In D.C. court, a victory for hearth and home
An estimated two-thirds of the 6 million or so gas fireplaces in the U.S. are purely decorative.
And thanks to a recent court order, these decorative fireplaces will not have to abide by Department of Energy regulations on energy efficiency — averting big losses for manufacturers. The District of Columbia Court of Appeals ruled in favor of an appeal filed by the National Propane Gas Association (NPGA) challenging the DOE’s recent actions to regulate decorative hearth products.
The victory for the hearth products industry, according to the NPGA, culminates a nearly two-year battle of the propane and hearth product industries with the DOE on the agency’s ruling of vented gas hearth products.
"If left unchallenged, the effect of the DOE rules would have eliminated entire product lines of decorative gas fireplaces and decorative gas log sets that would no longer be available to home builders or homeowners," said Rick Roldan, president and CEO of NPGA. "Additionally, the rules unfairly targeted the small businesses comprising the propane industry and would have resulted in a more than $20 million loss for our industry."
The Court also rejected the DOE’s notion that these products could be regulated by establishing exclusion criteria, including a ban on standing pilot lights. This equated to imposing a design standard on the industry, and the court ruled that the DOE does not have the statutory authority to do so in this circumstance.
The decision strikes down regulatory requirements imposed by the two DOE Final Rules affecting vented gas fireplaces, and gas log sets (75 Fed. Reg. 20112 and 76 Fed. Reg. 71836).
Made in America is right at home in Hartville
In Hartville, Ohio, sits America’s largest independent home center at 305,000 sq. ft. In the middle of Hartville Hardware sits a house constructed entirely of U.S.-made products — from the foundation to the sheet rock, paint and appliances.
"There’s definitely been an increase in people wanting to buy U.S.-made products," says Howard Miller, president of Hartville Hardware, a member of the Do it Best co-op. "General Electric makes washers and dryers in the U.S. and people love that. They’re asking for U.S.-made all the time."
But that wasn’t always the case. Three years ago, when Hartville brought in some Made-in-USA Carhartt apparel that retailed about 10% higher than similar imported product, people wouldn’t pay the extra money. "Now the sentiment has turned," Miller said. "They’re aware of the value of buying American-made product."
The folks back at Do it Best headquarters in Fort Wayne, Ind., agree that Made-in-USA has become more important to consumers in the last few years. "We have seen a renewed interest in these products and have addressed it in several ways," said Steve Markley, Do it Best’s VP merchandising.
First, the co-op has made it easier for consumers to identify American-made product by calling them out in the catalog and in advertising, giving Do it Best stores the option to use Made-in-USA-focused circulars that tie into Memorial Day, the Fourth of July and Labor Day. Within departments, Do it Best stores can use special Made-in-USA endcaps, signage kits, shelf danglers, bin label and stickers.
Do it Best members also have access to an increasing number of U.S.-made products. In fact, Markley said: "When making a decision on a product, country of origin is a consideration, and we’ve added products because they’re U.S.-made. I think the awareness of the average consumer is higher on this issue, and retailers are responding."
Regarding Hartville Hardware’s 1,850-sq.-ft. American house, Markley said he’s glad to see a retailer out there that’s so much in tune with its customer base, adding: "There’s an appetite from the consumer for product made in America, and they’ve recognized that and used it as a vast selling tool in their store."
The only product the store with in the store couldn’t showcase was reasonably priced U.S.-made lock sets. That explains the use of "assembled-in-USA" in that category.
Ace’s Venhuizen takes over the reins
On March 31, John Venhuizen will step from behind the scenes into one of the most front-and-center posts in the hardware business — that of CEO of Ace Hardware Corp. After standing and delivering a motivational presentation to thousands of dealers at the co-op’s Spring Convention & Exhibits in New Orleans, he sat down with HCN.
HCN: What worries you as you step into the CEO role?
Venhuizen: I think the theme of the day here is momentum and continuity. Change in leadership doesn’t necessarily mean change in direction. We feel like we have momentum. That’s not to say everything is rosy. We’ve got challenges.
HCN: You have stated that the industry’s declining transactions and store count are two of them.
Venhuizen: Our challenges and the retailer’s challenges are the same thing. There is pressure on our industry. It’s consolidating. There’s pressure on transactions and profit, and operating expenses, health care. But when has our business not had some sort of challenge? We need to focus on what we think we’re great at. We’re optimistic about our future despite all those challenges.
HCN: You also emphasized the idea of keeping score with money. Can you explain that?
Venhuizen: In business, we keep score with money. And we encourage our stores that they shouldn’t feel bad about that. But business is not about money. It’s about people. And people are why we keep score. Because in the end, for a lot of our owners, what they’re most proud of is what they can give back to the community. And they have the ability to give back because they run a successful hardware store.
HCN: A big buzz at your show is the introduction of Valspar.
Venhuizen: Without doing anything, because of our partner, you get 10% more gross profit on the No. 1-rated paint in America (according to Consumer Reports), Clark & Kensington. That’s a big win. They get a year and a half to sell Valspar before they have to pay for it. Third, they’re going to get the whole department for free — tinters, racks, decor signage and a free reset. And our dealers believe we are going to do what we say we are going to: drive footsteps into the store with the paint lineup.
HCN: Why are some on the fence about bringing it in?
Venhuizen: The issue is whether the brand they also have already will allow them to bring in Valspar. And that’s causing some consternation, understandably. That’s really the only tension. Outside of that, I’d say reaction is wildly enthusiastic.
HCN: Would you agree the No. 1 story today is the battle with the big boxes?
Venhuizen: The growth of Home Depot, Lowe’s and Menards has made it more difficult in our industry. But their days of large new store growth are largely behind them. In the $300 billion pie in home improvement in the U.S., we are going after the $40 billion that is the convenience hardware segment. Our stores get about $10.5 billion of that in the U.S. We’re going after the rest.
HCN: What’s your current home improvement story in your house?
Venhuizen: I just told the story [during the general session.} While I was traveling, I had my wife go painting with the No. 1-rated Clark & Kensington.
HCN: I didn’t know if that was a real story or just an entertaining story.
Venhuizen: It’s real. And it’s a project that is going on right now. Do you think I make that stuff up?
HCN: You look like you have fun up there speaking to the members. Is that a prerequisite for the job?
Venhuizen: No, but it helps. When you get a great team together and they love what they do, the energy comes through and that’s what you see.