Seven Corners sold to developer
St. Paul, Minn.-based Seven Corners Hardware, which has served hobbyists, homeowners, contractors and other DIY-oriented customers in the Twin Cities and beyond since 1933, will be closing its doors as a result of a real estate deal, said third-generation owner Bill Walsh, whose father and grandfather previously ran the store.
The company retained Tiger Capital Group to direct the sale of its merchandise inventories and other assets.
“Over the years, our family has turned down several offers to buy our property, which is prime real estate right across from Xcel Energy Arena,” Walsh noted. “We have always resisted these types of offers. But late last year, we made the difficult decision to sell to one of the nation’s largest real estate developers. The hardest part of this was contemplating the effect it would have on our 21 full-time employees.”
The decision hinged on a host of personal and business considerations, explained Walsh, who has operated Seven Corners for the past 28 years but has lived in California with his family for the past decade. “I have growing business interests in California and Nevada that have been requiring more and more of my time, and so traveling back and forth between the Midwest and the West Coast has become increasingly difficult,” he said. “Meanwhile, my son is a freshman at Notre Dame, and his career path is unlikely to include becoming the fourth generation to run the store.”
Given the tough competition in retailing today as well as Seven Corners’ location in a downtown neighborhood with rising real estate values, the pressure to close the business would only have grown moving forward, Walsh added. “Simply put, it seemed like the right time for this decision,” he said.
With 10,000 sq. ft. of retail space and 60,000 sq. ft. of warehouse storage, Seven Corners is known for the depth of its product lines as well as its 640-page catalog, which it distributes for free to contractors, woodworkers and hobbyists across the country. In 2012, the store’s distinctiveness prompted a profile in Popular Mechanics, which marveled at the dizzying selection of products, replete with unusual items like a 4-ft.-long pipe wrench or Manila rope so thick it has to be cut with a hacksaw before it can be sold to Mississippi River barge operators.
With its 1,500-or-so contractor accounts, Seven Corners sells 200 types of hammers, 400 screwdrivers, 170 different files and 4,200 plumbing products. “Our second-floor showroom has 900 power tools on display, with models of drills, saws, planers, routers, pneumatics, stationary machinery and other tools that some of our customers never knew existed,” Walsh said.
When Walsh’s grandfather, William L. Walsh, opened Seven Corners in 1933, the store sold much more than hardware. “People came in to buy hunting supplies, pots and pans — you name it,” Walsh said. “Back then, with our wood floors, 12-ft. ceilings and mix of general goods, we were more like an old-fashioned department store than a modern hardware operation.” But in the 1960s, Walsh’s father, Robert L. Walsh, responded to America’s postwar construction boom by broadening Seven Corners’ focus. “He wanted to meet the needs of busy contractors throughout the Twin Cities,” explained Walsh, who was 10 when he started helping his father at the store. “It was a great move, because later on it helped differentiate us from giants like Walmart and The Home Depot.”
When Walsh took over the business from his father in the late 1980s, he focused on ramping up the mail-order business. Catalog sales surged, and in 1991 Walsh expanded Seven Corners by adding a second floor. “Since about 1990, we have shipped more than 1.7 million packages all around the world through our mail-order business,” Walsh noted.
As Seven Corners grew, it retained some of the personalized, small-town feel that had characterized its early years, Walsh said. “You could walk in and say, ‘Geez, my faucet broke and my wife really wants me to fix it. Can you help me through it?’ And my guys would be happy to spend 20 minutes helping you through that, even if all you needed was a washer,” he said. “Conversely, a local university might call up with a $10,000 purchase of specialized tools and equipment for a big project. At our store, we have always been happy to serve both types of customers.”
At Handy, a new look for 2014
After a volatile 2013, Handy Hardware is entering the new year with new ownership, new structure and a new emphasis on customer profits.
The Houston-based hardware distributor launched an initiative called “Profit Plus, the New face of Handy,” which encompasses business improvements and dealer programs.
“The Handy team and I want to thank our customers who stood buy us in 2013, and want them to know Handy’s ability to service our dealers has never been stronger,” said Doug Miller, CEO.
Handy Hardware emerged from a Chapter 11 filing in August 2013 after being purchased by Hardware Holdings, part of the Littlejohn & Company group. The company’s structure changed from a member-owned co-op to an independent wholesaler and distributor. As a result of the bankruptcy proceedings, retailers who were members of the co-op lost their equity.
The changes at Handy include personnel. Hardware Holdings’ new president and CEO is Donald Devine, the former CEO of American Standard Brands. Hardware Holdings is also the parent company of Howard Berger Co.
“We are operating Handy Hardware and HBC as independent companies focused on serving their customers in their respective markets,” Devine said. “The common ownership structure should enhance Handy Hardware’s ability to provide their dealers with profit enhancing sourced products from HBC’s extensive catalogue of hardware and building products, which are available to dealers and retailers across the country.”
Another change is in merchandising. The company hired Craig Cowart as EVP of merchandising and marketing. Cowart was most recently the general manager of Your Other Warehouse, the wholesale division of The Home Depot based in Atlanta. He will spearhead Handy’s drive to improve our merchandising assortment, vendor relations, and dealer programs in support of the company’s “Profits Plus” initiative.
Cowart also served as president of Marvin’s, the Alabama-based home center chain.
Mickey Schulte, formerly VP merchandising, has moved to the newly created role of senior VP sales and key accounts, where he will oversee all of the company’s sales efforts. Ken Harvey, VP dealer services, will report to Schulte.
The changes will be addressed and explained at the distributors upcoming market in Houston. Handy said it expects nearly 500 booths of products from hundreds of suppliers at their spring market, which opens Feb. 13.
Said CEO Doug Miller: “We want as many of our dealers and vendors as possible to hear our vision of Handy Hardware, and we want them to share our excitement about Handy’s growth prospects with our loyal dealer base.”
Wisconsin hardware store closes after 55 years
In Jefferson, Wis., a local mainstay is shutting its doors after 55 years. Though it wasn’t suffering any extreme hardships, Punzel Hardware has announced its plans to close early this year after owner Jeff Punzel got a more lucrative job offer that will free up time for him to spend with his family, the Wisconsin Daily Union reported.
According to the news source, the store was surviving relatively well, but profit margins were tight for the independent.
The store has been in the family since 1958, when Punzel’s father, Lyle, purchased it. It opened in 1959 as a Gambles hardware store and continued on as an independent when Gambles sold out in 1980. It would later enter a franchise agreement with Trustworthy Hardware, and in 2007, Jeff and his wife, Toni, closed the original store and took over the True Value store in his hometown, opening it up as Punzel Ace Hardware. It went independent again early in 2013 as Punzel Hardware & Rental.
“Though the name changed many times, the family spirit and dedication to serving the Jefferson community never changed,” Jeff Punzel told the news source. “We have seen many faces come and go as our customer base has changed over the years, and we appreciate the loyalty and dedication our customers have shown us.”
“We went fully independent at the beginning of this year, and I wish we had done that years ago,” Toni Punzel added. “There is ample opportunity in this market for an independent hardware store, but it isn’t going to be this one.”
The store will remain open for the time being, with liquidation-level discounts on its stock and rental items. Inventory is expected to sell out in January or February.