Each month we will bring you news from global hardware groups. This month we have news from New Zealand, EDRA/GHIN, France, Germany and Italy to name a few.
EDRA/GHIN Launches ‘rediscovering your home’ manifesto
EDRA/GHIN has launched a manifesto entitled ‘Rediscovering Your Home in a Pandemic.’ The Manifesto highlights the importance of the home for everyone and the key role the home improvement industry plays in supporting people in creating, improving and, most of all, enjoying their homes. EDRA/GHIN General Secretary John Herbert said, “The role of the home has been redefined by the lockdown; one came to realise just how important our homes are.” He went on to say, “Our DIY retailers are dedicated to supporting people in their home improvement endeavours.” The full Manifesto can be read here.
New Zealand: Bunnings shut down sever stores
The Australian home improvement chain Bunnings is to close seven stores in New Zealand, according to various media sources in the country. It is reported that a warehouse, two trade centres and four smaller stores will close at the end of June with the loss of 145 jobs. The closures have been prompted by the tough trading conditions due to the Covid-19 pandemic. Three smaller Bunnings outlets had already closed in December 2019.
UK: Homebase tests new format
The British home improvement retailer has opened two stores under the new Decorate by Homebase brand in Sutton in the South of London and in Cheadle in the greater Manchester area. These smaller format high-street stores are located in former Bathstore shops and provide, according to the retailer, everything customers need under one roof for decorating projects – from the initial planning stages, to the final finishing touches. Damian McGloughlin, CEO of Homebase, said: “We’re always thinking about new store experiences for our customers, to deliver on our vision to make Homebase the go-to place for the inspiration, expertise and products customers need to take their projects from start to finish. We’re extremely excited about this concept. This launch was initially in our plans for March, though we chose to delay opening to ensure we could open our doors safely for customers and our team. We are launching Decorate by Homebase on a trial basis at this stage, but we see potential to roll this out across more high streets in future.”
US Half consider home improvement projects
Having now been sequestered at home for several weeks, about half of U.S. consumers (49%) say they’ve considered starting a home improvement project, according to research conducted by J.D. Power on 2-3 April of this year. Of those, 61% say they plan to do the project themselves. The top projects on the wish list include painting (15%), lawn and landscape projects (14%) and starting a garden (12%).
Retail sales show a record increase in May
U.S. retail sales in May rose by 17.7% from April. The increase is the highest on record and double analysts’ expectations. It reverses April’s decline, which was revised to 14.7%. Gains were seen across categories. Nevertheless, sales remained 6.1% below their May 2019 level.
Italy: Cangianiello Group launch regional chain Bricoware
In Italy, a small new DIY chain has been launched under the Bricoware brand. Behind this is the Cangianiello Group, which started out as an online retailer but now has three bricks-and-mortar stores and was hitherto a member of the Bricofer cooperative. The news was reported by the Italian industry service “10 minutes DIY and Garden”. The three existing stores close to Naples are being rebadged and are expected to reopen on 20 June. They have retail areas of 5,500sqm, 1,200sqm and 1,600sqm.
Chile: Concosud achieves small q1 sales rise
The Chilean trade company Cencosud increased its sales in the field of home improvement in the first quarter by 0.6% compared to the same period last year. It has reported the sales volume to be CLP 286.668 bn (EUR 320m). In local currencies, sales would have grown by 13.9%. This discrepancy is primarily due to inflation in Argentina where Cencosud made sales of CLP 118.596 bn (EUR 132m). In Argentinian pesos, that was 30.0% more than in the same quarter of the previous year, however, when converted to Chilean pesos, results in a minus of 2.3%. On the Chilean home market, Cencosud made sales with its home improvement division of CLP 149.532 bn (EUR 167m) and thus an increase of 2.4%. In Colombia, sales grew by 6.2% to CLP 18.540 bn (EUR 21m), however dropped by 1.9% after adjusting for currency effects. Cencosud’s DIY sales channels are Easy and Blaisten. Since the fourth quarter of 2019, the e-commerce share in Cencosud’s DIY business has risen from 3.3% to 4.5%.
France: DIY Sales drop 61% in April
The French spent April entirely subject to the lockdown conditions on account of the Covid-19 pandemic. As a result, the figures from the home improvement sector were worse than in March, the first half of which was not impacted. Sales in the sector plummeted by 61.5% in April compared with those in April 2019. The downturn in March was 49.2%, according to the Banque de France. A drop in sales of 29% occurred between January and April 2020, according to these figures published by the French industry association FMB. “The majority of DIY stores were chiefly functioning on the basis of drive-ins and click & collect during the 55 days of the lockdown. Stores were only able to reopen from 11 May onwards and gradually resume their operations to counter the deficit,” said FMB president Mathieu Pivain, commenting on the situation.
Canada: Lowe’s Canada’s new DC will be biggest in Western Canada
Lowe’s Canada has unveiled plans to open a giant distribution centre in the greater Calgary area. The facility, which will be 1.23 million sqft in size, is expected to open in the autumn of 2021 and will represent a total joint investment of more than $120m. The DC will become part of a network supplying more than 470 corporate and affiliated stores under Lowe’s Canada’s different banners. The Lowe’s facility will reportedly be the largest leased DC in Western Canada. Construction is slated to begin this month.
Germany: Support for Spoga+Gafa 2020 Encouraging
“We are working together with the garden sector to prepare ourselves for a new normal in daily life. We are underscoring this shared conviction under the hashtag #gardenbackstronger,” Koelnmesse says. The management of Koelnmesse has issued a further statement to exhibitors and visitors to the Spoga+Gafa show. In the statement, business division director Catja Caspary and Stefan Lohrberg, director of Spoga+Gafa, confirm: “As delighted as we are that most of the comments we’ve been getting from exhibitors and visitors have been confirmatory, we take their concerns very seriously, especially the uncertainty felt by our partners from overseas.” The feedback has encouraged the trade show management team to make the decision to let Spoga+Gafa go ahead on 6-8 September 2020 in Cologne.
Germany: Hornbach reports 18% sales rise
The German DIY store chain Hornbach has reported a rapid increase in sales by its DIY stores and almost doubled earnings due to the coronavirus crisis. According to initial preliminary results, sales in the first quarter (1 March to 31 May 2020) have grown by 18.4% to EUR 1.492 bn. The operating earnings adjusted for non-operating impacts on earnings (adjusted EBIT) increased by around 90% to around EUR 160m. The reason for the significant improvement in earnings is essentially the strong sales growth at home and abroad, reports the company. They state that in the course of the coronavirus crisis, customer demand in the stationary and online business has risen significantly since mid-March – also benefited by the pleasant spring weather in 2020. The largest sales growths were achieved in May 2020 with plus 36% (March 2020: minus 2%; April 2020: plus 17%), after all of the initially up to 64 Hornbach stores. which were affected by official sales restrictions, were reopened.
BHB supports use of the Corona warning app
The federal government’s Corona warning app has recently become available, with the aim of reducing the spread of the virus. The German DIY Industry Association BHB advocates installing the app on behalf of the hardware store branch and thus joins the HDE, which also recommends using it. “We see – and here we are in complete harmony with the German Trade Association (HDE) – the Corona warning app as an important step in increasing safety in our daily dealings with each other,” said BHB general manager Dr. Peter Wüst. The possibility of being able to identify the formation of possible infection chains and their triggers by means of modern tracing technology closes an important gap in the fight against the virus.
Denmark: Bygma Group reports 8% growth
The Danish Bygma Group’s sales grew by 6.2% to DKK 8.3899 bn (EUR 1.1255 bn) in 2019. Bygma A/S increased its sales by 8.1% to DKK 6.0837 bn (EUR 816.1m). CEO Peter Christiansen expects to see a possible slowdown in the market in 2020 and 2021.
Spain: DIY retailers see big turnaround
Sales in the Spanish DIY and hardware trade were down by “only” 2.96% in May as compared with May 2019. In a press release, the AECOC retail association stresses the “only”, because in April the downturn came to 75.4% and in the first quarter it was 9.3%. Most businesses in Spain were closed for weeks due to the coronavirus pandemic. On reopening, which occurred at different times in different regions, the big-box home improvement stores made up the most ground, with sales in May trailing those of the same period in the previous year by just 0.6%. In April, they were impacted more heavily than traditional hardware shops, seeing a drop in sales of 81.4% as compared with a 49.6% downturn for the latter. The fall in sales in May was 3.3%.
Phillippines: AllHome’s 42% sales rise in Q1
Philippine home improvement retailer AllHome’s first-quarter income rose by 30.4% despite the closure of top-selling stores in the last two weeks of the period. The company disclosed a net profit of PHP 270.2m (EUR 4.8m, USD 5.4m) for January to March 2020, from PHP 207.1m in the same period last year. Sales rose by 41.6% to PHP 3.36 bn from PHP 2.38 bn. A 24.3% rise in same-store sales, though weaker than the 32.5% growth posted in the first quarter last year, and revenues generated by 22 branches opened between April and December 2019 provided support. There were no new locations opened in the first quarter of 2020. AllHome closed all stores on the country’s largest island of Luzon from 17 March to 15 May following the imposition of one of the world’s toughest and longest Covid-19 lockdowns. Pre-lockdown, they accounted for 84.3% of AllHome’s 2020 revenues.