BOSTWICK-BRAUN'S VIRTUAL MARKET OFFERS DEALERS ONLINE DEALS The Bostwick-Braun Company, based in Toledo, Ohio, is holding its first-ever online market March 19-April 15, 2007. Retailers can shop the virtual show from anywhere and will have access to online-only show specials from vendors. The Market will offer stock and drop ship offerings and participating retailers can communicate with vendors and Bostwick-Braun representatives online. Retailers can register for the online market at www.bostwick-braun.com

HOME DEPOT, STANLEY HARDWARE PART WAYS
Stanley Works revealed that it is facing a loss in revenue in 2007 because Home Depot is replacing the manufacturer's hardware products with its own private label brands. Items such as Stanley's padlocks and latches will be replaced by products from Crown Bolt, a manufacturer that Home Depot acquired last year and is now part of the HD Supply family of businesses. Stanley said it will attempt to replace the lost revenue by selling more products to Home Depot's competitors, including rival big boxes and smaller independent stores. The New Britain, Connecticut-based company also revealed that sales to U.S. home centers and mass merchants are projected to be just 18 percent of consolidated sales in 2007, compared to making up 40 percent of consolidated sales just five years ago. This year, no single customer is expected to represent 10 percent of consolidated sales, according to John Lundgren, chairman and CEO of Stanley Works. Stanley's top executive also said that Home Depot's competitors were reluctant to stock their shelves with Stanley products because they viewed them as a "Home Depot brand."

PRO GROUP LAUNCHES FIRST-EVER ONLINE MARKET FOR DISTRIBUTORS
'Online Market Blitz' Set for March 19-30, 2007
PRO Group is launching its first-ever 100-percent online virtual trade show, a new marketing initiative being offered to its Distributor Members March 19 through March 30. The Online Market Blitz through the Bannockburn, Illinois-based InXpo is designed to offer all PRO Group Distributor Members the ability to buy promotional products from various participating PRO Group Vendors and communicate online with sales representatives. Brendan Sullivan, PRO Group managing director, said, "While Distributors have used online markets in the past, the PRO initiative marks the first time a Hardware Buying Group has conducted a show online for its Distributors to support independent manufacturers." According to Sullivan the PRO Group Online Market Blitz is designed to help transition the industry into the future of technology and the use of trade show automation. "PRO Group continues to strive to develop programs that reduce cost, time, and add value within the Hardware Channel at both the Wholesale and Retail level," said Sullivan. The Market will feature new items, displays, pre-packs and special "road show-type" selling opportunities for PRO Group Distributors. Richard Snowden, vice president, sales & marketing, for the Morristown, Tennessee-based Wallace Hardware, is a fan of Online Markets, having contracted with InXpo to integrate online pre-ordering for the Wallace Hardware markets. Snowden said, "The Wallace buying staff plans to participate in the PRO Group Online Market Blitz this month," adding, "The Online Market Blitz offers Vendors the opportunity to boost sales and grow business with Distributors in a fairly short period of time without a lot of costs incurred. For us, this is another advantage of our membership with PRO Group." Snowden said. Greg Galen, sales manager/hardware wholesale for Fluidmaster, said 2007 marks Fluidmaster's 50th year in business. "In 1957, the dial phone was the quickest way to reach the customer," Galen said. "In 2007, with PRO Group's Online Market, our message is relayed across all time zones in seconds with a few clicks on the keyboard. Although technology for our plumbing-related product hasn't changed as significantly over the years as electronic communication, Fluidmaster recognizes the importance of PRO Group's new approach in reaching the customer."

2007 INTERNATIONAL HOME & HOUSEWARES SHOW REPORT
The International Home and Housewares Show recently took place in Chicago, with around 2,100 exhibitors of storage items, small appliances, kitchen equipment, cleaning products and more. This year's event features an international section of exhibitors from Hong Kong, Thailand, India, Brazil and several other countries and regions. The event also includes the "Clean, Contain and Outdoor Domain" exhibit and the "Wired and Well Expo" for the first time. Guest speakers and presenters at this year's event will include Colin Powell and celebrity chefs Rocco DiSpirito and Todd English. Celebrity endorsements and celebrity product lines were a hot trend at this year's show. (Source: Adapted from Home Channel News)

POWER AND HAND TOOL DEMAND CONTINUES TO RISE
Power and hand tool demand in the United States is projected to rise 3.1 percent annually through 2011, reaching $14.3 billion, according to a report by the Freedonia Group, the Cleveland-based research firm. Sales will be driven by product innovations, particularly in the development of higher-voltage lightweight cordless electric tools. Increases will also result from continued interest in DIY and hobby activities in the consumer market, especially among women. The development of new consumer-friendly battery-powered tools, such as wrenches and clamps, will spur gains as well. But a flat outlook in construction and manufacturing employment might also dampen growth. Professional users accounted for more than two-thirds of overall tool demand in 2006. Despite rising demand, production of power and hand tools in the United States will remain flat, as producers expand offshore production in lower-cost nations such as China, as reported by the Freedonia Group.

WEBER-STEPHEN RECALLS 14,000 GAS GRILLS
The U.S. Consumer Product Safety Commission, in cooperation with Weber-Stephen Products, has announced a voluntary recall of some models of the manufacturer's Weber Genesis 320 series gas grills. A gas hose attached to the side burner of the grill can crack or break off during shipping, causing it to leak while in use. Weber has received 49 reports of hose damage or gas leaks. No injuries have been reported. The grills were sold nationwide between November 2006 and February 2007 through Home Depot, Ace Hardware, True Value, Do it Best and other hardware and home improvement stores. Product models included in the recall carry a serial number beginning with the prefix "DI." Specific model numbers and consumer instructions for replacement parts and installation can be obtained by calling Weber's recall hotline at (866) 249-3237 or visiting www.weberrecall.com.

STANLEY PREDICTS 8% GROWTH
The Stanley Works, at a meeting with investors, said it expects fiscal 2007 total sales growth of approximately 8 percent over 2006. That would put sales at $4.34 billion, compared with $4.02 billion in 2006. The company also said it has long-term objectives of 8 to 12 percent annual sales growth and annual earnings per share growth in the mid-teens. Strategically, the company said it is less dependent on large U.S. retailers for sales than in previous years.

AHMA'S HARDLINES TECHNOLOGY FORUM® FINALIZES PROGRAM DETAILS
IBM and Microsoft Keynote; Retail Panel has International Flair
The American Hardware Manufacturers Association (AHMA) announced a full schedule of events for the 2007 AHMA Hardlines Technology Forum® (HTF®) to be held April 22 - 25 in Orlando, Florida. Highlights of the conference include two keynote presentations from IBM and Microsoft Corporation; a retail panel that includes top retailers from around the U.S.A., as well as one of New Zealand's largest retailers for the hardware/home improvement industry, the unique-to-HTF® Buyer/Seller Forum; and over 40 individual educational sessions covering a multitude of topics, including GTIN/GLN, Bar Coding, Data Syncronization, EC/EDI, RFID and CPFR. "This conference continues to be the premier technology conference for our industry, but its scope is reaching out further than ever before," said Timothy S. Farrell, AHMA's president and chief executive officer, "so we constantly challenge ourselves to bring to HTF® the newest and latest educational information, the most innovative solutions, and dynamic keynote presentations from industry giants. If you attend HTF® this year, you're going to hear from IBM, Microsoft, Wal-Mart, Lowe's, Do It Best, True Value, The Home Depot, and, for the first time, ITM, New Zealand's largest group of independent Timber, Hardware and Building Supplies." For more information on HTF®, visit www.ahma.org/htf.

HOUSING AFFORDABILITY IMPROVES
The composite index of housing affordability in the country surged 5.9 percent in January thanks to moderating housing prices and favorable interest rates, according to the most recent monthly report from the National Association of Realtors. The index improved to 116.1 in January from 109.6 in December. An index of 100 shows that a family earning the median income has enough income to qualify for a loan on a median priced home in the country. Regionally, the index stands at 104.6 in the Northeast, 155 in the Midwest, 126.5 in the South and 77.4 in the West. You can see the full report at: http://www.realtor.org/Research.nsf/Pages/HousingInx.

TREND PATROL: TEN HOT HOME FURNISHINGS LOOKS
Executives at the World Market Center home furnishings campus in Las Vegas reported on 10 trends dominating the recent Las Vegas Market Trade Show. These trends are a good barometer of customer demands that impact the home improvement industry as well.

• Wild Things
  Look for organic forms, wood grains, ceramics and shells, recycled materials, natural floral/botanical motifs. Minneapolis-based Trend Forecaster Michelle Lamb said, "We are seeing more wood products, lighting and decorative accessories made of found wood in its natural state."
• Give Me Shelter
  Four-posters, sleigh beds and padded headboards are all still top sellers, but bedroom furniture manufacturers are also finding new popularity in the embrace of the sheltering bed.
• Neutral Attitude
  Layering, tone-on-tone effects and accents of wood and metal create calming tones. Look for pale earth tones, vanillas and creams. Palm Springs, Calif.-based Designer, Dann Foley, said, "Today's neutral settings are set off with punches of color in rich woods and striking metals. Works of art are then used to make a color statement in a room."
• All That Glitters
  Metals create light touches of gold and silver, particularly in combination with black. Coppers and bronzes could be the next wave in this trend. Christine Chow, director of membership for the New York-based Color Association of the United States, said, "Today's metallics are not flashy, but aged or painted, brushed, hammered or woven in hues of brass, pewter and copper."
• The Kids Are All Right
  The juvenile market is all grown up. What's new here is the breadth of styles and designs, and the ability for customization. Styles run the gamut.
• Now THAT'S Entertainment
  With changing dimensions, shapes and depths, hot electronics need updated home theater pieces to showcase them properly. Watch for the latest plasmas, multi-function seating and ample storage.
• Modern Architecture
  Styles are as much art as furniture, floating tabletops (think Gehry rather than Gothic) metals, wood and glass.
• Playing the Scales
  Look for grand-scale beds and dining furniture, as well as cozy tables-for-two and sleeker condo-sized sofas.
• Cautious Carvings
  We've strayed away from carved case goods in recent years, but the look is coming back into play. Don't think of the over-embellished woods of the past, this look is sleeker and more subtle.
• Special Effects
  Watch for specialty bedding, or beds that are constructed with more than just the usual innerspring coils.

HOME DEPOT CEO BLAKE GRANTED 222,816 STOCK OPTIONS
Frank Blake, chairman and CEO of Home Depot, has been granted 222,816 stock options, according to a filing with the Securities and Exchange Commission. The options will vest when the closing stock price has been 25 percent greater than the exercise price for 30 consecutive trading days, but not within one year of the grant date. The exercise price for the options was not disclosed.

HOME DEPOT PROFITS FALL 28% IN FOURTH QUARTER
Home Depot reported that fourth-quarter earnings fell 28 percent to $925 million compared with net earnings of $1.3 billion in the fourth quarter a year ago. For the year, net earnings fell 1.3 percent to $5.76 billion compared with net earnings of $5.84 billion. Net sales for the quarter totaled $20.3 billion, a 4 percent increase from sales of $19.5 billion during the same period last year. Net sales for the year grew 11.3 percent to $90.8 billion from sales of $81.5 billion in fiscal 2005. Comparable-store sales fell 6.6 percent during the quarter, while total sales in the retail segment fell 2 percent. Total sales in the company's HD Supply wholesale business rose 66.4 percent to $2.9 billion. The company attributed the large gains to sales from acquired businesses. Retail sales for the year were $79 billion, a 2.6 percent increase, but comparable-sales for the year declined 2.8 percent. Fiscal 2006 sales at HD Supply were $12.1 billion, an increase of 161.6 percent above HD Supply's 2005 sales of $4.6 billion. "2006 was a challenging year for us," Frank Blake, Home Depot and chairman and CEO, said during a presentation broadcast over the Internet. "We felt the effects of the slowdown in the home improvement and housing industry."

HARSH WINTER LENGTHENS HOMEOWNERS' SPRING
On the heels of one of the most damaging winters in Denver, homeowners have more than enough projects on their spring fix-up lists. With nearly nine consecutive weeks of snow on the ground and the third snowiest December on record, home repair needs this spring are above and beyond typical spring-cleaning routines. According to Gary Gibson, head of the Denver-based national sales office for Done Right!™, the following is a top-10 "must repair" list, which mirrors the priorities (and recent requests) of local homeowners.

• Carpet cleaning
• Plumbing repairs
• General handyman
• Maids and cleaning services
• Painting
• Garage doors
• Remodeling jobs
• Chipped, cracked and weather-beaten driveways and sidewalks
• Damaged shingles and leaky roofs
• Lawns and gardens

LOWE'S PROFITS FALL 11.5 PERCENT
Lowe's reported that net earnings fell 11.5 percent to $613 million for the fourth quarter of 2006, compared to net earnings of $693 million in the fourth quarter a year ago. Net earnings for the year grew 12.3 percent to $3.1 billion from $2.8 billion in fiscal 2005. Fourth-quarter sales declined 3.7 percent to $10.4 billion for the 13-week period ended Feb. 2, 2007, versus the 14-week period ended Feb. 3, 2006, and sales of $10.8 billion. Fiscal 2006 sales increased 8.5 percent to $46.9 billion from sales of $43.2 billion a year ago. Comparable-store sales declined 5.3 percent during the quarter and were flat for the year.

WAL-MART STORES HAS RECORD FOURTH QUARTER
Wal-Mart Stores reported record fourth-quarter financial results, with sales up 11 percent to $98.1 billion from $88.4 billion last year. Earnings were up 8.8 percent to $3.94 billion from $3.59 billion last year. For the year, Wal-Mart sales rose 11.7 percent to $345 billion from $309 billion in 2005. Fiscal earnings grew 6.7 percent to $12.18 billion from $11.41 billion last year.

SEARS HOLDINGS PROFITS RISE 27 PERCENT
Sears Holdings reported that fourth-quarter profits were up 27 percent to $820 million from $648 million in the fourth quarter 2005. For the year, profits rose 76 percent to $1.5 billion from $858 million in fiscal 2005. The company also reported total fourth-quarter 2006 revenues of $16.2 billion, flat with revenues of $16.1 billion in the fourth quarter of 2005. However, the fourth quarter of 2006 was a 14-week period, and the fourth quarter of 2005 was a 13-week period. Full-year revenues were $53 billion, down 2.3 percent from fiscal 2005 revenues of $54.3 billion. Total domestic comp-store sales declined 3.1 percent for the quarter, while Sears comp-store sales fell 4.9 percent and Kmart comp-store sales were down 3.7 percent.

ACE HARDWARE SALES, EARNINGS UP FOR '06
Ace Hardware reported 2006 wholesale revenues of $3.77 billion, a 6.5 percent increase over 2005 and the co-op's largest gain since 1998. The Oak Brook, Illinois-based company also reported net earnings of $105.5 million for 2006, up 5.1 percent from net earnings of $100.4 million last year. Domestic revenues increased by 6.2 percent over 2005, driven primarily by new store openings and strong sales in the paint/cleaning supplies, plumbing and basic electrical categories.

NEW HOME SALES PLUMMET 16.6 PERCENT
Sales of new single-family homes in January fell 16.6 percent to a seasonally adjusted rate of 937,000 units from the December rate of 1.123 million units. The number is also down 20.1 percent from the January 2006 rate of 1.173 million units, according to figures released today by the U.S. Department of Commerce. David Seiders, chief economist for the National Association of Home Builders attributed the decline to the return of "normal" winter conditions in U.S. markets, the opposite of the effect of last year's mild winter, which lifted sales. The inventory of new homes for sale edged down in January to 536,000 units, the lowest since February 2006 and equivalent to a 6.8 month supply at the January sales pace. Regionally, new home sales declined 37.4 percent in the West, 18.7 percent in the Northeast, 9.7 percent in the South and 8.1 percent in the Midwest. The median price of new homes sold in January was $239,800, slightly higher than the month before but 2.1 percent below a year earlier.

JANUARY EXISTING HOME SALES RISE
Total existing home sales increased 3.0 percent in January to a seasonally adjusted annual rate of 6.46 million units, up from a 6.27 million pace in December. Compared to January 2006, however, sales were down 4.3 percent from the 6.75 million-unit level. Total housing inventory levels rose 2.9 percent at the end of January to 3.55 million existing homes available for sale, which represents a 6.6-month supply at the current sales pace - unchanged from the revised December level. Supplies peaked at 7.4 months in October. The National Association of Realtor's economists expect existing home sales to gradually increase this year, but also pointed to warm weather as a boost to sales in January. Regionally, existing-home sales in the West rose 5.6 percent to an annual pace of 1.32 million in January but were 9.6 percent lower than a year ago. The median price in the West was $321,300, down 4.6 percent from January 2006. In the Midwest, existing-home sales increased 4.8 percent in January to a level of 1.53 million, and were 0.6 percent lower than January 2006. The median price in the Midwest was $162,600, which is 3.5 percent below a year ago. Existing-home sales in the South rose 2.0 percent to an annual sales rate of 2.54 million in January, but were 7.3 percent below a year ago. The median price in the South was $174,600, which is 1.7 percent below January 2006.

UPCOMING DISTRIBUTOR SHOW DATES & EVENTS
 

Wallace Hardware Company, Inc.  Dealer Market 05/08/2007 - 05/10/2007  Gatlinburg Convention Center  Gatlinburg, TN  shirley.graybeal@wallacehardware.com

Group Merchandising Conference  06/11/2007 - 06/13/2007  Embassy Suites Hotel  Atlanta, GA  michele.simes@pro-group.com

Brendan Sullivan (click to enlarge)		PROfiles: BRENDAN SULLIVAN Brendan has been with FARM MART (www.farmmart.com), a PRO Group, Inc. division focusing on helping independent farm Distributors and Retailers compete profitably, as managing director since April 2005. Brendan is an award-winning management professional with 20 years of diverse experience in wholesaling and retailing, Brendan joined PRO Group from True Value Company, where he served as a regional manager-affiliate sales working with multi-store pro dealers and farm/ranch accounts in the Midwest Region. Brendan began his industry career with ServiStar soon after graduating from the Westfield, Massachusetts-based Westfield State College. Previous positions with TruServ, Cotter & Company and SERVISTAR/COAST TO COAST included regional merchandising & advertising manager, regional merchandise manager, retail consultant, sporting goods buyer, and Builders' Hardware buyer. Brendan's extensive, varied background benefits PRO Group, Distributor Members, Retailers and Vendor Partners. Having worked in distribution and retailing, Brendan has an innate understanding of the wholesale aspects, plus the impact for independent retailers.

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

--Warren G. Bennis