Stores prepare for spring awakening
Spring is the most important time of year for home improvement retailers, and independent hardware stores need to compete for consumer dollars by getting their store names in front of the local audience. Having a well-stocked store is one element in a successful spring campaign. Driving traffic into that store is another.
Howe’s True Value Hardware & Garden Center in Warren, Pa., draws people in through a couple of major spring events: a grilling day and an outdoor power equipment sale day. During the former event, which usually takes place out side the store shortly before Father’s Day, co-owner Luke Howe trots out his selection of Weber and Grill Zone grills, using one to cook up hot dogs and sausages for customers. Sometimes the grill is raffled off at the end of the event to create more interest.
“Food is always a driving factor for customer count,” Howe said. “When we have the food out, we see people we’ve never seen before, and a portion of those become repeat customers.”
For the “outdoor power equipment day,” which Howe’s has been doing for 20-plus years, the store gets its selection of Steele, Toro, Simplicity and Honda riding mowers gassed up and ready to try. They set up tents and canopies out front and give people a chance to test chainsaws and other heavy tools. And with True Value offering $500 in co-op money for spring events this year, Howe’s is ready to try yet another promotion: a “bucket” sale whereby people can fill up a bucket and receive 20 percent off the merchandise.
“These things get us a lot of exposure, and that increases foot traffic,” Howe added.
Germantown Hardware in Germantown, Tenn., an Orgill customer, jumpstarts its spring business each year with an anniversary sale, which in the past has brought in $25,000 over a two-day period. The store offers discounts on 10 spring related items, induding wheelbarrows, flats of flowers, fertilizer and gardening gloves. This year, the sale will be held April 25 and 26, according to store manager Justin Wagner, who added, “We used to have it two weeks earlier, but we want to make sure the weather is cooperating.”
Do it Best is helping its members attract spring shoppers through several promotions, including a $1,000 spring shopping spree sweep stakes to bring more traffic in to the stores. One member, Hardman’s Do it Best in Spencer, W.Va., is taking the promotion a step further, creating a uniquead that offers suggestions on how customers can spend their $600 government rebate. Possible projects include doing a bathroom remodel for $249.99, adding a 10-by-12-foot deck for $364 and installing a new wood floor for $823.68.
Do it Best is also offering three catalogs: the outdoor living catalog with outdoor furniture and accessories; the outdoor power tool catalog with lawn mowers, string trimmers and other machines; and the spring merchandise catalog, which gives a good representation of the 68,000 skus in the Do it Best warehouse.
The outdoor living catalog, for example, has been expanded to include exclusive patio sets and a more upscale product mix, and sales are projected to increase 10 percent to 15 percent in 2008. There are other positive numbers to report as well: store participation in the outdoor furniture category increased by 25 percent this year, and the number of catalogs being circulated by direct mail and in the stores has increased by 51 percent.
Do it Best is encouraging members with limited store space to present outdoor furniture as a special order business, with customers being able to choose from the catalog and have the product shipped from the warehouse in a couple of days.
Kilp Carroll, manager of Hardware City, a Do it Best store in Clarksville, Tenn., is thrilled with the new catalog, which his store had sent out with the local 25,000-circulati on news paper last month. Carroll, who sets up four vignettes in the store so customers can see some of the most popular styles, says he receives an average of 25 special orders a week—more than double the special orders received last year.
Larry Gemmen, owner of Gemmens Hardware in Hudsonville, Mich., is going beyond the Do it Best promotions and partnering with Scotts and Greenview to offer incentives in a direct mail campaign to area residents. For example, those customers who buy the four-step Scotts fertilizer program receive a $5 coupon to be used on other Scotts products. In addition, Gemmens advertised discounts on screen, window and outdoor power equipment repair through the end of March.
“Things like this generate a lot of activity in the store in the spring,” he said. “It brings people in to look at the presentation of new products and generates repeat business.”
Bed Bath & Beyond declines in fourth quarter
Specialty retailer Bed Bath & Beyond posted weaker fourth-quarter earnings, due in part to an extra week in last year’s fourth quarter. The company saw earnings of $172.9 million, down 16 percent from $205.8 million in the same period last year.
Net sales for the fourth quarter were $1.93 billion, down 3 percent from last year’s fourth quarter. Comparable-store sales for the fiscal fourth quarter of 2007 decreased by 0.4 percent.
For the fiscal year, which again was one week shorter than the previous fiscal year, the company saw earnings decline 5.3 percent to $562.8 million from $594.2 million a year ago.
Net sales for the year were $7.049 billion, an increase of 6.5 percent from last year. Year-over-year, comparable-store sales increased by 1 percent. The company opened 22 new stores in the fourth quarter, including its first location in Canada.
The retailer said it expects comparable-store sales to be relatively flat or negative in 2008. Bed Bath & Beyond also warned investors it expects a per-share percentage decline in 2008 earnings from the low double-digits to mid-teens.
Bed Bath & Beyond operates a total of 971 stores nationwide.
Canfor reduces production
Vancouver, B.C.-based Canfor is reducing its production volume to reflect market realities. The company pointed to “falling demand and poor pricing for softwood lumber with no indications of a market recovery in the near future.”
Canfor will be reducing workweeks at a number of its operations. In addition, Canfor’s Prince George Sawmill will move from three shifts to two and its Clear Lake finger joint operation from two shifts to one. This move will reduce Canfor’s annualized lumber production by approximately 600 million board feet.