Return of the Home Center

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Return of the Home Center

By Andy Carlo - 06/11/2018

Nearly 20 years ago, the independent home center concept began taking hits.

With the empires of Home Depot and Lowe’s opening stores at a breakneck pace, many home centers turned their focus to pro customers while avoiding direct competition with the growing threat. The independent home improvement business model known as the home center appeared endangered.

Lowe’s had hundreds of stores less than Home Depot and its own, brighter flavor of home improvement. Wall Street analysts praised Lowe’s, saying the sky was the limit for growth opportunities. In the meantime, as Home Depot opened about 200 locations per year, some accused the retail giant of cannibalizing its own sales. The independent home center philosophy seemed to be facing extinction.

But modern living — filled with constant communication and demanding schedules — can prompt the need for getting things done quickly and getting it right the first time around. The need for thorough, quality service and a wide, diverse product selection has pumped fresh blood into the home center model. 

“The home center is here to stay,” said Brett Hanson, owner of Tri State Building Center in Sisseton, S.D.

At Tri State (which has been selected as one of the 50 Stihl Hardware All Stars in the class of 2018), customers can find tools, hardware, electrical supplies, housewares, paint and sundries, lawn and garden products and, yes, lumber and building supplies all beneath one roof. The business was created when Hanson saw a need in the community and opened a lumberyard in 2011. The following year, Hanson bought the local hardware business and consolidated it under one roof.

“But the little hardware part of it just kept growing. There was a need in the community,” Hanson said. Sales tripled at Tri State within a year and have grown tenfold since.

Do it Best CEO Dan Starr concurs that the home center model is making a return, among an assortment of retail models. “We see a mix across the board on how retailers choose to go to market,” he said.

Starr points to some of the changes that have occurred in recent months at the Sunroc Building Materials location in Springville, Utah, as a primary example of an LBM retailer who has made a slight shift in direction.

With 12 locations in Utah and Idaho, Sunroc Building Materials offers customers a diverse product selection with an emphasis on one-on-one service. The dealer traditionally had a pro focus, but has now gravitated toward providing a more traditional retail setting at its Springville store. There, the company has installed a Color Bar — the new Do it Best store-within-a-store paint merchandising model — and brought in 3,000 new SKUs.

Most contractor sales and deliveries have been shifted to Sunroc’s neighboring Lindon, Utah, location. “Contractors now pick up smaller, quick items here,” said Jennalee Long, assistant retail manager. And despite battling a Home Depot location just a few miles away, Long noted that Sunroc’s business model at the 2,000-sq.-ft. store caters to today’s customer.

“We offer a lot more personalized service and get to work with customers one on one,” she said. “Everyone can have the same products, but not everyone can offer one on one service.”

At Tri-State, the company prides itself on being wired-in to the latest products and trends in order to meet the needs of all customers. “We try to stay on top of what’s new by working with all of our vendors — we try to be on the front line and stay ahead of our customers when it comes to new products and technology,” Hanson said.

This year, Somerville Lumber Co. in Bridgewater, N.J., transformed into Somerville Home Center. The business also maintains deck design centers in Bridgewater and Flemington. Aside from a branding change, the new Somerville Home Center has upgraded its IT system, overhauled its social media strategy and placed a focus on becoming a one-stop shop for customers.

The company said it has maintained a position in central New Jersey by not only offering high-quality products and customer service, but also by ensuring customers can complete a wide range of home renovations. In addition to a combined 6,000-sq.-ft. comprehensive decking and outdoor living department, Somerville offers cabinets, tile floors and countertops for kitchen installations, along with faucets and plumbing fixtures for bath remodeling projects. Windows and doors are also part of the equation.

As it transforms, Somerville says its goal is, “to develop new products and services and to keep current with changing times.”

Roughly 300 miles north, serving the Cape Code region, the islands and Massachusetts’ South Shore, is Mid-Cape Home Centers. Founded in 1885, multiple generations have shopped the business.

“While the vast majority of our business is from contractor customers, we understand the importance of meeting all home improvement customer needs with our retail presence and extensive product selection,” said Jack Stevenson, president of Mid-Cape Home Centers. “We are blessed to operate in communities that deeply value the importance of buying local and supporting local businesses, and we make a strong effort to serve these communities with the unique products and services they need.”

Although products vary across Mid-Cape’s six retail locations — including two kitchen design showrooms — Stevenson said “summer traffic constraints make it even more critical to offer the right DIY products at the right locations.”

For example, at its Wellfleet store, Mid-Cape serves many hardware and paint customers; and in other locations, it serves DIYers looking for windows, doors, flooring, cabinets, countertops and more.   

“With multiple locations, showrooms and a diverse portfolio of products and services, we pride ourselves on having high-quality, industry-experienced representatives,” Stevenson said. “Hang around long enough and you’ll hear our customers talking about how their dads and their granddads shopped here, and when you ask what keeps them coming back, the answer is simple: It’s the high-quality products, the people and the Mid-Cape experience.”

Back in South Dakota, Hanson said Tri State’s ability to meet the requirements of so many customers is the key.

“That’s our challenge,” he said. “Trying to have every product our customer wants.”

More than 90% of the time, Tri State gets it right, Hanson said. That includes sporting goods, too.