Embracing water conservation
Gov. Jerry Brown’s 25% water usage reduction mandate seems to have driven the point home for many area residents: Drought conditions in California are hardly a distant abstraction anymore.
As California strives to rise to the occasion, there’s a natural selection of sorts that’s taking place in the building industry. The mainstream is adopting the products that do the best job of conserving water — and by extension, the hardware stores that do the best job of supplying them.
Truthfully, home improvement retailers are encountering a fertile valley of sales growth and opportunities, particularly as they apply to irrigation products.
David Cowie, co-owner of Baller Hardware in Los Angeles, sees his customers moving toward drip systems and water-saving shower heads in the absence of much other change.
Augie Venezia, president of the 100%-employee-owned Fairfax Lumber & Hardware, has seen a boost in his bottom line as well: Customers are going after water-conserving devices, and they’re also considering ways to adopt gray water reuse and rainwater harvesting. Should conditions continue along this track for another two years or so, Venezia foresees a major landscaping overhaul involving more hardscape and drought- and heat-tolerant plants.
In many ways, though, dealers aren’t merely taking a front-row seat to the transformation. They are also serving as the gatekeepers, directing the tide to an extent, and increasingly taking on a role as water conservation gurus in their communities.
“We were on this well over a year ago,” said Orchard Supply Hardware president Bob Tellier. “We’ve launched several programs to provide water-saving alternatives. We’ve done an education program on water saving in native California plants — everything from lavender to cactus and succulents. We label products accordingly and help customers make a considered decision, because it’s just a fact of life out here on the West Coast: five years of a pretty bad drought.”
Venezia agrees that awareness has reached critical mass, and like Tellier, his team has been expecting it.
“A lot of stuff that’s still in limbo really hasn’t hit in a hard way, but people are asking questions,” he said. “The phones are ringing. They’re talking to us about water tanks, gray water reuse and other water-conserving devices like shower heads. They’re not talking much about toilets yet, but we have them ready to go, and we’re gearing our nursery toward plant materials that are drought-tolerant.”
Obviously, the retailer’s role in effecting this sea change depends hugely on innovative suppliers. WaterSense-rated toilets have been on the ball, finding ways to use nearly half the water in any given flush: 1.28 gallons versus as much as 3.5, according to Adriana Miller, product manager for Mansfield Plumbing.
TOTO has earned special esteem as a Water Efficiency Leader (as designated by the EPA), touting high-efficiency, gravity-fed gallon-per-flush toilets that entail 71% water savings when replacing a 3.5 gpf toilet.
Elsewhere around the house, products like Toro’s Precision Series Spray Nozzles can reduce outdoor water usage by at least 30%, simply by using less water while retaining the same spray patterns and coverage. Even better if consumers are using a laundry ball in their wash cycle, which makes the used water suitable to be reused again for landscaping purposes.
Still, it takes a sage hardware store owner to help consumers navigate all these new options that are suddenly available to them, as well as guide them in using them to optimal effect. This, for Venezia, is akin to a promotion for the hardware retailer — a rise in prominence and significance within his community.
“Working in our industry has really not ever been a real glamorous job, but what we’re starting to see is products and methods of installation becoming more and more sophisticated,” he said. “And it’s taking more consulting by sales to customers regarding these products. It’s elevating the lowly hardware person to a higher position, and I think that’s a good thing.”
Orchard Supply Hardware: 2015 Retailer of the Year
San Jose, California-based Orchard Supply Hardware, the 2015 Hardware + Building Supply Dealer Retailer of the Year, describes itself as a company that wants to change the conversation about home improvement retailing.
How? By listening to the customer. By offering something different. And it definitely helps to have a conversation piece like the upscale, 40,000-sq.-ft. “neighborhood format” concept store format.
Orchard Supply executives talk passionately about being the first choice for repair and maintenance, for paint and for anything to do with the backyard. And its new format store earlier this year was honored with the Retail Design Institute’s National Award for the large format store.
But more than that, the retailer — a stand-alone division of Mooresville, North Carolina-based Lowe’s — is bringing ambitious plans to the West Coast. The 78-store chain is on pace to reach its three-year plan of $1 billion in annual sales and a fleet of 100 stores by the end of 2017, leading the industry from San Diego to Seattle.
And it starts with the store. Orchard Supply goes to market with a clear strategy: to fill the underserved space between the corner hardware store and the warehouse home center. That’s where the company’s 30,000-sq.-ft. to 40,000-sq.-ft. prototype comes into play.
“The store design is a crucial part of the strategy, because we want to change the conversation about hardware retailing,” said Bob Tellier, president. “This is not your hardware store where you look for one or two items. You come in to have a conversation and solve problems and have an exciting place to shop.”
In early April, Orchard Supply opened three brand new locations, all in California: Woodland Hills, Cerritos and Irvine. A week later it converted three existing California stores to its new “neighborhood format” — Sand City, Milpitas and Foster City. Three more were slated for re-grand openings as this article went to press: Pasadena, South Pasadena and Granada Hills.
By the end of the year, 65% of the Orchard Supply store base will be contained in the new, award-winning “neighborhood” format. That’s a long way from 2011, when only one store out of 80 sported the new look and feel. Also at the end of the year, the company’s focus will shift from remodeling mode to new-location mode.
Background and structure
Orchard Supply Hardware, which dates back to 1931 and its formation as a farmers co-op, has seen more than its share of ownership and management changes in the past decade. Under the ownership and management of Sears Holdings, the top post was held by Rob Lynch (now CEO of Lumber Liquidators) and then by Mark Baker, a former Home Depot executive.
Most recently, Lowe’s purchased the company out of bankruptcy proceedings in September 2013. Initially, Lowe’s executive Richard Maltsbarger was installed as president. In January, the stand-alone nature of Orchard Supply became more pronounced as Lowe’s promoted Tellier to run the Orchard business.
The relationship with Lowe’s has been positive and supportive, Tellier said. And the decision to elevate longtime Orchard merchant Tellier to the post of president is seen as a clear message in San Jose that Lowe’s is allowing Orchard to be Orchard.
“Even though we share ideas and we share information, there is no one from Lowe’s on-site here in San Jose,” Tellier said. “ Lowe’s was clear: They bought us because they like our concept, and we were a great alternative to their big-box stores. They agreed with our strategy. They’ve done everything they’ve promised, and they’ve been very supportive. We couldn’t have done it without them.”
So far, that cooperative spirit does not include sharing of brands. Though Orchard does carry Craftsman, closely identified with Sears, it doesn’t carry Lowe’s brands such as Kobalt. Conversely, there are no Orchard brands on Lowe’s shelves.
“On the merchandising end, our strategy, our customer base and our merchandising philosophy are quite different than Lowe’s,” Tellier said. “They provide a full project solution to customers, and we’re a repair and maintenance, paint and backyard company.”
He added that Orchard Supply actually competes with Lowe’s in many markets — “friendly competition,” he added.
Ultimately changing the conversation about hardware retailing involves changing the customer experience. At Orchard, a key part of that involves the phrase “lifestyle merchandising.” Tellier describes Orchard Supply’s business model as evolving more and more to an off-the-shelf merchandising style. The stores strive to create an atmosphere where consumers can see the products in their natural state — the way they would be used in their homes or their backyards.
“Our mission is to connect with our customers,” he said.
Noteworthy at the National Hardware Show
Looking back over its 70-year history, the National Hardware Show could check a couple things off its list on this significant anniversary.
For one, it’s managed to expand well beyond the wildest dreams of original NHS founders Abe Rosenburg and Charles Snitow — today requiring the sort of massive square footage only the Las Vegas Convention Center can provide.
On the other hand, it’s managed to build a sense of continuity into its legacy, with many of the same exhibitors returning year after year.
Many of the products identified here (as worthy of your time) come from these familiar NHS stalwarts, but as an institution that never truly stays still, there’s always room for some up-and-comers.
Channellock Slim Jaw, Wide Azz(r) Wrench
This wrench packs more than just a fun name. The adjustable wrench’s jaws open extra wide to 1-3/8 in., with length for added grip and a thinner profile for more maneuverability in tight spaces. (channellock.com)
Benjamin Moore Arborcoat Premium Exterior Stain
This is a stain that portends to do more than just deliver outstanding looks to decks, siding and outdoor wood furniture. It also touts its color retention and protection properties, with many varieties containing a mildew-resistant and water-repellant formula. (benjaminmoore.com)
Olympia FL450 LED Floodlamp
An essential commodity for both indoor and outdoor use, the FL450 is compact, light to carry and long-lasting: three hours of battery life at 450 lumens, to be exact. When time is up, its cordless, rechargeable design provides continuity. (olympiaproducts.com)
AMES NeverLeak Water System
These poly and steel hose-winding carts, cabinets and reels stand by their name. The aluminum water system won’t be bothered by extreme temperature dips, and it’s designed to prevent cross-threading. (ames.com)
Gorilla Super Glue
This impulse aisle heavyweight is hard to miss with its extra-tough formula that provides lasting repairs and dries in only 10 to 30 seconds. It’s also reinforced with rubber to help it bounce back from drops and bumps. (gorillaglue.com)
General Tools Express Drivers
Featuring a dual drive mechanism that doubles the speed of any job, the new Express Ratchet Driver and Ratcheting T-Handle Express Driver make versatile screwdriving an intuitive feat. The ratcheting mechanism allows the tip to rotate in the same direction no matter how you hold the handle. (generaltools.com)
Earthcore Industries Burnie Grill
This new impulse buy is like fire in one’s pocket. It’s a portable, single-use fire that’s perfectly self-contained, with no need for any wood, lighter fluid or clean- up. One match is all it takes to set the alder wood campfire aglow. (earthcore.co)
Hyde Tools Black & Silver Putty Knife
In celebration of its 140th anniversary and the trademark tools that put its name on the map, Hyde Tools will be showcasing special edition versions of its Black & Silver putty knives at the National Hardware Show. (hydetools.com)
BeraTek Hold and Go Slow Cooker
Slow cooking with the ease and speed of on-the-go design? This slow cooker boasts a 5-quart for appearances at tailgates and parties. The lid locks to prevent leaks, plus the handle can hold the lid for you while you serve. (beratek-industries.com)