Hardware Retailing The Industry's Source for Insights and Information
On Monday, the independent home improvement industry woke up to some of the biggest news in decades as Do it Best announced its bid to acquire substantially all assets from True Value, which filed for Chapter 11 bankruptcy under private equity ownership.
This week, Hardware Retailing has gathered reactions and insights from retailers and wholesalers on the news and how it might impact True Value retailers and the channel as a whole.
Dalton Meny, director of operations for Meny’s True Value, which has three locations in southern Indiana, says he thinks Do it Best leadership could be a good fit for their business. He is hoping for a smooth transition and that the deal proceeds as intended. His parents, Michelle and Gary Meny, are fourth-generation owners of the business, and the Meny family put out a statement to customers this week assuring them that it was business as usual for their stores.
“I’m very interested in what this acquisition will look like when all is said and done. This could really give us a competitive advantage against other retailers by combining the power of these two businesses,” Meny says. “With Do it Best gaining additional buying power, it will better equip us all to be more competitive against the big boxes. I think that is something we all want to achieve in this industry.”
Meny also says he hopes regardless of what happens, the True Value brand will continue.
“Our customers recognize the True Value brand in our community,” Meny says. “There is also a sentimental aspect to it, as our family has been with True Value for 60 years. If the brand is going to stay around, we would like to stay with it.”
In Minnesota, owner Dave Ables offers a unique perspective, as he and his wife Lori’s current hardware store—Three Sons Hardware—is part of the True Value brand and they have owned other True Value stores in the past. His recently purchased lumberyard—Tri-County Lumber—is part of Do it Best.
“I believe it’s great for every True Value store owner, especially those of us who have been around since the old co-op days,” Ables says. “The co-op model provides a lower cost of goods sold, better transportation costs, a wider variety of vendors and a strong member-owned core structure. My family is very excited, and we look forward to continuing to thrive with both True Value and Do it Best.”
While he has only been a part of the True Value brand for 10 years, Bradley Carson, owner of J-Town Hardware and Rental in Jeffersontown, Kentucky, is overall excited to see where the deal will go and how it will potentially strengthen the True Value brand. He expressed some concerns for the future of his store with an existing Do it Best retailer just down the street.
“Hopefully they’re not going to drop me because that Do it Best store has been around longer, so I have that unknown that’s on my mind,” Carson says. “But I’ve always embraced change; it shakes things up and brings better people, ideas and procedures to the surface. In a world where growth is made through company acquisitions, this seems the norm nowadays.”
Past True Value retailer and now Do it Best retailer Scott Sommers, president of Hartville Hardware & Lumber in Hartville, Ohio, says they joined Do it Best in 2001 because of their focus on efficiency, company culture and the desire to serve the members.
“I believe this is a great opportunity for the True Value members to return back to their roots,” Sommers says. “I also believe this is good for the industry. When any group of independents becomes stronger we all benefit.”
As a current DIB member, Sommers says he is hoping to leverage some of the strong retail brands from True Value.
“I am excited that the increased buying power of the co-op will allow us even better programs from our current vendors, as well as access to vendors we don’t currently have,” Sommers says.
In addition to retailers, leadership from other industry wholesalers have been sharing their reactions. Steve Synnott, CEO of Hardware Distribution Alliance (HDA), emphasized the organization’s readiness to support True Value dealers and any independent retailers through its network of over 60 independently operated distributors that span the U.S.
“Our distributor members are in a perfect position to serve any hardware store in America, including True Value retailers seeking a reliable and responsive distribution partner,” Synnott says. “With over $7 billion in buying power and more than 400 vendor partners, HDA is ready to provide immediate resources and invaluable connections to ensure True Value dealers can continue their operations with minimal disruption.”
Synnott says that as the hardware industry undergoes continued changes and consolidation, HDA remains steadfast in its mission to ensure independent retailers not only survive but thrive.
“Whether through access to critical products, customized inventory solutions or the collective knowledge of its experienced distributor partners, HDA offers independent dealers the tools they need to remain a vital part of their communities,” Synnott says.
Orgill CEO and president Boyden Moore says that in light of the news, Orgill will make every effort to support True Value retailers in maintaining uninterrupted access to products and services.
“At Orgill, we have always championed the independent dealer. One thing that Orgill can offer to the thousands of True Value customers during these uncertain times is a pathway to stability in their future business relationships that would enable them to continue serving their communities without fear of any interruption,” Moore says. “Orgill has continued to make investments in its distribution network, retail programs and field sales team that will allow us to step in and provide True Value customers with the products and support they need and the comfort of knowing that we will be there with them to help grow their businesses—with no uncertainty or surprises.”
Orgill currently shares business with True Value at over 800 stores and has 65 True Value to Orgill conversions already underway in the next couple of months.
“Because we have done more and more business with current and former True Value customers in the recent months, we aren’t starting at ground zero when it comes to conversions or switching systems. We have the ability and the insights to make this process as efficient as possible,” Moore says. “We have already routed every True Value store, both those we currently service and those that we don’t so we can be more responsive to these stores’ needs.”
Do it Best is also assuring retailers that it will also continue to provide a stable and reliable solution for affected retailers, especially in the immediate term with drop-ship orders, which is already operating and ready to support all their product needs through a simple no-fee Do it Best application process that ensures ordering within 24 hours.
“Despite all the news and headlines, it remains business as usual at Do it Best,” says Dan Starr, Do it Best president and CEO. “Business as usual means providing the full value of our sales team, distribution network, extensive vendor relationships and supply chain excellence to every dealer who wants to grow their sales. Our professional sales team is the best in the industry and are experts in identifying the right products and services to help drive retail success.”
While Do it Best announced its bid to acquire substantially all of the True Value assets and business operations, the transaction remains subject to regulatory and court approvals. During this process, Do it Best and True Value must remain separate and distinct companies operating independently in the hardline wholesale marketplace.
“If any retailer in the marketplace is experiencing uncertainty or supply disruptions, Do it Best stands ready, willing and able to meet their needs, and they don’t have to rebrand or take their sign down to do it,” Starr says. “Our message is clear: Do it Best is here to bring stability and to supply independent home improvement retailers with the least disruption so store owners can focus on serving their customers.”
Ace Hardware did not reply with a comment, but in a message to Ace retailers obtained by Hardware Retailing magazine, Ace president and CEO John Venhuizen says that while Ace was asked to participate as a potential bidder to replace Do it Best, it has declined. The message also stated: “Since 1998, we have converted 1,718 stores to Ace Hardware, 918 of which were formerly with True Value. Converting is always hard. But, over the years we’ve gotten pretty good at this. And now, I suspect the number of those who are interested will only grow.”
Read the full breaking news story here. Plus, hear from Do it Best president and CEO Dan Starr, who shared additional insights into the True Value purchase plan, and read how NHPA is supporting True Value retailers and the channel during this time with tools and resources.
