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Ace’s revenue growth was fresh news at the Ace Hardware Fall 2015 Convention, but CEO and president John Venhuizen offered a warning to retailers: don’t get comfortable.
On Wednesday, the cooperative reported revenue growth of 6.5 percent in its second quarter. The company has grown quickly since 2013, with 514 new stores opening and substantial growth in retail sales, transactions, average tickets and store resets.
“Our brand is on fire,” John Surane, executive vice president of marketing, merchandising and sales, told a crowd at the general session that kicked off the convention. The co-op’s fall buying show began Thursday and runs through Saturday this week in Chicago.
Store owners have made great progress, but they could get tired or afraid to take risks because their businesses are doing well, Venhuizen said.
“What I’m worried about is that you’ll get comfortable,” he said. “Take action, even though the future’s hard.”
He suggested steps, such as cutting spending on circular advertising, putting more money into digital marketing and offering more promotions to Ace Rewards customers to cement their loyalty. Stores should also post the value they are giving customers when products are on sale, rather than letting shoppers leave the store without knowing they got a deal, he says. Retailers should also get their employees trained on customer service and leadership.
Opportunities to save and earn money include an investment in replacing their stores’ lighting with LED bulbs. Retailers will not only benefit from the energy savings but will also be able to market that savings to other businesses by showing them their lower electric bills, Venhuizen says.
Retailers all want to grow, but they need to understand that growth requires bravery, which involves risk, he said.
Their businesses will decline without growth, but if they pursue growth, they need to pursue it with discipline. Otherwise, they will either struggle through the pain of the discipline that growth requires or live with the pain of regret, he says.
“Every active optimist knows that there’s no such thing as pain-free growth,” Venhuizen says.
Jim Findley, store manager for Miller’s Ace Hardware in the Pittsburgh area, came to the Ace show to look for new products, vendors and special buys – but he also appreciates hearing the reminders of the co-op’s goals.
“It’s refreshing to hear the folks from Ace corporate describe the vision for the company in their own words,” Findley says.
His job isn’t just to get up every day and go to work, he says. “For me, it’s helping customers. It’s being part of the community. It’s being a good neighbor,” he says.
