HOME DEPOT TO ANNOUNCE HD SUPPLY SALE
Home Depot will sell its Home Depot Supply unit to a group of private equity firms, according to a report recently in the New York Times.  Home Depot reportedly could announce the deal to sell the unit for more than $10 billion. The deal is expected to be made with Bain Capital, the Carlyle Group and Clayton Dubilier & Rice.  The offer made by the three firms bettered another offer by Thomas H. Lee Partners and CCMP Capital Advisors, the newspaper said.  The company announced in February that it was exploring a possible sale, spin-off or public offering of its HD Supply business. It retained Lehman Brothers to assist in the process.  The HD Supply business produced $12 billion in revenues in fiscal 2006, accounting for 13.3 percent of Home Depot's revenues.

NEED IT OR WANT IT?

Consumers want things in their homes to last a long time, but they junk their cabinets, faucets and all sorts of appliances long before they wear out because their tastes, desires and lifestyles change and manufacturers are forever catering to and encouraging those changes as they try to improve their sales. For instance, based on comments from about a dozen faucet manufacturers, an NAHB study of the life expectancy of a home's components concluded that kitchen faucets should last an average of 15 years.  "Yet only about 30 percent of residential faucets sold each year replace ones that are broken or worn," said Jack Suvak, marketing research director at Moen. The rest are split between newly built homes and remodeling projects, wherein people typically start replacing their fixtures a couple of years after moving in. "Most home owners are not comfortable with what they inherited," Suvak said. "They want to make it their own.  Given that people typically don't remodel piecemeal, lots of fixtures and appliances get replaced simply to match the new fixtures and appliances around them," said David Pringle, chief executive of Broan-NuTone. "That's why the company offers 40 new styles of medicine cabinets each year," Pringle said. Medicine cabinets should last more than 30 years, the builder's study found, but manufacturers do not want consumers to hang on to them for nearly that long.
(Source: Washington Post (5/5/07); Dina ElBoghdady as adapted in http://www.nbnnews.com )

NRHA NAMES 2007 YOUNG RETAILERS OF THE YEAR

Six young hardware retailers are being honored for outstanding achievement as owners and managers of independently owned hardware and building supply stores in the United States and Canada. They are honorees in the 2007 Young Retailer of the Year Program, now in its 11th year.

The purpose of the program, which is coordinated by the North American Retail Hardware Association (NRHA), is to recognize outstanding performance and encourage talented young people to pursue a career in the retail hardware business. To date, the program has honored 79 young retailers. This year's honorees include:

Under $2 Million in Sales:
Paola Castro, vice president of operations and general manager of C&S Hardware, New York, NY.

Over $2 Million in Sales:
Adam Busscher, owner of Picton Home Hardware, Picton, Ontario, Canada.

Mike Nelson, owner of Nelson's Ace Hardware, Selma, CA.
Dan Wilson, vice president of sales and marketing, Wilson & Sons Building Supply, Russell Springs, KY.

Multiple Store Operations:
James Cabirac, owner of Kief Hardware, Galliano, LA.
Merritt Morris, manager of Imperial Do It Center, Brawley, CA.
Nominees for the Young Retailer Award must be 35 years of age or younger and are judged for their career advancement, professional accomplishments, goals for the future, education and community involvement. Honorees will be special guests at NRHA's 2007 National Convention this month at the Grand Cypress Resort in Orlando, Florida where they will be recognized at a banquet in their honor.  Sponsors of the program are 3M Co., The Scotts Co., Cooper Tools and the American Hardware Manufacturers Association.

EVENT SPOTLIGHT: GROUP MERCHANDISING CONFERENCE

HOME IMPROVEMENT INDUSTRY DISTRIBUTORS FROM PRO GROUP AND VAL-TEST ATTEND GROUP MERCHANDISING CONFERENCE IN ATLANTA
The Group Merchandising Conference organized by PRO Group, Inc. and Val-Test Distributors June 11-13, 2007 at the Embassy Suites Hotel in downtown Atlanta included 983 scheduled buyer/vendor appointments. The meetings took place in private suites throughout the Embassy Suites Hotel, with Vendors offering conference specials and reviewing benefits of new products, merchandisers, displays and promotions to attending buyers.  This is the third year PRO Group has hosted this conference and the first year distributors from the Schaumburg, Illinois-based Val-Test Distributors participated.  Steve Synnott, president and chief operating officer of PRO Group, Inc., said, ""By adding Val-Test members to the existing mix of PRO Group Member Distributors, we increased buyer attendance and exposure for the Vendor community. It's part of an ongoing goal to make this a more meaningful industry event that includes a broad spectrum of buyers."  At this conference, Vendors are invited to actually set up gondolas, endcaps or other merchandise displays in their suites, which offer much more meeting space and comfort than typical tabletop displays or samples that can be carried into an office, according to Synnott.  Mark Marotto, sales manager for Chicago-based LDR Industries, said, "The Group Merchandising Conference helps build partnerships. We can introduce customers to product categories that will enhance their opportunities for growth," Marotto said. "We enjoy this conference because of the opportunity it gives us to sit down with so many customers at one location in three days."  Distributor Tommy Drinkard, president and hardware buyer for Lynchburg, Virginia-based Barker-Jennings, said he feels the conference is valuable to attending Manufacturers and Distributors alike. "You get a chance to plant a lot of good seeds at this event." Drinkard said he is seeking out good buys and hopes to strengthen his mix in certain lines. "I am looking for hot items and new items and at this event I get the opportunity to talk to some of the people at the factory that I don't generally see throughout the year." Full Press Release

EVENT SPOTLIGHT:  NATIONAL HARDWARE SHOW

NATIONAL HARDWARE SHOW UNITES INDUSTRY

The National Hardware Show® made a one-time stop in Orlando, Florida this year, making it easier for retailers in the Southeast to attend the industry's largest trade show. The 2007 edition, held May 8-10 at the Orange County Convention Center, attracted more than 3,000 exhibitors and a worldwide audience of buyers in search of hot new products and the latest trends. The show returns to Las Vegas next May.  Among the trends spotted on the show floor were environmentally friendly and energy-saving products, items designed to make household repair and maintenance jobs easier and a whole host of products designed to turn backyards into outdoor living rooms.  During the show, the magazine also hosted a panel discussion featuring the Industry's Top Guns. Four leading independent retailers were given that distinction:
• Greg Fuller, CEO, All American Home Center, Downey, California.
• Stan Hardman, president, Hardman's Supply, Spencer, West Virginia.
• Boyden Moore, president and CEO, Marvin's, Leeds, Alabama.
• William E. Aubuchon III, CEO, Aubuchon Hardware, Westminster, Massachusetts.

Dick Frame, senior merchandise manager for PRO Group, said of this year's show, "There were more Vendors in attendance this year, with a few of the majors such as Cooper Tools and Robert Bosch back in attendance.  I met with several new Vendors in the Presidents Council Buyer Meetings and came out with a few new potential programs for PRO Group."   Merchandise Manager Bob Reiling said, "The National Hardware Show was huge again this year.  I had a joint meeting with Tom Nunes of Horizon Distribution with one potential PRO Group Vendor and interviewed four other prospective new Vendors at the Presidents Council-sponsored Open Buying Days.  I found at least four other potential vendors for the Group.  On Wednesday evening, LDR Industries hosted a wonderful dinner for a dozen PRO Group Distributor personnel and staff.  I also met with many of our existing Vendors to discuss opportunities as well as some nagging issues that we occasionally have with Vendors.  It was time well spent."  In other news, Dick Frame, Bob Reiling and Joy Smith of PRO Group, Inc. participated in the Presidents Council Buying Days to benefit City of Hope.  The support received from 46 buyers representing 13 retailers/buying groups from the U.S., Canada, Europe and South America, as well as 60+ suppliers made this event a tremendous success.  City of Hope is one of just 39 Comprehensive Cancer Centers in the United States as designated by the National Cancer Institute (NCI), and a founding member of the National Comprehensive Cancer Network (NCCN).  It is at City of Hope that more than 300 physicians and scientists and over 2,500 employees work to find the causes of and cures for cancer and other life-threatening diseases, including diabetes and HIV/AIDS.

2007 GOLDEN HAMMER AWARDS

23RD ANNUAL GOLDEN HAMMER AWARDS PRESENTED AT NATIONAL HARDWARE SHOW

Home Channel News held its 23rd Annual Golden Hammer Awards May 9, honoring top retailers and suppliers in the home channel. Robert Strickland, former chairman of the board for Lowe's, addressed the crowd and received a standing ovation for his service at the nation's second largest home improvement retailer. Strickland was inducted into the Home Channel Hall of Fame at the Golden Hammer event. Golden Hammer awards were given to retailers, including Brentwood, Tennessee-based Tractor Supply for Retail Partner of the Year; Minneapolis-based Northern Tool & Equipment for Specialty Retailer of the Year; and Long Island, New York-based Costello Ace Hardware for Innovative Retailer of the Year. In the vendor category, Stanley Tools was named Vendor of the Year.  In the category of Hardware and Tools/Supplies, Golden Hammer Awards were given to SC Johnson, Leviton, Simpson Strong-Tie, BonaKemi USA, Stanley Tools, First Alert, 3M, Fluidmaster and DeWalt. In the category of home decor, Golden Hammer Award-winners included Schlage, Hunter Fan, Danze, Bruce Hardwood, ClosetMaid, Whirlpool, Benjamin Moore, KitchenAid, Mohawk and Levolor.  In the category of LBM durables, awards were presented to Kohler, Johns Manville, DAP, Therma-Tru, KraftMaid, Georgia-Pacific, DuPont and Andersen Windows & Doors.  In the outdoor living category, Golden Hammer winners were Weber-Stephen Products, Pavestone, Accents Unlimited, Scotts, Fiskars, Bemis and Honda.  Thirty-four suppliers also were honored with HCN's Silver Circle Awards.  Communication awards went to Stanley Tools for business-to-consumer marketing, M-D Building Products for packaging, Osmose for point-of-purchase marketing and Hyde Tools for business-to-business marketing.  The HCN's Golden Hammer Awards' Selection Committee gave Committee Choice Awards to 3M for category management, First Alert for inventory management, Stanley Tools for new product innovation, Weber-Stephens Products for quality control and Johns Manville for serving professionals. (SOURCE:  Retailnet.com)

Stanley Works      

Vendor of the Year   

CEO CHANGE AT BRASSCRAFT

BrassCraft has announced the pending departure of Todd Talbot, president, who is leaving to become president of a business within the industrial and commercial building industry, according to a company press release.  Don Woody, currently the president of Liberty Hardware, will assume the role of president of BrassCraft/Alsons. Woody joined Masco in March 2000 as vice president of operations with Baldwin Hardware. Following the divesture of Baldwin, he served as the president of Weiser, Inc. from 2002-2004; the president of Alsons/Bath Unlimited from 2004-2005; and most recently, as the president of Liberty Hardware from 2005 through the present.

ANOTHER EXECUTIVE TO LEAVE HOME DEPOT
Jim Stoddart, Home Depot's senior vice president-growth initiatives, is the latest executive to leave the company in the wake of CEO Bob Nardelli's departure in January. Other departed top executives include general counsel Frank Fernandez and human resources chief Dennis Donovan, who, like Stoddart, had strong ties to Nardelli.  In other news, Jack VanWoerkom has been named executive vice president, general counsel and corporate secretary at Home Depot. He will report to CEO Frank Blake.

LOWE'S 1Q PROFIT FALLS 12 PERCENT

Lowe's reported net earnings of $739 million for the first fiscal quarter ended May 4, 2007, a 12.1 percent decline from profits of $841 million in the year-ago period.  Sales for the quarter increased 2.1 percent to $12.2 billion from last year's $11.9 billion. Same-store sales for the period fell 6.3 percent.

HOME DEPOT FIRST QUARTER PROFITS FALL 30 PERCENT

Home Depot reported that net earnings for the first fiscal quarter fell 29.5 percent to $1.046 billion from $1.484 billion in the year ago period.  Total sales for the period increased 0.6 percent to $21.6 billion from last year's $21.5 billion. Total sales in the retail segment declined 4.3 percent to $18.5 billion from $19.4 billion as same-store sales declined 7.6 percent. Total sales in the HD Supply segment increased 46 percent to $3.1 billion from $2.1 billion in the year-ago period.

WAL-MART MAY SALES UP 7.7 PERCENT; PLANS TO SLOW STORE GROWTH

Wal-Mart Stores recently reported same-store sales during May increased 1.1 percent, excluding fuel sales. Including fuel, same-store sales increased 1.3 percent for the month.  Total U.S. sales for the four weeks ended June 1, 2007 increased 7.7 percent to $28.26 billion.  The complete press release and financial report from the retailer for the month is here: http://www.walmartfacts.com/articles/5081.aspx.  In other news, at its annual conference of shareholders, retail giant Wal-Mart said it would slow the number of planned U.S. supercenter store openings this year by more than 25 percent.  The plan would help drop capital expenditures by $1.5 billion, with the added aim of improving store sales.

ACE REVENUES UP 2.4 PERCENT IN FIRST QUARTER

Ace Hardware reported total revenues for the first quarter ended March 31, 2007 increased 2.4 percent to $902.7 million from $881.6 million in the year-ago period.  Net earnings for the period declined to $13.8 million from $14.7 million in 2006.

TRUE VALUE REVENUES DOWN 1.6 PERCENT IN FIRST QUARTER

True Value Company reported revenue of $488.5 million for the quarter ending March 31, 2007, a decrease of 1.6 percent or $8.1 million from $496.6 million for the same period a year ago. The cooperative posted a quarterly net margin of $8.7 million, a decrease of $4.1 million versus $12.8 million one year ago.  The prior year's first-quarter net margin included a $5.6 million one-time gain from a reduced reserve that was previously established for an arbitration matter. Excluding the prior year's non-recurring gain, net margin was up $1.5 million or 20.8 percent from last year.

SEARS HOLDINGS EARNINGS ROSE 20 PERCENT IN THE FIRST QUARTER
Sears Holdings released first-quarter financial results buoyed by insurance and settlement gains. Net earnings rose 20 percent to $216 million from $180 million last year. Sales fell 2.5 percent to $11.7 billion from $12 billion last year.  Comparable-store sales declined 3.9 percent during the first quarter.  While operating results improved at Sears Canada stores and expenses fell in the company's U.S. division of Sears, sales declined at Kmart stores domestically.  Domestic comparable-store sales declined 3.4 percent at Sears, while Kmart's comparable-store sales declined 4.4 percent. Poor weather conditions, tough competition and rising energy costs were blamed for the declines.

PRO-BUILD READIES FOR DENVER HEADQUARTERS
Pro-Build Holdings, one of the nation's largest suppliers of building materials, plans to move into a new permanent headquarters site in Denver in July, according to the Denver Post.  The company reported in March it would relocate its headquarters to Denver. Currently Pro-Build is headquartered in South Plainfield, N.J.  The company is planning a 15,000-square-foot facility at 7595 Technology Way in Denver. The company also is considering a data center at the site, the newspaper reported.  Pro-Build currently has temporary offices set up in Denver, with about 60 employees already working there.  Earlier this spring, the company said it will establish four regional offices, with Pro-Build East in Charlotte, N.C.; Pro-Build South in Tulsa, Okla.; Pro-Build North in Winona, Minn.; and Pro-Build West in Olympia, Wash., where administrative and back office functions for each region will be consolidated.  Pro-Build Holdings operates more than 500 lumber and building product distribution, manufacturing and assembly centers throughout the United States.  The company trades under several regional brands, including United Building Centers, Spenard Builders Supply, Lumbermens, Home Lumber, Dixieline Lumber, F. E. Wheaton, Hope Lumber and Supply, Strober Building Supply, U.S. Components and the Contractor Yard.

NATIONAL ASSOCIATION OF REALTORS POINTS TO GRADUAL HOUSING UPTURN
Home sales are expected to move in a "relatively narrow range" with a gradual upturn by the end of the year, according to the latest forecast from the National Association of Realtors (NAR).  "Overall housing levels are historically strong, but sales remain sluggish compared to the recent boom," said Lawrence Yun, NAR senior economist. "Home sales will probably fluctuate in a narrow range in the short run, but gradually trend upward with improving activity by the end of the year."   However, Yun added, "It's important to keep in mind that all real estate is local, and many markets are expected to have higher sales and strengthening prices during the second half of this year."   The NAR reports that existing-home sales are projected to total 6.18 million in 2007 and 6.41 million in 2008, in contrast with the 6.48 million sales recorded in 2006. New home sales are forecast at 860,000 this year and 901,000 in 2008, down from 1.05 million last year. Further, housing starts are likely to total 1.43 million units in 2007 and 1.49 million next year, compared to 1.80 million recorded in 2006.  The national median existing-home price should ease by 1.3 percent to $219,100 in 2007 before rising 1.7 percent next year. The median new home price will probably fall 2.3 percent to $240,800 this year, and then grow by 2.6 percent in 2008, the NAR reports.  The 30-year fixed-rate mortgage is likely to increase to 6.6 percent in the third quarter and then hover at that level through 2008.

HOME IMPROVEMENT RETAIL SALES IMPROVED 2.1 PERCENT IN MAY

Total sales of home improvement products through retail channels in the country improved 2.1 percent in May from April to $29.614 billion, according to the latest Department of Commerce report. Sales, however, were 1.7 percent below year-ago May sales of $30.114 billion.  Sales for the first five months of the year were $145.100 billion, 3.3 percent below the same period last year.  Overall sales of all types of retail goods and services in the country rose 1.4 percent to $377.9 billion in May and are running 5.0 percent ahead of last year for the first five months of the year. The complete report from Commerce is here: http://www.census.gov/svsd/www/retail.html.

MILD REMODELING SLIDE FOLLOWS IN HOUSING'S FOOTSTEPS

Following in the footsteps of the current downturn in housing production and sales, the residential remodeling market has entered into a decline that is expected to persist well into next year, according to participants in a recent NAHB news teleconference.  The slowdown is expected to be concentrated almost entirely in home owner improvements, and the extent of the decline in the industry won't be as steep as the ongoing correction in home building.  "Americans will spend nearly $233 billion on home remodeling this year," said NAHB Chief Economist David Seiders. While that represents a 1.9 percent increase from the record $228 billion spent in 2006, it translates into a modest decline of 1.5 percent once it's adjusted for inflation.  "Remodeling activity in 2008 is expected to grow by 2.8 percent next year," he said, which would be a decline of 0.5 percent after inflation.  Along with growth in the nation's economy, an aging housing stock — with homes in the U.S. averaging 33 years and rising — will be providing some underlying support for upgrades and repair even as remodeling volume weakens.  While the direction of activity in remodeling generally follows home building, with a lag time of three to six months, "home owners cannot put off a major repair like a leaky roof as they can discretionary upgrades, and that stabilizes the industry during slower housing markets," Seiders said.  Noting "a good bit of sensitivity of larger improvements to owner-occupied housing" during down times, Seiders said that the downturn would be most evident in highly discretionary jobs like remodeling kitchens and baths and adding rooms.

UPCOMING DISTRIBUTOR SHOW DATES & EVENTS
 

Prior to working for PGM, Annie spent over 10 years as marketing director for companies in the medical manufacturing and the healthcare industry in Colorado and Illinois. Annie excelled in all aspects of marketing -- from trade show selection and participation to focus group research and new product development. In addition, Annie has vast experience in video and film production in Los Angeles and Denver, including music videos, feature films and even exercise videos. Zone Workout, anyone?

Annie graduated Summa Cum Laude from Regis University, where she received a B.S. in Business Administration with an emphasis in marketing and e-commerce. She has taught film and video production management techniques at the University of Colorado's Colorado Film School. Annie is also actively involved with the Colorado film community, producing both independent films and television shows. She currently serves as an advisory board member for the Warren Tech Multimedia Training Program.

TALENT

"Great things are accomplished by talented people who believe they will accomplish them."