DISTRIBUTORS/CO-OPS

High-hopes for farm, ranch and pet

BY Ken Clark

True Value’s Kevin Rewerts, divisional VP of merchandising for automotive-pet-farm & ranch, said the co-op’s five-year plan to grow the farm-and-ranch-and-pet business by $100 million is on track. 

In an interview with HCN, Rewerts added that the pet division is taking on a retailer’s-best-friend role at the co-op, and has emerged as the fastest growing category at True Value. 

“We’re seeing very high double-digit increases in pet,” Rewerts said, pointing to increases in both the number of dealers getting into pet and the number of dealers adding shelf space to existing pet-related assortments.

“Our best members carry pet and use pet as a focal point of their store,” he added.

Some 300 new pet brands are available to True Value dealers, including dog food brands Royal Canin and Iams. The company also rolled out is own private-label True Value brand – Pet Expert dog food and dog treats. It was launched June 16 after about eight months in the making. 

When he did his own product testing of the treats, Rewerts says dogs in his neighborhood “gobbled them up like candy.”

While the pet category brings hardware stores into competition with some big national chains, Rewerts says the projected $60 billion industry has no single dominant channel. Therefore, independents have an opportunity to break in.

“Most people who buy from retailers buy from two or three retailers for their pet needs,” he said. 

Pet not only drives traffic into the store, he said, it leads to incremental purchases. “That’s why the hardware channel is loving this business,” Rewerts said.

The Chicago-based co-op has three years remaining on its five-year, $100 million, farm-and-ranch growth plan.

 

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Ace breaks ground for Ohio distribution center

BY HBSDEALER Staff

A groundbreaking ceremony Tuesday drew representatives from Ace and local business leaders to the site of a future retail support center in West Jefferson, Ohio.

The co-op expects the 500,000-sq.-ft. facility to be completed in July 2014. The facility will essentially replace an older facility currently operating in Toledo.

“Ace is pleased to break ground on this state-of-the-art facility,” said Rick Whitson, VP retail support, Ace Hardware Corp. “Our new Retail Support Center in West Jefferson will play an integral part in Ace’s overall supply chain, carrying as many as 16,000 different products to supply hundreds of Ace retailers and, in turn, serve thousands of consumers.”

The co-op operates 14 retail support centers.

The West Jefferson facility will serve Ace Hardware retail locations throughout Ohio, parts of Michigan, Eastern Indiana and Northern Kentucky. It will also employ approximately 100 Ace team members locally.

The warehouse will have the capability to expand by more than 280,000 sq. ft. to meet future growth needs. The facility will be furnished with 84 dock doors, as well as power equipment that will run by hydrogen fuel cell technology. 

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Ace Hardware reports sales gains in Q2

BY HBSDealer Staff

Pointing to sales gains in virtually every department, Oak Brook, Ill.-based Ace Hardware Corp. reported second-quarter revenue growth of 9.7% — to $1.74 billion from $1.07 billion. Net income increased to $42.3 million, compared with net income of $14.9 million in the same quarter last year.

CEO John Venhuizen said the co-op is pleased with the results so far in 2013. "Sales increased in virtually every department with significant growth at both wholesale and retail from our Discovery Edge, Level 3 merchandising re-sets and branding inititatives," he said. 

The second quarter also included a charge of $6.2 million related to the closing costs of the co-op’s Retail Support Center in Toledo, Ohio. 

Across the Ace network, same-store retail sales were up 5.3% for the quarter, with momentum gaining in June (up 6.1%) and July (up 9.8%). 

The company’s income statement includes a line for retail revenues — $77.7 million for the three months ended June 29. This line tracks the company’s December 2012 acquisition of Westlake Ace Hardware, which operates 86 stores in the Midwest. Same-store sales at these Ace-owned stores were down 3.4%, which the co-op contributed to a cold spring that limited lawn and garden sales.

On the wholesale side, total wholesale revenues were $1.1 billion, up 2.4%, as compared to the prior year. The increase would have been 4.4%, when including wholesale revenues to WHI, the indirect owner of the Westlake chain.

The Ace co-op added 34 new domestic stores and canceled 19 in the second quarter. The total domestic store tally stands at 4,121 as of June 29. 

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