Poll question: The impact of the co-op model
Independent hardware and building supply dealers come in all kinds of sizes and all kinds of business models. And in the last half century or so, the co-op business model has played a major role in the industry.
This week’s poll question examines the extent of the impact of the co-op on the independent dealer. HBSDealer asks: “How much credit should be given to the co-op business model for the success of the independent hardware and building supply dealer over the last half century?”
Take the survey on the right side of this page (or scroll down on your mobile advice.) HBSDealer also encourages your opinions via e-mail, send them to [email protected].
True Value nation awaits results
These are pivotal times for the True Value Company. The results of the membership’s vote on the Chicago-based co-op’s deal with ACON Investments are expected to be announced Friday, April 20.
As of press time, the signs pointed to a high probability of the deal passing, bringing an end to the long history of True Value as a co-op. The deal would also result in the sale of 70% of the company and the return to member shareholders of $229 million.
True Value’s headquarters released an early tally of the votes on April 13. In the tally, 85% of the members had voted for the proposal after 72% of the proxies had been counted. That announcement followed a 15-stop bus tour in which CEO John Hartmann led “town hall” discussions about the proposed deal. True Value described the meetings as successful and positive.
One dealer who attended the Manchester, N.H., meeting, Tom Cost Jr. of Killingworth (Conn.) True Value, described the attitude of the dealer attendees this way: “I think the mood has swung from very upset and frustrated, to mildly concerned and cautiously optimistic,” he told HBSDealer.
The ACON Investments deal is supported unanimously by the True Value board of directors.
But signs of a lingering opposition were readily apparent on a Facebook page called Concerned True Value Members. The site contains criticisms of the deal and the amount of time and information members were given to consider the deal. The page also shows organized efforts to convert voters from “yes” to “no” — including votes already cast. It’s unclear if those efforts swayed significant numbers of votes.
Particularly outspoken in opposition is Richard Reese, owner of True Value member Standard Plumbing in Sandy, Utah. Reese brought a lawsuit to block the deal to the Delaware Chancery Court. The suit failed to sink the deal, but did result in extending the voting a week, as management provided additional information related to the transaction.
Still the co-op management expressed confidence that the deal would go forward. A special meeting was slated for April 20, when the board of True Value will announce the results of the vote. “Based on the massive vote support, our plan remains to close the transaction on or around April 20th, following the special meeting,” John Hartmann wrote in a statement to members.
Three questions for John Mize
It was announced this week that John H. Mize intended to step down from day-to-day operations at Blish-Mize Co., where has worked for 56 years, most recently as executive chairman and chairman of the board. He’ll continue to serve as chairman of the board of the Atchison, Kan.-based family owned hardware distributor.
As previously reported, Mize was president and CEO of Blish-Mize for about 35 years. “I saw success and had some challenges, and I also had a lot of fun,” he said.
In the following Q&A-style email interview, Mize expounded on his career and the state of the industry.
What is the biggest change in the business today, compared to early days of your career?
Technology — truly the computer and the internet. The computer helped speed customer service at both ends. More speed on our end to get orders to our customers. Blish-Mize was also one of the first to provide price stickers for our customers with bin labels for quicker reordering.
Who was your mentor in the business?
My mentor was my father [John Mize Sr.], who ran our company for years with a vast knowledge of working with both vendors and customers.
What’s the biggest challenge facing hardware stores?
Hardware stores have to provide answers for their DIY consumers and have the goods in stock. They also have to provide the same customer service as their online competition — easy returns, fast delivery. A lot of our customers today are not the traditional hardware store — they are lumber yards and building materials dealers.
Our biggest challenge has always been how to grow. Acquisitions is one of the answers. We’ve made a few of them. We are a survivor in this business because we manage our business responsibly and we take care of our customers.