Do it Best Addresses Retailers’, Vendors’ Concerns

With its purchase of True Value final, Do it Best presented a Town Hall with Do it Best CEO Dan Starr and recently appointed president of True Value Dent Johnson to keep Do it Best members and True Value retailers up-to-date on how the companies are moving forward. 

While there are still a number of questions yet to be answered, one of the biggest questions has been what will happen to the stock investments many True Value retailers hold. In the Town Hall, Starr reiterated that during a bankruptcy there is an order in which debts are satisfied, starting with secured creditors, then unsecured creditors and at the end of that line is the ownership group, including True Value retailers who are part of the 30% ownership. As of Dec. 20, 2,664 creditors have filed claims totaling $2,509,785,162, with $1,910,814,223 of that amount secured debt. 

“The concern we have is that it seems—based on the True Value bankruptcy filings—very unlikely that those retailers are going to recover anything. There is an overwhelming amount of debt and not a lot of assets to cover it. That’s the worry that I have for those members,” Starr says. “Unfortunately, the bottom line is it’s out of our hands as part of the bankruptcy.”

Many True Value retailers have also been questioning the status of their 2024 rebates. Johnson says his team has been working on a 2025 rebate plan that includes the ability to continue to earn rebates for 2025 purchases, along with an opportunity to recover what was earned in 2024 with continued business with Do it Best.

“We know that True Value retailers depend on and are expecting that rebate,” Starr says. “So in the last few weeks, finding a solution has been one of our priority items.” 


Patching Vendor Relationships

Vendors have also had questions about what it will look like working with Do it Best and TV Hardware Distribution LLC, the new wholly-owned subsidiary of Do it Best, moving forward. Some of these questions were answered in an email sent to True Value vendors this week. (In full disclosure, NHPA, which publishes Hardware Retailing and Paint & Decorating Retailer magazines, is a vendor of True Value and received this email.) 

In the email, Do it Best CEO Dan Starr shared that it is important to note Do it Best and TV Hardware Distribution LLC will not assume any pre-existing vendor agreements with the True Value debtors. Additionally, Do it Best is not responsible for any pre-bankruptcy general unsecured claims owed by the True Value debtors to any vendors. 

As outlined in the purchase agreement, Do it Best has assumed and agreed to pay up to $45 million for Section 503(b)(9) claims for goods delivered to the True Value debtors during the 20 days preceding the bankruptcy date and any allowed administrative expense claims for goods delivered between Oct. 14, 2024, and Nov. 22, 2024. Claims reconciliation will take place during the 45-day period after the Dec. 23, 2024, administrative expense bar date. Payment for claims will be issued by mid-February 2025.

“With this expanded footprint, we look forward to strengthening our existing relationships with our valued vendors and cultivating new partnerships with those who have supported True Value,” Starr says in the email. “By combining the Do it Best and True Value retailer networks, we anticipate a substantial increase in business opportunities with our trusted suppliers, creating mutual benefits for years to come.”

Starr and Johnson also addressed supply chain stabilization and vendor relationships during the Town Hall. Johnson says the drop-ship program has resumed after being suspended since Nov. 4 and all Fall 2024 Fall Reunion orders have been placed with vendors, lending confidence that orders will come in either as planned or close to expected dates.

“There was a lot of pressure to get the purchase of True Value closed quickly because we saw the supply chain deteriorating very rapidly for True Value retailers,” Johnson says. “Our priority since then has been getting inventory moved, the supply chain opened back up and stabilizing the operation to the highest extent possible.”

Repairing damaged relationships with vendors has also been a top priority. Johnson says his team is making hundreds of calls each day and making headway in regaining trust with vendors. 

“There was some pretty severe damage done to a number of those vendors who are left with a pretty significant financial penalty,” Johnson says. “I’m happy to report that with the vast majority, we’re having a lot of luck with. I’ve got a couple of key vendors that we’re still trying to work through some issues but we’re confident we can get it turned back around.”

Creating an Efficient Distribution Network

In May 2024, Do it Best opened its ninth warehouse. With the addition of the True Value warehouses, it is now operating 20 distribution centers. True Value closed the Denver distribution center in November 2024, and the distribution center in Manchester, New Hampshire, is slated to close at the end of the month. 

Johnson says the company will not need that many distribution centers to supply retailers in the future—even with their ambitious growth plans—but for the short team, all will remain open and operational.

“We’re looking at how we can consolidate to improve efficiency,” Johnson says. “We are moving as quickly as possible to stabilize the supply chain and then we’ll figure out how to gain efficiency.” 

Do it Best was running $1.6 billion through its nine warehouses, while True Value was doing $1.2 billion across 12 distribution centers, and Starr says Do it Best will spread that efficiency mentality to the True Value warehouses.

“Our first order business is making sure we are not disrupting retail business; retailers need to have access to product and good fill rates. That’s job No. 1,” Starr says. “Once we feel comfortable that we’re working through those issues, we’ll evaluate whether we can take one or two or more warehouses out of the distribution network without impacting delivery and fill rates.”

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Follow along with all of the Do it Best and True Value news:

• Do it Best Announces Combined Spring Market With True Value in 2025
• Do it Best Successfully Completes Purchase of True Value
• Industry Wholesalers Reach Out to True Value Retailers
• Vendors Seek Return of Goods or Payment From True Value, Courts List Exec Bonuses and Payouts
• True Value Temporarily Suspends Drop Ship Program
• True Value and Lenders Reach Milestone Agreement Moving Sale to Do it Best Forward
• True Value RDCs Prepare for Potential Shutdown
• Judge Shares Concerns With Direction of True Value Bankruptcy Filing
• Bankruptcy Judge Allows True Value to Use Cash Collateral While Lenders Push Back
• Industry Reacts to True Value Bankruptcy and Potential Sale to Do it Best
• NHPA Offers Tools, Reassurances to Retailers Potentially Impacted by True Value Bankruptcy
• Do it Best CEO Adds New Insights to True Value Purchase Plans
• True Value Files for Chapter 11 Bankruptcy, Do it Best Bids to Acquire Assets