ABS hardware retail stats to July 2023

East coast flat, Rest of Australia (RoA) shows mild growth

Hardware retail revenues have stayed strong through July 2023, though trailing 12-month comparisons show some declines. Overall revenue for Australia grew at close to one percent.

Hardware retail sales slowed considerably for the 12 months ending July 2023, according to figures from the Australian Bureau of Statistics (ABS). While growth did not go negative for the nation as a whole, given ongoing inflation, it's likely the general market has retreated over the past year.

For July 2023 itself, however, there was a degree of mild positivity for most states, with revenues for the most part matching to revenues for July 2022, or even lifting above those. (There are anecdotal reports of a more generalised slump for August 2023.)

Looking at the trailing 12 months, the two states that did well were South Australia (SA) and Western Australia (WA). SA produced 7.95% growth, for a total increase of $128.9 million, while WA grew by 5.0% and an increase of $131.2 million. Close behind in percentage terms was the Australian Capital Territory (ACT), with 5.0% growth, and an increase of $25.3 million.

Queensland (QLD) was almost flat with a 0.01% increase. Victoria (VIC) continued to see declining revenues, down by -0.26%. New South Wales (NSW) is also showing a decline for the 12 months, down by 1.3%, a reduction of $86.3 million.

As a whole, Australia saw a 0.8% uplift, and a net gain of $207.9 million.

New South Wales

As Chart 2 illustrates, NSW was one of several states that saw July 2023 come close to matching July 2022.

Taking a wide perspective, NSW had its second best results for July in 2023, just a shade off the results for July 2022. Again, it's difficult to statistically account for inflation, but even with that discount, the month performed relatively well.


Surprisingly, given that 2023 has seen a general slowdown in hardware revenues for VIC, the July 2023 result was the second-best historically, beaten only by the huge result for July 2020, as seen in Chart 3.

This does come at the end of a year with a definite slide in comparative revenues since January 2023. The real test of the VIC market is what happens in November and December 2023.


Making comparisons with the somewhat "zany" three years since COVID-19 is not always useful. The pattern we may be seeing in QLD from April 2023 onwards is a return to the pre-COVID-19 patterns, albeit at a higher level, as shown in Chart 4.

Again, the result for July 2023 is the second-highest ever for the state, and it follows on from a steady increase in revenues over the prior three months.

South Australia

SA has had its best 12-month period ever for hardware retail revenues, though the result for July 2023 just edges ahead of July 2022. Chart 5 shows this outperformance, especially from August 2022 through to January 2023.

Western Australia

Like SA, WA is having its best 12 months ever for hardware retail revenue - though by a small margin. In fact, 11 out of the twelve months have set new records for the state as shown in Chart 6.

The state is very much a tell of two halves when it comes to hardware revenue, so the real test will come over the next six months.

Tasmania and Northern Territory

The lack of data through the COVID-19 years still makes individual comparisons for Northern Territory (NT) and Tasmania (TAS) difficult. We can derive an estimate of the total for the state and territory, but it's not really of much use statistically. So we present this chart for completeness sake.


Generally speaking, the results for July 2023 are encouraging, and show a resilient market that is softening, but also holding up under pressure from high interest rates and inflationary pressures.

One element that might be helping to boost it a little is that other areas of expenditure - such as international travel - remain expensive. That's not just a matter of airline ticket prices, but also the AUD (somewhat paradoxically) remains devalued against currencies such as the USD and the Euro. It's cheaper to renovate the bathroom than to visit Italy or Los Angeles.


Indie store update

Bailey's Key Hardware listed for sale

The Toowoomba-based store in regional Queensland is considered a local icon and will change hands for the first time in 17 years

Bailey's Key Hardware which has been a fixture on William Street in Crows Nest, a rural town in Toowoomba for 90 years, has been listed for sale through Hampton Realty, reports The Chronicle.

The hardware store is set to stay, with owners Peter and Dianne Nightingale-Smith selling the 790sqm property, business and stock as a going concern.

Mr Nightingale-Smith said the former English couple, who bought it 17 years ago as part of a business visa arrangement, had been well supported by the town. He told The Chronicle:

The only way we could come out here was with a business visa, so we had to buy a business over here. We had to run that business and achieve a certain turnover, and after those two years we could do what we liked, but we're still here 17 years later. We just love the town, the people have been pretty good, and it's a nice place to live.

Mr Nightingale-Smith said Crows Nest was lucky to still have an independent hardware store, at a time when the industry continues to experience consolidation mainly at the hands of big box retailers such as Bunnings.

We still feel the impact from the 'big green shed', it still hurts us a bit, but especially after COVID, people are coming into us who haven't been there before.

Selling agent and Hampton Realty principal Craig Allen said the offer was even more attractive thanks to increased investment in Crows Nest since the end of the pandemic.

Crows Nest is really taking off, and there are more opportunities, so I think someone will head in there and grow this business even more.
There are people moving to Crows Nest from the coast and wanting to get out of the hustle and bustle of the city.

The couple plans to remain in Crows Nest and keep running the neighbouring gifts and homewares business Nightingale Crafts, in between travel.

Bailey's Key Hardware was originally established by Arthur Bailey in 1933, before his sons Terry and Arthur took over the reins and the business remained in family hands until 1998.

  • Source: The Chronicle
  • retailers

    Big box update

    Noarlunga Bunnings to move and re-open

    Bunnings store approved in Victoria and production begins at a timber and truss plant in Melbourne's west

    A Bunnings Warehouse in the southern suburbs of Adelaide is set to relocate to be part of a local retail hub with more space. The Noarlunga Bunnings store will close in early-2024, with a new branch opening in the Colonnades shopping centre. Bunnings regional manager Tom Miller exclusively told the Adelaide Advertiser:

    The proposed new store ... will feature an additional 1400sqm of retail space, a much-improved five-lane drive-through timberyard, as well as an additional 60 car spaces.
    The existing Noarlunga team will transfer to the new store, as well as the creation of around 20 new local jobs. Works have commenced at the new site to convert the vacant building into a Bunnings Warehouse, which is expected to open in the first half of 2024.

    Mr Miller said the current location will continue to operate until the new location is ready to open.

    Manor Lakes, Victoria

    A Bunnings store will be part of a new retail and trade supplies precinct in Manor Lakes, a Melbourne suburb located 33km south-west of the CBD, in the City of Wyndham local government area.

    Wyndham council's planning committee unanimously approved a development application for the construction of Manor Lakes Town Centre 2A.

    The proposal from Ranfurlie Asset Management involves a Bunnings store being built on the site at 485 Ballan Road, adjacent to Ranfurli's existing Manor Lakes Central shopping centre. Ranfurlie Asset Management CEO Cameron Male said:

    It will cement the precinct as a key retail and lifestyle asset for the area. Manor Lakes Central boasts over 75,000 visitations per week and is established as a retail & commercial focal point not only for the local community, but for the surrounding population.
    This development will generate construction jobs and inject increased dollars into the local economy with additional spend by workers and consumers alike.

    In the Wyndham Star Weekly, local councillor Pete Maynard said:

    This permit application will ensure timely access to goods, services and employment of in excess of 600 ongoing jobs and approximately 200 with construction to existing and future residents in the area.

    Along with construction jobs and Bunnings Warehouse, other large retail outlets, showrooms, restaurants, convenience stores and a service station are also expected to provide ongoing employment.

    Timber and truss plant

    Bunnings has begun production at a 31,000sqm just-in-time timber and truss plant in Truganina, a Melbourne suburb located 22.4km west of the CBD.

    When operating at full speed, it is expected to produce 2800 home lots -trusses and frames - a year, according to a report in The Australian Financial Review (AFR).

    It is part of the $75 million the hardware retailer is investing in plants to manufacture timber wall frames and roof trusses for houses, townhouses and low-rise apartment buildings.

    The plant at Truganina Business Park follows a similar one opened in outer Sydney's Minto in July and precedes a third due to open in south-western Brisbane's Wacol early next year.

    Bunnings plans to expand its footprint of frame and truss plants - HNN Flash, April 2022

    Bunnings is three years into a five-year plan to make its commercial business as big as the retail arm. As cited in the AFR, Bunnings chief operating officer for commercial Ben McIntosh is reported as saying:

    There was always a trade or commercial part of the business, but it was never the focus. We can do two things at once.

    According to the AFR, the strategy behind selling frames and trusses - which make up about 15% of the cost of a home - is that it establishes a supplier's relationship with a builder at the start of construction and makes it easier to sell other products throughout the typical nine-month construction process.

    Some analysts, such as Tim Moore from consultants Industry Edge, have seen fit to portray this as somehow being the first step towards pre-fab builds. While pre-fab certainly makes sense, it has long been much more of a demand problem - with tradies loathe to set aside their 1970s era production techniques - than a supply issue.

    It's also worth noting that pre-fab - if and when it comes at scale to Australia - is likely to be boosted by major investors in large mid-size to smaller large-size construction companies, while Bunnings has repeatedly asseverated that its target market is the same as that of the Independent Hardware Group (IHG): house-by-house builders working with small teams of sub-contractors.

    That said, it's possible Bunning might tap into a slight expansion of pre-fab as a shortage of qualified tradies becomes less a matter of better efficiency and more about just getting a build completed. As Mr McIntosh is quoted as stating:

    [Builders] are time poor, they need efficiency - it is harder and harder to get skilled labour on site, and it's getting more expensive.

    Bunnings managing director, Mike Schneider, has commented that the ongoing demand for more dwellings will help to fuel the bottom line at the big box retailer. However, if you look over the plans by Victorian government, and other solutions provided for the housing crisis, the more is towards larger, multi-dwelling construction - which will be the only way to supply affordable housing in Australia's major cities.

    That's a category which Bunnings (and IHG) have all but excluded themselves from. Certainly, there will be ongoing strength in single-house builders, but it's not going to be quite the boom for retailers that many seek to portray this as.

  • Sources: Adelaide Advertiser, Wyndham Star Weekly, The Australian Financial Review and The Age
  • bigbox

    Retail update

    Deniliquin Mitre 10 sold to Dahlsens

    In Tasmania, contractors have begun work on the Clennett's Mitre 10 store in inner-city Hobart

    Deniliquin Mitre 10 owners Katrina Knuckey and Alan Braybon will hand over the ownership of the business to Dahlsens on November 15, 2023. The store will operate in addition to the existing Dahlsens store in Deniliquin, NSW.

    Mr Braybon, known as Bluey, will retire after 38 years as an employee and owner. Ms Knuckey will be staying on with the new owners, leading the team as manager of Dahlsens Mitre 10, as it will be known. Speaking for both of them, Ms Knuckey told the Deniliquin Pastoral Times:

    We don't make this decision lightly, with our priority always being the ongoing service to our customers and jobs for our team. We are staying where we are, as your local Mitre 10, with more support to better help you...

    Ms Knuckey also said she is "excited for the opportunity" to work for Dahlsens.

    I am also excited for the change and the challenges that will come with providing our customers with the same great service. The change is good for everyone. Dahlsens will be supportive, and I am looking forward to the future of the business.
    Geoff Dahlsen is a fifth-generation family member and is leading the commitment by the Dahlsens team to continue everything we've started.

    Mr Dahlsen said the good news is that the store will continue to service the Riverina community in an "even stronger capacity for many years to come".

    Very little will change. You will still see the same happy faces and great products you're used to, with Katrina Knuckey leading the team.

    Deniliquin Mitre 10 will be added to the more than 60 other Dahlsens sites located around Australia. The closest Dahlsens store is located at 205-207 Barham Road in Deniliquin, and managed by Doug Miller. The Deniliquin Mitre 10 and Dahlsens Barham Road trade sites will remain trading in their separate locations.

    Mr Dahlsen said to expect a "seamless transition" with business operations being largely unaffected during this period. He also expressed gratitude to Alan and Katrina for entrusting his family with the business and the team.

    We commend their leadership and commitment to the Deniliquin community. Our utmost priority is to honour and strengthen the foundation they have laid.

    Mr Miller said the change will be "great for Deni".

    I'm excited, and with the acquisition Dahlsens is securing the sustainability and future of the town. Katrina and I both live in the community and look forward to making things bigger and better, servicing our community.
    One thing I love about the family-run business is that we get such a say in how we run the business at our local level. We get to influence the way things are run. The stores are not just a cookie-cutter box version. They all look different, but we work together to bring in new ideas and the best service we can offer.

    Clennett's Mitre 10

    Construction has begun on the Clennett's Mitre 10 store in Hobart, Tasmania. Previously home to an automotive service department, the Patrick Street site will soon house the "much needed" and only city-based hardware store.

    The location, which will join the several existing Clennett's stores in Kingston, Huonville, Sorell and Swansea.

    In 2020, the company said the development would fill the void left by the demise of K&D, which closed its final store that year.

    At the time, the new site was described as 3900sqm with 1000sqm of retail space, a 2000sqm trade centre and off-street parking for 40 cars. The initial investment will be $2 million, with a further $4 million expected to be spent in the next 10 years.


    Mitre 10 store planned for Hobart CBD - HNN, July 2022
  • Sources: Deniliquin Pastoral Times and Pulse Hobart
  • retailers

    USA update

    Lowe's solution to increasing theft

    CEO Marvin Ellison has attributed low theft rates at the home improvement retailer to investing in the company's workers

    Like many retailers, home improvement retailer Lowe's has reported increased losses from missing or damaged inventory over the past few years, reaching nearly USD1 billion by one estimate.

    But unlike dozens of other retail executives, Lowe's CEO Marvin Ellison said the losses from retail theft this year are not expected to have a material impact on the company's profits. Speaking at Goldman Sachs Global Retailing Conference recently, Mr Ellison said:

    It is one of the areas of the business that we're most pleased with as a major big box retailer.

    Lowe's inventory shrink as a percentage of sales last year was just over 1% - at the low end of the typical industry range of 1% to 1.4% - and that's after an uptick from a 2016 low of 0.57%, based on an analysis by CNBC. Mr Ellison highlighted technology investments and his stores' more rural and suburban locations as factors that help reduce shoplifting and organised retail crime.

    More than the cameras, sensors, and secure merchandising displays, Mr Ellison said investing in human capital provides the most bang for retailers' buck in keeping crime out of stores.

    Having spent my entire adult life in retail at every level, the one thing that I understand clearly is that the greatest deterrent for any type of theft activity is effective customer service.

    In other words, having more employees engaging with customers in stores goes a long way toward preventing losses.

    Earlier this year, Mr Ellison said Lowe's spending on employee compensation had increased by USD3 billion since 2018, and would grow by another USD1 billion over the next three years. He also said that Lowe's is the highest-paying retailer in certain smaller markets.

    Joe McFarland, executive vice president of stores at Lowe's, said in another interview:

    We are awarding over USD100 million in bonuses for our frontline hourly associates in recognition of their hard work and dedication during the second quarter. Our investments in our associates are paying off as we continue to elevate the customer experience with a 200 basis point improvement in both our DIY and Pro customer service scores this quarter as compared to last year.

    Lowe's spends "a lot of time" training employees, Mr Ellison said, and he described the company's asset protection team as "best-in-class in retail." Strong local partnerships with law enforcement also factor into the equation.

    So when you take all of those things together, they've been incredibly beneficial to us even in the second quarter. It's a difficult environment - I've never seen anything like it - and we're incredibly pleased that we're able to have a differentiated performance relative to the other major retailers.


    Curbing retail theft - HNN Flash, June 2023
  • Sources: Business Insider and Infotech Lead
  • bigbox

    Bradford Insulation supports NCC 7-star rating

    Redefines energy efficient homes

    The introduction of the NCC 7-Star rating will rely heavily upon the insulation sector, yet achieving this rating does not mean completely changing the way building and construction is implemented, according to Bradford Insulation

    As Australia continues to move towards a more sustainable future, it's likely that energy efficiency standards will continue to rise. The new NCC 7-Star rating not only demonstrates a commitment to energy efficiency stewardship but also presents many opportunities for better practices in building design and construction.

    The insulation industry in Australia is stepping forward to a 7-Star rating and, with it, the future of sustainable living.

    Insulation for the roof, walls and floor, is a cornerstone of energy-efficient building design. Proper insulation reduces energy consumption for heating and cooling, along with a comfortable and healthy living environment. It can significantly contribute to noise reduction, leading to quieter interiors.

    Given Australia's diverse climatic zones, insulation has to work both ways by keeping homes cool in the summer months and warm during the winters. A well-insulated home reduces reliance on air conditioning and heating systems, cutting energy consumption and greenhouse gas emissions.

    The new NCC 7-Star rating is a major step forward in promoting more energy-efficient and durable systems with a longer-term net zero goal design and construction practices in Australia. This standard primarily affects the residential sector, pushing the building trade to adopt new approaches and techniques to achieve higher energy efficiency levels.

    In addressing the forthcoming introduction of the NCC 7-Star rating, Kathy Hocker, general manager of marketing & customer operations at Bradford Insulation, said:

    We are at a pivotal point in the industry. The advent of this new rating is set to bring about a significant change in insulation installation and usage across Australian residences. We foresee a boost in demand for sophisticated insulation materials, to meet the increased energy efficiency standards. However, before we go through this transformation, there are a number of factors that builders, specifiers and architects should understand and which homeowners of new builds should also be across.

    With the new NCC 7-Star rating, buildings will need to have even higher insulation, glazing, sealing, design or layout and passive solar design to meet the increased standards. This update represents a 18-25% improvement for homeowners on the base energy efficiency requirements as compared to the older NCC 6-Star rating. (Sourced from "Shoot for the stars: Top tips to improve your home's energy efficiency" by the Climate Council)

    The following are practical tips and strategies designed to help industry professionals including hardware retailers to effectively explain these changes, enabling them to make well-informed decisions about their insulation choices.

  • Don't ignore R-values: An R-value is a measure of thermal resistance; a higher R-value is likely the most cost-effective choice for achieving energy efficiency in any design. Regardless of the climate zone, building orientation, or construction type, prioritising a higher R-value insulation should be a fundamental part of a building plan and recommendation to homeowners.
  • Look for quality products: Quality is key in insulation products for their effectiveness and longevity. Bradford Gold[tm] and Bradford Gold[tm] High Performance Insulation is designed for Australia's unique climate and has been independently tested for performance under various conditions. They are certified to Australian standards, meeting or exceeding compliance guidelines for thermal performance. Bradford products are also accredited for fire safety, environmental sustainability, and health considerations.
  • Don't overlook acoustic insulation: Alongside thermal insulation, consider the benefits of acoustic insulation to help reduce noise transmission between rooms and from external sources. Some insulation materials such as Bradford SoundScreen provide both thermal and acoustic benefits.
  • Install properly: Even the best insulation won't perform well if not installed correctly. It's essential that insulation fits snugly between studs, joists, and beams, without gaps or compression so it retains its design thickness. Installation in accordance with the NCC and Australian Standards is always recommended.
  • Seal it up: A well-insulated home isn't just about the insulation itself; it's also about preventing air leaks and minimising hot and cold draughts blowing through the home. Builders should ensure gaps around windows, doors, and other areas prone to air leaks are properly sealed.
  • Don't forget condensation control: While sealing a home for energy efficiency is important, so too is ensuring sufficient moisture control and ventilation to reduce the risk of condensation, mould growth, and poor air quality. Vapour permeable wall wrap and ventilation solutions should be considered as part of the overall design.
  • Understand the full cost: The cost of insulation isn't just about the price of the product. It also includes installation costs and the ongoing savings in energy costs that the insulation will provide over its lifetime. Optimising insulation is more cost-effective compared to enhancing other more expensive building components, as it provides an overall Star rating gain for less than the cost of other building elements.
  • Related: The National Construction Code (NCC) 2022 energy efficiency provisions for new homes is set to take effect (with various State transition periods) from October 1, 2023.

    Seven-star energy ratings for new homes - HNN Flash, September 2022
  • Source: Bradford Insulation, part of CSR Building Products Ltd
  • companies

    Haymes Paint launches latest colour library

    Colour Library Vol.17 is named Origins

    Colours that evoke security, comfort and belonging will be the most popular hues in 2024, according to the company's latest expert colour forecast

    Origins is a "transformative fusion of past wisdom and futuristic potential, designed for the architect, innovative interior designer, and discerning design enthusiast" according to Haymes Paint. At the heart of Origins lies "the courage to explore and adapt".

    The collection has been crafted in collaboration with muti-disciplinary design studio Nexus Design, home decor and furnishings brand Adairs, as well as design duo @joshandmattdesign.

    The Colour Library Vol.17 - Origins, offers six different colour palettes:

  • New Narratives
  • Heritage Hues
  • New Terrain
  • Retro Mash-Up
  • Solid Ground
  • Strong Haven
  • Interior design specialist at Haymes Paint, Erin Hearns, said:

    The company is delighted to launch Haymes Paint's Colour Library Vol. 17 for 2024. At Haymes Paint we understand the world around us constantly evolves, and there's a growing need for sanctuary in every space we occupy. The 'Origins' collection aims to provide that refuge, grounding us with a return to timeless essentials while infusing contemporary trends.

    Erin's career encompasses interior design, retail, and visual merchandising. This diverse background allows her to strike an ideal balance between colour and architecture in every project that crosses her desk. Working in harmony alongside builders, architects, painters, and DIY customers, she has a wealth of knowledge that enables her to bring out the personality in any space.

    To celebrate the release of Origins, Haymes Paint is set to host a panel event that will explore the scientific underpinnings of the forecast. This year's panel of experts, which includes its collaborators behind Origins will take an in-depth look into the intricacies of how colour, tone, and texture influences not only the look and feel of an environment but also the mood and intention for people in the space.

    About the partners

    Nexus Designs - Haymes Paint engaged the design studio to develop the colour palettes. Experts in providing analysis of global trends, coordination of colour ranges, colour advice and analysis, Nexus Designs used its extensive industry and consumers insights to develop these palettes. Multi-disciplinary to the core, Nexus Designs drew on its integrated offering including interior design, product development and visual communications to bring an innovative and nuanced response to the brief.

    Adairs - A leader in shaping the dreams of home enthusiasts, Adairs creates design solutions that transform ordinary spaces into dream havens. Leveraging over a century of expertise, Adairs leads the way in offering on-trend home decor and furnishings, blending luxury with affordability to elevate everyday living spaces.

    Josh & Matt (@joshandmattdesigns) - Josh Jessup and Matt Moss are a Melbourne-based couple who have gained traction on TikTok due to their eclectic and unique interior design style. With a following of 839k on TikTok and 633k on Instagram, Josh & Matt have a loyal fan base that values their talent and style.

    With their style revolving around curated maximalism, infused with a blend of postmodern and retrofuturism elements, Josh & Matt's aesthetic embodies their identity. Their content lets them use their space as an extension of themselves, connecting with people all over the world.

    Josh and Matt's eye for design and style allows them to see beyond current trends, their love of colour makes them a great collaborator for Haymes Paint.


    HBT 2023 Conference Member Highlights

    Innovation and execution highlights

    HBT has introduced "Member Highlights" at its 2023 Conference. The four stores which were the subject of a Member Highlight all bring something new to retail in 2023.

    At its 2023 Conference the HBT National Buying Group (HBT) introduced "Member Highlights". These enable HBT to highlight those stores that have made significant changes, and helped to introduce new retail ideas.

    The four stores to receive the first Member Highlights were, for the most part, highly innovative, and had undergone significant transitions during 2022 and early 2023. Presenting these stores, HBT provided a short, high-quality video introducing the store, followed by a question and answer session with the store owners, including questions generated by the attending HBT members.

    K&K Steel

    K&K Steel is located in Hastings, Victoria, which is 70km south of the Melbourne CBD (about an hour's drive), on the eastern side of the Mornington Peninsula. One of the owners of the store, Bill Heyblom spoke with HBT's Andrew Graham, one of HBT's managers of member services, about the recent deep-reaching changes to the store.

    Those changes really arose from an understanding that in order to grow, the store needed to change its focus so as to attract more customers. As Bill told Andrew:

    When we bought the business, it did a little bit more in the job lots and that sort of thing, house lots ... but we're not set up to actually move heavy material. We also lost a few of our tradesmen [customers]. They retired and we had to sit down and decide what we wanted to do.
    We've got a really great fabricator who is very artistic and very creative and he loves the challenge. So we've found that we are getting people in that will ask for a weird job. They've gone to other places and said, no, we can't do that. That's not in our capabilities. So we embrace the difficult, we go down and we grab our fabricator, we have a chat with the customer and say, this is what you want, is this how you want it done?

    Bill provided an example of the kind of work they moved to doing, to the delight of their customers:

    We had one lady come in [whose] grandfather used to race speed cars. She had the tail section of his speedway car and wanted to make a TV table out of it. They didn't know how to do it, so they brought us a photo of what his speed car looked like. With a bit of thought, the fabricator managed to fabricate it so that it looked like the bump bar on the back of the speed car. When they left, they were just ecstatic. The father came in after that, he just said 'amazing'. Couldn't believe that this could be done.

    While that goes to the substance of how K&K changed its business model, much of the substantial change has been about how the store has changed its appearance in terms of product display and placement. One of the major changes was reducing the height of shelving. K&K wanted a clear line of sight across the store. However, they found it difficult to source the kind of shelving they wanted - so they built it themselves., developing mobile shelving on wheels.

    We had a need to be able to display a lot of things in a small area while keeping with this height limit. We had to think about how we did it. So we designed the shelving ourselves. The beauty of using them is that we can change the store around in half an hour. We now have the ability, if we want, we can shuffle things around. We can move one item, we can move rows of items so that the store doesn't get stale, so that people don't come in and walk right past things they might need because they know where the other thing is.

    One result of these changes is that Bill has noticed a shift in the customer base.

    We found that we are actually getting more female customers come in now. It used to be that they only came in if their husband sent them in for something, but now we're getting the females that come in and go, oh, can you help me with this and do that? I need something like this. So it's all tied into making [the store] more inviting for people to come into.

    Such a transition needs lots of help, of course. K&K benefitted from the support of many of its major suppliers.

    We spoke with our major suppliers, Bordo, Klingspor. They jumped on board straightaway, said, yeah, what do we want from us? How can we help you? ITM were another one that said, great, let's do it. We're also Metabo dealers. And they jumped in and said, alright, we can do something for you there. Most of the people that we consider our main suppliers jumped in. They jumped on board and gave us extra bits and pieces. We got in with Allstate Trailer Parts and they were great.

    At the core of the changes, however, was K&K's relationship with HBT. In fact the initial impetus for change came from Bill's business partner overhearing a remark at an HBT Conference that if you hadn't changed your store much over the past five years, you likely needed to make changes as a priority.

    I've been working at the business for 20 years and the previous owner was reluctant to do anything. We talked about we needed to change things, but he didn't want to put the effort in.
    HBT has, from day one, opened doors for us that we couldn't get to otherwise. It's been a good asset to get ideas from. We've been able to approach people and say, what can we do here? We're in discussions at the moment on how we can improve the outside of the building. The outside is tired and we need to do something there. And Andrew and I, and Roger and Jane, we've working out what steps to take next. So it's been great in helping us to look for ways forward to change the product range, and to expand on what we are doing.

    One question that came from the floor was about what K&K did to retain staff - a common theme at the 2023 Conference. Bill admitted he didn't have any real solutions, especially as much of the longer-term staff had reached retirement age.

    We've had nothing but trouble getting staff. We were down to one fabricator and I get a phone call on a Saturday morning when I wasn't working, from Roger saying, just had a guy drop off a resume. I said, did you let him out the door? So we quickly rang him up and got him back in, and by 11:30 he had a job. He's turned out to be the best person we've employed. He's just so creative. He's incredible.

    Earlier in the conference in a keynote speech by Bernie Brookes, former CEO of Myer, the concept of "Uber" staff, who want to work retail as almost part of the gig economy had come up, and Bill confessed that much of his current staff followed that model.

    Talking about the Uber personnel. We've actually gone basically to that by default, where you've got four staff members and none of them are full-time. They all wanted to just do casual or part-time work.

    Cooma H Hardware

    The town of Cooma is located about 115km due south of Canberra (about a 90-minute drive). It's also located close to the Snowy River 2.0 project, which has become a major driver of the Cooma economy, and of sales at Cooma H Hardware.

    Two of the owners of the hardware store, Jannene Rixon and David Van der Plaat, spoke with HBT's Jason McElligott. Jannene began by explaining how important customer service is to the store:

    A lot of people say they come back because of our customer service. I had a girl in probably about two weeks ago, she'd been down to Mitre 10. They didn't have the screws she needed. She was trying to put her kids' bunks together. She couldn't do it that night. They were devastated. She came and got the screws from me. I saw her in Woolies that afternoon, and she said, 'Oh thank you. The service out there was so good. The bed got together, the kids were so happy!' So that's what we like to do and in a small community you get the feedback.

    While Cooma has benefitted substantially from the Snowy River 2.0 project, David does point out there are some downsides, especially when it comes to hiring staff.

    It's a double-edged sword. It's created something like a mining boom. Property prices went up, things got really busy, but it's created major issues with staffing and stuff as well because they've come in and they're paying money. So they've got guys out there, out of school, they are earning $3000 a week in the factory, for an 18 year-old. Made it really hard to retain staff.

    According to David, they've given up trying to directly supply the main contractor on Snowy, Future Generation. Instead they service the contractors working for Future Generation.

    What we've found a really growth area for us is servicing the contractors because you're dealing with people who know we're talking about and we're doing very well with that.

    Jannene also points to growth in their core building sales as well.

    At the moment, our trade business is sort of growing. A while ago we had a change in staff and one of our guys stepped up and has started doing a lot of our quoting and is getting back to our builders in a really timely manner. So we are sort of growing the trade section because we're getting back to builders. Up in the Jimenbuen area, there's a fair bit of building work happening. So we're getting a lot of work up there that we weren't getting before, as the person in the role previously wasn't getting back to people quick enough.

    Recently HBT helped Cooma move to the H Hardware livery for their hardware store. Much of the inspiration for the redesign came from David.

    With the new building, I designed it all myself. I love looking around hardware stores. So when I travel around, I find a hardware store to walk into. I've been doing it for years, so I sort of knew what I wanted. I just sat in with a piece of paper and drew a box and started from there, sort of thing. And then we sent our plans to HBT, they did the H Hardware, logos and that design all that up the outside.

    Fix & Fasten

    Fix & Fasten is a fastener specialist retailer, with stores in Sunshine West to the west of the Melbourne CBD, and another in Campbellfield, to Melbourne's north. Andrew Graham spoke with the retailer's two principals, Jason Filia and David Sevrakov. F&F is part of the Industrial Tools & Trades (ITT) division of HBT, and both Jason and David participate in HBT's steering committee.

    One of the most interesting aspects of F&F is that the retailer utilised the Toyota-inspired "kanban". Taiichi Ohno, an industrial engineer at Toyota, was essential to its development during the 1950s. The system originated with Toyota emulating some of the stocking practices of supermarket systems.

    At the most basic level, kanban helps to aligns inventory levels with actual consumption. When the manufacturing area has consumed its stock of a part, a signal is sent to its local inventory for replenishment. The inventory sends a signal to the external supplier, and it is restocked.

    While that seems almost obvious, many inventory systems still work through bulk orders, which are replenished on a schedule, rather than through demand signals, often resulting in either overstocking or understocking.

    The insight that F&F brought to the market is that by interlocking with customers via kanban, they create a system that provides a strong barrier to entry for competing suppliers - it's not enough to just have a screw or bolt that is fractionally cheaper, an entire system would need to be replicated. As David describes it:

    Our kanban system is a supply solution that we've developed into the market. It allows us to manage our major accounts in a controlled fashion, taking the urgency out of what's always urgent, which is workshop consumables. You know, a $5 thing can stop a whole workshop. So what we've developed is the kanban, which is a bin rotation system.
    The cost savings that has not only through our customer but through our own business is amazing. Procurement, the old fashioned walk around with pen and paper to take in the weekly order that they would do is eliminated. To be honest, sometimes we almost make some positions redundant because it just looks after itself. It allows us in our business to actually control the purchasing, allows us to buy better, we know what's coming and yeah, it's a really good system the customers love, and it locks the customer for forever.

    HBT has been one of the core pathways to success for F&F. As Jason explains:

    The HBT supplier base being so large and various has provided us with product ranges that traditionally we haven't had any exposure to. That broad buying range has allowed us to be competitive, and, with our service offering, our customers are actually potentially forcing us to take on extra product range because of that service and the way in which we're delivering the product.

    David was especially full of praise for HBT's online portal that links suppliers and members.

    The online portal that's been developed over the years, especially now, is a great asset to our business. Even just to search products, to search suppliers. We've got our own signings from our sales teams, our purchasing officers, so they can really just jump on and work through the portal and find out what they're after and that sort of stuff. Accurate pricing, notifications and communication through the portal is second to none.

    While F&F faces the same problems with staff as other retailers in hardware, the company has developed a more active approach to managing the situation, according to David:

    Something else we've taken care of is, I suppose with our staff, we've sort of thought outside the box and instead of getting traditional fastener staff, we sort of look for specialists. So currently we've got a hydraulic specialist within our business. We've got a sealant specialist that we've gathered from outside our traditional industry and rely on them to help us build that category. So we've built this, I suppose, structure of specialists within our own business through the sales team that we can lean on when we get a certain, I suppose, lead into silicone we'll take that account manager with us and help us.
    The other thing we've identified is obviously [the current staff] are not going to be around forever, so we've got to bring the new generation through. So we started a skill-invest type scenario for succession. We're bringing teenagers through the business. They do a 12-month course, they get a certificate at the end of it and then, if they're up scratch, we retain them as a full-time employee And we've had some great success with that. We've got some young kids within our business that I suppose have got the "want" to move through the business. The old-school heads have got all the knowledge, but bringing those young ones through means they can feed off that knowledge for the next generation.

    Hoadley's Hardware

    Definitely one of the strong crowd favourites at the Conference was the presentation of the Hoadley's, who are a delightful young couple who decided to open a hardware store in Blayney, a town in New South Wales, west of Sydney, between Bathurst and Orange.

    It seems to have been a long time since younger people could just open such a store, with little knowledge about how the retail end of thing works, and go on to enjoy some success. But Tayla and Blake Hoadley, with their two young children, have managed to do exactly that.

    One key to this was the amount of help the couple received from HBT's general manager - member services, Mike LoRicco. Blake is frankly honest about is lack of experience when he describes the process of getting going:

    I was going to start a hardware shop. I knew there were buying groups, but I didn't know where to start. So I was ringing Bremick or Macsim or anyone. I rang directly and said, "I'm starting a hardware shop will you, supply me?" And they all said, oh yeah, we should be able to.
    So I was ringing all these people going, well how am I going to work all this? Anyway, long story short, I was scrolling the internet trying to find a buying group, and found one, which was IHG actually. I got in contact and that worked, I had my hopes up, but then I started getting suppliers in and got talking about HBT. So I looked HBT up on the website, sent an email and, funnily enough, the next day, Mike actually rang me. Yeah, we got talking and then Mike came out to see me.
    It's all started from there really. It's been good.

    As a native son of Blayney, and a tradesman (plumber), Blake was aware that there was a real need for another hardware store.

    It was hard to get materials if you needed them. And then because the [existing] shop that was there was never, well they had stock, but they didn't always have the right amount. If you needed 10 fittings, it might've only had four. So I'd find myself going to Orange or Bathurst to get materials to do my jobs. Every tradesman you talk to in Blayney would say that and they just get someone to deliver it from Orange or Bathurst, which is half an hour away. So I talked to dad about it early on, probably two years before we actually did it, and said we should do a hardware shop in Blayney, but we never sort of did it. And then here we are, we're doing it.

    Even though Blake has an "in" with the trades, the store still balances more towards DIY.

    Well, we're sort of probably 40% trades, 60% DIY at the moment. So we don't have heaps of trades and we've got a lot of up and coming tradesmen similar to my age that are coming through. All the older tradesmen haven't been to my shop because they don't like change. They're stuck in their ways and where they shop. But all the younger ones, I'm starting to get along with them really well, making friendships coming in. It's been great.

    Not only has HBT helped out, but so have the suppliers.

    Suppliers been really helpful actually. Setting up core ranges or top sellers because I'm new to this game, I didn't know where to start. When I first thought I was just starting a few screws, different varieties, but we got 10 bays of screws, all different screws and I didn't think I'd have to have that many screws, but it's surprising it's your bread and butter stuff, that turns over really quick, but you've got to have the screws to be able to sell the screws so you if you are going to have only a small range, probably going to lose some of the customers, we'll lose some sales.

    While Blake is busy building relations with the suppliers, his wife, Tayla, helps to make the store friendlier.

    I pride myself more on the customer service side. We are very family orientated and Blayney's such a small community, tight knit, everyone loves that sort of feel. So I'm in there to be bright and bubbly to say hello to everyone to stop Amelia, our daughter, running down the aisle past someone and knocking them over or something. So yeah, Blake's the guy with all the answers to all the questions and I'm the one to just be there for everyone and greet them and make them feel welcome. And as Blake said, I feel like that's why people come back is that we try hard to help everyone where we can, we can order things in or at least try our best to. But it's just that nice small community feel and we feel that that's what everyone loves and that's what I sort of stick to.

    That said, Tayla has definite plans for a more involved future.

    We have a seven month old baby. I'm technically on maternity leave still. But once he's in day care and that sort of thing, I'd love to get into the shop and really dive into that side of the shop. But until then, I definitely have lots to learn. Lots to learn, but we complement each other in that way. Blake has such a background in the industry and I'm there to be bright and bubbly. So yeah, we complement each other.

    Blake, like any good hardware retailer also has his eyes fixed on the future, and it's no surprise what he most wants: more space.

    Bigger shop, big area because we're only in probably a thousand square meter area, including the outside yard. So we're limited to the room and we'd love a bigger shop to do more things. Such as pet stuff or nursery, maybe going to the mower side of things as well. When ee took over, it was a mower shop and there's very much demand for that in Blayney. Time will tell. If we run into a heap of money, it'd be good. See what happens.

    Bunnings full-year results FY2023

    Gains are subdued

    With inflation taken into account, Bunnings contracted over FY2023. This is most likely due to contraction in DIY sales over the second half of the year.

    Wesfarmers released its results for FY2023 on 25 August 2023. Overall revenue was $43.6 billion, up by 18.2% on the previous corresponding period (pcp), which was FY2022. Excluding the acquisitions making up Wesfarmers Health, revenue was up by 7.4% on the pcp to $38.2 billion. Net profit after tax (NPAT) was $2.5 billion, up 6.3%.

    While HNN will be providing a full analysis of the results for Bunnings in the next edition of HI News, we will provide a brief look at the results here.

    For the company's Bunnings division, revenue was $18,539 million, up by 4.4% on the pcp. Earnings before interest and taxation (EBIT) was $2345 million, up by 1.2% on the pcp. Store-on-store (comp) sales growth came in at 1.8% for FY2023, down from 4.8% in the pcp.

    In his opening remarks, Wesfarmers managing director Rob Scott stated:

    Bunnings delivered solid sales growth reflecting the resilience of demand across its offer and strong execution of its strategic agenda. Bunnings again demonstrated its capacity to grow its proposition and addressable market whilst maintaining strong returns during the year.
    This included the successful pets launch and continued advancement of their whole of build commercial strategy. Bunnings also continues to make significant progress on its digital agenda with increasing engagement through the Power Pass app, Bunnings marketplace and OnePass and Flyby programs.

    These remarks were later followed up by Wesfarmers CFO Anthony Gianotti:

    Bunnings sales growth of 4.4% was supported by growth across both consumer and commercial segments. Bunnings continued to demonstrate the resilience of its operating model with all trading regions delivering sales growth for the year. Despite the impact of prolonged wet weather across the east coast during the 2022 spring trading season, Bunnings sales were supported by continued building activity and robust demand from commercial customers, which was offset by slightly lower consumer sales.
    In the second half, Bunnings has seen some good consumer demand continue for necessity products that support recurring home repairs and maintenance and for smaller scale DIY projects. But compared to the second half last year, consumers have demonstrated a more cautious approach to bigger ticket purchase decisions and the commencement of larger projects. Overall, Bunnings earnings of $2.2 billion represented an increase of 1.2% or 1.9% after excluding the net impact of property contributions. This result continues what has been a remarkable period of growth for the business with earnings up 42% since 2019.


    It is somewhat predictable that after the strong growth across the major COVID-19 years, Bunnings would see some decline in growth for FY2023. Given the inflationary background to these results, there is little doubt that these results represent a net contraction.

    That is highlighted by the growth of comp sales of 1.8%, while the background sales growth for hardware retail was 4.3%, according to Australian Bureau of Statistics (ABS) numbers. This most likely reflects a stronger contraction in DIY-based sales over the second half of FY2023.

    It is notable that for the year penetration of online sales is now at 1.7%, down from 3.0% in the pcp.


    Retail update

    "The Other Hardware Store" campaign continues

    Queensland based Sunshine Mitre10 has produced videos of its store in North Lakes and recently opened outlet in Aura

    Back in 2021, Mitre 10 invited Australians to check out the "other" hardware store, through an advertising campaign created by Dig agency.

    Mitre 10 recently launched the latest iteration of "The Other Hardware Store" campaign. The agency said:

    This new work builds on the 'why' showing how you can trust Mitre 10 to deliver the care and expert advice you need to get the job done right, first time.

    Marketing manager at Mitre 10, Kath Carroll, also said:

    It's customer service and expert advice that drive a strong point of difference for the Mitre 10 brand. Our customers repeatedly tell us that when you visit a Mitre 10 store you get all the information you need so you can avoid the back and forth. This new creative builds on the work we've done since launching The Other Hardware Store and acknowledges the relationship and trust we have with our trade customers.

    David Joubert , executive creative director at Dig, said:

    There's nothing worse than struggling on a DIY job and feeling like the world is watching. So, in true Mitre 10 style, we delivered a simple message with distinction: you can trust Mitre 10 to get the job done right. First time. And save yourself from a little... scrutiny.

    A video of the campaign can be viewed on the following link:

    Mitre 10 advertising campaign on Vimeo - August 2023


    Mitre 10 positions itself as "The Other Hardware Store" in a series of ads - HNN Flash, May 2022

    Sunshine Mitre 10

    The Sunshine Mitre 10 superstore in Northlakes opened in 2022. General manager Neil Hutchins said his team is proud to be part of one of the fastest-growing areas in Queensland.

    More than two years before the store opened, the Sunshine Mitre 10 team saw the potential of the North Lakes location and Mr Hutchins is pleased with the results so far. He told the Moreton Daily:

    We recognised early that North Lakes would be a great location for another store in our network, which now includes over 20 locations throughout Queensland, from Weipa in the north, to St George in the west, and south to Brisbane.
    Moreton Bay is recognised as one of the fastest growing regions in Australia with a population of over 490,000 people and predictions of up to 30% more over the next decade.

    The North Lakes store is more than 8400sqm, with more than 3400sqm under roof. It is located at 49 Stapylton Street, close to Ikea and the Westfield shopping centre and easy to get to from the Bruce Highway. Mr Hutchins said:

    That makes it super easy for our customers to get in, get out and get on with it, especially with our great Trade Drive-Thru.

    He said the Sunshine Mitre 10 team is also getting involved in the local community, not just by employing locals but also through community and sporting sponsorship.

    What is now Sunshine Mitre 10 was started by the Lanham family on the Sunshine Coast more than 110 years ago. Being a part of and supporting the communities in which we operate is really important to us.
    That's why in North Lakes we have already created sponsorship partnerships with North Lakes Leopards Rugby Union, Hammerichs Coffee and various local schools and retirement villages.

    A video of the North Lakes store can be viewed at the following link:

    Sunshine Mitre 10 North Lakes store on Vimeo

    A video of the Aura store can be viewed at the following link:

    Sunshine Mitre 10 Aura store opening on Vimeo
  • Sources: Mumbrella and Moreton Daily
  • retailers

    Home First Services relaunched

    One-stop tradie shop with same-day service

    Under new ownership, the group has almost 250 staff across Melbourne, Sydney and Adelaide offering home maintenance

    In a related sector to hardware retail, Home First Services is made up of a group of plumbing, electrical and home improvement companies that fell into administration after the COVID-19 lockdowns.

    James Hetherington co-owned the three companies - PlumbFirst, ElecFirst and Comfy First - which went into administration the week after builder Porter Davis collapsed, having been unable to meet the increased costs of materials, soaring wages and labour shortages brought about by the pandemic.

    One of his competitors, Australian Home Services group, saw an opportunity to bring these entities together under the one umbrella, refine the business model, rework the loss-making parts of the business, and re-brand it in Victoria and South Australia. It has plans to grow quickly to become a national business.

    Mr Hetherington was retained to lead the transition as chief executive of the new Home First Services organisation. He said:

    We're relaunching the Home First Services brand with a much more sustainable business model so we're planning to come back stronger, bigger and better than before. Most of our staff stuck by us through thick and thin during COVID so, as much as anything else, we're doing this for them. Now, they should all have great job security.

    A key differentiator is the company's guarantee of same-day service and if it doesn't live up to that promise, it will take $100 off a customer's bill.

    Mr Hetherington said he (and his customers) became so fed up with "the tradie experience" such as leaving messages on answering machines, having calls returned a day later, putting up with shoddy workmanship that he resolved to try and change that with his offering.

    We want to serve our communities and ensure our clients receive a level of service that's unmatched. That means breaking the traditional stereotype of the 'tradie' experience.
    If you make a promise that you'll give a customer same-day service, you've got to live up to it. We've all been there, booked in a trade only to have them not show up, cancel on us or just aren't as professional as we'd expect, so we're trying to make the whole process much more customer-friendly.


    Earlier this year, Melbourne-based Plumbfirst became the third major contractor to run into trouble with Victoria's largest privately-owned contractor Richstone Group also calling in voluntary administrators, and CDC Plumbing and Drainage placed in liquidation in February, with the loss of 197 jobs.

    WLP partners Alan Walker and Glenn Livingstone were appointed as administrators of Plumbfirst and five other group entities. At the time, WLP said:

    The administrators are now seeking urgent expressions of interest from suitable parties to recapitalise or purchase the group and its assets, or both. While that process advances, the administrators will continue trading the group with no interruption to ordinary operations expected at this stage.

    Mr Walker said the company's directors decided to place it in voluntary administration after rising materials costs adversely impacted its performance.

    The group comprises one of the largest plumbing and electrical contracting operations across southeast Australia with a well-established 170 strong workforce and customer base.
  • Sources: Australian Home Services and The Australian
  • companies

    US update

    Lowe's tops quarterly estimates, slightly misses on revenue

    Spending on small-scale repair and maintenance work has helped Lowe's counter a fall in demand for big-ticket items, amid a challenging housing market and inflation

    Home improvement retailer Lowe's reported mixed results for its second quarter as US consumers tackled springtime projects and helped offset weakening home improvement demand.

    A delayed spring season pushed demand for goods such as garden equipment and outdoor supplies into the quarter from earlier in the year.

    In addition to spring projects, Lowe's said it got a lift from online growth and momentum with home professionals.

    As a result, the company topped Wall Street's earnings estimates, but fell slightly short of expected sales.

    Revenue reached USD24.96 billion compares to the expected USD24.99 billion. Net sales fell from USD27.48 billion a year earlier.

    Comparable sales in the second quarter decreased 1.6% but that is better than the 2.6% decline that analysts expected, according to FactSet.

    Lowe's has been working to attract more home professionals, which tend to be bigger and more steady spenders. Only about a quarter of Lowe's sales come from home professionals, while they account for about half of sales at Home Depot.

    On a call with investors, chief executive Marvin Ellison said those professionals tell Lowe's that they still have a healthy amount of projects in the pipeline. That helps drive purchases of paint, plumbing tools and more.

    But after a period of higher costs and out-of-stock items, falling prices are now contributing to lower sales, Mr Ellison said. Not only have timber prices dropped significantly, but appliances have come down in price, too.

    Mr Ellison also said Lowe's feels good about the long-term outlook for home improvement because of the older age and low availability housing in the US. But, he added, the business will have a tougher time in the short term.

    When you look at consumer sentiment, we noted that we're seeing a pullback in DIY discretionary spend. And that's really for us the overall theme of how we see the second half of the year.

    Mr Ellison added he expects Lowe's to outperform the home improvement market in the second half of the year "irrespective of what the macro environment presents," citing strong online sales and growth in the company's Pro-customer business that caters to professional builders, contractors and handymen.

    While the pro-customers were working on slightly smaller projects, they still had a healthy backlog of projects left, Mr Ellison noted.

    Rural offering

    In May, Lowe's announced "a new one-stop shop concept" tailor made for shoppers living in rural communities. New or revamped stores would cater to that market's indoor and outdoor needs with expanded product categories in pet, livestock, trailers, fencing, utility vehicles like ATVs, clothing and specialised hardware.

    The company's enthusiasm for pushing aggressively into smaller rural communities comes as its sales in larger metropolitan markets have slowed as the pandemic emergency has come to an end.

    Lowe's told analysts that it had piloted the rural store concept a year ago with successful results and has been expanding the idea into existing Lowe's stores, primarily in the South, Midwest and Northeast throughout the US summer. Mr Ellison said:

    While in years past, our penetration of rural and remote stores was viewed as a competitive disadvantage, we now expect that these stores will be a key component of our operating profit growth over the next 3 to 5 years.

    Lowe's said it was scaling its rural store format to as many as 300 additional stores by year end for rural customers. Mr Ellison said:

    When we look at the pilot stores where we've been very diligent on going after those specific categories of apparel, farm and ranch types of items as part of our expansion opportunity, we actually saw sales per square foot improve.

    More recently, he told CNBC:

    I grew up in a town of less than 10,000 people with two stoplights, and I lived 12 miles in the country from the 10,000 people, so I understand the rural experience really well, and this is passion project for me. Our goal is to give these customers a one-stop shopping experience.

    Mr Ellison said he heard from customers in rural areas that they sometimes had to travel to multiple locations to find products they needed, especially related to pets and livestock. In late July, Lowe's said it was expanding its store-in-store pilot program with Petco, aiming to give customers easier access to pet supplies.

    We have the unique ability to execute both urban and rural and do it in a way when a customer walks in, it feels like their hometown store.
  • Sources: Reuters, CNBC, Business Insider and CNN
  • bigbox

    Want Home + Gift

    Homewares create a welcoming store

    More independent retailers are broadening their ranges to include home decorating products. Want Home + Gift has found a niche with hardware stores by offering products that appeal to customers through authenticity.

    More independent retailers are revisiting their in-store stock, and exploring new options. That is largely because independent retailers have seen increases in general store foot traffic since the end of the COVID-19 restrictions. That is largely down to an increase in overall sales, with more people fixing up their homes. There have also been some shifts in the market dynamics between Bunnings and the independent market.

    One area they are keen to explore is the more decorative, homewares oriented area. At the same time, they have something of an aversion to goods that belong more in a gift shop, where all too often the twee meets up with the kitsch.

    Enter Want Home + Gift. A new supplier to the HBT National Buying Group, and exhibiting at the 2023 HBT Conference for the first time, they've attracted outsized interest to their small stand.

    HNN spoke with the two owner/directors of the company at the Conference, Mark Woolfson and Alan Duhamel. According to Mr Woolfson, while the company has been around for 25 years or so, the current owners acquired the company back in 2006. The reason behind their current success has been a crucial pivot from being all about "gift" type products, to products that customers would want to buy for themselves and their own homes.

    When we bought the company, just the fact that it had so many customers diluted the risk a lot. And we saw an opportunity to not narrow it down just to giftware, but to [open it up to] more decorative products, everyday products for anybody. Not just someone looking for a gift. This is just an easier purchase, so that if someone walked into a store they could purchase it not strictly as a gift. Narrowing it down to just strictly being a gift item was restricting.

    With that shift in purchase basis, this meant there was a whole new range of retail customers interested in stocking the products.

    We definitely got a different type of customer. More the garden centres and the hardware stores, which was much less "gifty" than going into a gift shop. Traditionally, if you're looking for a gift there is a gift shop or a newsagent, even a pharmacy. And so it just opened up completely. It's even the garden centre started and the hardware stores followed and we've been very successful and they've become our key customers, our core customers.
    So we tend to buy what our customers buy from us. We follow what they need. We followed them down that rabbit warren, it's gone down the garden and then hardware route. So our product is more applicable to hardware and garden centres than it is to gift shops.
    It's an easier sell for everybody, if that makes sense. If you're looking for a gift, that's more specific. It's more complicated. Will the person like it? Is it enough money? Maybe you should spend more money? So many questions. If someone falls love with a piece, it's a much easier sell.

    While that is a good beginning, Mr Woolfson points out that the company has also used the changed market conditions over the last year and more to improve the position of Want Home + Gift. As Mr Duhamel describes it:

    Some of the feedback we've been getting today is that we've continued to do business as usual. We have kept the same people, same level of service. We actually heard this from quite a number of visitors today. They were saying to us some of the other competitors in a similar space have just hiked their prices up. A lot of businesses have changed hands. The prices have really gone up and the level of service has fallen. So that was a good thing for us to hear. We've been consistent.
    We pride ourselves on talking to our customers and trying to do what we can for them. An example is freight. We'll work with them. If they have a forwarder, we'll work with them. We do what we can to make things work.

    Want's supply chain runs through China, but also through Indonesia. While they tend not to specify products from scratch, they take existing products and change some of their features to better suit the Australian market, such as colour, materials and textures.

    The company doesn't see itself as being any kind of a "wheeler and dealer" in the market, but more as offering a product that has a natural appeal, and offers an opportunity for add-on sales. As Woofson puts it:

    We've got in different directions. The size of the business has changed, we've grown, but it's growth in terms of better product, better authenticity. There's not so much sales pitch involved. That's been the best growth for this business sector. We don't have to force it on deals and things.

    For hardware stores, one the best things about the product - aside from its strong appeal to customers - is that it also helps to make hardware stores a more pleasant place to visit.

    We had one lady who came in here, and she said, this is exactly what we're looking for. It's like solving a problem for them. It's also solving a problem for them more in decorating the hardware stores, making them softer.
    It softens everything. The plants further soften these products. So our product is softening all the hardware, it's just making for a softer store.

    ABS building approvals: Capital cities

    FY2023 is down, but how significant is this?

    There has been a widespread decline in dwelling building approvals across Australia's capital city regions. While some June 2023 results have been lower than in the previous three years, these don't seem predictive of a slump for first quarter FY2024.

    Economic forecasting has narrowed somewhat during August 2023 to focus on whether the Australian economy is seeing an abrupt slowdown in the first quarter of FY2024. With broader retail businesses reporting a slowdown in sales for the first six weeks of FY2024, and some hardware retailers seeing a similar trend, there is some confirmation that there is more of a drift downwards than upwards. However, most mainstream economic indicators show something of a more mixed "will we or won't we" trend.

    Building approvals are very much in that uncertain grouping. Looking at the Australian Bureau of Statistics (ABS) stats, you can certainly make the case for a slowdown, but the real case is perhaps more about volatility than decline when viewed on a state and territory basis.

    We're looking here at the ABS series that tracks building approvals for the greater capital city regions - including the Australian Capital Territory (ACT) - for all house and non-house building approvals through to June 2023. The 12-month periods thus correspond to the standard Australian financial year of July through to June.

    Greater Sydney

    The first thing that is clear about the Sydney numbers is that there is increased volatility for FY2024. January 2023 shows the lowest point for the four years - FY2020 through to FY2023 - under consideration. And May 2023 shows the highest point for that time period.

    Five of the 12 months in FY2023 represent highs or lows for the time period. While FY2023 represents a decline on FY2022, the largest decline is from FY2021 to FY2022.

    Likewise, approvals for June 2023 show a decline over May 2023, but remain above the level for June 2020.

    Greater Melbourne

    The stats for Melbourne in FY2023 show a distinct division into halves for calendar 2022 and calendar 2023, divided by the very common sharp slump in January 2023.

    For the first half of the FY approvals follow the average of the preceding three years, followed by a slightly lower number for January, and then four months from February through to May of below average approvals. Then there is a recovery back to near-average numbers for June 2023.

    However, Melbourne does show more certain signs of decline for FY2023, with approvals significantly lower than for the three preceding years.

    Greater Brisbane

    As often seems to be the case with Brisbane, the region falls somewhere between Sydney and Melbourne statistically. Total approvals for FY2023 are lower than for FY2021 and FY2022, but higher than FY2020.

    About the best that can be said is that the region remains volatile, but with the balance moved to the downside.

    Greater Adelaide

    Somewhat similar to Melbourne, Adelaide has seen a slightly stronger first half to FY2023, concluding in a somewhat lower slump in January 2023, and then a more subdued second half. There is a four-year high in approvals for November 2022, and then a four-year low for March and April 2023.

    In fact, the Adelaide numbers for FY2023 from November 2022 onwards track fairly closely those for mostly pre-COVID FY2020.

    Greater Perth

    In a more extreme version of Adelaide, Perth shows numbers for FY2023 that are similar but below those for FY2020, but this comes in the shadow of a very strong increase in approval numbers for FY2021.

    Australian Capital Territory

    FY2023 for the Australian Capital Territory (ACT) shows actually less volatility than the preceding three years, and this comes - mostly - at the expense of the highs rather than the lows.

    May and June 2023 are especially weak, showing low points for the four years.


    Conversely to the ACT, Hobart shows higher volatility for FY2023 than for the preceding three years. Four year lows were set for seven months during FY2023, including a significant slump in June 2023.

    Yet the larger overall slump for Hobart happened in FY2022, coming off the highs for FY2021.


    Given the smaller size of the Darwin market, it's volatility is has been relatively subdued. FY2023 has not been its best year, but it actually outperformed FY2022, and came close to FY2020.


    Chart 9 shows the total building approvals by financial year for the greater capital areas described above.

    It's always worth mentioning that there is something of a distortion in terms of comparing regional/urban areas for NSW, as it is the only state that has a number of significant urban areas outside of its capital city.

    What the chart does show is that FY2023 has been a slower year for approvals than the previous three years. That slump seems significant for Melbourne and Perth, but far less so for Sydney and Adelaide, with Brisbane somewhere in-between.

    Of course what we are really seeing in FY2023 is the tension between demand on one side for more dwellings, and increasing costs due to rising interest rates on the other. The real question is probably not whether the Australian economy will begin to decline in FY2024, but when and how interest rates might go down, and thus give more dwelling purchasers a path to market.


    Retail update

    Beacon Lighting's profit slide

    The retailer is focused on growing trade sales, including introducing a tradies' frequent flyer scheme called Beacon Trade Club

    Beacon is the biggest provider of speciality lighting, ceiling fans and globes, and reported full-year revenue of $311.955 million, up 2.5%. However, profit declined 17% to $33.6 million, just shy of analyst expectations of $35 million.

    The retailer, which has 119 stores serving both retail and trade customers, warned of a slow start in July.

    Consumer sentiment [retail customers] has been adversely affected with rising interest rates, inflation, and economic uncertainty.

    As a result, Beacon has focused on growing trade sales, including introducing a tradies' frequent flyer scheme called Beacon Trade Club. It said trade customers had responded very well at a time of consumer pessimism.

    Total trade sales increased by 21.6%, trade sales through stores increased by 22.5%, and online trade sales increased by 36%.

    Overall trade sales accounted for 29% of sales for the year, compared with only 15% five years ago. Executive chairman Ian Robinson said Beacon's commercial order book has been "surprisingly consistent," as pent-up COVID demand comes through.

    We thought that with all the talk about the slowing down of volume residential building we would see a fall-off. The order book hasn't changed much over the last 12 months and is not expected to.

    Beacon also plans a large number of store openings to expand its reach to 195 outlets.

    In The Australian, Citi analyst Sam Teeger said he was more confident about the retailer's outlook following an earnings briefing.

    Beacon appears optimistic it can hold gross margins at similar levels to 2023, noting freight tailwinds, lower factory prices, and low stock turns mean what is being sold today was purchased eight months ago. Trade remains the No.1 priority ... and 2024 growth is expected here. While the US has been disappointing the company remains committed to this market.


    Beacon will continue to push into the wholesale market - HNN Flash, October 2022
  • Sources: The Australian and Adelaide Advertiser
  • retailers

    New product: Essentials Pack

    JB Weld's Essential Travel Pack now includes SuperWeld

    In addition to SuperWeld, the other JB Weld products are stored in one handy plastic box for users

    The Essentials Pack has three putty sticks: one for repairing steel (SteelStik), one for water-related repairs (WaterWeld), and one for repairing plastics (PlasticWeld). The two-part epoxy is designed to repair metals, and now JB Weld's SuperWeld is part of the pack.

    SuperWeld is a super glue that can be applied directly to the repair area and works on so many surfaces such as plastics, glass, ceramics, rubber, stone and wood. It sets quickly in around one minute.

    All these products come separately stored in compartments within a clear plastic box. The back of the box has information including instructions, a guide for working times through to setting times, plus the overall rating once fully cured.

    When using any of the putty sticks, assess how much you need then cut a piece off and remove its outer wrapping. Begin to work the putty together in your hands - it's ready to be used once it's fully mixed.

    Each putty stick has different applications but with each one, the contents can be moulded into any shape. The curing time for the putty varies, with the SteelStik and WaterWeld requiring one hour. The PlasticWeld takes three hours.

    After waiting the required curing time, the putty can then be drilled, tapped, sanded, filed, or painted, depending on the putty type. At the completion of the repair, you simply return any unused putty back into the tube so it's ready for the next repair.

    The final product making up the kit is KwikWeld. Two tubes are used with the two-part epoxy cold weld system. It requires a mix ratio of 50/50, so it's just a case of squeezing out what you need from both tubes and mixing them together well. This product provides a permanent bond on a range of surfaces and takes between four and six hours to completely cure.

    JB Weld Essentials Pack can help deal with multiple situations, and the products come stored in a neat, hand-sized carry case.

    For more information, visit the company's Australian distributor, HPP Lunds website below or call Ben Leonard (07) 3722 1111.

    HPP Lunds, a leading independent wholesaler of automotive parts and accessories in Australia

    The JB Weld Australian catalogue is available to download from the following link:

    Download JB Weld Australian catalogue

    HBT Conference: The buying team

    Jody Vella heads up the HBT buying team

    Jody Vella, general manager - buying for HBT National Buying Group, describes how HBT is evolving its Conferences, as well as its overall businesses. He sees hardware retail continuing to grow, and independent retailers continuing to play a significant role.

    The HBT National Buying Group (HBT) is holding its 2023 Conference in Cairns, Queensland from August 21 through to August 25. HNN caught up with Jody Vella, the group's general manager - buying, to find out what's happening, and how the group has evolved post-COVID-19.

    Focus on growth

    Jody - and HBT in general - is very much convinced there is room for further improvement and growth for independent hardware retailers in the current and emerging market.

    Greg Benstead [HBT CEO] and I will be talking on Tuesday. The main part of the presentation is that we want [members] to grow. That's the whole idea of why we're here. That's why the members have invested, and we absolutely love that they've invested four days with us. And so for us, it's in our interest, all of our interests, to help them to grow.
    And the question is, how do we help them grow? So there's some things that we're going to be talking about, about how to better interact with HBT and why they should interact and transact. We'll talk about the supply portal [HBT's online link to members] and we'll use some case studies of what others have done and how they've managed to really perform well with HBT.
    But it's a positive conversation. It's a conversation about: we want you to grow and we stand ready to help and this is what we think. If you're not doing this, then maybe you should think about doing that type of thing.
    The opportunities are there. The independent hardware channel is very important and it's growing. I think it's a credit to every one of our members and our suppliers that support us. I just think that you've just got to be a bit smarter about it. Not work harder, just work smarter, and just be a bit more strategic in what you do and how you partner with people, with suppliers, and how you use their expertise as well.

    Conference evolution

    Since Greg joined the group as CEO, there has been a constant evolution in the annual Conferences - in part a response to ongoing growth in member numbers. That said, 2023 marks the sharpest departure from the previous Conferences. As Jody explains it:

    I think as the conferences have evolved since 2019 - of course we couldn't do any in the two years with COVID, but last year's and this year's, there's been a continual evolution about what we're trying to do and the information we're trying to impart. We're trying to turn it into a real networking event, an information sharing event.
    I think it's just good to get all of our members and all of our suppliers in one place at one time. It's the only time where we can network, learn and find out what others are doing. Hopefully we can provide bits and pieces that they can take back to their stores, or put into the business plan for suppliers, to improve the way they go about doing business, interacting and growing sales with HBT.

    One of the core areas of evolution is in the way the members of Jody's team do their presentations.

    The key characteristic about all the presentations is that our suppliers are going to be up there on the stage with us. So they'll be up there talking and it'll be a question and answer session, as opposed to here's a 40 slide PowerPoint presentation that we'll talk to you about. And then questions at the end.

    The teams' Wednesday presentations cover a range of topics. Marcella Indries, who specialises in garden ranges, will be talking about the pet category and impulse buys in general. Jonathan Hall will discuss changes to insulation regulations, and the opportunities this offers. Kate Lamb will discuss how retailers can display some of the larger and bulkier items more effectively, to get better value from their floor space. Kevin Marshall will discuss power tools, joined by power tool suppliers and an HBT member. Peter Hurley will present one of his well-received talks on the timber industry.

    Rounding off those sessions, Alix Coates will discuss how to make better use of HBT resources to better market member businesses. According to Jody, this is something of a major focus for HBT in 2023.

    I think we've really got our marketing and promotional program together. There's still a lot to be done on that, but I think we've taken a big step forward with how that's come about and put procedures and processes, and protocols in place to really drive those promotions. Not only drive them, but cycle them the next year and continue to grow business for the suppliers and for the members.

    A passion for independents

    For HBT's executive team, helping out independents is something of a passion, and that's especially the case for Jody. His career has taken him from a corporate beginning with Coles, to helping independents with FoodWorks, and now to HBT.

    I've been involved with independent businesses for, well. since 2009 when I started at FoodWorks, independent supermarkets very similar to HBT. And I just admire these people, because I think that they go out there, they're true entrepreneurs. They may not think of themselves as that, but they are. They service their community, they play an important role in the local community and they provide services.
    I think that for any business, it doesn't matter what it is, whether it's a supermarket or a hardware store or a music shop or a camera store or whatever, you cannot beat independent businesses.
    It's the same in HBT. We have such a diverse range of stores, and each one of them is unique. And I just think that I take my hat off to them, I really do. I think if they're going to have, I suppose, the guts and the courage to go and do this, then they should be supported by people that really are as passionate as they are. That's what we do.
    As we say to the suppliers every time we raise the subject of improving the deal [offered to members]. We do so not for us, but on behalf of their own customers. And I just think, as Greg would say, we sleep well at night because everything we do is for the members.

    Ongoing coverage

    It is becoming evident that, as significant other groups in independent hardware lean further into a corporate/independent model, HBT is one of the national groups helping to establish the fundamentals for independent hardware retailers.

    In line with that HNN will be offering ongoing coverage during this weak which extracts the parts of the conference that have general significance for the hardware retail industry overall.


    Hardware retail sales to June 2023

    Is the party over yet?

    While FY2023 was a record-setting year for hardware retail revenues in many regions, the gains in the east coast states were much lower, with Victoria continuing to contract. While it is unlikely that FY2024 will see widespread contraction, gains are likely to be even more incremental.

    The Australian Bureau of Statistics (ABS) has released hardware retail sales for June 2023. This means that in comparing the trailing 12-month numbers, we're looking at the financial year (FY) from July to June.

    In general retail, the June 2023 numbers are being seen as broadly significant in terms of predicting the first quarter of FY2024. It's unclear if that is really the case for hardware retail, though the performance during that quarter itself will likely be very significant as an indicator of the market for the following 18 months.

    New South Wales

    The graph shows that sales for New South Wales (NSW) in FY2023 closely shadowed those for FY2022 from January to March, then dropped to a lower level from April to June.

    That said, the June numbers remain relatively buoyant, beating both June 2020 and June 2021.


    In many ways the core question about the June numbers for Victoria (VIC) is what is going to happen in the following July? July has taken on the role of being the lowest revenue month, where prior to FY2020 it shared that role with June.

    That's shown in the developing convergence around $510 million for the month over the past three years, while July shows a relatively wide divergence.


    FY2023 saw Queensland (QLD) setting all-time records for hardware retail sales for July through November, following on from record sales for FY2022 in December, March, April and June. In FY2023, sales tracked FY2022 from December to February, but have been generally lower since then.

    It's difficult to see the sales pattern altering much for QLD, given that its economic drivers are broadly different than those for NSW and VIC.

    South Australia

    In technical statistical terms, FY2023 has been something of a cracker for South Australia (SA), with every month setting a new record in sales.

    The first seven months were particularly strong, but since February sales have tracked closer to FY2022. While SA does tend to be more volatile than NSW, VIC and QLD, it seems unlikely the state will see a sharp decline.

    Western Australia

    Western Australia (WA) didn't quite match the record of SA, only setting new records for 11 months in FY2023 - April dipped slightly lower than results for FY2022.

    The economic factors that affect WA are so unique that it's difficult to see it in comparison to the rest of Australia. Broadly, given the effect of changes external to the state, it seems likely that revenues will continue high, but under those for FY2023.

    Australian Capital Territory

    The Australian Capital Territory (ACT) managed to exceed or close to equal new records for six months in FY2023.

    Since October 2022, the territory has closely followed the trend set by FY2022, but diverged higher in May and June. Predicting this region is very difficult, but again there is cause for optimism looking ahead to FY2024.

    Combined Northern Territory and Tasmania

    As we lack much of the historical data for these two regions, we have backed into some numbers by subtracting the total revenues of all other regions from the total for Australia (this is a slight over-estimation, but by very little).

    It's difficult to imagine two more different regions, so statistically this is pretty much nonsense. But the chart does indicate that for FY2022 and FY2023 the two regions seem to be doing well.

    HNN will begin to reinstate stats for these two regions individually for FY2024.


    The nation managed to set hardware revenue records for the first seven months of FY2023, and closely followed FY2022 for the remaining five months.

    Of course, as with the results above, inflation plays a key role in these new records, but they are at the very least modestly good.

    However, we can see more of a trend if we look at the percentage growth across financial years for the past five years, as shown in Chart 9:

    It is clear that revenue growth in NSW, VIC and QLD has been slowing down over the most recent financial year. In fact, figuring in inflation both NSW and QLD are probably negative in real terms, and VIC, of course, is negative for both FY2022 and FY2023. That is balanced by very strong growth in other states and territories.


    The post-COVID-19 economy remains something of a mystery today, largely because it seems to shift significantly over each half. There is an admixture of some remaining traces of COVID-19 hesitancy, combined with compensatory/recovery changes, plus genuine medium-terms shifts in consumption.

    One revealing chart to look at is for returning travellers to Australia who travelled to see friends and family, or to go on holiday:

    Just glancing at this chart, it is evident that while visiting friends and family has recovered almost to pre-pandemic levels, holiday travel is below the historical norm.

    In fact, departures in these two categories for FY2019 totalled 9,330,510; for FY2023 this was just 7,141,640, a 30.7% drop.

    How are we to interpret that? One possible cause is that airfares remain historically expensive at the moment, exacerbated by the falling AUD - which is falling, slightly paradoxically, because forecasts indicate the Reserve Bank of Australia (RBA) will taper future increases in interest rates.

    It's most likely, of course, that past increases in interest rates mean that families which are somewhat financially committed to mortgage payments on increasingly expensive real estate now cannot afford holidays. But is this a positive sign for hardware retailers, as it means what spare funds they do have, they will be more inclined to spend on the asset that is consuming most of their investment capital, housing?

    Short term and likely medium term maybe this does benefit the hardware retail sector. The problem is that it points to a growing imbalance in the economy. It is never wise in investment terms to concentrate on a single asset category.

    Should house prices decline for some reason, Australia could suffer some fairly severe consequences. We're less than 15 years on from the last time that happened.


    Supplier update: Fletcher Building

    Investment program announced

    Fletcher runs a NZD3 billion-plus business in Australia under brands including Tradelink plumbing and bathroom supplies, Laminex, Stramit roofing and structural steel, Iplex pipes, Oliveri sinkware and Fletcher insulation

    Australasian building products group Fletcher Building (Fletcher) - which is listed on both the New Zealand and Australian stock exchanges - said it has more than NZD800 million earmarked for investments over a four-year period.

    These investments include the Laminex Taupo wood panels plant, Comfortech insulation, a new frame and truss plant, and the acquisitions of Tumu and Waipapa Timber.

    Chief executive Ross Taylor said the investments would progressively mature over the coming couple of years and by the 2027 financial year the company expects they will add about NZD120 million in operating profit.

    Mr Taylor also told BusinessDesk (New Zealand Herald) the investment program is part of Fletcher's view that the medium- and long-term fundamentals are very strong on both sides of the Tasman.

    The company doesn't have a large presence in the timber sector and is investing more than NZD250 million in Taupo on value-added wood products, many of which are used overseas, while the Waipapa timber mill provides structural timber, which the company already sells. He told BusinessDesk:

    There's real opportunity there for us to actually help modernise some of the construction techniques, but equally to take the raw timber product in New Zealand and value add to it.
    What we're interested in beyond that is all the other opportunities with wood products broadly, whether it be for fuels, using pellets and by-products, or other value-add products around that.

    Fletcher also plans to boost automation at its frame and truss plant, which takes structural timber to make structural frames. Mr Taylor said:

    That allows us to both increase capacity but makes it more efficient both in cost and production, so it gives us productivity improvements.

    Other areas Fletcher is targeting for growth include code changes to ensure houses are warmer, so it will invest in modernising and increasing its insulation manufacturing facility in Auckland, with plans to triple capacity by 2027.

    Fletcher's new NZD400 million Gib plant in Tauranga is scheduled to be fully completed by the end of October, coming on time and within budget. The plant has already started production and has 50% more capacity than the previous Gib plant.

    The company also flagged another NZD250 million of capital spending on its growth program and NZD30 million for the Gib plant in the June 2024 year.

    Mr Taylor said Fletcher is holding off pursuing a "big opportunity to grow our residential business" until the firm sees the market starting to grow. Major investment plans for the cement value chain at Golden Bay are waiting for clarity from the New Zealand Government on carbon industrial allocations and border adjustments, he said.

    There's a good pipeline of existing stuff which will really start maturing in two or three years, but there's another really sizeable pipeline beyond that in New Zealand and Australia.

    The company also announced that the chief executive of its the Australian arm, Dean Fradgley, would be stepping down from his position in early 2024.

    Annual results

    Fletcher's annual profit fell 46% after it faced extra costs related to the troubled international convention centre in Auckland.

    Net profit fell to NZD235 million in the year to June 30, from NZD432 million the previous year, the company said in a statement to the NZX recently. The result included NZD301 million of one-time costs, largely due to NZD255 million in provisions for the convention centre and related Hobson St hotel project.

    Fletcher Building is losing money on the convention centre being built for SkyCity Entertainment Group after a fire in October 2019 resulted in extensive damage which delayed the project and escalated costs.

    Excluding one-time costs, the building supplies and construction company lifted operating profit 6% to NZD798 million, in line with its forecast for about NZD800 million. Revenue slipped 0.3% to NZD8.5 billion.


    Iplex is under investigation in WA for leaky water pipes - HNN Flash, April 2023
  • Sources: The Australian Financial Review, The New Zealand Herald; 21 Aug 2023 and Stuff NZ
  • companies

    Garden and nursery update

    The Green House Ballarat expands

    Allan's Nursery in Youngtown, Tasmania has been sold to a local buyer for $2.4 million, and is expected to be turned into a residential development

    Ballarat-based nursery and garden centre, The Green House is transforming a suburban warehouse into a retail and hospitality destination. Co-founders Di and Daniel Hannon announced the launch of a second location opening in Spring 2023.

    The new store - located at 415 Sturt Street - is described as a "mini-Green House," stocking a range of plants and homewares. It will run as a pop-up from September to late December, with potential to become permanent if successful.

    The Hannons made the tree-change from Melbourne to Ballarat about 15 years ago, establishing a bed and breakfast/wedding venue at Springmount, then selling that to launch The Green House in 2020.

    Combining a nursery, cafe, bar, and events, the venture has proven very successful despite being tucked-away in a former factory site, and relying largely on word-of-mouth advertising.

    The hope is to win even more fans in the lead-up to Christmas at a location with greater foot traffic. Di Hannon told The Ballarat Courier:

    It'll be a way of letting people know we exist because a lot of people still don't know about us in Ballarat.

    Allan's Nursery

    The sale of Allan's Nursery in Youngtown, part of Launceston (TAS), will bring to an end a business that supplied gardeners with plants and seedlings for 58 years. Founder Bill Allan told The Examiner:

    We finish up on the 1st of December so there's going to be lots of bargains. We'll probably open part of this to the public, so there should be some healthy gardens this year.

    At its peak, the Allan's business employed 60 staff across garden centres located at Prospect, Youngtown and Rocherlea. Mr Allan and his late wife Noelene built the Youngtown facility from scratch and built up a robust customer base that included Bunnings and Mitre 10. He said:

    I'll miss the staff ... I'll miss getting the orders out and thinking to myself, 'that's a nice plant'. I made the motto that if it's not good enough to go out, and we've maintained that policy.

    The nursery may be selling but the Allan's legacy will live into the future. Allan's Garden Centre Prospect is trading under separate owners and Mr Allan has bred several plants that will stay in seed, including the Allan's Early Red tomato and a pansy called Storm Cloud. The flower comes in 13 colours. Mr Allan said:

    What's different about this pansy is the stripes through the petals.. It's absolutely first class.

    Storm Cloud is also the name of the boat that brought Mr Allan's great-great grandfather and grandmother from Scotland to Tasmania though they didn't find out until after two years after naming the pansy.

    Mr Allan's retirement plans don't include hanging up the garden gloves. He said:

    I'm going to finish breeding that pansy [improving it]. I am building a little glasshouse at home.


    Allan's Nursery in Tasmania is on the market - HNN Flash, October 2022
  • Sources: The Ballarat Courier and The Launceston Examiner
  • retailers

    New product: Twin Tubes

    JB Weld's Twin Tubes started a legacy

    The range of twin tube epoxies helped to inspire JB Weld's tagline "The World's Strongest Bond", and reflects the products' capabilities

    The two-part epoxies are very versatile products, according to JB Weld. To back up its tag line, the company has third party strength testing data to support the claim which is detailed on every piece of packaging.

    With a paste-like consistency, Twin Tubes are very effective at filling gaps and cracks. Once cured, they create a permanent bond and can be sanded, drilled, tapped, shaped and painted.

    Twin tube products include the JB Weld brand that comes in 57g tubes and larger 283g tubes, KwikWeld also comes in the same two sizes, while MarineWeld is offered in a 57g tube and ClearWeld is available in both 57g tube and larger 118ml cylinders.

    JB Weld is the original cold weld that works with all metals, stone, concrete, fibreglass, rigid plastics, wood and ceramics. It is a high strength repair product that bonds and fills gaps setting in 4-6 hours and cures in 15-24 hours. It is temperature resistant to 287 degrees Celsius and fuel resistant.

    KwikWeld is a fast bonding and gap filling solution which acts on the same surfaces as JB Weld but sets in six minutes and cures in 4-6 hours. It has a strength of 2424 PSI compared with JB Weld that has a strength of 5020 PSI.

    MarineWeld is specially made for strong lasting repairs to boats and marine equipment, pools and plumbing. It has the same strength and setting times as JB Weld but is waterproof

    ClearWeld is perfect for glass, tiles, rigid plastics, ceramics, wood and most metals. It is a quick setting epoxy that cures clear with a strength of 3900 Psi and a setting time of just five minutes and cured in one hour.

    JB Weld products in twin tubes, syringes, and putty sticks all have two-component epoxies, consisting of a resin and a hardener. When combined, they harden to bond on most surfaces. The primary difference is in the dispensing method:

  • Twin Tubes: Resins and hardeners in two separate tubes that users dispense in equal parts onto a surface for mixing and application.
  • Syringes: Resins and hardeners that come in two separate containers within one syringe unit. Pressing the plunger dispenses the resin and hardener in equal parts for mixing and application.
  • Putty Sticks contain an outer and inner layer that, when mixed by (gloved) hand, become a mouldable, shapable solution to seal cracks and repair holes.
  • For more information, visit the company's Australian distributor, HPP Lunds website below or call Ben Leonard (07) 3722 1111.

    HPP Lunds, a leading independent wholesaler of automotive parts and accessories in Australia

    The JB Weld Australian catalogue is available to download from the following link:

    Download JB Weld Australian catalogue

    A hardcopy version is available by calling (07) 3722 1111. A QR code is also available to receive the catalogue.


    HBT Conference 2023 - Showtime!

    Showtime! pre-conference edition

    All the news about the upcoming HBT Conference. Find out the background behind the keynote speakers, interviews with retailers, and even where you can get the best coffee in Cairns.

    Download Showtime! 2023

    For 2023, HBT National Buying Group has chosen to take some bold moves - moving the Conference from May to August, and staging it in Cairns. "Under the hood" the changes are even more innovative: there is now a retailer services Tradeshow as well as a products Tradeshow, and the "traditional" Conference dinner has been replaced by a series of more engaging networking events.

    Those events range from tours of the gorgeous surrounds of Cairns, to a "Business & Brews" session at a local brewery, where suppliers and retailers can better get to know each other.

    As HBT CEO Greg Benstead has commented, the standard HBT holds itself to is delivering specific quantifiable results in the actions it takes for its members - recognisable "take-aways". What is unique about the 2023 Conference is that each part of the event holds itself to that standard, but so does the entire conference experience itself.

    For example, the idea of having a separate Service Supplier Trade Show, where software suppliers can present their products on Tuesday, overlapping with the very important topic of Planning Succession for Business - and having the latter repeated so that members feel more free to visit both.

    The thinking behind this is that over the coming two to three years, these "background" services are going to become ever more important. We're likely to see more rapid evolution in their development, and new linkages between these services and broader cloud-based services.

    Likewise, succession planning is going to achieve newfound importance. As businesses grow, simply calculating the value of a business becomes more complex - which is a good "problem" to have! But there are value issues in selling to outside companies, and fairness issues in handing on a business to the next generation, or the extended family.

    The daily sessions are geared towards helping retailers make better use of the boost in business that post-COVID construction and consumption has brought to hardware retail. Plus there are two really outstanding keynote speakers: Bernie Brookes, ex-Myer CEO; and Grace Brennan, who started the now-iconic "Buy from the Bush" movement.

    In this edition of our pre-conference "Showtime!" publication, HNN gives you the background on the keynote speakers, interviews with some retailers attending the event - and even a guide to the best coffee places, when you need to nip out from the conference and grab a quick brew.

    Download your copy by clicking/tapping on the image/link below:

    Download Showtime! 2023

    Indie store update

    Mooroopna Hardware under new ownership

    Established by Allen and Jenni Hunter in 1983, the store was sold to Mitre 10 after 28 years. But five years later in 2016, the corporate head office closed it down before it was reopened by Mr Hunter because of community demand.

    Familiar faces, Joey and April Campanelli have taken over at Mooroopna Hardware, located around 181 kilometres north of Melbourne in the City of Greater Shepparton. It follows Allen and Jenni Hunter's retirement when they sold the business to the Campanellis.

    Joey Campanelli has been working in the store for 12 years, and April Campanelli for the past three. April Campanelli told Shepparton News:

    I mean, everyone knows Joey's face. I've been in the background, but everyone knows Joey. When I say that I work here they go, 'Oh, how long have you been here?' because I've been in the office.

    The husband-and-wife team has also retained the existing staff of around a dozen people. She said:

    Fantastic staff. We're like a family. Keep it nice and tight. Everyone works together ... that's the best part.

    The couple, who have four children, said they have also had strong support from customers welcoming them into their new roles. Mrs Campanelli said:

    We sent out an email at the start of the month, and there was so many 'Congratulations!' and that sort of thing, and customer support is the most important part. We won't have a business without them. So we really appreciate all of that.

    They said customers shouldn't assume that locally owned businesses don't have the same reach or access to products as the larger retailers, saying what counts is relationships. Mrs Campanelli said:

    We try to focus on what customers want, so if they come in and they say, 'I need this!' Joey has a such an amazing resource of reps and everything.
    I think we even had one at like eight o'clock at one night, a customer called him and said, 'I need this stuff. I need this. How quickly can you get it?' and it's like, 'Okay, I'll send this person a text. I'll see what's going on'.

    It's that personal touch the couple is determined to hold on to and ensure there's a hardware business in Mooroopna for many years to come.

    The Campanellis said they have a passion for local community growth and success, to ensure there are local opportunities for the future of their children and community.

  • Sources: Shepparton News and Mooroopna Hardware
  • retailers

    Supplier update: Building materials

    James Hardie price increases helps to deliver results

    CEO Aaron Erter said the company focused on what it could control. This focus has enabled it to "start the year strong, delivering our best ever first quarter results for both adjusted net income and operating cash flow," he said

    James Hardie's sales in Australia rose 5%, although this was mostly due to recent price rises. Australia is part of the company's Asia-Pacific region that also includes New Zealand with a small contribution from the Philippines, according to The Australian Financial Review (AFR).

    The company said average net sales prices at its Australian and New Zealand operations were up 12% to a record $209.7 million in the quarter compared with a year ago, while volumes were 8% lower.

    Over 12 months in the Asia-Pacific, prices rose 10%, double the rate of increase last year, and significantly higher than in 2019, 2020 and 2021.

    Earnings before interest and tax margins in the Asia-Pacific region rose 35% to $69.5 million in the three months to June.

    The company's overall net profit for the three months ended June 30 fell by 3% to USD157.8 million ($240.1 million) compared with the same period a year earlier. Sales revenue was down 5% to USD954.3 million.

    Chief executive Aaron Erter warned of a tougher housing market (in North America) for the rest of the financial year, with sales volumes likely to slow as high cash rates there hit prices and consumer confidence. In the North American market - which makes up 73% of the company's sales - the total addressable market for its products would drop by between 5% and 18% in calendar 2023, compared with 2022.

    In Australia, labour shortages continue to hamper the housing market, which is also likely to weigh on local sales.

    Last November, James Hardie was forced to lower its profit guidance as it began to see a "significant change" to the Australian housing market outlook. Labour shortages and unfavourable weather conditions were cited as the main challenges despite backlogs.

    Mr Erter also said there was less activity in the renovation market, a key driver of the company's earnings, as higher interest rates and economic uncertainty made households more reluctant to commit to large projects. He told an investor briefing:

    People are sitting on the sidelines and waiting for a little bit.

    However he said the long-term growth opportunities to tap into the North American renovation market were robust because there were 40 million homes in the US that were more than 40 years old, and therefore ripe for updating.

    Mr Erter said there had been a review of capital spending plans across the company, and a planned greenfield plant in Melbourne was a casualty. James Hardie announced it would scrap plans to build a $400 million factory at Truganina outside Melbourne as it reassesses capital spending priorities in uncertain economic times.

    The new facility had been designed to produce fibre cement for the local housing market and export markets and was on track to be up and running by 2025.

    Construction on the plant was already 18 months in, with design and construction contracts in place. The exercise to shut down the project will be expensive, although the sale of land may ease the financial hit.

    The factory, commissioned under previous boss Jack Truong, who was dramatically forced out of the company last year after bullying accusations, was expected to generate as many as 200 full-time jobs when it was up and running.

    There were another 500 jobs expected during peak construction. Some of these jobs will now go to Sydney under Mr Erter's preferred option that will see capacity expand at James Hardie's existing operations near Parramatta, and outside Brisbane.

    Mr Erter puts the Melbourne decision down to a shift in strategy and was careful to say that inflation or surging construction costs had "zero" impact on the cancellation. He said brownfield - using existing operations - was now the preferred path when adding capacity to the company's manufacturing network rather than a greenfields approach of the Melbourne plant. In The Australian, he said:

    One of the most important things that we do is capital allocation and this was really looking at this, scrutinising this, and just realising that we had other options here.

    Faced with being caught out with surging commodity prices, James Hardie under Mr Erter's direction, has aggressively pulled back spending and sought to protect profit margins over market share.

    Mr Erter said James Hardie aimed to keep winning market share, but not at the expense of profitability.

  • Sources: The Australian Financial Review and The Australian
  • companies

    New product: JB Weld

    Ute beds as good as new with Herculiner

    Utes have traditionally been the vehicle of choice for tradies, and now they have reached a level of popularity that was never imagined when the first Aussie ute was built by Ford in Australia in 1934

    Keeping them looking good is a difficult matter when during the week the trays are full of tools and machinery hauled to work sites where the tools are pulled in and out over the tray floor. On weekends too, the ute is often loaded with leisure equipment like trail bikes or camping gear or rubbish for a quick run to the tip. This all means the ute floor gets quite a beating and it shows but not if the floor is treated with Herculiner.

    Last year Herculiner proved to be the number one truck bed coating brand in North America ahead of five other brands. This is for good reason as it prevents rust, and resistant to petrol, oils, solvents and other chemicals. It has a high scratch resistance, adhesion, impact resistance, chemical and skid resistance. When cured, Herculiner provides a non-slip coating with a textured, tough, durable layer that won't chip, flake or peel.

    Its proprietary solvent-based formula allows Herculiner to adhere better to surfaces than water-based products, and it can bond to virtually any surface or material including wood, metal, concrete, aluminium, asphalt, rubber, fibreglass and plastics including PVC.

    If damaged other coatings need to be removed or gouged, Herculiner can easily be repaired with additional applications because it adheres to itself.

    Various methods can be used to apply Herculiner - brush, roller or spray compressor. Application is an easy process starting with preparing the surface by cleaning it of all dirt and grime and masking off areas to be painted. All paint areas must be scuffed to remove gloss and the surfaces wiped down with Xylene (Xylol), Acetone or MEK solution using a rag.

    Herculiner must be thoroughly mixed before use, and mixed during application so that the rubber particles remain suspended to ensure an even application. A light first topcoat acts as a primer.

    After about four hours, Herculiner is dry to the touch and when it no longer feels tacky a second coat should be applied. This is left to cure for at least 24 hours before light use or 3-5 days before heavy use.

    Herculiner is available in a Bed Liner Kit with everything users need to get the job done including two rollers, one brush, 3.78L of Herculiner and one abrasive pad.

    For those who already have brushes and abrasive pads, there are two sizes of Herculiner tins. One is 946ml and will cover around 1.4 square metres with two coats, and the larger is 3.78 litres which will cover around 5.5 square metres.

    Herculiner is also available in an aerosol spray which is great for touch-ups, cutting in before applying with a roller or for protecting hard-to-reach areas like wheel wells.

    Herculiner is a JB Weld product available in Australia through HPP Lunds. For more information, visit the company's Australian distributor, HPP Lunds website below or call Ben Leonard (07) 3722 1111.

    HPP Lunds, a leading independent wholesaler of automotive parts and accessories in Australia

    US update

    Sales drop at Home Depot in Q2 - but still above forecasts

    Spending on home improvement will be down overall this year, according to one analyst. There are signs that American consumers, after spending big on homes during the pandemic, are slowing their roll.

    The Home Depot announced another quarter of declining sales, but it was a dip that was expected as the company works through what executives called a post-pandemic "settling". During a teleconference, chief executive Ted Decker said:

    We look at 2023 as a year of moderation after the explosive growth we had in the last few years.

    The home improvement retailer beat profit and sales expectations in its second quarter, but sales continued to decline as inflation and interest rates play a larger role in the spending choices made by Americans.

    Comparable sales, which strip out the effects of store openings and closings, fell 2% rather than 3.9%, as had been expected by analysts polled by FactSet.

    In the US, consumers have been pulling back their spending on home improvement after more than a decade of large demand, which accelerated during the pandemic as people spent more time in their homes and spent less money on services.

    Spending on major projects continues to weaken as customers opt for smaller renovations, either because they already completed a larger project during the pandemic or because they are waiting for interest rates to soften before breaking ground, executives said.

    Customers are also buying fewer big-ticket items such as patios and appliances. Sales of items costing USD1,000 or more were down 5.5% during the second quarter. In a statement, Mr Decker said:

    While there was strength in categories associated with smaller projects, we did see continued pressure in certain big-ticket, discretionary categories.

    As the pandemic faded over the past two years, Home Depot has relied on fewer, higher-dollar transactions to lift its top line. Growth in Home Depot's average ticket size fell flat in the first quarter and was flat again in the second quarter, though the decline in transaction count moderated compared with previous quarters to 1.8%. Part of that decline was attributed to deflation in core commodity categories.

    The home improvement retailer also reported that its Pro sales outperformed DIY in the second quarter. However the company said that Pro sales performance was "slightly negative" this quarter, as backlogs for Pro orders start to decrease.

    Despite its above-expected second-quarter sales and signs that project demand is still healthy, Home Depot is refraining from revising guidance while the winds of consumer spending continue to shift, Mr Decker said.

    We don't know how quickly or further the share shift in [personal consumption expenditures] will occur and where spending in home improvement in particular will ultimately settle.

    Many concerns remain, including the Federal Reserve's campaign to chill inflation with interest rate hikes.

    The company posted a profit of USD4.66 billion for the quarter, down from USD5.17 billion last year. Sales slid 2% to USD42.92 billion, topping analyst forecasts for USD42.19 billion, according to FactSet.

    Home Depot reiterated its guidance for sales and comparable sales to fall 2% to 5% from the previous year. Management lowered its financial forecasts when it reported first-quarter results, which helped reset expectations.

    The US housing market is making a sluggish recovery, with higher interest rates keeping potential buyers on the sidelines. Add in the effects of inflation, and people are less eager to invest in home-improvement projects, according to Wedbush analyst Seth Basham.

    Harvard's Leading Indicator of Remodelling Activity predicts that annual expenditures for home improvement in the US will decline at an "accelerating rate" through the first half of 2024.

    But Mr Decker said the company remains positive on the medium-to-long term outlook for home improvement and its ability to grow share in a fragmented market. There may still be some caution, but there's no economic reason to panic, he said.

    The overall economy and the consumer in particular have remained incredibly resilient.

    Home Depot has 2,326 retail stores, the vast majority in the US, and more than 470,000 employees.


    In May this year, the company projected that its sales this year would be between 2% and 5% less than the previous year's.

    Home Depot in a "transitional" year - HNN Flash, May 2023

    In 2022, The Home Depot posted its first annual sales decline since 2009.

    Home Depot results FY2022/23 H1 - HNN Flash, August 2022
  • Sources: The Atlanta Journal-Constitution, Wall Street Journal and Barron's
  • bigbox

    US update

    Home Depot's CIO discusses the role of technology post-pandemic

    The home-improvement retailer aims to increase and better serve its professional customers at a time when DIYers are pulling back on their projects

    In an interview that appeared in the Wall Street Journal (WSJ), chief information officer at Home Depot, Fahim Siddiqui talked about how technology is vital to the retailer's future as it looks to expand its base of professional customers, and take advantage of generative artificial intelligence.

    It comes at a time when Americans are curbing their spending on home improvement, and Home Depot has warned that annual sales will fall for the first time since 2009. In May, it reported a 4.2% decline in revenue to USD37.26 billion.

  • WSJ: Go through a little bit of what happened during the pandemic, and how technology helped you get customers what they needed.
  • Mr Siddiqui: Since we were open and our stores were open, we had to also invariably connect what traffic we saw in dot-com, to what we saw in supply chains, to what we saw in our stores. We did not have curbside delivery until then, and we went and built curbside delivery capabilities in a matter of days and deployed it to our stores.

    Now, in theory, curbside delivery sounds pretty simple. I put an order in and somebody delivers that order to me. But in the back end, it's complicated because you have to take the order, process the order, home it into the correct store, then create the work order within the store to pick up the appropriate order, stage it, and when the person does arrive, connect them again to have the associate deliver the order to that vehicle.

    You can see how many things have to possibly come together across a varied platform and multiple applications.

  • WSJ: How does the Home Depot mobile app drive what you learn about customers, and how you guide them to the right products?
  • Mr Siddiqui: We look at the app as a competitive differentiator for us, and we provide specific journeys within that for our customers. If you look at the highest level, our DIY customers constitute half of our business, and our [professional] customers constitute half of our business.

    We have customised the actual user experience based on the needs of the DIY customer who might be more interested in browsing and searching.

    I was showing the app to somebody and we were at a dinner table, which had a sunflower in the middle. So I took an image of the sunflower and the app went and found everything that looked like a sunflower from our inventory. Unfortunately, in this case, they were all plastic, but that's what we sell in stores.

  • WSJ: How do you view technology's role in supporting the health or continued growth of the business?
  • Mr Siddiqui: Our growth story, first of all, really focuses on building the capabilities for complex order management, for trade credit, for delivery that will meet the needs of our [professionals] that are looking for a planned purchase event.

    Next, customer experience. We do the best job that we can on customer experience, but we also know there are so many more opportunities in the customer journey to take friction out and be the preferred provider. As of last year, we transitioned a hundred percent of appliance deliveries to our network [rather than outsourcing to external distribution centres]. Are we perfectly good and great at it? No. We believe we have opportunities just in that one instance.

    We are continuing and we will continue to make appropriate technology investments. As we have shared, our target is to invest 2% of our capital into new capabilities, be it new stores, be it technology.

  • WSJ: What are you personally excited about in retail technology?
  • Mr Siddiqui: I'm very excited about the power of generative AI, and AI becoming a core part of our technology stacks, both in terms of browse, search, call centres, what associates have in their handhelds. So that they can anticipate, have the productivity, and really be supportive and helpful - be it the chatbot we write, be it the application, or the device that our associates have in their hands.


    Home Depot technology renews focus on customers - HNN Flash, April 2022
  • Source: Wall Street Journal
  • bigbox

    HI News 7-02: Wesfarmers Strategy Day

    A personal remembrance of Graeme Danks

    This edition includes a deep dive on the Wesfarmers Strategy Day and a perspective on the recent passing of Graeme Danks

    The Wesfarmers Strategy Day 2023 introduces some new elements to Bunnings.

    The following is an excerpt:

    It seems likely that Australia is entering into a period when its relationship to its past commercial history is changing. One aspect of these shifts is that the immediate strategies of Bunnings - which are important to the overall hardware market in Australia - are set to become more entwined with the overall functioning of its parent, Wesfarmers.
    That's not to say that there's been much of a shift in responsibilities, as Wesfarmers managing director Rob Scott made clear. But, with the advent of OneDigital, which combines responsibility for OneData, its analytics workshop, along with OnePass, its customer loyalty program, the conglomerate now has a somewhat different stance when it comes to facing the future and developing new strategies.
    From HNN's perspective, a strong undercurrent to the Strategy Day was the early development of a conversation between the investment analysts and Wesfarmers' management about those new strategies. That discussion is being driven by two main factors: the increasing importance of the digital in accessing markets (including less-digital markets); and the maturation of the Wesfarmers retail business model, which brings with it a reduction in its structural (therefore exponential) growth potential.
    Download HI News 7-02

    Graeme Danks

    The following is an extract from the main story:

    As a business, Danks always wore "hardware" on its heart because of the independent retailers in the group, and was known for a culture of "sticking to its knitting" that helped it to deliver successive earnings growth.
    When Woolworths announced the acquisition of Danks in 2009, it was a distributor and marketer to 583 Home Timber & Hardware, Thrifty-Link Hardware, and Plants Plus stores as well as 939 other retailers.
    For Graeme Danks, it meant his family's unbroken 150 years' ownership of the company that bears his name had ended.
    Download HI News 7-02

    Retail update

    Fagg's Mitre 10 just got bigger

    New Total Tools store planned for Queensland, Jamiesons Joinery and Building Centre changes name and Beaumont Tiles expands into Western Australia

    Geelong-based Fagg's Mitre 10 has expanded its footprint in regional Victoria after merging with G. Gay and Co. Mitre 10 in Ballarat. G. Gay and Co. includes Wilsons Mitre 10 located in Maddingley, a suburb of Bacchus Marsh, which became part of the business in 2022.

    The combined entity will include eight stores, about 20 delivery vehicles, and 400 staff. It aims to expand product lines including timber, construction materials, plaster, power tools, hardware, and gardening supplies. In a statement, the group said:

    ...Customers will benefit from an enhanced shopping experience with improved in-store layouts, updated digital platforms, and an increased focus on innovation.
    The improved customer experience will also provide access to a wide range of products and services across a broad geography area, through a single trade account ... The merger will also create opportunities for staff development and provide a platform for sharing expertise.

    General manager of Fagg's Group, Andrew Pitman, said the merger will uphold the store's legacy with each location retaining its current name.

    We're introducing a new brand masthead for the business. It's a new business that we'll all hang under.
    There's three distinct family businesses that have been running for years, we'll certainly be recognising the heritage of those family names. They've significantly contributed to their own communities over that time. We don't want to dismiss that.

    The merger is expected to provide a crossover benefit for customers. He told Times News Group:

    With the combined stores, it gives customers the opportunity particularly for builders to shop more broadly across what is an aligned geographical area. It's a really good union and partnership. Getting bigger means you're far more resilient and robust going forward.
    There'll be some efficiencies. For Ballarat builders down in Geelong, we can turn around deliveries at a quicker time since we'll be doing deliveries from out that way, and the same for Geelong builders working in Ballarat.

    Part of the merger will see offerings previously exclusive to individual stores potentially incorporated across the businesses. Mr Pitman said:

    The Ballarat group have their plastering business that we don't necessarily have. In Geelong, we have Design 10, our bespoke showroom for builders which focus on kitchens, bathrooms, and laundries as well as timber cladding and floors.
    We see opportunities to provide those services into Ballarat and the plaster business into Geelong.

    Fagg's has been operating in Geelong since 1854, and was started by brothers Samuel and William Fagg in the 1850s. In 2017, it acquired Belmont Timber, and currently operates stores in Torquay, South Geelong, Wallington and Belmont.

    G. Gay & Co was founded in 1918 and took on the Mitre 10 banner in 2014. It has three stores across Ballarat.

    Total Tools

    A development application has been lodged for a Total Tools store in Springfield, a suburb of Ipswich (QLD), according to a report in The Queensland Times.

    Specifically, the application proposes a two-storey development with a Total Tools warehouse on the ground level, and a lower ground level compromising two unknown businesses. The 5467sqm premises is currently vacant and located within Springfield Town Centre.

    The 3200.30sqm ground-level will be host to a Total Tools trading floor, storage space, staffroom and an outdoor recreation style staff lunch space. The two lower-level buildings intended to complement Total Tools will both have retail showrooms greater than 400sqm.

    The space will be home to 61 car park spaces with five spaces made for trailer parking and nine on street parking areas.

    Jeffs Joinery and Building Centre

    Jamiesons Joinery and Building Centre in Cowra (NSW) has been renamed as Jeffs Joinery and Building Centre.

    With expansion over the years, the business structure has changed to offer two main services. The first is joinery and manufacturing that provides cabinet making services from manufacturing kitchens to wardrobes and laundry cabinetry, timber windows, timber screen doors, and more.

    The second is the building centre and timber yard that sells to both retail and trade customers. Products include timber, building supplies, tiles, hardware, plumbing and bathroomware, with a fitout showroom for bathrooms and kitchens.

    Col and Janellle Jeffs purchased the business from the Jamieson family in December 1988. They have grown it from five staff to 14 and believe it was time for a change in branding. Col told the Cowra Guardian:

    Now is the time for the next generation. And the Jamieson family were supportive.

    With the hard work we've put in, from where we started to where we are today, there's been a fair expansion of the business.

    It's nice to see a new generation and under the Jeffs banner there's the added incentive to drive the business. We've been privileged to operate under the Jamieson name for 35 years and with Troy taking over operations of the business, it was time for change.

    Not that Col and Janelle are going anywhere. As Col said:

    We'll be here for a few years yet.

    A strong family team helps build success, but Troy Jeffs said they couldn't do it alone.

    My family has always said, and I would agree, good staff makes a good business. Having staff that are committed, honest and loyal are important attributes to making a business work.
    This in turn flows over to how our customers are treated. One must believe in the product you are offering your customers, stand by your decisions and be fair and honest with your customers.
    You also need to have the drive and commitment to succeed which in turn enables the business to grow and prosper.

    And when it comes to personal service the Jeffs say it is what has stood them apart from their competitors. Troy said:

    We strive to achieve the best personal customer service and advice to our customers, whether it be trade enquiries, handymen or the home renovator.

    Col added:

    We're a one stop shop in knowledge no matter what you're building ... We're also a little bit unique because we have the diversity of being able to cut a bit of board to selling a vanity, the cross section of the business means the customer benefits.
    We can cut you a bit of timber to size, make you a kitchen, make you a new door, or sell you a full bathroom and tiles or the roof for your house. The diversity is something the town needs. We find we can cater for all budgets.

    Jeffs Joinery and Building Centre is the only combined joinery/timber yard/building supply business in the Central West, according to the Cowra Guardian. Troy said:

    Seeing such a successful business grow from the hard work that my parents put in, drives me to continue their legacy and continue to grow the business and provide to locals and surrounding areas as we have done for many years.

    The business has provided support through sponsorship and donations to local sporting groups, schools, the arts and a variety of charities. Troy said the more local support they received, enabled the business to better support the community, employ more local people and continue its growth.


    The original joinery business was started by Bill Jamieson and traded as W R Jamieson. In the 1940s, Bill was employed as an apprentice carpenter and joiner with H S Francis & Co, which was located in Vaux Street, the current location of Jeffs Joinery and Building Centre.

    In 1945, Bill went out on his own operating a joinery from a shed at the back of the family home.

    By 1949 Bill moved to set up business in Railway Lane where it operated as a timber yard and joinery works. It was here that the business name changed to Jamieson and Son when more of the family joined the firm.

    Bill retired in 1984 and the business continued under the ownership of Bill's son John, his wife Gwen and son Stephen.

    A tragic plane crash in 1988 which took the lives of Stephen and John's apprentice, resulted in John making the difficult decision to sell or close the business. This is when the Jeffs took the big step of buying the business with the official changeover taking place in December 1988.

    During this time the business was primarily a joinery, but it also sold timber and hardware. Under the guidance and help from John, the business expanded, warranting a need for a larger premises and was relocated.

    In 1994 Col and Jannelle purchased Henry H S Francis Building Supplies (which had begun as a sawmill in the mid 1850s), and Jamiesons Joinery was on the move again to Vaux Street. The Jeffs absorbed the Henry H S Francis business into the renamed Jamiesons Joinery & Building Centre.

    Beaumont Tiles

    Bunnings-owned Beaumont Tiles announced it is opening four new stores in Western Australia by the end of the year.

    The tile retailer has already opened its first store in Joondalup, to be followed by stores in Mandurah, Midland and Myaree in the coming months. Beaumont Tiles CEO Danny Casey, said that while Beaumonts previously had a presence in WA through its Builders Selection Centre to serve big builders, the opening of the new retail stores would provide West Australians with an extensive tile and bathroom range, and hard flooring options the rest of the country has access to.

    The entry of Beaumonts into WA will provide homeowners with a new experience when they are undertaking a new build or a renovation, given the breadth of products we offer and the expertise we provide to help them with their dream home.
    The experience will be unlike anything consumers have had up to now, with the offer of styling consultations and innovative technology, such as our BeVisual Visualiser and an exclusive What's My Style quiz designed to help make the process easier.

    Mr Casey said the new stores in WA have a larger footprint than the current showroom format and will feature a new fit-out style designed to enhance the renovation experience for retail customers, the trade and renovators.

    At Beaumonts, we are always looking for ways to make things better for our customers and our new store at Joondalup plans to bring a more spacious and comfortable feel that we will eventually roll out across the country.
    It will offer an immersive experience with trending bathroom settings, product displays, a cafe, and a play table, allowing customers to create flat lays and different tile designs to style their homes...
    We also offer complete bathroom packages to provide homeowners with a more effortless way to get their renovation started. These include custom designed packages by interior experts such as Shaynna Blaze, and packages inspired by Block contestants' designs, including one from WA's resident blockheads Ronnie and Georgia.
    At Beaumont Tiles, we are looking forward to bringing a new building experience to Western Australia that helps get their renovations started with our innovative store experience and broad hard flooring, bathroom ware and tile offering.

    Research undertaken for Beaumont Tiles shows that 16% of WA households intend to undertake a home tiling project in the next 6-12 months.

    The move into WA will see 40 new jobs created in roles including sales, interior design, warehousing and logistics and management.

  • Sources: Times News Group, Geelong Advertiser, The Ballarat Courier, The Queensland Times and Cowra Guardian
  • retailers

    Big box update

    Bunnings' new operating model

    The hardware retailer has been named as a litigant in a writ filed to the County Court regarding a fatal incident that involved sub-contracted security guards at one of its stores

    Bunnings announced it has restructured its senior management team, taking out a layer of eight "regional manager" roles.

    In the new structure, according to The Australian, Bunnings managing director Mike Schneider will have a director of store operations reporting directly to him, who in turn will have a larger pool of general managers and area managers that then feed into store managers across its 352 outlets.

    Mr Schneider said the latest restructure would be good for local Bunnings store managers, and give a greater voice to store teams as they pass on to senior managers what customers want. In The Australian, he said:

    This supports our low-cost operator model, ensures a stronger voice for our team, simplifies communication and enhances execution across our network. Post-pandemic, this design will help enable deeper engagement with our store teams and in turn a more consistent customer offer.

    The number of redundancies is expected to be less than 10, with executives offered redeployment opportunities. Mr Schneider said:

    We can confirm this will not affect our team working in stores and will simplify their reporting lines. Overall, our team continues to grow as we actively recruit roles across our store network to ensure we are offering customers the best experience.

    Bunnings will also cut 100 jobs from its New Zealand head office as way to increase efficiency as consumers slow down their spending and seek lower prices. The hardware retailer plans to cut staff in areas such as finance, human resources, merchandise, marketing and retail operations.

    Mr Schneider said the restructuring would not affect the more than 5000 employees at store level or its trade centres and distribution outlets in New Zealand. He told The Australian Financial Review (AFR):

    We continue to be absolutely committed to the New Zealand business and its growth and success. We have really thought about this, and it's about improving the operating model and about leveraging scale and cost. We see this very much as helping drive more simplicity and more group alignment [between the Australian and New Zealand business.]

    The New Zealand business will still have localised buying and marketing.

    The most recent restructure follows a round of redundancies in late 2022 across Bunnings' national support centre and head office in areas such as training, communications and other support services.

    Bunnings planning staff cuts: report - HNN Flash, November 2022

    Bunnings' efforts to flatten its corporate structure comes at a time when consumers face tougher economic times and inflationary pressures.

    The move also comes as Bunnings doubles down on projects to boost efficiency and use of tech to help staff spend less time on tasks like locating stock and refreshing price tickets. Mr Schneider told The Age:

    We're continuing to work really hard to find innovative ways to boost productivity and efficiency across our business.
    We've invested in a number of tech-based projects that are helping us achieve this, aimed at reducing the number of hours our team spend on task[s] and reinvesting them into customer service.
    This investment, coupled with the small changes we've made to our operations team, all comes down to simplifying our business. Our goal is to help our store and support teams become more efficient, productive and streamlined, leading to an even better experience for customers.
    We know that simplicity can be a really powerful asset in retail, which is why it's a real focus for us moving forward.

    At Wesfarmers' strategy day in May, Mr Schneider told investors that the group had used technology to remove or redeploy 2.4 million hours of "task time" since 2020.

    Bunnings Strategy Day 2023 - HNN Flash, June 2023

    Bunnings has been trialling electronic shelf labels to save hours spent updating paper tickets, and has run trials using robots in store to scan aisles overnight and work out what stock needs replenishing.

    Big box update: In-store robots - HNN Flash, June 2023

    Court case

    In September 2016, Anthony James Georgiou, had allegedly stolen a gas cylinder and saw blade when he was tackled to the ground by subcontracted loss prevention officers Abdul Habib Brenzai and George Oyee at Bunnings Warehouse in Frankston (VIC).

    He was restrained while they waited for police but fell unconscious before he was taken to hospital, where he died later that day, according to the Herald Sun.

    Mr Georgiou's daughter, who the newspaper has chosen not to name, has launched legal action against the security guards, claiming her father died as a result of a prolonged assault which was "intentional, reckless and/or negligent".

    In a writ filed to the County Court, the daughter accuses the security guards' employer New Security Solutions Group of negligence for failing to properly train or supervise the men.

    Bunnings has also been named as a litigant for allegedly failing to provide the security guards and their employer with the hardware company's Code of Conduct which outlined their obligations when detaining people.

    In her claim, Mr Georgiou's daughter says she is seeking compensation for injury, loss and damage that resulted from her father's death. In a statement to the Herald Sun, Mr Georgiou's family said his death had left them "burdened with indescribable pain and sorrow".

    Slater and Gordon Public Liability Lawyer Neha Pratap said dependants of a person who had died due to the negligence of others were entitled to compensation.

    My client, through her litigation guardian, is exercising her legal rights to compensation following father's death, which we say was avoidable.
    This is also an important public safety issue given a person was placed in a situation of danger that would have been avoided had the defendants taken reasonable care in the circumstance.

    Bunnings director of store operations Ben Camire said the company would defend the allegations.

    We've previously extended our sympathy to the Georgiou family. This matter is currently the subject of legal proceedings which we'll be defending. As we've maintained through the extensive process to date, there's nothing more important to us than the safety of our team and our customers.

    Bunnings said it expected its contracted security providers to employ people who had undergone industry training, held required licenses which are registered with the overseeing government department in Victoria and to monitor the delivery services provided by its staff.

    Last year, coroner Darren Bracken found Mr Georgiou's use of methamphetamine, his weight and a pre-existing heart condition contributed to his death, but he would still be alive had he not been detained by the security guards.


    Coroner reports on Bunnings-related death - HNN Flash, September 2022

    Property developments

    The Bunnings store in the inner Melbourne suburb of Collingwood has been sold to a private investor for about $65 million.

    The 7000sqm store attracted offers from seven private investors and sold unconditionally just three days into an expressions of interest campaign. Based on annual income of $3.12 million, a $65 million purchase price would translate into a relatively tight yield of 4.8%.

    Yosh Mendis from Burgess Rawson said the sale achieved the third-highest price paid for a freestanding Bunnings in Victoria after a 21,670sqm Hoppers Cross store sold for $79 million on a 3.95% yield last year and fund manager Newmark Capital paid $85 million in 2021 for an under-construction 18,626sqm warehouse in the Melbourne suburb of Preston on a yield of 4.4%.


    The 7000sqm Bunnings site in inner-city Collingwood in Melbourne is expected to sell for about $65 million - HNN Flash, June 2023

    The former site of the North Wollongong Bunnings store has also been placed on the market, according to a report in the Illawarra Mercury. It is owned by Perth-based company BWP Management Ltd.

    The 2.73-hectare site, located at 73-75 Gipps Street, is being marketed as "a significant development proposition poised to become a major residential mixed use apartment development".

    Bunnings announced the store's closure in September last year with its final day of trade in January ahead of the lease expiring in March.


    Bunnings in North Wollongong to close - HNN Flash, September 2022
  • Sources: The Age, The Australian, Herald Sun, The Australian Financial Review and Illawarra Mercury
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