Jason Ellis from EGO

EGO electric OPE makes a mark in Australia

As cordless becomes a real factor in OPE, EGO brings a unique heritage

The big news at the end of 2018 was that, at long last, cordless outdoor power equipment (OPE) really began to take off, in both the consumer and the professional market. That's partly from a growing acceptance of electric power in general – driven in part by the success of premium vehicle makers such as Tesla. It's also all about the power, as well. Earlier versions of cordless OPE often either didn't really have the "grunt" to get the job done, or the batteries would run down too fast for professional and tradie users to take them seriously.

In a world that is becoming increasingly environmentally conscious, the frantic grumble of a two-stroke leaf blower in the morning is just not acceptable anymore. The oil-and-petrol exhaust smells not at all like victory, but more a permanent defeat for the climate. In Europe and the US regulations have been steadily clamping down on all small petrol engines, making the switch to quiet, clean electric steadily more appealing.

That said, it is still very much a question of balance. Professionals using cordless tools do have to stay conscious of charge levels, overall battery life, and that the top end of power in the tools might be below that of petrol tools. But the gains, on the other side, are really vast, especially when it comes to maintenance. Let's face it, "reliability" and "two-stroke" are concepts that simply don't go together, in the long run, while electric tools simply keeping going.

EGO marketing manager in Australia, Jason Ellis, suggests areas users don't often think about, such as trigger time, play a big role in broader acceptance of cordless OPE. He said:

When a person starts up a petrol mower, they've got it going constantly. When someone comes out and talks to you, the mower is still going, and you talk to them. With EGO cordless products, if someone comes to talk to you or you have to stop, it turns off completely. So you go from 'hero to zero' in less than a second. You're not using the juice so therefore your trigger time, or run time, is extended. You don't have constant noise or vibration. When you turn it off, it's off and that's the beauty of it.
When you want to turn it on, you hit the trigger and you're ready to go. The downtime is minimised with EGO cordless products because you don't have to go and get petrol at the petrol station. You've just got to make sure that batteries are charged, but you can do that through in-car or mobile charging.

Jason also mentions a new product the company has launched called the Backpack Link which can easily be attached to any of its handheld products. He said:

You can put this backpack on and attach our largest capacity battery to give you extended run times. Then you just plug the backpack into all the different tools. So you don't need to take that backpack off. You can go from a line trimmer to a chainsaw to a hedge trimmer to a blower, and all you're doing is plugging in the backpack component.

Jason can see quite clearly why there has been a reluctance to change over to cordless.

Historically a lot of cordless products just haven't met the demands of users in terms of power performance, runtime and charge time. That's really been the main hurdle for people crossing over to cordless. It's okay for the standard DIYer using it for 10 minutes but if someone's got a bigger block or they are a commercial user, up to now cordless really hasn't provided them with what they need.

EGO has been able to solve some of these problems for the end user by developing rapid chargers. Jason explains:

It's really being able to charge it in a time period that is convenient when a user has two batteries. In a lot of cases, if we've got a battery that runs for 50 minutes and we've got a rapid charger that charges it in say 60 minutes, you've got infinite runtime. By the time they finish using one battery, the other battery will be charged. So that's one factor.
On the runtime, it is working out the area that people need to cut and how long that takes. And then being able to have a machine with the right power battery that will cover that off for 80% of the cases. For instance, when we did research on lawn sizes, 80% are below 800sqm which means 80% of the population could be covered by our 7.5 Amp battery.

Jason admits that it is difficult to make direct comparisons between a petrol motor and cordless in terms of torque because there are more factors between the battery and the wattage of the motor in, for example a mower or hedge trimmer. He said:

It's the ability of the product to cut and perform, and get the outcome that users would normally get from a petrol unit. That's the feedback we are getting. People are saying it is cutting through branches, and logs with the chainsaw or it's cutting the grass as good, if not better, than a petrol unit.

Pricing and positioning

For hardware retailers and end-users to embrace a new product, it also has to be about selling it at the right price point. Jason explains that EGO is targeting the weekend warrior, the DIY enthusiast rather than beginners, as well as commercial users. He said:

We have people buying our products, not so much moving from one cordless product to another, but coming from petrol to cordless. That's the biggest market growth for us. People do move from cordless but once you're in a platform, most people will persevere with that platform as they'll use that same battery across many products. So what we find from a price point of view, EGO sits below a Husqvarna and STIHL – who have been in the market a long time – but our performance is equal to theirs, if not better.

Every single EGO product that is available globally is sold throughout Australia and New Zealand. This can be another argument for accessing the tool platform because once people get the batteries and the chargers then they can add other accessories as well. Jason said:

People who have been in trade working with power tools understand one battery fitting all tools, but a lot of people in gardening who have never touched cordless actually don't understand or are unaware that one battery can power all tools. They may never have owned a drill or a circular saw or anything like that, in terms of a cordless product. So this is new.
One of the things we constantly advertise is that our ARC Lithium 56-Volt battery powers all EGO tools. We have about 22 products in the range that is mixed among kits and skins. If you branched it out into all the kits, skins, attachments, battery chargers and accessories, we have 69 SKUs in the range. So we have a vast range covering the majority of outdoor power equipment requirements.

Jason said the EGO team has identified that there is work to do in terms of informing potential customers about a unified battery platform. His background in power tools makes him very familiar with the concept and something he brings to his current role.

Coming into OPE, it was obvious that people weren't understanding the benefits of getting a cordless platform that crosses many product categories … The battery is an expensive component because it is the fuel of the tool. Being able to utilise that one battery across many usages helps 1) manage costs and 2) get the most out of the product and the price you paid for it.

OH&S application

The recent changes to OH&S legislation has positioned EGO well in terms of targeting commercial users. Jason explains:

We will continually launch and promote product for the home user and the DIYer but the future of EGO is to look at every facet of outdoor power equipment for the commercial user ... We know that in Europe and Canada, councils are banning all use of petrol so it's not long before that will start to filter down into Australia and New Zealand. So we understand that there is going to be increased demand for cordless products, regardless of brand.
But we know that there are certain parameters through run time, charge time and power that is required by users to emulate petrol products and therefore EGO is challenging our development team, and our manufacturing team to create products that meet those requirements. So it's really important that everything we do at EGO is at its best before we launch it because we want to make sure that it will meet the requirements of commercial users.

As the company moves towards more trade-focused tools, issues such as noise and vibration is something that EGO's cordless products can easily address. Jason relates the story of a local gardening service where the professional end-user tried out EGO's cordless backpack blower. This has given them more flexibility when it comes to doing their work, especially at places where limiting noise pollution is very important, such as schools. He said:

What some of our commercial users are finding is that their day is more in control because they don't have to work very early mornings and late at night [when there is no-one around]. They can work throughout the day because they don't have noise restrictions placed upon them.
A typical conversation is about 60 decibels. A lot of our units are around 70 decibels or below. We only have two above 70 which is a chainsaw and a backpack blower, but a common petrol mower can be up to 93 decibels. So it's really important. And we want to make sure the performance of our products is there but, equally, we are constantly looking at ways to reduce vibration, reduce noise, and make the products easier for people to use.

The future of EGO products is also secure with millennials and Z-generation users because 19 or 20-year-olds aren't going to know how to re-point a spark plug or do similar mechanical maintenance. That's a lost knowledge. Mowers will have to be taken into a service centre to get that kind of maintenance done. With electric motors there's almost nothing that you'd need to do for their lifetime. Jason said:

For that younger generation, the millennials, it's easy for them. They understand cordless as a concept. They understand that you push a button and it goes. To have to prime an engine or change the spark plug, and then pull cord a number of times and then get the speed right, is foreign to them. So cordless really plays into that next generation. And also they understand Lithium because it is part of their culture.
Historically when we first had cordless, we were using the Lead acid, where you would use it for eight minutes, but have to charge it for 12 hours. And for a lot of the older generation, that's what they remember. So when you talk cordless to them, they can be quite negative about it, and put up barriers. That's their memory, and one of the reasons why they stay with petrol. When you get it in their hands, they can see all the benefits and how it performs. Then the barriers are broken down very quickly.

Becoming a dealer

There is a simple process for retailers to start stocking EGO. Jason explains:

We have a couple of steps for a dealer to come on board. They have to carry a certain amount of the range. Once they do, they get better pricing. They also get added on to our website where our store locator has been very important in directing end-users to dealers. We track the data that goes through that and a lot of people do go through our website. Seventy per cent of them research the product through the website ... and then they go to the retailer. Plus they get availability to promotions, specials, point of sale, in-store, and training nights. Our guys will go in and do training, and we have an Australia-wide service warranty and service setup. So that's for any issues that they may have and we fully look after and service the product.

To read these and other articles in our HI News PDF magazine, please download here: hnn.bz/pdfs/hinews-5-01.pdf

people

Laura Keogh, Methven

Group head of brand

Laura Keogh reflects on her career as a woman working in the world of plumbing fixtures

Marketing at many home improvement suppliers over the past five or six years has been an area that has taken something of a budget hit. Retailers' demands for lower prices on mid-quality items has driven suppliers to pare down marketing budgets to a slim 2010s version of their more robust 1990s numbers.

These things are somewhat cyclical, of course, but what has made the current down-cycle more pronounced is both the rise of the super-retailers, and the advent of digital as a major marketing channel. The first has seen store brands become often more important than individual product brands (consumers asking "What does store X sell?" rather than "Which stores sell brand Y?").

The second has caused companies to re-examine their marketing spend, as they realise that older forms of marketing (such as print magazines) don't work as well as they once did. However, not all digital is equal, and making the best choice - or combination of choices - is now more complex.

There is a solution to both these problems. That solution comes down to one thing: people. While it is tempting to see marketing as being driven largely by numbers, the reality is that the numbers are there to measure the creative impact of the individuals who implement marketing. Good marketers are now essential.

Laura Keogh, group head of brand at New Zealand plumbing supplies manufacturer Methven, is one of those good marketers. With post graduate business degrees in both marketing and information systems management, and a wide range of experience in different industries, Laura exemplifies many of the qualities needed today in a modern multimedia marketer.

Laura was kind enough to engage with HNN to tell us the story of her career trajectory, and how she became part of Methven's senior management team. It is a story of persistence, hard work and an ability to turn her academic experience into a very real, lively contribution to the businesses she has worked in. And, of course, true to form, she also provides us with some good insights into Methven's product lines, especially when it comes to its well-regarded showerheads - including their new VJet(TM) technology.

  • Q. You have an interesting background, with both a Master of Business Administration and a Master of Science, but it is evident from your career choices that you have a real love and affinity for marketing. Did you know that was the path you wanted to take when you were at college, or did that develop once you started your first jobs?
  • Marketing evolved into a personal career goal after finishing my undergraduate college education and leading the customer service activities for CellularOne in the late-1990s.

    You see, my undergraduate Bachelor of Arts degree, was in History/Political Science, as I once aspired to be a lawyer. However, with more law students than lawyers at graduation time, I decided to put that dream on ice and enter a business sector where there were more opportunities to kick off my career.

    My first job was with CellularOne (formally Vanguard Cellular) where I started as a customer service agent and moved up the ranks to manager in six years. During that time, I was constantly involved (and sometimes frustrated) with the marketing team. The more I interacted with them, discussing promotions and phone campaigns, the more I wanted to be in marketing. So, I attended night school at the University of North Carolina to complete the curriculum required to apply to Katz Business School at the University of Pittsburgh - known for strategic marketing and IT.

    In graduate school, I decided to complete both the MBA and MS because the world of marketing was about to make a momentous shift towards digital. My MBA was focused on marketing/strategic planning and the MS on information systems management - where website building was a big part of that curriculum. Because I did not want to defer my earnings for very long, I finished both degrees in the same time as one - with distinguishing high marks. This required taking seven courses at once! I had to juggle a large work load through the identification of project synergies. I chose projects that could cross the material of many subjects, giving me and my study team a well-rounded (and efficient) result.

    I am very proud of that time. I proved to myself that I could do anything that I set my mind to and developed a real affinity for working in high productive teams.

    My experience leading up to the completion of my MBA/MS helped develop me into a marketer - I developed collaborative teamwork skills, a penchant for quality customer experience and the desire to create. I am glad I made that decision to pursue marketing. It was the right move for me and 15+ years on - I still love it. Marketing provides a well-rounded set of skills: strategic planning, collaboration, presentation, negotiation, brand communication, financial analysis and, of course, creative. It is a career that really reaps the rewards of personal satisfaction through accomplishment.

  • Q. It is often thought that women can easily find themselves pushed aside when it comes to the "technical" sphere of business. Did you experience that as an information systems post-graduate, or was there a more welcoming culture?
  • Post graduate school, I focused my career on various aspects in marketing, strategic planning, new product development, research and brand communication. I leveraged my MS education (in information sciences) to jump-start my hiring potential and later collaborate and push agencies to their online potential.

    Working at an American airline, straight out from graduate school, did pose some challenges. When I would tell people that I work for an airline, nine times out of ten they would assume as a flight attendant. Funny, it was never as a pilot!

    My first role was in an all-male Planning Department. As an analytical planner, I performed analyses to identify the high traffic domestic routes, recommend upgrade or downgrade plane sizes and assist in the negotiated entrance into new markets. I think the guys thought it was amusing how hard I worked and tried to fit into this male dominated role. It took a while to win them over, but my perseverance did pay off. They were very critical of my work, but over time I noticed that sometimes my ideas became their own - which confirmed my ability and increased my courage.

    They challenged me in many ways. One event in particular springs to mind. For some reason, none of my colleagues were available to attend a scheduled meeting in the Upper Penninsula, Michigan. Although it felt a little like I was a last resort and was finally removed from the game bench, it did not faze me. I accepted the challenge!

    I had two weeks to prepare. The Upper Peninsula is world-renowned for golf and the invitation said to "bring your clubs". So I bought golf clubs and quickly learned some basic golf skills. I used to go to the driving range with my Dad (in primary school) and was a decent field hockey player - so why couldn't I pick up some of the basics? I knew the golf course was the best place to interact with men and build affinity.

    No time for lessons though, I needed to be "game on" with my upcoming meeting with the Upper Peninsula Airport Commission - a group of men - to discuss putting in 69 seater jets into the Upper Peninsula. We discussed this opportunity over a round of golf at one of those beautiful resorts on the water. All I remember is cringing as I struck the ball from the ladies' tees, replacing countless divots and missing putts throughout all 18 holes. However, in the end, our conversation yielded what we both intended. It was not an easy feat! Glad they "gave a girl" a go!

    After a tough 18 months in Planning, I moved into the NPD/Research (new product development) side of airline marketing. That role was a lot of fun. We tracked our sales and NPS (net promoter score) performance versus the competition, initiated development of a CRM (customer relationship marketing) system, tested our new products (seats, menus, wine), new branding, and brand communications with our domestic and international customers. That was the role that really jump-started my classical marketing experience.

  • Q. Do you think the role of women in the workforce has changed during the 21st Century? Or would you say your corporate experience has been pretty much the same over the past two decades or so?
  • That is a great question. I have worked within many different industries in the USA and Australia over that course of time: mobile communications, airlines, FMCG, manchester bedding and now plumbing. In each company, the structure was different based on the number of hierarchy levels and size.

    I'd say that in general, there are lots of women in marketing roles - which makes sense as so many companies are targeting the purchase decision maker (typically female 25-55 years of age), but you rarely see women in the marketing 'C suite'. I hope that picture changes in the future. I think we can all benefit from more women in these top positions.

    Download

    To read the full version of this article, please download the magazine, HI News, Vol.4, No.8, by using the link below:

    HI News, Vol.4, No.8: Laura Keogh, Methven
    people

    High-heels and Hi-Viz

    Jacinta Colley talks life in the timber industry

    "Having it all" was once a glamorous cliche from the 1990s, but today women like Jacinta see it as another item on the to do list

    At the Hardware & Building Traders (HBT) annual conference in May 2018, Women in Hardware held an event, where Jacinta Colley was the main speaker. National account manager for the respected timber supplier Simmonds Lumber, Ms Colley told some of the story of her journey through the ranks to her present position.

    It was, to most of us who attended, a really enrapturing experience. Both because it was quite a story, and also because Ms Colley was able to share some of the more extreme moments she had gone through.

    It is a story that is not just about setbacks, and real difficulties overcome. It's also about a woman who developed a talent for taking advantage of any opportunity, no matter how small, that offered itself. Who conformed when it was necessary to go on, but who also blazed back when she could.

    The following is the speech that Jacinta Colley gave. HNN has edited the original speech for the purposes of brevity and clarity.

    In year 10 when I was doing work experience at a hairdresser's, sweeping the floor. I often wonder where I would be today if I had gone down that track. Because, I am here today in an amazing industry, full of amazing people.

    When I was 20, I had moved in and out of my parents' home, and I was kind of annoying my folks a bit. They said to me, "What are you going to do Jacinta? Have you decided?" Well, I didn't know what I wanted to do.

    My father was working for Carter Holt Harvey at the time. One day he came home and said, "There's a job going at Carter Holt as an internal sales representative and we think you should apply."

    I'm like, "Are you kicking me out?" And he said, no no, you don't have the job yet.

    I thought, okay cool. And he said, "You are going to move to Melbourne."

    I said, "I don't have the job yet."

    He said "You are going to do what I tell you. You are going to sell yourself and get that job."

    In the end he won, and in two weeks I was gone.

    Only now, in my late 30s, do I thank him - and then only after a couple of wines! Because I would never admit that to him.

    Meyer Timber

    After 18 months with Carter Holt Harvey, I was approached to work at Meyer Timber in Melbourne, which is a timber wholesaler. I got to work beside a man named Frank Assisi and he became a mentor to me. He was absolutely instrumental in me getting into the wholesale world. And really understanding the ins and outs of a house [timber company] because when I was at Carter Holt all I knew about was pine fascia and flooring. So he really helped me along. No question was ever too hard. He always gave me the time of day, and we are still very close to this day.

    Brisbane: Carter Holt, then Simmonds

    Carter Holt Harvey kept coming back to me and saying, "We want you to be a rep, we actually think you would do a pretty good job, but you have to move to Brisbane."

    I thought, why not? I don't know anyone but I will meet people. So I did that. And if I hadn't taken a leap of faith, I certainly wouldn't be where I am today.

    My time at Carter Holt actually turned out to be quite short. Roger Healy who was state manager for Simmonds Lumber at the time, said to me, "You need to come and work for us."

    I said, "Why would I want to do that?" And he said, "We're fun and there is more for you to learn in the real world." So I decided to accept that invitation, and I moved over to Simmonds.

    I would moved away from a corporate world of red tape, of being told what I can sell at what price and under restrictions. That move to Simmonds would be the best decision of my life.

    The first day

    I will never forget the first day I started Simmonds. I walked in wearing heels, and the whole bloody place was tiled. It was absolutely hilarious. I am click-clacking along, and one of the boys said, "Are you going to be wearing those every frigging day?"

    I replied straight back: "Hell yes!" And when they all laughed, I knew I would fit right in.

    I remember Roger taking me for a walk to the sheds and he pointed to different products. I asked him, can I sell anything in the shed? And he said, yes that is what you were employed to do.

    So I asked, do I need to know the cost as well? He said, yes you have to make a margin. And I said, am I going to understand that?. He said, "Absolutely."

    So these were very instrumental lessons for me.

    The dumb email

    Roger would also be, as it turns out, the first person I would tell that I would be taking maternity leave. He was thrilled, but my CEO at the time was not.

    My then-CEO would send me an email in capital letters, in all RED TEXT and it said, "Jacinta, I have received your news that you are expecting. Do you know that company cars are not tp have car seats fitted to them? Do you know that this is why I was reluctant to hire a young female in sales?

    He added that the next female he would hire would be over 50 years old.

    I stayed at my desk for some time, and I really pondered over this email. I thought, "this could be fun!" But instead, I deleted it, and I moved on.

    Now I'm sure that hasn't happened to all of you but maybe you have had similar experiences. That happened nine years ago and today I think I would be much stronger fighting back. But at the time, I didn't have the confidence that I have today. And I'm really fortunate now that where I work I have a bit more flexibility, and Simmonds are very family-supportive.

    After Roger

    About two and a half years ago, Roger made the decision to leave Simmonds Lumber. He had been a real advocate for me, supporting me in being a mum, and juggling work, which can be very tough. I was very pissed off at him for leaving because it was going to get harder.

    But his decision to leave - and we are still very close to this day - would open the door for me to go beyond being a sales rep, and to step up and become a sales manager in Brisbane. And that meant having grown men in their 50s report to me.

    After I had managed to do that, another door opened, and I was able to take the position of national account manager at Simmonds. This would be a first in Simmonds, having a female international role, reporting to the CEO. I was also the first female at Simmonds to take maternity leave. So I have experienced a lot of firsts at Simmonds Lumber.

    There are some tough things that can happen in the wholesale game. There are some tough things you are confronted with in a very male dominated industry. What is quite unique about Women in Hardware is that there are a lot of you in hardware. There are not a lot of us in my part of the business [timber wholesale]. So I'm amazed at the turnout today [in Adelaide]. It is phenomenal.

    Industry awards

    I have worked very hard to gain respect in the timber and hardware industry, and that is something I have been recognised for.

    After a year at Simmonds, I received my first Timber & Building Materials Association (Australia) (TABMA) award in 2005.

    I remember when I had been nominated and someone at the time said, "Does she really have to attend?" The day of the award was Simmonds' annual golf day. But he was told it was important that I attend. It was hot that day and I had to hire a dress because I didn't have one. I was extremely sunburnt. I remember being so nervous that I almost fell off the stairs, it was absolutely hilarious.

    In my ninth year at Simmonds, I was very fortunate to win sales representative of the year again.

    This slide was in 2015 when I won the national representative of the year in my 10th year at Simmonds. So I am really honoured and proud people in my "game" respect me and feel confident that they can talk to me and ask questions.

    I've also lucky that I have a multitude of people who I can look up to in our industry. There is Kirsten Gentle from TMA, Fiona Lucky who is based out of Brisbane, who is another woman who has defied odds and is right up there in the industry. And Tamika Smith, who I've recently just got to know, she is founding director of TSR Property Solutions and Aspiring Young Businesswoman of the Year in 2017 from the Women in Business Awards of Australia (Gold Coast).

    I am also close to a group of women who are part of this amazing industry, Women in Forest and Timber Networks (WTFN). They comprise about 5% of the workforce. It is a forum for women to meet and exchange ideas, similar to Women in Hardware, and it was formed to ensure that our voices are heard. We aim to recognise contributions, we celebrate achievements and we support each other.

    Looking back

    I feel very fortunate to work in such an amazing industry. I don't have a university degree. I am pretty much self-taught by learning from people in my sector and believing in myself.

    I was really nervous when I put my hand up and applied for the national role. Not because I didn't think I could do it, I knew I could but because I would be the first female in Simmonds in a national role in a very male dominated business. There are 89 staff at Simmonds nationally and I'm one of 11 women. There are two women in Brisbane.

    So reporting to a male CEO, and every other senior manager is male, could that be scary? No. I actually think they are more scared of me, to be honest. In fact, I have a bit of a reputation in the office that if you want something done, then give it to Jacinta.

    "Having it all"

    Often people ask me how I balance it all - how do I "have it all" - wife, mum, big job, fitness etc. - how have I done it?

    My reply is often "You need to know what you want and what you are willing to do for it."

    And, of course, make sure you are aware that in our game there are gender differences, because there are. Make sure you're not talking too much - women tend to talk a lot, men less. Look for non-verbal clues, and don't fight everything. Sometimes it is best to pick your battles.

    Also, be selfless, don't think about the next promotion or next job you are doing, think about what it is that you want to drive for the shareholder and the customer and your employee, rather than your self-interest.

    I then back it up by saying - be authentic to yourself. Don't wear a mask, it is far too exhausting. I think that is the main thing, be authentic because that is what has got me this far and I'm not going to change now!

    Download

    To read more articles about women in the hardware industry, please download the free, complete edition of HI News at:

    HI News 4.6: Jacinta Colley - Grace & Pressure
    people

    Steve Fatileh, HBT

    Group buying manager

    Steve's work at HBT has come to have much to do with the buying group's H branded hardware stores

    Steve Fatileh has become very much "Mr H", when it comes to his work with Hardware and Building Traders (HBT) as a group buying manager.

    While he has been responsible for securing a wide range of suppliers for the overall buying group, there's no secret to the fact that he has helped to nurture the group's once static H brand from just 13 stores, to 28 active stores, with another 14 in various stages of transition.

    In the 12 months to June 2018 alone, eight stores completed the changeover.

    In an industry that has a pressing need for innovation and innovators, Steve has helped to shape the beginnings of a brand presence for an independent buying group.

    Beginnings

    Steve had a slight premonition even before he officially started working for HBT back in early 2015 that the H part of the business might attract his interest.

    At the second meeting he had with the Australia-wide buying group, the subject of the group's H Hardware branded stores had come up. Speaking to the HBT managers and senior members of the group who were interviewing him, Steve started asking questions.

    He first asked what HBT was currently doing with the H stores. The answer was, at that time, very little. The 13 H Hardware stores signed up were the same 13 that had signed on five years before.

    Steve followed up by asking what the advantages were for members who signed up for the H branding. The answer was that, well, the stores certainly looked good, with strong colours and a workable design. But at the time, in terms of anything material beyond their appearance, H stores did not get any extras.

    Afterwards, walking away from a meeting that had ranged over many topics, Steve found his thoughts returning to the H stores. He thought that, if he accepted this role with HBT, he might consider seeing what he could do with H.

    It was a modest ambition. He had no idea that it would soon become, in less than a year, something of a driving obsession for him.

    First steps

    With a strong background as a category manager for Clark Rubber, which is a strict franchise operation, it took Steve a little while at first to acclimatise himself to a buying group that was made up of a collection of opinionated, widely varying individuals, who were free to sign on to deals if that suited them, or go their own way if it did not. While he respected that attitude, he was also aware that there were gains to be made if like minds could get together.

    What triggered my interest in the H brand straight away is that part of my role is to benefit the stores and see what I can do for them. I thought immediately that if we have some commonality between some stores, there would be more we could do for them as a collective group.

    Part of what reinforced that thinking was his first exposure to the H Hardware stores that were then operating.

    The first HBT store I went to was Cameron's H Hardware store [in Bateman's Bay, NSW]. Like anything, the first impression you get lasts with you the longest. So that became the sort of benchmark for me. I went and saw one of our best stores straight off. Later, I saw other stores, which were good, but didn't quite reach that level of excellence. So in my mind there was the question: Why couldn't all our stores be more like the very best stores?

    Steve still remembers that first encounter with Cameron's.

    There was a professional feel to the store straight away. The workers were all in uniform. There was good signage, and there was good direction, if you wanted to look for something. Everything was clearly marked with signs. Each product had its own area, and each category had its own area, and it was all well-planned. The people that I spoke to, the staff, were well informed about the products. So, yeah, straight away you got that sense of professionals. So that would that would probably be the store that captivated me at the beginning.

    If he wanted to work on H Hardware, the first thing Steve had to do was to get management buy-in. Fortunately, the group manager at the time, the late Tim Starkey, was known for his encouraging management style.

    There was certainly a plan behind H Hardware in those early days, and it was my own plan, one that I put forward. The first thing I had to do was to convince Tim it would be worth it, as a lot of my time would go into building the brand. Tim was the kind of manager who backed you. He just said something along the lines of: "Yeah see how you go. If you think that's the way to do it, see how you go doing it your way." And, you know, if you succeed, well done, if you fail - well, they'll come and talk to you!

    Steve started out first with research, getting some numbers to back up what his intuition was telling him about the status of the brand, and its potential for the future. That led him to develop two key questions that would end up determining the future of the H brand stores. In the end, it all came down to a matter of costs and benefits.

    The first question was "Why?" Why would anyone want to go through the transition to an H Hardware store? What were the benefits, and how would they be delivered?

    The second question he developed was about the raw costs of doing the conversion, and the amount of time it would take up for retailers. The transition period itself would affect the business, then on top of that were the costs of the raw materials to make the change, the cost of installation, and the sheer amount of time required for the staff and owner to implement the changeover.

    It was by coming up with an answer to the second question that Steve ended up solving the first as well. That answer came to Steve as a result of a "thinktank" session HBT held in 2016. HBT had yet to develop its "key suppliers", but they had brought in some of the major suppliers to the group for a chat.

    We talked about H Hardware and one of the suppliers asked us: "Why aren't you guys pushing this? Do you realise we will get behind it if you do?" I think that even the suppliers felt that they wanted another player in the market.
    Straightaway then, you know, it was a bit of a light bulb moment for me. I said well that can eliminate our cost issue with the conversions to H Hardware. If the suppliers were willing to back it up, let's get them to support the stores and finance some of it or assist in contributing to the fitout cost of the paint, the signs, and so forth.

    Of course, for that kind of deal to work out, there needed to be something in return for the suppliers, as well.

    In return, if the member agrees to receive help with the fitout, they then commit to that supplier to be their main supplier in that category. In most cases, that supplier is already dealing with that member and is already their predominant supplier. But it gives the supplier security, knowing they are locked in.

    Hardware retailers are a little unique in that they tend to need individual premises, often on a large piece of land, with both a main building and sub-buildings they have to maintain. Changing all that to a new brand is expensive and difficult. The result of the deals with suppliers over items such as paint can mean that the new brand fitout costs even less than the standard capex allocated to the major maintenance stores do every four to six years.

    As a natural consequence of these arrangements, Steve worked out what the special benefits would be for members who converted to H Hardware. These, too, would come from the suppliers, and help to further enhance their relationship with H Hardware stores.

    Second stage: branded products

    While these answers to the initial questions helped to spur the first stage of development of the H Hardware stores, Steve knew he had to go further still to drive the brand to the next stage of its development. That next step turned out to be the development of "H" branded products, for sale through all HBT member stores.

    The lead product Steve chose to work on was paint. Partly that was inspired by a slightly neglected offer that had come the way of Mr Starkey some time before.

    The paint deal was sitting there for a while, because after Gavin [Keane] took up his position [as group buying manager], he took on ITT [Industrial & Tool Traders] as a pet project. Tim and Gavin were then really busy getting new members to come on board.
    Duralex long had this idea, and they left it with Tim, so it was sitting there on the shelf. Some time after I came onboard Tim just said one day: "Hey Steve, look at this for us, will you?" So that was where the idea for a branded paint came from.
    We had to refine it. We also had to go to market as well, and see if other paint manufacturers were interested, because Duralex were only a smaller supplier to HBT at the time. They had a good reputation for the quality of what they did. They didn't have that many accounts with us, and we were concerned if they would be able to keep up with the supply and availability.
    But we found Duralex really wanted to invest in HBT and invest in the concept of the paint itself. While other companies were interested, Duralex were willing to go all out on this project. It was a slight risk, but one we were keen to take. It also meant that from 2016 to 2017, Duralex have seen their order numbers with HBT grow by a very high percentage. So, yeah, it's a good story. It worked out well for everyone.

    After the paint launched, with its distinctive "H" branding, HBT turned its attention to a range of other products as well. One of the major coups was to launch an H branded version of Soudal silicone products, along with others such as tape measures, paint brushes, and even door handles.

    Managing that kind of program, Steve explains, is very much a matter of focusing on quality.

    With all the H branded products, if you have a look who they are, they're all reputable suppliers that we chose. When we go through the process of picking a supplier, we pick the product first.

    Finding quality products needs a quality process, so HBT came up with the idea of an "H" committee to help it develop this line of business.

    After we had developed a couple of the products, we then formed the H committee. Our committee decides what products we should look at as candidates for exclusive H products. We invite sometimes three or four submissions, though when we start, we already a good sense of which suppliers would likely work out best.
    For the most part, the suppliers that we choose must have a very good relationship with the HBT team, HBT members, and have a lot of accounts across the group. We always look for equal or better quality to the product they're already selling to our members - but with a price advantage. So that's kind of the selection process for an H product.

    Third stage: marketing

    With an attractive offer for HBT members to move over to H Hardware, a deal that made the transition easier in terms of cost, and included benefits that would accrue to both members and suppliers from participating in the brand, Steve next turned his attention to the hardest challenge of all: marketing, and generating brand awareness.

    Steve decided to look to an idea long familiar with hardware retailers: the print catalogue.

    The reason we did the catalogue was that we don't have the financing to do something like television advertising. HBT is still gearing up to get digital channels such as social media working. Catalogues were a reasonable cost, and the potential for a good return.
    Since doing the catalogues we've had suppliers new and old saying: "How do we get in there? How do we promote our products?
    So I think it has benefited us by putting our name out there, showing that we're a player in the market, and also it's benefited suppliers who want to be involved and want their products in our catalogues.
    It's a demand situation. If a supplier sees their competitor in there and they're not, they're coming to the party by giving us better deals and better specials to be in the catalogue. So the benefit extends even beyond marketing.

    Keen to find other cost-effective channels, the H brand has launched a presence in Shop A Docket at targeted Woolworths stores as well. For example, in the northern Melbourne exurban suburb of Whittlesea, both the local IGA grocer and the local Woolworths store now promote Whittlesea H Hardware through shop-a-dockets.

    A building brand

    This all adds up to what has become a considerable asset not just for HBT, but for the independent hardware community at large. Steve sees the H brand as offering many independents just the right mix of brand presence and power, mixed with real choice.

    So there's a bit of buoyancy now, there's a bit of excitement with H Hardware. Especially with the bigger players in the market, such as Bunnings, if your business doesn't stand for something, and there's not consumer confidence that you're buying well, that you are part of a brand or a group, then consumers will think that you're not competitive. They won't have the confidence to come to your store.
    H Hardware gives you that, it gives you that brand, that perception that these guys are part of a bigger picture and that they're going to be around for a few more years. Unlike an independent with just a very local brand, such as "Bob's Hardware Store".

    And yet, as Steve points out, with H Hardware, the spirit of individuality that runs so strong in a "Bob's Hardware Store" is kept alive.

    That's the thing with H Hardware from the start. There were a couple of concerns by some people before they joined, such as that they didn't want to lose that identity. For example, with someone like Chris Moorfoot out at Yarra Junction H Hardware, he was worried about the store's identity. But that is still a very unique store, and uniquely suited to its environment, in one of the real beauty spots of Victoria. These stores not only keep their name when they convert to H Hardware, they keep that independent spirit.

    The thing that makes Steve the happiest, however, about the whole H Hardware enterprise, is that he is just now seeing the results coming through for full-year financials at the stores he has helped steer into H Hardware. And they are good, very good in fact.

    The stores posted a significant increase. That released me from my biggest fear. A lot of them have come on because of the trust they have in the person behind the brand implementation, in me, you know. So to see that at the end that they are doing well and have achieved success through the brand - I'm just happy.

    What's next? Steve wants to hit a total of 50 stores by the end of 2018. And unless something major happens to the industry, HNN is very sure he's going to make his number.

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    Oldfields: A rightful share

    Oldfields comes back

    Recently appointed CEO Richard Albela is helping to restore Aussie icon brush brand Oldfields to its place in the market as a quality leader in paintbrushes

    The late twenty-teens in Australia have seen a range of smaller Australian hardware-associated businesses finally give up on their plans to continue manufacturing goods in Australia, and turn to sourcing more of them overseas. One of the better known is GWA Group based in Adelaide. In what can only be described as a truly gracious move, the former CEO admitted that he had done some things that were not optimal, found a replacement CEO in Tim Salt, and set the company up to continue to recovery, if not yet complete success.

    The recipe that Mr Salt applied is something of a familiar one. He restarted innovation, research and development, especially in the Caroma brand of sanitaryware, controlled costs, and boosted the overall image of the brand.

    Richard Abela, who took over as CEO of the legacy paintbrush firm Oldfields in early 2017 has followed something of the same path as he has worked to revitalise what had become a small ASX-listed company balanced on the edge of a very precarious P&L. Like Mr Salt, Mr Abela turned to research and development, setting about to build what the company would describe as one of the best possible paintbrushes for professionals on the market today.

    However, he has taken the company much further than that as well, seeking overseas markets for products such as its scaffolding, and moving sales of its shed business to a direct online model.

    While HNN is fairly sure that Mr Abela has not read the books written by modern "startup" guru Eric Ries (author of The Lean Startup, and The Startup Way), it is interesting how much of what he has done at Oldfields bears a strong resemblance to the strategies that Mr Ries recommends. One fundamental of that kind of startup thinking is simply that a company is nothing without a customer base, and that the only way to find out what customers want is to involve them in the development process - and not just by asking questions and hearing the answers. As Mr Ries points out (frequently and with some force), customers are seldom able to really articulate what it is they want. To work out what that might be it is necessary to not just listen to them, but also to watch their actions and reactions.

    It is, we could say, management by doing, rather than management only by meeting and consulting. It takes about five minutes of being in the same room as Mr Abela to grasp that he is strongly committed to this kind of doing.

    When HNN met with Mr Abela it was January, and we treked through the simmering heat of a Sydney summer day to meet him at the neat, modest factory where Oldfields continues to produce some of its products. He began our conversation by telling us about the new line of brushes the company had launched and how well they were doing in the market.

    The brush that was launched last year has gone really well. It's really exciting for us. We launched it in November 2017, so the pickup has been very very encouraging. We are already out of stock of one size... And we've been having conversations with people about brushes that we haven't had for a long time.
    The good news is it's coming from the trade. These are the guys who are using it and if you recall at our launch, we had trade people together with store owners and they are the ones providing that feedback.
    We really went out there to say that Oldfields is back and I think that is the truth. We will continue to push that story.
    In months and years to come it will be an ongoing story... Now we will go through our whole range and there may be some adjacent products launched in the future. I was out in the back yesterday and I saw that our warehouses are now struggling to keep up. That is really great, a good problem to have.
    So we are under some pressure to get orders out. And it's different because historically if we were largely in the DIY market the demand might be prior to Christmas, but now it's the New Year when all the tradies are back at work. It's a shift back towards our core, and what we are traditionally good at. The tradies seem to be saying, "We are so glad to have Oldfields back". It's not about us necessarily, but they are buying the brushes and saying "this is great".
    Momentum has really started to kick in, replenishment orders are starting to flow in. The stands that we developed, there are now 180 of those in stores across Australia. We didn't have them eight weeks ago. There's a couple hundred more to go and in our pipeline , then there's another couple hundred more to go out. People are trying it, they are liking it, and they are coming back.
    It's a journey back. We're not all the way back in five minutes, but the journey back has commenced. For us, this is long-term. This is the first year of a five-year plan.
    The good news is the first step has been good. We are not sitting here saying we're in just five stores or six stores; we are already in over 120 stores. Soon we should be in 250 stores. That rollout is gaining momentum and that's partly because we do have the history and the legacy. We have a great roller product so to match the brushes up now is really quite exciting. It is taking hold. Even industry experts are saying so.
    It's rewarding and all that but we've got a lot of work to do. It's good to know that the investment we made sends us back to our core, and the target person - which is the tradie - is saying "this is great".

    While very pleased with the first indications of success in the new strategy, Mr Abela is also very quick to indicate that much of that success (as with GWA Group) is not entirely due to him, as the process was started by the previous CEO.

    It was about a two-year process. And I've only been here about 13 months, so my predecessor needs to take credit for the development of that. To a large extent that's my predecessors' doing. Tony Grima needs credit for that. My predecessors, when we went through a tough time, did all the hard work to get us into a position where I can grow. I am fortunate enough that both those guys worked really hard and they got us into a position of a low cost base and I am the beneficiary of their hard work. So I can now grow that.
    But it's also a re-positioning of where we are. There is no doubt that this business and many others like this business, were seduced by the big boxes. But to be honest with you my realisation when I arrived was that we largely had a homogenised market. We really did have white bread in a white bread shop.
    It's a particular kind of philosophy, you can have any bread you like as long as it's white. And for me, that's not what Oldfields is. Oldfields is trade traditional. Yes, there are segments of that market that are disposable and certainly we can deal with that, but that's not our core.
    Having said that, that [low product cost] discipline is not lost. So the cost savings must continue. For us it's a continuously competitive environment, so the discipline that they instilled must continue and it is continuing. We are adding more costs now because we want to grow, that comes with growth, but it doesn't mean we lose focus on costs.

    Though Oldfields did take the decision to not be a preferred supplier with the Metcash-owned Independent Hardware Group (IHG), Mr Abela is quick to point out that this was not a question of "slamming the door" on that relationship or that kind of business. Overall his concern seems to have been that concentrating solely on price discount and the ultra-lean production processes that go with it would not be good for a company that really needed to start standing up and presenting a clear, understandable identity to the market.

    We headed down that road [in the past] and strategically that may have given us some volume but now it's not where we want to be. And so we made a decision early 2017 to not exit that market completely but that's not where our focus needs to be...So we did break some relationships with retailers who wanted to take the whole thing off us and we have to make commercial decisions for our shareholders and for our employees and our community, which is our trade community. And we made those tough decisions.
    The good news is we're back now to where we wanted to be. It's taken a year and it will take another year before we are even stronger. But the margin is strong and we are heading in the right trajectory of where we want to be. So we are not on the path of this forever cycle of debating with buyers and big chains who want it 5% cheaper each year.
    There is nothing wrong with seeking cost savings but not to the point where it starts destroying you. And I think for us, getting back to our core has been very very important. So that's what we've done.

    Download article

    This is only an introduction to this article. To read the full article, please download the PDF of HI News Vol. 4, No. 3 at:

    HI News 4-03: Richard Abela restores Oldfields
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