True Value vote looms large
A bus decked out with the True Value logo and a sign that reads “Tools for Transformation” has been roaming the highways on a mission – to explain the choice faced by dealers that could dramatically change True Value, or not. At issue is the structure of the co-op, the future of the brand as a distributor, and the liquidity of shareholder’s equity tied up in stock.
As reported March 15, The True Value Company announced a transaction with private equity firm ACON Investments that will return $229 million to True Value retailers. Under the deal, True Value retailers will retain 30% of the company, with 70% equity going to ACON. The deal will result in current True Value retailers taking 70% of their invested capital, 100% of their promissory notes and the 2017 Patronage Dividend repaid following close. The move is described by True Value Company as a deal to “accelerate transformation of True Value Business.” It will also convert the structure of the company from a co-op selling products to its member owners, into a distributor selling products to any and all customers.
In an article that appeared in the Chicago Tribune, Hartmann is quoted: “The concept of a co-op, which I’m very respectful of even though I’ve asked shareholders to move away from that, is that individuals came together as a group to do things they couldn’t do on their own. The unfortunate thing is it traps their investment, their equity, in the company.”
The plan to bring in ACON Investments as a majority owner has led to a wide range of opinion within True Value’s family, and throughout the industry.
Among the True Value dealers showing enthusiasm for the deal is Steve Fusek. He posted the following on a popular industry bulletin board: “Not sure how this can be a bad deal, especially for members of the coop. We get paid our $229 million to control ourselves. No risk of accounting errors, etc. How can that be bad?” The elimination of debt and the ability of the company to invest in itself were also cited as positives by Fusek.
“I have yet to speak with a member that did not think this was in the member’s best interest,” he posted.
In a network of some 4,000-plus dealers, not everyone is in agreement.
Tom Cost, Jr., of Killingworth (Conn.) True Value was in attendance for the True Value tour’s meeting in Manchester, N.H. on March 21. “I think the mood has swung from very upset and frustrated, to mildly concerned and cautiously optimistic,” he told HBSDealer.
On Monday, Hartmann’s bus tour was in Mankato, Minn., for the tour’s 15th and final “Town Hall” meeting with dealers to explain the benefits. “Meetings were very successful at ensuring our members were fully informed to cast their vote,” said Jean Niemi, VP of communications for True Value Company, via e-mail. “Overwhelming majority have walked away feeling positive.”
The deadline for voting is just before midnight April 12. A simple majority is required to pass the proposal.
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Retail customer experiences ranked
It’s a tie. Ace Hardware and Dollar Tree tied for the top spot in the retail industry (with an 82% score) in the 2018 Temkin Experience Ratings, an annual customer experience benchmark of companies based on a survey of 10,000 U.S. consumers. Along with landing the top spot in the retail industry, Ace Hardware and Dollar Tree placed 7th overall out of 318 companies across 20 industries.
Overall, the retail industry averaged a 74% rating in the 2018 Temkin Experience Ratings and came in third place out of 20 industries.
“Ace Hardware and Family Dollar lead a strong group of retailers. In fact, more than three-quarters of retailers earned good or excellent scores,” said Bruce Temkin, managing partner of Temkin Group.
The ratings of all retailers in the 2018 Temkin Experience Ratings are as follows:
- Ace Hardware: 82%
- Dollar Tree: 82%
- Family Dollar: 81%
- BJ’s Wholesale Club: 80%
- Amazon.com: 79%
- Menards: 79%
- PetSmart: 79%
- True Value: 78%
- Walgreens: 78%
- Dollar General: 78%
- Staples: 77%
- Sam’s Club: 77%
- Home Depot: 77%
- QVC: 76%
- eBay: 76%
- O’Reilly Auto Parts: 76%
- Bed Bath & Beyond: 76%
- Bath & Body Works: 76%
- Advance Auto Parts: 76%
- Barnes & Noble: 76%
- Costco: 75%
- Rite Aid: 75%
- Kohl’s: 75%
- JCPenney: 75%
- T.J. Maxx: 75%
- Dick’s Sporting Goods: 74%
- Lowe’s: 74%
- Target: 73%
- Office Depot: 73%
- 7-Eleven: 73%
- Etsy: 72%
- AutoZone: 72%
- Ross: 72%
- Old Navy: 72%
- CVS: 71%
- Michael’s: 71%
- Nordstrom: 71%
- Toys ‘R’ Us: 71%
- Gap: 69%
- Marshalls: 69%
- GameStop: 69%
- Wal-Mart: 69%
- Best Buy: 68%
- Macy’s: 67%
- Apple Retail Store: 67%
- Kmart: 67%
- Sears: 66%
- Foot Locker: 65%
- Office Max: 65%
The 2018 Temkin Experience Ratings evaluates 318 companies across 20 industries: airlines, auto dealers, banks, computer & tablet makers, credit card issuers, fast food chains, health plans, hotels & rooms, insurance carriers, investment firms, parcel delivery services, rental cars & transport, retailers, software firms, streaming media, supermarket chains, TV & appliance makers, TV/Internet service providers, utilities, and wireless carriers.
Temkin Group then averaged these three scores to produce each company’s Temkin Experience Rating.
In these ratings, a score of 70% or above is considered “good,” and a score of 80% or above is considered “excellent,” while a score below 60% is considered “poor.”
The 2018 Temkin Experience Ratings can be accessed at TemkinRatings.com.
I’m not sure comparing stores with low to no customer service requirements to those that demand extensive customer service due to the complexity of the products being sold is a fair comparison. These should be catigorized for a more accurate reflection of customer satisfaction. IMHO
Ace honors Vendors of the Year
Oak Brook, Ill.-based Ace Hardware Corp. recognized 11 companies as 2017 “Vendor of the Year” honorees. The awards were based on the vendors’ efforts to help the co-op invest in the brand, support its business-to-business efforts and align with Ace’s long-term growth strategy.
The following companies were recognized during the co-op’s Spring Convention in Dallas:
- Magnolia Paint/Kilz (Paint)
- Freud/Diablo (Tools/Auto/Farm)
- Duracell (Electrical)
- Charlotte Pipe (Plumbing)
- United Solutions (Hardware)
- e-cloth (Cleaning/Home/Impulse)
- The Scotts Company (Lawn & Garden)
- Big Green Egg (Outdoor Living)
“Providing legendary service, convenience and quality is who we are at Ace,” said John Sommers, VP of merchandising. “Our vendor partners understand that and share our commitment to making sure our retailers have access to the best portfolio of product offerings. This year’s group of honorees went to great lengths to advance our vision of being the most helpful hardware stores on the planet with the best brands.”
Additionally, Ace also recognized three vendors for their work in specialty categories:
- Koopman International, a family-owned company based in the Netherlands that offers kitchen and home décor items, received the International Award for demonstrating superior support of Ace International programs with measurable impact.
- NEBO was named Ace Hardware’s Innovation Vendor of the Year for its support and growth of innovation via products and programs, including the launch of its new line of work lights.
- 3M received the Ace Foundation Children’s Miracle Network (CMN) Vendor of the Year award in recognition of its donations and sponsorship of Ace Foundation and CMN events.
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