — his phone number, his address, a “book-now” button leading to an automated online booking system, and his services with prices. We dispensed with the typical “blog” and “about us” page because we didn’t see the need. I built the site for him and we were off to the races. That small site has for the past five years averaged 1,000 visitors a month with 90% of them being new visitors. The most visited pages are the booking page and the services page. The rest of the pages on the site get less than five visitors each month. What this project taught me is that if you can anticipate the needs of your customer and fill them quickly, then you and your website will be a success.

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So what are most hardware dealer sites getting wrong? • Unclear call to action. We have all visited that website where you want to know one simple thing (like store hours) and you can’t find it. It is frustrating and leads to a bad impression of a business. Here’s the remedy: a) In the header of your website make sure you have the following. Phone Number, E-mail, and address (if you have multiple locations you could simply have a link to “Locations”) b) Also in your header menu have your top “services.” What are your top services? Is it rental, window repair, or lumber? Make sure there are links to these services in your header menu. c) Keep your menu choices in the header to a maximum of 4 to 6. Too many and your customers will be confused. Too few and they will simply leave. • A cluttered home page. You don’t want customers to get a bad impression when they enter your store – or load your website. Make sure it is clean and easy to navigate. Emphasize your best “deal,” which can be a discount, a service, or any other promotion you currently have running, or all three. However, avoid using a “slider” or “carousel image at the top of your home page. These are not only distracting, they diminish the site’s ability to guide users to the most popular areas. Instead of a slider, try using a static image or maybe multiple links to the top three pages on your website. For instance: “Rentals,” “Shop,” and Special Offers.” • They lack Security. I know it’s 2019, and every website should be encrypted and protected. Right? Wrong. I still see many hardware retailers out there with sites without

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SSL’s. What is an SSL? Essentially it encrypts communication between a computer and a website. This is important for two reasons. First, it establishes trust with the consumer that your website is secure when they see “https://” in the browser’s address. Second, Google announced in September of 2016 that its Chrome browser would notify users when they visited sites that were not using an SSL, and subsequent posts hinted that Google would actually penalize sites in search results for not having an SSL installed. This means that if your competition is using an SSL and you aren’t, then their website will appear above yours on Google. That makes it much more likely that a potential customer will visit their site instead of yours. • Well, that’s done.” Dealers often view their website as they view a construction project. Once it is up and running, they forget about it and assume that people will just come streaming in. Nothing could be further from the truth. I am not advocating for hourly, daily, or weekly changes to the website. Instead, I recommend what I do with my clients. Once a month, stop and take a look at the analytics from the site and make adjustments. Analytics can be intimidating. They can require effort to gather actionable intelligence. But trust me, it is worth the effort. I recommend working with a marketing professional, or take an online course. Luckily, Google offers free online training that is quick and easy to learn. Start with Google Analytics for beginners. • They abandon their site or social — They started and never finished. This goes for both websites

and social media accounts. You would never try to stock in your store every type of home improvement product ever made because you simply wouldn’t have the time, space, or monetary resources to make it possible. Often times I talk to my clients after they are already frustrated with trying to run a business, their website, and their five social media channels. Let’s return to the example of my barbershop client. As a two-man operation, their most precious resource is “time.” They were daunted by the prospect of managing a blog, Twitter, Facebook, Instagram, and Snapchat. That’s why we decided to focus on just Instagram and Facebook, because that is where the largest number of their clients already are. Also, now that the two platforms (Facebook owns Instagram) are linked, it is simple to cross-post to each quickly and effectively. Plus, we integrated their Instagram feed into the homepage of their website so that their site is being updated with new images from their Instagram feed. This strategy has been incredibly effective for them. In conclusion, present your most important information in the header (Phone, Email, Hours, top products and services). Make sure your homepage is focused on promoting your top “deals” (no slider, please). Also, make sure your site is secure by using an SSL to show both your customers and Google that you are a trustworthy place to visit online and off. Never stop improving your website. Analytics, if used properly, are like a map leading you to more customers — but only if you look at them once in a while. Lastly, complete what you start. The rewards are worth it.

Brandon Wolf is the founder of Digital Wolf, a Fort Wayne, Ind.-based consulting practice with specialties in digital strategy and Internet sales. He is a former e-commerce manager for Do it Best Corp. He can be reached at brandon@digitalwolfagency.com, or the web site: digitalwolfagency.com

HARDWARE + BUILDING SUPPLY DEALER APRIL 2019

High-Tech Report

More questions (and answers) on the path to tech savvy Good business decisions usually begin with good questions. In that spirit, HBSDealer reached out to the tech industry to identify the kinds of queries that independent dealers should ask their tech vendors, their consultants, and even their internal teams when it comes to assessing or investing in their retail systems. Here are few good starting points: “What kind of support can you expect from your technology partner?” An investment in technology is one thing, making it work to its fullest is another. The process of implementation, training and support is equally important (at least) as the technology itself. That’s one of the ideas emphasized by Paladin POS, based in Bend, Ore. “The probability that folks are using their cell phone or any piece of personal technology to the fullest capacity is pretty slim,” said Jeff Rogers, marketing director for Paladin Data Corp. “It’s the same for point-of-sale systems.” Retailers in the market for upgrades should learn who will be providing support, where their calls be answered, and what kind of systems are in place to track calls, he said. ”Support is one of the most important considerations,” Rogers said, pointing to the goal of putting customers in a position to be successful, based on the success of other clients. Ultimately, a successful investment with the right support will lead to a solution that allows the dealer to focus

on the business, not the technology. Simplicity is a key theme among Paladin customers, according to testimony from users such as Clinton (Md.) Hardware and Coos Curry Supply. “We strive to be intuitive and easy on the front end, and very powerful on the back end,” Rogers said. “How do you quantify the benefits of an investment in a software upgrade?” At Epicor Software Corp., creators of the popular Eagle N Series retail management solution (among other products), there is strong agreement that dealers should ask the basic questions -- how can the retail management system (also known as enterprise resource planning (ERP) software ) help me grow? and how can the technology partner help maximize the investment? There is also great confidence in the ability of a modern retail solution to move the dial on several business metrics. For instance, “Days Sales Outstanding” (DSO), which measures collections processes and

APRIL 2019 HARDWARE + BUILDING SUPPLY DEALER

customers, improves 9.6 days after implementation — from an average of 42.9 days to 33.3. The savings means more effective collection and greater insight into customers. Numbers also show an improvement in the speed of information. According to Epicor’s research, modern systems deliver timely information 92% of the time, compared to a legacy system’s ability to deliver it 84% of the time. Modern ERPs are 7% more accurate. Inventory reports are 4% more accurate. And customer satisfaction ratings increase from 88% to 93% on average, according to Epicor’s statistics. And another statistic that Epicor likes to share is from a survey of retail leaders, 73% of whom agree that an “effective, integrated IT infrastructure is the key to business success.” “How can we use technology to better connect with our customers?” That broad question is straight from the playbook of hardlines distributor Orgill, and a common refrain among customercentric tech consultants. According to Boyden Moore, president of Memphis, Tenn.-based Orgill, it’s a question that leads to several others. “In thinking through this question, one area to explore among many is the store’s website — a store’s digital front door,” he said. It’s important, he said for the web site to support the store brand by serving as the digital or virtual version of walking into the physical store’s front door. A website, fully optimized, is easy to navigate and is supported by customer reviews. It’s integrated with a distribution partner “to provide endless aisle opportunities” And it’s integrated with customer loyalty and e-mail marketing campaigns, among other things. “Those are some of the questions we think are important and are working on to better support our dealers in an increasingly complex and fast-moving technical environment, “ he said.

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“What is your technology partner’s commitment to your industry?” Cary Anderson, VP of research and development for Kerridge Commercial Systems, says that entering a relationship with a technology provider is like entering a marriage. “One of the biggest mistakes that people make is that they don’t select an industry-specific software package,” he said. Commitment to a specific industry is particularly important in the building supply industry, which is shaped by state and local building regulations, plus the intensely specific units of measure — think linear footage and tally items. “Most lumber companies aren’t just in the lumber business anymore,” Anderson said. “They have truss shops, door shops, panels, some even do

windows. A software package has to accommodate that, and a technology partner has to understand that. “If all that isn’t programmed into the basic architecture of the software, it simply doesn’t make sense to buy a generic package and modify it to their needs,” he said. The good news for dealers is that commitment is relatively easy to spot. Pay attention to conferences, trade shows, meetings of associations — the brands participating are showing commitment. Understanding the industry helps a tech partner collaborate with a dealer on maximizing the power of the software package. It also promotes postinstallation success. One major mistake made repeatedly, according to Anderson, is a failure to emphasize training. He suggested that

the investment in training should be greater than the investment in the actual technology package. “If you’re company isn’t getting new training, it’s not taking advantage of the full power of the product,” Anderson said. It’s very common, he said, for a dealer to express a desire for a certain functionality, only to be told “you’ve been able to do that for the past five years.” Those exchanges are the result of dealers failing to take advantage of training for frequent (usually twice a year) softwarepackage enhancements. Dealers want simplicity. But they want powerful tools, also. Dealers are typically moving from one system to another system, so the question becomes: “What does this new thing do for me that the old doesn’t do?”

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HARDWARE + BUILDING SUPPLY DEALER APRIL 2019

Century Club

Spahn & Rose: 115 and growing By Andy Carlo Baseball immortal Cy Young pitched the first perfect game in the modern era, and Theodore Roosevelt was president when Spahn & Rose Lumber Co. was formed in 1904. More than a century later, Spahn & Rose continues a tradition of providing products and services that make it easier for contractors and builders to operate their businesses efficiently and profitably. And the Dubuque, Iowa-based pro dealer continues to make moves. In early March, Spahn & Rose announced that it had acquired Lake Geneva, Wis.-based Dunn Lumber; also a 100-year-old-plus dealer having been founded in 1894. Dunn Lumber was recently named the 2019 Wisconsin Retail Lumber Association Dealer of the Year. Following the acquisition, Spahn & Rose now operates 18 locations in eastern Iowa, 4 in northern Illinois and 2 locations (including Dunn Lumber) in Wisconsin. The company also operates a lumber re-load center in Independence, Iowa to service its locations.

“One of our company’s strategic growth initiatives is to add profitable companies that share our culture and core values.” — Dave Davis, CEO of Spahn & Rose

The dealer’s primary customers remain home builders, contractors and remodelers, accounting for about 80% of total sales with the remaining 20% of sales to homeowners and DIYers. All of Spahn & Rose’s locations have a complete assortment of millwork, cabinets and countertops to go along with a competitive selection of hand tools, power tools, fasteners, builder’s hardware and home security. The dealer’s flagship Dubuque location is its largest store, featuring a broader selection of nearly every product line it carries. “One of our company’s strategic growth initiatives is to add profitable companies that share our culture and core values,” said Dave Davis, CEO of Spahn & Rose. “I’ve known Dunn Lumber and their reputation in the industry for quite some time, so initiating a conversation with them was an easy call to make. Dunn Lumber does business much like we do, and closely aligns with our culture.” Dunn Lumber was founded in 1894 by Edward F. Dunn, and the store had been owned by the same family since it opened. Current owners — brothers Mike and Terry Dunn — are retiring after the sale to Spahn & Rose. Dunn serves builders, remodelers and homeowners

APRIL 2019 HARDWARE + BUILDING SUPPLY DEALER

throughout Walworth County, southeastern Wisconsin and northern Illinois, consisting of lumber and building materials, hardware and rental divisions. “The culture at Dunn Lumber is very similar to Spahn & Rose, so it is a natural fit. We have no plans to change Dunn Lumber’s name, marketing focus or local management,” Davis says. Spahn & Rose has overcome numerous business disruptions over the course of its long history. In 1911, the main yard and corporate office in Dubuque were ravaged by a devastating fire. A new yard was soon built and remained in place before moving in 2015. During that same span the company survived multiple economic disasters, including the Great Depression and Great Recession. Most recently, like many in the industry, Spahn & Rose faced wide swings in lumber and commodity pricing in 2018. That wasn’t the only challenge last year. “Construction spending was down

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Several views of the evolution Spahn & Rose has undergone during its 115-year history.

HBSDealer.com Untitled-1 1

significantly in Iowa in 2018, so we had to work harder and be sharper every day to grow our business,” Davis adds. Looking ahead to the rest of 2019 and beyond, Davis says that the company plans to be more aggressive, outbound and disciplined in obtaining new business and customers. The company also plans to “sensibly” expand its product and service offerings to meet the needs of its existing core business. “Other plans include using technology better in order to deliver real, measurable benefits to our customer base,” Davis said. Spahn & Rose is also poised to go on the offensive when it comes to strengthening its workforce. “Recruiting, hiring and retaining talent and focusing on making our

employees’ lives better — in order to remain a local employer of choice,” Davis explains. “Local” is a word that’s important to Spahn & Rose. In 1950, the Spahn & Rose Charitable Foundation was established with the goal of improving education opportunities and quality of life across the two dozen communities the dealer serves. Each year, Spahn & Rose invites representatives from service organizations to its Dubuque, Iowa, store for Big Red Check Day. In 2018, the Spahn & Rose Foundation made donations to 66 organizations. With 115 years under its belt, Spahn & Rose has developed a reputation for selling quality building products and for treating their customers the way they should be treated. “We pride ourselves on being a visible part of our communities,” Davis says.

HARDWARE + BUILDING SUPPLY DEALER APRIL 2019

4/20/2017 9:56:39 AM

Century Club Centuries in the making, still making moves • Aubuchon Hardware, founded in 1908, acquired Lynde Hardware and Supply, a hardware store on Main Street in Gardner, Mass. According to both companies, the deal brings together two families that have served the local community and its hardware needs for generations. In 110 years, Aubuchon has grown to 103 stores. “We are really marrying together,” said Celeste Drake, VP of Lynde Hardware. “They have been in hardware longer than we have and it’s nice to have someone local taking it over.” Both of the Drakes will remain employed by Aubuchon. • Deering Lumber, founded in 1866, was acquired by U.S. LBM Holdings. A strong customer base, diverse

product offering and team focused on customer relationships make Deering Lumber an ideal addition to our family of companies,” said U.S. LBM President and CEO L.T. Gibson. With this acquisition, U.S. LBM now has 5 locations throughout Maine. Deering Lumber operates 3 locations in Maine, serving custom home builders and remodelers across most of the state and the neighboring New Hampshire coastline. • “You don’t stay in business for 150 years unless you grow with the times,” said Erin Leonard, president of Gordon Lumber. The Freemont, Ohio-based pro dealer founded in 1868 will consolidate two “redundant” retail operations, while expanding its components manufacturing business. And the company has made several management promotions to help

execute its growth strategy. Operations at its limited service Bellevue and Bowling Green lumberyards will be consolidated into full-line contractor and retail lumberyards in Fremont, Genoa, Huron and Port Clinton. Gordon also said it is reallocating additional resources into the full line lumberyards to support growth, expand product and service offerings. This change follows years of centralizing pro-sales and service out of its main line lumber yards. “The housing industry has adopted and embraced components as the way of the future and Gordon Components will be there to support and serve the continued growth in this sector,” Leonard said. Additionally, the pro-sales retail businesses have shifted to a model of fewer and larger distribution points that cover more geography [and] offer more services.”

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Ace Hardware Report

Two Helpful Places to Chill Ace Hardware’s 2019 ‘Coolest’ stores capture the spirit of independence. Hensel’s Ace Hardware of Arcata, Calif., appeals to the entire family, with its full-service paint center, housewares department and built-in, old-fashioned candy store. Madison Ace Hardware serves its Florida town of 2,853 so well that it has a following of 7,983 Ace Rewards Members. The two stores, both known for their community centricity, now have something else in common. They’re both honorees of the Ace “Coolest Hardware Store” award. “Out of more than 5,200 Ace locations around the world, no two stores are the same,” said John Tovar, VP, retail operations and new business for Oak Brook, Ill.-based Ace Hardware

Corporation. “That local differentiation, on top of the service, convenience and quality our customers have come to expect, is what has Ace Hardware poised to stand the test of time.” The hardware co-op says it selects only a handful of Ace stores annually to receive the Coolest-Store award. The recognition is based on how well the store differentiates its offerings, services and culture to meet the needs of the community, Ace said. Both stores were recently recognized at the Ace Hardware 2019 Pinnacle Conference in Las Vegas. Here’s how Ace describes its two honorees:

Hensel’s Ace Hardware

Three years ago, Ceva Courtemanche purchased the store from her father and immediately set out to renovate and improve the business. Split between two different buildings decorated with historic photos from the community, Hensel’s Ace Hardware is known for its housewares department, fullservice residential and commercial paint center, and full old-fashioned candy store. Hensel’s is a destination for international and local gourmet candies, Benjamin Moore paints, and unique houseware gifts, but what sets the store apart is the focus on creating a friendly and fun environment. From the store’s monthly spirit days where the staff dresses in a theme

Ceva Courtemanche, left, leads the team in Arcata, Calif.

to compete for customer’s votes, to their traditional December “Ugly Ace Sweaters”, and even a free familyfriendly Halloween haunted house, the folks at Hensel’s keep the instore experience fresh and fun. Courtemanche and her team’s commitment to the community goes

APRIL 2019 HARDWARE + BUILDING SUPPLY DEALER

beyond the store’s locally-focused product assortment, as she and her staff have become known in Arcata as a company willing to step up for the greater good.

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Tyler McDonald, left, manages the store, known as “the mall of Madison.”

Madison Ace Hardware

Tim and Lacretia McDonald own Madison Ace Hardware, and the McDonalds’ story is one of faith, family, and having a servant heart for their community. Tim is a full-time preacher, who left a job at a local paper mill because he felt called to create a different lifestyle for his family. Lacretia is a proud grandma, piano teacher, and the store’s bookkeeper. Their son, Tyler, now serves as Madison Ace Hardware’s Store Manager. At Madison Ace Hardware, everything starts with an expertly-trained staff, who each sign a handbook of core values and work to earn the right to wear their iconic red vests. While Madison is a small rural community in Florida with a population of 2,853, the Madison’s Ace Hardware already has 7,983 Ace Rewards Members. A true testament to the product assortment at the store and a

ACE BY THE NUMBERS

A couple of records, and a lot of metrics Oak Brook, Ill.-based Ace Hardware Corp. set a pair of records in its latest quarterly earnings report. The company posted record-breaking fourth quarter revenues of $1.4 billion, up 5.7% from the same quarter last year. The company also reported a record $5.7 billion in full-year revenues, up 6.1%. “Strong new store growth, increased same-store sales, and a 43% increase in acehardware.com revenues helped us realize a health 5.7% increase in revenues during the fourth quarter,” said Ace CEO John Venhuizen.

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reflection of the community’s support. Some of the product offerings include locally crafted, real wood outdoor furniture, national brands such as Traeger, Big Green Egg, Weber, and Yeti. The store also offers specialized outdoor items like camping, fishing, pocket knives, marine, expanded towing, collegiate merchandise, bulk propane and bulk kerosene.

Ace finished the year with a net increase of 132 retail outlets, bringing its total at the end of 2018 to 5,253. (About 800 are outside of the United States.) Ace also provided clarity on the performance of the 3,000 co-op members who share point-of-sale data. This group generated the following stats: Q4 Retail same-store sales:

1.3%

FY Retail same-store sales:

2.3%

Q4 Average ticket:

2.3%

FY Average ticket:

3.3%

Q4 Number of same-store transactions:

1.0%

FY Number of same-store transactions:

0.9%

“The teams at Hensel’s Ace Hardware and Madison Ace Hardware exemplify what makes Ace great,” said Tovar. “[They’re] helpful, unique, and always striving to meet the changing needs of the community.”

Net income for the quarter jumped to $25.1 million, up from $14.0 million in the same quarter last year. For the year, net income was $128.2 million, a decrease of $19.2 million, from fiscal 2017. The company said the full-year decrease was a result of warehouse expansion costs, lower Retail Support Center productivity, and increased marketing and advertising expenses. The company’s 2018 patronage dividend was $142 million. Ace also shares financial performance results of its Ace Retail Holdings LLC — the owner of 123-store Westlake Ace Hardware stores. For the full year, the chain’s revenues were $329.7 million, up 19.6% from the previous year. Westlake added net 15 new stores in 2018.

HARDWARE + BUILDING SUPPLY DEALER APRIL 2019

Market Insights

As houses gain in years, remodelers pick up the pace Here’s some good news coming out of Harvard: The remodeling market has expanded more than 50% since the end of the “Great Recession.” That’s one of the headline findings of “Improving America’s Housing 2019,” a report by the Joint Center for Housing Studies of Harvard University. The study finds that as homebuilding struggled to meet the nation’s growing housing needs, spending on improvements and repairs to both owner-occupied and rental properties hit a record of nearly $425 billion in 2017. “With new construction slowly recovering from historic lows, 40% of the country’s 137 million homes are at least 50 years old,” said Abbe Will, associate project director in the Remodeling Futures Program. “The aging of the housing stock has been a boon to the remodeling industry, with spending surpassing investment in homebuilding every year for over a decade, and contributing 2.2% to US economic activity in 2017.” The steady uptick in house prices in many markets and the aging population are also driving increased spending on home improvements and repairs. Rising prices mean growing home equity, which provides owners both the incentive and the means to undertake more and larger projects. Additionally, older households have higher homeownership rates than younger households, and many have the resources to afford major renovations, including accessibility modifications that allow them to remain safely in their homes as they age. Households 55 and over account for half of all improvement spending by homeowners today. Although younger households have struggled to gain a

APRIL 2019 HARDWARE + BUILDING SUPPLY DEALER

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foothold in the homeownership market since the housing crash, the number of owners under 35 is finally showing signs of a rebound, and so is their remodeling spending. In particular, younger households contribute significantly more to local improvement spending in many metros across the Midwest and the South, where owning is more affordable than in high-cost metros on the east and west coasts. With homeownership recovering, almost 7 million rental and vacant units were converted to owner occupancy in 2016 and 2017, and their owners invested $50 billion in improving their condition. Additionally, homeowner spending on repairs following natural disasters totaled about $30 billion, accounting for 6 percent of national home improvement expenditures in 2016–2017. To pay for home improvements, homeowners relied largely on savings, even for major projects; more than half of projects costing $50,000 or more in 2017 were funded by cash. Expanding the ability of owners to pay for improvement projects over time— whether through home equity loans or lines of credit, cash-out refinances, or contractor-arranged financing—would not only generate considerable growth

in the remodeling industry, but also help to preserve and modernize the nation’s aging housing stock. “Over the next decade, the strong preference of older homeowners to age in place and the increasing difficulty of building affordable housing in many

markets will continue to hinder the construction of new homes,” said Kermit Baker, director of the center’s Remodeling Futures Program. “The remodeling industry will therefore retain its critical role in helping the country meet its housing needs.”

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PEOPLE IN THE NEWS Deere & Company’s Board of Directors has elected John May as president and chief operating officer. May has been with Deere for 22 years and joined the senior management team in 2012 as president of agricultural Solutions and chief information officer. Last year May was named president of the Moline, Ill.-based company’s Worldwide Agriculture & Turf Division, with responsibility for the Americas and Australia, the global harvesting, turf and utility, and crop care platforms, and the intelligent-solutions group. Earlier in his career, May headed the company’s China operations, served as factory manager at the Dubuque Works, and was vice president of the turf and utility platform.

84 Lumber named its 2019 Rookie of the Year: Nick Luchonok, a co-manager of the lumber yard company’s Oakland, N.J., location. Luchonok is 84 Lumber’s third Rookie of the Year. After starting at the company in January 2018 as a manager trainee in Lords Valley, Pa., he was promoted to co-manager in Oakland, N.J. last August. Luchonok has brought an ambitious nature to his role, the company said. One of his primary goals as co-manager is to refamiliarize the store’s contractor customers with counter service. “(We) needed someone who could bring some of that business back to the counter,” said Luchonok, the company’s third associate to earn the ROY title. “Now contractors are being exposed to and supported by more people at the store, including manager trainees, which improves the overall service they get from us.”

Nick Luchonok, and 84 Lumber President Maggie Hardy.

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APRIL 2019 HARDWARE + BUILDING SUPPLY DEALER

Hardware, paint and lumber distributor PACOA named Joan Walsh to the post of senior director of merchandising/ purchasing. Walsh comes to Port Washington, N.Y.-based PACOA with more than 25 years of experience in the merchandising and purchasing arena. She has worked in in consumer goods, gourmet food and sporting goods, along with a six-year run at Emery Waterhouse. According to the announcement, Walsh’s strengths are in senior level management of sourcing, product selection, vendor management, purchasing and merchandising. The company said that Walsh and David Steuerman will develop and execute strategic sales planning and relationship building to capture market share and drive revenue growth. PACOA are the initials for Paint Applicator Corporation of America.

HBSDealer.com

Emery Jensen Distribution, a division of Ace Hardware Corp., named Travis Wilcox as regional VP of sales, East. Wilcox will be responsible for managing and developing the sales team covering the East Coast to support growth and expansion in the area. Before joining Emery Jensen Distribution, Wilcox gained experience managing a sales team for Benjamin Moore. He also gained hands-on retail experience as the owner of retail cellular stores. He will be working with the Emery Jensen sales team throughout the East, as well as out of his Fort Lauderdale office.

Haack

Eagle Materials announced that CEO Dave Powers will retire as an officer of the company, effective July 1. Powers will remain on the board of directors and will be succeeded as CEO by Michael Haack, currently president and COO at Eagle. Haack joined Eagle as COO in 2014 after a 17-year career at Halliburton Energy Services. He was named president and COO at Eagle in 2018. Powers has had a 40-year career in the building materials industry and joined Eagle Materials — formerly Centex Construction Products — in 2002. He was promoted to executive vice president for Gypsum in 2005 and named president and CEO in 2016.

Greg Ugalde, a Connecticut-based builder and developer with more than 25 years of experience in the home building industry, has been elected as the 2019 chairman of the National Association of Home Builders (NAHB). Ugalde is president and chief legal officer of Torrington-based T&M Building Co., Inc., one of the state’s largest home builders. “Easing the growing housing affordability crisis is the most important issue facing our industry in 2019,” said Ugalde.

SPECIAL ADVERTISING SECTION

PRODUCT SHOWCASE

KeyHero™ is a free mobile app for iOS and Android to store your home and office keys the smart way, digitally. Create digital copies of your keys Cut duplicate physical keys from saved digital keys Share digital keys using the KeyHero™ app. Visit mykeyhero.com for more information.

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The New HYDE® DIG-IT™ The DIG-IT™ is a multipurpose heavy duty removal and scraping tool. It’s ideal for digging out caulk, grout, mortar, and other difficult-to-remove materials. It has a heavy duty high carbon steel blade with a beveled edge for scraping paint.

4-in-1 Magnetic Arm Hold needed items with the Magnetic Holding Arm by Master Magnetics featuring a rubbercoated, non-scratch magnetic base and smaller magnetic base for interchangeable mounting tools. Includes spring clip, suction cup and clamp hold notepads, phones, flashlights and more. Metal plate included for mounting on flat nonferrous surfaces.

HARDWARE + BUILDING SUPPLY DEALER APRIL 2019

Residential Construction/Sales

Monthly Retail Sales, not adjusted

13 months of housing starts and existing-home sales

home centers and pro dealers (NAICS 444) and hardware stores (NAICS 44413)

Total starts

NAICS 444

(in thousands, SAAR) Jan.: 1,230,000 1400

1300

NAICS 44413

(sales in $ billions)

32.2

34.5 31.6

32.1 29.4

28.9

2.32

2.45

2.33

2.21

2.29

2.31

1200

1 10

1100

1000

OCTOBER

2017

SOURCE: COMMERCE DEPARTMENT

NOVEMBER

DECEMBER

OCTOBER 2017

2018

NOVEMBER

DECEMBER

2018

SOURCE: MONTHLY RETAIL TRADE REPORT FROM THE U.S. CENSUS BUREAU

Single-family starts (in thousands, SAAR) Jan.: 926,000 950

HBSDealer Stock Roundup

900

the percent-change performance of stocks based on Mar. 14 prices 50

850

800

ANNUAL CHANGE

750

700

TSCO

SOURCE: COMMERCE DEPARTMENT

Existing-home sales (in millions, SAAR) Jan.: 4.94 million 5.75

LOW

20 10

SHW

0 DE

-10

BMC

-20

5.5

SWK

-30 5.25

DJI

BECN

-40 -10

BLDR

-8

-6

-4

-2

MONTHLY CHANGE 4.75

BECN (BEACON); BLDR (BUILDERS FIRSTSOURCE); BMCH (BMC STOCK HOLDINGS); DE (DEERE & CO.);

J F M A M J J A S O N D J

HD (HOME DEPOT); LOW (LOWEâ&#x20AC;&#x2122;S); SHW (SHERWIN-WILLIAMS); SWK (STANLEY); TSCO (TRACTOR SUPPLY);

SOURCE: NATIONAL ASSOCIATION OF REALTORS

WY (WEYERHAEUSER); DJIA (DOW JONES INDUSTRIAL AVERAGE)

Consumer Watch Unemployment rate

Consumer confidence

Gas prices

for the entire United States

indexed to a value of 100 in 1985

average price per gallon (regular)

5.0 4.5

100

5.5

$2.50

Current

$2.00 80

6.0

Prior month

120

Prior year

4.0

3.8% 3.5

February

6.5 60

131.4

$2.53

February

Mar. 14

140

APRIL 2019 HARDWARE + BUILDING SUPPLY DEALER

$1.50

$3.00

SOURCES: LABOR DEPARTMENT, THE CONFERENCE BOARD, AAA

HBSDealer.com

Gain the Competitive Edge Maximize Margins and Profitability with Kerridge Commercial Systems

Kerridge Commercial Systems (KCS) world-class ERP solutions have been and continue to be developed for your business needs. Our software solutions help you get closer to your customers, build profits and grow margins. Your sales, operations, and back office staff will benefit from systems designed by hardware and construction related supplies experts with the goal of improving day-to-day performance and enhancing your customer’s experience.

Measurable benefits realized with Kerridge Commercial Systems fully integrated ERP solutions: • Only true fully-integrated ‘all-in-one’ ERP system designed speciﬁcally for lumber and building materials distributors, wholesalers, retailers, dealers, and manufacturers.

KCS provides fully integrated ERP systems complete with Sales Order Processing, Purchase Order Control, Integrated Accounting, Business Intelligence (BI), CRM, E-commerce Solutions, Warehouse Management, Stock Management, Tool and Equipment Rental, and so much more.

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• We are a 40+ year old company with over 900 corporations using our solutions daily. • Support, Implementation and Development 90% of our customers are in the Lumber, are based in our U.S. oﬃces and committed General Building Materials, Industrial Supplies, to our customers’ needs. and Floor Coveing industries. • Business Intelligence (BI) gives you clear • Branch Management, CRM, Manufacturing, business insights by measuring and E-commerce, Rental Management, Wireless monitoring your overall business Warehouse Management, Dispatch/Delivery, performance. Business Intelligence (BI), and robust • Our solutions are scalable from 10 to over Financials…all built by our in-house 10,000 users. development team. • E-Commerce enables you to sell online, manage stock and give customers access to their accounts.

• Improve margins, experience greater proﬁtability and enjoy the ability to grow your business when you partner with KCS.

When investing in a new ERP system, it is important to select a software solutions provider that will be your partner when it comes to integration, implementation, and training. KCS will be there for the long-term with dedicated customer support and on-going innovation.

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info@kerridgecsna.com

919.379.3800

Let

transform your store!

Look what other industry leaders are saying... “Since our conversion to Hillman, our Hardware Department looks much sharper and cleaner, and creates a lasting impression on the consumer.” “Their merchandising is top-notch – making it very easy for the customer to quickly identify and locate the product they are shopping for.” “Our sales figures have increased considerably, while simultaneously recognizing an increase in profit margins.” “Hillman offers high-quality products that I can sell with confidence.”

The Hillman Group, Inc. Cincinnati, OH 45231 • www.hillmangroup.com

CATEGORY MANAGEMENT ✓ Analysis and SKU rationalization ✓ Maximize inventory productivity and overall profitability VISUAL PRESENTATION ✓ Enhanced POP and shelf talkers make shopping easier ✓ Customized POGs and pricing labels ✓ Exceptional display fixtures

Visit us at booth #7212 National Hardware Show - Las Vegas