Ace reports uptick in revenues
Oak Brook, Ill.-based Ace Hardware reported first-quarter revenues of $923.2 million, up 1.7% from the same quarter in 2012.
Net income of $4.4 million was down from $10.2 million earned in 2012.
"While our first-quarter results are down compared with the prior year, both revenues and net income were ahead of plan," said John Venhuizen, Ace CEO. "The first quarter of 2012 was an extraordinary quarter because of the unseasonably warm spring weather with revenues up $54.2 million, or 6.3%. Our expectations were that this was unlikely to recur in 2013, and we planned accordingly."
Venhuizen replaced Ray Griffith as CEO at the end of March.
The December acquisition of Westlake Ace Hardware, the 85-store Midwest chain, resulted in a reduction of reported wholesale revenues, as wholesale revenues from Ace to Westlake — a total of $18.9 million for the first quarter of 2013 — are now eliminated.
Ace’s balance sheet also reflects the acquisition. It now includes $74.4 million of Westlake inventory, $19.7 million of property and equipment, $23.1 million of goodwill and other intangibles, and $39.0 million of acquisition debt.
The co-op’s wholesale revenues of $883.4 million were down 2.7% compared to the same quarter last year. Comparable-store wholesale merchandise revenues declined 2.2%. The co-op said "approximately half of this decline was in the lawn & garden categories where the unseasonably cold spring weather in 2013 compared to the unseasonably warm spring weather in 2012 negatively affected demand."
Ace added 21 new domestic stores and cancelled 19 domestic stores. The new store count at the end of the first quarter is 4,106.
Do it Best reveals best sellers and opportunities
Indianapolis — Speaking to the collected body of Do it Best Dealers during the co-op’s Merchandising Market Preview here, Steve Markley described light bulbs as a high-interest, high-reward category.
He encouraged dealers to visit the GE booth, as well as that of new vendor TCP. Vendors and Do it Best executives say that as more options — and more questions — hit the light bulb category, the more the hardware store format will benefit. If they have the right products and the right product knowledge, light bulbs can result in big gains.
Markley also pointed to the fastest growing categories for the Fort Wayne, Ind.-based co-op year-to-date. They are:
• Patio fans and heaters, up 113%;
• Audio components, up 54%.
• Oscillating tool accessories, up 46%;
• Janitorial supplies, up 21%;
• Pond and fountain supplies, up 21%; and
• Food/snacks/beverages, up 20%.
In the area of light bulbs, where LEDs are increasingly a factor, Markley said the business has evolved beyond the obligation to meet efficiency regulations. "It’s about the opportunity," he said. "It’s there for you to pick up business and pick up market share. Make sure you have the right product and make sure your staff understands the opportunities."
Markley also pointed to a new "price-buster" program inspired by member demand for super low price discounts throughout the year. "We have the price buster promotion coming out on a monthly basis," he said. "These are Sneak-Peek type discounts on items we store in our RSC."
Sneak Peek is the term for the co-op’s 90-minute special-discount buying frenzy the night before the show officially opens. Some products are discounted more than 50%.
Markley said response to the program has been encouraging. "Look for that to grow."
May market emphasizes performance
Indianapolis — A number of innovations, events and product deals helped draw thousands of member-owners to the 2013 Do it Best May Market.
“From the strong member response at the Sneak Peek, to the solid attendance at our many seminars and training events and continuing out to the bustle on the market floor, we’ve seen a lot of enthusiasm among our members this weekend,” said Do it Best Corp. President and CEO Bob Taylor.
One of the points of emphasis on opening day of the May 18-20 market here at the Indiana Convention Center was the concept of performance. At the annual kickoff breakfast, Barry Wishner, president and CEO of ProFormance. In his message to Do it Best members, he showed how to jump start ideas and accelerate growth by questioning everything.
Before the official Saturday start of the market, attendees were able to take advantage of savings — some as high as 52% — at the annual Friday Night Sneak Peek event, during which select market vendors offered pricing exclusively to Do it Best members on a range of products. Member purchases reached $7.8 million during the 90-minutes event.
The Fort Wayne, Ind.-based co-op promotes the savings associated with the Sneak Peek event as a an opportunity to more than offset the cost of attending the event.
Some of the tech advancements highlighted at the market include the latest enhancements to the mydoitbest.com member website along with a new mobile app for the iPad that brings together all the product and ordering information necessary to make buying decisions on the sales floor.