—Ace CEO Ray Griffith described the economy as the “800-pound gorilla” in the room and a challenge as tough as the retail competition.
Speaking here at the Ace Fall Convention during a general session, Griffith pointed to some positive stats. Ace’s operating expenses are expected to be some $16 million below 2007. Comp-store sales at Ace were down in the second quarter, but not as far down as big-box competitors.
Through August, bottom line income stands at $57.3 million, ahead of last year’s $52.7 million.
“Ace financially is rock solid, and the brand is vibrant, folks,” he told the assembled dealers, who interrupted his 35-minute speech to applaud several times.
A feeling of conservative merchandising hung over the several dealers in St. Louis, who said they were responding to economic conditions with a conservative merchandising strategy. “We’re not looking to gout on a limb and try fancy new products,” said Jim Lee, manager of one of two King’s Ace Hardware stores in Billings, Mont. “We’ll stick with what we know and do our very best.”
During the co-op’s merchandising presentation, Lori Bossmann, Ace’s vp-merchandising, marketing and advertising announced market share gains in the paint category, from 2 percent to 4 percent overall. She also pointed to an opportunity to sell more to customers throughout the store, as about 48 percent of shoppers buy only one item per visit. “What an opportunity,” she said.
Also described as an opportunity for dealers is environmentally friendly products. “Green products are the fastest growing market segment in the lawn and garden industry,” said Guy Duvall, lawn and garden merchandise manager.
Ace has opened 66 new stores so far this year, with 29 branch stores, 24 new investors and 13 conversions and have 109 prospects registered at the St. Louis convention.