Ace doubles down on savings
Ace Hardware has results to report for its SAVINGSource initiative, which was launched in early 2015 to leverage its combined purchasing power to cut costs for its members.
In addition to reduced operational costs (an estimated $120 million, according to Ace), members are also enjoying improved contract terms with vendors.
Through SAVINGSource, Ace stores have access to pre-negotiated pricing for products and services within 40 operational categories across five functional areas, including: technology and communication; supplies and replenishment; professional services; facilities services; and, capital projects and construction. Specific examples include insurance, 401(k) administration, computer hardware and software, phones, office products, waste and recycling and HVAC.
“In today’s ever-changing retail environment, Ace’s small business owners face an incredible amount of challenges, including fierce competition and more complexities than ever before,” said Fadi S. Abu Manneh, senior manager of retail procurement. “We are proud that SAVINGSource saves store owners time and money on these fundamental areas of their business so that they can focus their energy and investments on driving their businesses and communities forward.”
Cost-saving opportunities are identified by members of Ace’s corporate Retail Indirect Procurement department, who use data to figure out which Ace stores collectively use the same service or provider. That puts Ace in a better position to negotiate improved rates and service terms.
Purchasing power is then negotiated in a number of ways: via existing corporate spend, via a sourcing event (where Ace works with a Retailer Input Team to contract with providers directly), or via group purchasing organizations (GPOs), who combine the spending power of their multi-billion dollar members. One such example is Ace’s relationship with Corporate United, the nation’s largest GPO. Corporate United has chosen to work exclusively with Ace Hardware in the convenience hardware channel.
“I am extremely impressed with the amazing work Ace has done to identify opportunities across the organization to further take advantage of our co-op’s scale, strength and reputation,” said Kirby Kuklenski, owner of five Ace Hardware stores throughout Denver and Colorado Springs. “Aligning with SAVINGSource has saved us a meaningful amount of money in a short period of time. The savings potential here truly is exponential and speaks to the power and strength of the Ace Hardware cooperative.”
“As a store owner, I wear many hats, sometimes too many. It’s extremely reassuring that my co-op has a dedicated team of corporate professionals reviewing contract terms and negotiating on my behalf. I sleep a little easier knowing our hard-earned profits aren’t being spent on unnecessary expenses,” added Kuklenski.
Beacon acquires BJ Supply
Beacon Roofing Supply acquired BJ Supply, a distributor of roofing and related building products in Northeast Philadelphia.
Founded nearly 30 years ago, BJ Supply’s Bristol, Pennsylvania, location will complement Beacon’s existing presence in Philadelphia, its surrounding suburban counties and New Jersey.
"Teaming-up with Beacon presented the best opportunity for our company to grow our business and introduce new product lines to our customers," said BJ Supply founder Joseph Pfluger, who will remain with the company. "Beacon long has been a powerhouse in the Philadelphia suburbs, and we look forward to being able to bring Beacon’s greater product offerings to our customers and to complement Beacon’s existing area locations to more efficiently service customer needs. This is an exciting day for our company.”
"We are very excited that BJ Supply has joined the Beacon family," said Paul Isabella, Beacon’s CEO and president. "It is a great company with a strong customer base and experienced employees. Combining BJ Supply with our existing Philadelphia area branches gives us a more powerful footprint in Northeast Philadelphia with even greater access to New Jersey customers. It is a great addition to Beacon.”
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MiTek opens third warehouse in 13 months
MiTek opened a new warehouse and distribution facility in Atlanta, Georgia.
Serving two-step customers and MiTek’s sales network, the 45,600 sq. ft. facility will warehouse truss connector plates and USP Structural Connectors products.
This new facility is the third warehouse opened by MiTek in the past 13 months, and it joins other facilities already located in New Jersey, Florida, Indianapolis, Minnesota, Houston, Phoenix, and California.
The new Atlanta facility enables rapid distribution of MiTek building products to customers within a 500-mile radius. It’s one mile from the Hartsfield-Jackson Atlanta International Airport.
“With its strategic location, it provides us with even more coverage areas for one-day or two-day delivery of MiTek products,” said Todd Asche, Senior VP of operations. “This new warehouse and distribution facility is clear evidence that MiTek is ‘on the march,’ with a goal of distributing our products at an expansive geographical scale.”
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