November 17, 2017
Ontario Introduces Tax Cuts For Small Business
In order to ease the transition to increasing the minimum wage, Ontario will slash small business taxes and offer millions in incentives. The province’s fall economic statement shows the corporate tax rate for small businesses will fall from 4.5 per cent to 3.5 per cent effective January 1, the same day the province will increase minimum wage from $11.60 to $14. As part of the $500 million package for small business, the province will designate that one-third of its procurement spending on goods and services will come from small- and medium-sized businesses by 2020. The government will spend $124 million over three years to help companies with fewer than 100 employees who hire youths aged 15 to 29. The government will pay incentives of $1,000 for each worker hired and another $1,000 for each worker retained for at least six months by a small business. However, critics say these incentives will not ease the transition to the wage hike for small businesses. Business groups have argued that needed offsets for business should have comes months ago. Plamen Petkov, vice-president of the Canadian Federation of Independent Business, says the government's planned tax cut and incentives still fall short. The minimum wage hike “will put a crushing burden on Ontario's small businesses and their ability to remain competitive in a global market. As important as the initiatives announced today are, they won't offset the real impact of this legislation on Ontario's jobs and the economy.”
KPMG Unveils Customer Engagement Framework
KPMG International has unveiled a customer engagement framework designed to help businesses understand the increasingly complex and multi-dimensional forces that influence decision-making and preferences of consumers. The inaugural ‘Me, My Life, My Wallet,’ is a global analysis of how the seismic influences of socio-political and economic shifts, accelerated mass adoption of new technologies, and mobility are upending fundamental beliefs around what drives consumer behaviour. With findings from a survey of 10,000 people across the U.S., UK, India, and China, the report incorporates human-centered design thinking for business model innovation. Based on what KPMG calls the Five Mys, Customer Wallet, and Generational Surfing, the framework goes deeper than just the analysis of data through a single lens. From Millennials to Baby Boomers, it aids in assessing the drivers of consumer decision-making by looking at the multiple factors that influence people's everyday lives. Together, the three dimensions of the model – behavioural, financial, and demographic ‒ help deliver a more comprehensive, 360-degree view of a consumer.
Simpson Strong-Tie Launches Blog
Simpson Strong-Tie has launched a blog for construction professionals. ‘The Building Strong’ blog is an industry resource that aims to provide insights and fresh perspectives to help construction professionals design and build safer, stronger structures as efficiently as possible. The company developed the blog to discuss issues of special interest or importance to building professionals and will cover topics from rising labour costs, proper installation methods, and new design technologies to unique viewpoints on the changing landscape of the building industry. “For more than 60 years, we’ve listened to our customers throughout our product development process – either through our sales teams or by answering customer-service questions – and now we can communicate with them in a new way through our blog,” says Shelby Lentz, director of communications.
ecobee Opens Toronto Headquarters
ecobee Inc. has opened a head office in Toronto, ON. The company, which was founded in Canada, is the manufacturer of the ecobee smart Wi-Fi thermostat. The 37,000-square-foot facility was designed by Ray Inc. to foster creativity and innovation for a rapidly growing workforce that doubled in the last year to almost 200 people. Last year, the company launched its ecoboee4 in the U.S., a smart thermostat that runs with Amazon Alexa.
Bruno Leads Derby
Ralph Bruno is chief executive of Derby Building Products Inc. (formerly Novik Inc.), the international manufacturer of the Tando and Novik brands of exterior cladding products. Previously, Bruno was national sales manager of Trex Company in the early ’90s before starting AZEK Building Products in 2000, where he served as president until 2009.
Newell Brands Sales Decline
Newell Brands Inc. had net sales of $3.7 billion in the third quarter of 2017, a decrease of seven per cent compared to net sales in the third quarter of 2016. Gross margin was 34.5 per cent for the quarter versus 32.2 per cent in the prior-year period. Operating income was $323 million, or 8.8 per cent of sales, compared to $324 million, or 8.2 per cent of sales a year ago. Net income was $234 million, compared to $187 million. The company had weak sales in appliances and cookware while the work segment had a sales increase of 1.6 per cent.
Taiga Has Sales Increase
Taiga Building Products Ltd. had sales of $396.6 million for the second quarter of 2017, an increase of 18 per cent over sales of $335.1 million in the second quarter of 2016. Gross margin dollars for the quarter increased to $37.8 million compared to $29.5 million in the same quarter last year. Gross margin percentage was 9.5 per cent compared to 8.8 per cent a year ago. Net earnings were $6 million, an increase from $3.1 million in the year-ago period. EBITDA was $16.2 million compared to $11.3 million.
November 16, 2017
Canada Will Challenge To Stop Duties
The Canadian government says it will challenge the North American Free Trade Agreement (NAFTA) in its bid to stop U.S. duties on Canadian softwood lumber. Canadian softwood lumber producers have already laid down about $500 million in countervailing and anti-dumping duties since the U.S. Department of Commerce ruled last spring that Canada was unfairly subsidizing its softwood industry and selling wood into the U.S. at unfairly low rates. The main issues stem from the fact that most Canadian softwood is on Crown land and producers pay stumpage fees, set by provincial governments, for the right to harvest the wood. The U.S. Lumber Coalition alleges these fees are deliberately set too low and represent an unfair subsidy to Canadian producers. Canada vigorously denies these claims and has won several NAFTA challenges over similar softwood issues in the past. The government says it will even go to the WTO, if necessary.
Home Sales Increase Modestly
National home sales had a modest monthly increase in October, but remain below levels recorded one year ago, says the Canadian Real Estate Association (CREA). Home sales edged up 0.9 per cent in October on the heels of monthly increases in August and September, but remained almost 11 per cent below the record set in March. Activity was up from the previous month in about half of all local markets, led by the Greater Toronto Area (GTA) in Ontario and the Fraser Valley in British Columbia, together with a number of housing markets in the Greater Golden Horseshoe region in Ontario. Actual (not seasonally adjusted) activity was down 4.3 per cent, extending year-over-year declines to seven consecutive months. Sales were down from year-ago levels in slightly more than half of all local markets, led overwhelmingly by the GTA and nearby cities. The number of newly-listed homes eased by 0.8 per cent following a jump of more than five per cent in September. With sales up slightly and new listings having eased, the national sales-to-new listings ratio rose to 56.7 per cent in October from 55.7 per cent in September.
Nationwide Retailers Receive Recognition
Alex Yakovyshenko, general manager of TIMBER MART member Haney Builders Supplies in Maple Ridge, BC, was presented with the ‘2017 Outstanding Retailer Award’ (ORA) for young retailer. He was recognized for his leadership skills and management ability shown at a young age. Lowe’s Barrie (ON) received the ORA for best large surface retailer and Ace Matériaux Armand Dumaresq (QC) received the ORA for best building supply/home centre under 15,000 square feet. RONA Penticton (BC) was awarded the ORA for contractor specialist. Gow’s Home Hardwater in Bridgewater, NS, was honoured with best hardware store ORA and Sayer Home Hardware in Hagersville, ON, received the ORA for Marc Robichaud community leader.
Amazon Marketing Services Available For Canadian Brands
Amazon has launched marketing services for Canadian brands, offering a suite of pay-per-click performance advertising products available via a self-service portal. Sponsored products, headline search, and product display ads help brands increase customers' discovery of their products on the site based on relevant keyword searches, products, and shopper interests. Brands can also now create their own Amazon Store – a free, customizable, multipage shopping experience that showcases the brand and a curated product selection. Amazon introduced display advertising on its Canadian site in 2015. Its offering also spans advertising on websites both within and outside of Canada.
USG Acquiring Ceilings Plus
USG Corporation plans to acquire Ceilings Plus, a U.S. manufacturer of specialty ceilings products. The company says the addition will expand its product portfolio, accelerate innovation, and enhance its presence in the high-growth specialty ceilings market. “This acquisition will increase our penetration into architectural specifications and enable cross-selling opportunities for USG’s existing tile and grid ceiling products,” says Jennifer Scanlon, president and CEO of USG. The transaction is expected to close by the end of 2017.
Maybury Appointed Technology Officer
Dr. Mark has been appointed to the newly-created position of chief technology officer with Stanley Black & Decker. Previously, he held a variety of strategic technology leadership roles during his 27 years at the MITRE Corporation.
Sales Rise For Hardwoods
Hardwoods Distribution Inc. had revenue of $257.3 million for the third quarter of 2017, an increase of 9.3 per cent over revenues of $235.4 million in the third quarter in 2016. Organic third-quarter revenue increased 3.4 per cent, year-over-year. For the quarter, gross profit grew by 8.5 per cent to $47.6 million while gross profit margin was 18.5 per cent compared to 18.6 per cent in the same period in the prior year. Profit of $7.3 million was in line with results from the year-ago period. Sales in Canada were $34.5 million compared to $32.9 in 2016, while sales in the U.S. for the quarter were $177.5 million versus $155.2 million.
Acquisitions Drive Intertape Revenue
Intertape Polymer Group Inc. had revenue of $243.4 million in the second quarter of 2017, an increase of 17.9 per cent compared to revenue in the second quarter of 2016. The increase was partially due to additional revenue from the Cantech and Powerband acquisitions. Gross margin decreased to 20.9 per cent from 21.7 per cent for the quarter. Net earnings were $19.2 million, an increase of $13 million over net earnings in the year-ago period. Adjusted EBITDA for the second quarter was $32.4 million, an increase of 15.9 per cent year over year. Earnings were also impacted by the acquisitions.
November 15, 2017
Sales Increase At Home Depot
The Home Depot had sales of $25 billion for the third quarter of 2017, an 8.1 per cent increase over net sales of $23.2 billion in the third quarter of 2016. Comparable store sales for the quarter were positive 7.9 per cent and comp sales for U.S. stores were positive 7.7 per cent. Net earnings were $2.2 billion, an increase of 10 per cent over net earnings of $2 billion in the same period a year ago. The company estimates that hurricane-related sales positively impacted comparable store sales growth by approximately $282 million in the quarter.
Contractor Prices Continue Increase
Contractors' prices for new non-residential building construction rose 0.6 per cent in the third quarter compared with the previous quarter, says Statistics Canada. Prices have increased across industrial, commercial, and institutional building structure types since the fourth quarter of 2015. Prices were up in all seven census metropolitan areas (CMA) surveyed. Prices rose the most in Vancouver, BC, and Montréal, QC, (both up one per cent). Contractors working in Vancouver reported a rise in the costs for architectural and structural building components due to higher material costs and a shortage of skilled labour. Contractors in all seven CMAs surveyed reported higher prices for lumber in the third quarter, coinciding with the forest fires in British Columbia. According to the ‘Industrial Product Price Index,’ prices for lumber and other sawmill products rose 4.1 per cent from June to September 2017. Since the beginning of 2017, the year-over-year price increases reported by contractors in these two CMAs have in part reflected higher prices for drywall and concrete. From January to September, the ‘Industrial Product Price Index’ recorded a 2.1 per cent price increase for ready-mixed concrete nationally.
Owl Merges With McIlveen
Owl Distribution has merged with McIlveen Lumber to create a national choice for retail lumber dealers across Canada. Combined, the company will have five distribution centres and two reload facilities to cover markets from Quebec through British Columbia for buying group members. The combined company will offer regional distinctions while presenting a national program consistency. Current staff will continue to provide a regional focus to build local business relationships. The transaction is expected to close by mid-November.
Regal ideas Receives Davey Award
Regal ideas Inc. was awarded the ‘Silver Davey Award’ for its integrated marketing and merchandising campaign called ‘Inspiring Homeowners.’ The campaign combined the company’s online and social presence with its in-store branding and turn-key merchandising solutions. The awards honour the best in web, design, marketing, and social media from companies around the world. Regal ideas’ marketing campaign was one of more than 4,000 entries in six categories that were considered. The company delved into social media platforms this year, which included a new website and video series.
Shoppers Value Time, Convenience For Holiday Shopping
Even with the rise of eCommerce, most consumers (54 per cent) prefer to shop in-store over any other methods (online, mobile, or social media), says JDA in its third annual ‘Consumer Survey.’ The survey shows consumers value their time, with 75 per cent favouring a quick and easy shopping experience where the merchandise is in-stock over being offered a personalized experience. JDA says that during the next two months of holiday shopping, retailers will find success by combining the convenience of unified commerce solutions that consumers demand with the right inventory visibility and well-trained staff to create a seamless holiday shopping experience at the store level. Convenience remains an integral part of customers’ shopping experience whether it’s to shop, pick-up, or return an item. Consumers have embraced fulfillment services like ‘Buy Online, Pickup In-Store’ and ‘Buy Online, Return In-Store’ which offer retailers even more opportunity by garnering more in-store foot traffic. JDA says offering incentives can encourage consumers to make more use of these services.
Stockfish Gets New Role
Devin Stockfish is senior vice-president, timberlands, with Weyerhaeuser, effective January 1. Previously, he was vice-president of Weyerhaeuser's western timberlands business. He joined the company in 2013. He will replace Rhonda Hunter, who will retire after 30 years with the company.
Storms Impact Boise Cascade Earnings
Boise Cascade Company had net income of $31.7 million for the third quarter of 2017, an increase of 217 per cent compared to net income of $10 million in the third quarter of 2016. Net sales for the quarter were $1.2 billion, a 15 per cent increase over net sales of $1.1 billion a year ago. Adjusted EBITDA was $75.8 million, up 40 per cent over adjusted EBITDA of $50.8 million. Wood product sales were up eight per cent and income was up 108 per cent; building materials distribution sales were up 18 per cent; and income was up 40 per cent. Wood price increases and increased demand for wood from catastrophic storms in the U.S. impacted sales and income.
Ply Gem Sales Increase
Ply Gem Holdings, Inc. had total net sales of $564.7 million for the third quarter of 2017, an increase of 6.5 per cent over net sales of $530.4 million in the third quarter of 2016. Net income for the quarter was $27.5 million, a decrease of $27.2 million year over year. Operating earnings decreased $6.1 million to $61.9 million. Adjusted EBITDA was $77.1 million in the third quarter, a decrease from adjusted EBITDA of $82.5 million in the year-ago period. Gross profit margin was 23.4 per cent, a decrease of 240 basis points compared to last year. Net sales in the siding, fencing, and stone segment increased 7.4 per cent year over year and net sales in the windows and doors segment increased 5.5 per cent.
November 14, 2017
Retailers Seek Ways To Stay Relevant
Only five per cent of traditional retailers believe their customers are loyal and are searching for innovative approaches to stay relevant against the threat of new competitors, says an EY survey. ‘How can retailers afford the rising price of loyalty?’ finds that new consumer standards for price and convenience are placing pressure on Canadian retailers to disrupt in order to remain competitive ahead of the busy holiday season and beyond. Ted Salter, EY Canada consumer products and retail leader, says, "Digital outlets are empowering consumers more than ever. They're expanding into new channels and setting new consumer standards for convenience, value, and experience – proving hard to match profitably and straining customer relationships with physical stores." Almost all (87 per cent) retailers believe a loyalty strategy is a critical priority with just 16 per cent saying that their traditional approach is fit for purpose. And they know that getting it wrong can be expensive; 80 per cent say a ‘one size fits all’ loyalty approach damages profitability. "Retailers need to create loyalty that sticks," says Salter. "Leveraging customer data is key to building a personalized, convenience-based approach to capture and retain customers. But research shows that too few companies are tapping into the insights available."
Dodge Momentum Index Recovers In October
The Dodge Momentum Index rose in October, climbing 13.2 per cent to 130.9 from the revised September reading of 115.6. The index is a monthly measure of the first (or initial) report for non-residential building projects in planning in the U.S., which have been shown to lead construction spending for non-residential buildings by a full year. The move higher in October nearly reversed the erosion of the past four months (including September’s 7.9 per cent decline), with October posting healthy gains in both sectors. From September to October the commercial portion of the index advanced 16.8 per cent, while the institutional portion grew 8.3 per cent. On a year-over-year basis, the index is now 6.1 per cent higher, with the commercial portion up 5.5 per cent and the institutional portion up 6.9 per cent. October’s increase supports the belief that building activity has further room to grow during this cycle. While month-to-month activity could continue to be volatile, there are enough projects in the pipeline to sustain growth into 2018.
CFIB Partners With Northbridge Insurance
The Canadian Federation of Independent Business (CFIB) has partnered with Northbridge Insurance as its exclusive commercial insurance partner for its members. Through the partnership, CFIB members have access to a small business insurance solution that includes comprehensive property and liability coverage, plus cyber risk protection. Members also receive legal expense insurance, covering up to $100,000 in legal costs, underwritten by DAS Canada. In addition, CFIB members get unlimited telephone access to Legal Assist services, which provides general legal advice for business questions ranging from product ideas to contract legalese and employment issues.
Tall Cabinets To Lead Kitchen Cabinet Demand
Kitchen cabinet demand is forecast to grow 5.9 per cent per year to $17.1 billion in 2021, says a report by the Freedonia Group. Tall kitchen cabinets will be the fastest growing as design trends and consumer preferences increasingly favour these products. Both base and wall kitchen cabinets will post strong gains going forward, with base cabinets continuing to account for the majority of kitchen cabinet demand. Tall kitchen cabinets are projected to reach a value of $3.2 billion in 2021 on annual advances of 7.7 per cent. Base cabinets are expected to see 5.2 per cent annual growth through 2021. Base cabinet demand will benefit from the continuing trend of larger kitchens. A recent uptick in the popularity of outdoor kitchens with base cabinets will also drive growth.
Wood Flooring Slows Armstrong Sales
Armstrong Flooring, Inc. had net sales of $308.5 million for the third quarter of 2017, a decrease of 1.6 per cent compared to net sales of $313.4 million in the third quarter of 2016. It says the decrease was primarily a result of a decline in net sales in the wood flooring segment. The company had a net loss of $18.7 million in the quarter, compared to net income of $9.3 million a year ago. Adjusted EBITDA was $25.5 million, a 21.4 per cent decrease over adjusted EBITDA of $32.4 million in the year-ago period. The resilient flooring segment had a 2.2 per cent increase in net sales for the quarter, while wood flooring segment sales decreased by 7.4 per cent.
Foundation Has Double Digit Sales Increase
Foundation Building Materials, Inc. had consolidated net sales of $535.4 million for the third quarter of 2017, a 28.8 per cent increase over consolidated net sales of $415.6 million in the third quarter of 2016. Base business net sales decreased 1.2 per cent year over year. Gross profit for the quarter was $154.8 million, a 37 per cent increase compared to gross profit of $113 million a year ago. Gross margin was 28.9 per cent compared to 27.2 per cent. Net income was $1.3 million compared to a net loss of $15.3 million a year ago. Adjusted EBITDA was $40.3 million. The specialty building products segment net sales increased 23.7 per cent.
November 13, 2017
Entrepreneurs Eager To Build Business
Forty-four per cent of Canadian entrepreneurs with 20 employees or more expect to acquire another company in the coming five years, says a study by BDC. ‘What do buyers look for when purchasing a business?’ shows most buyers want to buy a profitable and stable business (61 per cent) or a profitable and growing company (31 per cent), with only eight per cent looking for an unprofitable or declining firm to buy with the expectation of turning it around. The top-cited motivation of buyers is horizontal integration (acquiring a competitor), mentioned by 36 per cent of companies, followed by expanding geographic presence (27 per cent). BDC advises businesses to carefully search for the optimal acquisition target thorough due diligence while staying disciplined about how much they pay. It says to look for financing that maximizes repayment flexibility and to get outside advice if needed.
Walmart Loses Watermelon Display Case
An Alabama man has won a $7.5 million verdict in his lawsuit against the retailer after he claimed he tripped and broke his hip while buying a watermelon at a Walmart store. He says his foot became trapped in a pallet beneath the watermelons as he reached for one. Walker’s attorneys said that Walmart should have covered the pallet so it couldn’t entangle a shopper’s foot. In a court filing, the company said the display wasn’t dangerous and it believes the damages were excessive. It plans to appeal.
American Express Launches Virtual Payment
American Express Canada has launched its vPayment, a digital payment solution that replaces plastic cards with virtual account numbers, allowing businesses to pay and reconcile a wide range of corporate expenses. The solution offers the convenience of traditional card payments with added transaction level controls, improved reconciliation, and lower fraud risk. It assigns a specific-use account number to each transaction and users are able to set a payment amount, date range, and other transaction details. During expense reconciliation, a transaction is matched to its associated virtual account number. The system is suited for procurement and accounts payable departments within organizations looking to streamline payment processes. The virtual account numbers can be processed using the same point-of-sale equipment as traditional credit cards, so there is no additional technology required for suppliers already accepting American Express.
Consumers Warned To Beware Of Warranty Limitations
The Competition Bureau has issued a warning to consumers to ask questions about warranties when purchasing appliances. It says certain warranties may come with restrictive clauses that may end up costing them more than anticipated. Some warranties only cover parts or repairs to varying degrees. Some may even require that owners do business with an ‘authorized’ or ‘accredited’ supplier, which is often more expensive than a local repair shop. By not following instructions or recommendations, they risk voiding the warranty completely. The bureau suggests asking questions of the retailer or manufacturer about the warranty before making the purchase. As well, if they are misled by indications on the warranty, they should file a complaint with the Competition Bureau.
LAMCO Products To Use Fire Retardant Technology
LAMCO Forest Products Inc. of St. Felicien, QC, has entered into an agreement with UK-based Intelligent Wood Systems Ltd. (IWS) to bring the IWS-FAST holistic Fire Mitigation system to North America. The company intends to use the IWS technology with its black spruce engineered-wood products (EWPs) to provide passive fire safety. “This technology penetrates our products (LAMCO LFL and LAMFLOOR) creating a self-extinguishing passive fire resistance adding moisture resistance,” says Andres Dingman, vice-president of sales with LAMCO.
Maheu Joins LATICRETE
Spencer Maheu is North America director, product management, with LATICRETE. Previously, he led the product management, marketing, and business development teams at Osborn International, a division of Jason Industries. He has also led product development teams at Stanley Black & Decker.
Snap-on Has Rise In Sales
Snap-on Incorporated had net sales of $903.8 million for the third quarter of 2017, an increase of 8.4 per cent over net sales in the third quarter of 2016. Consolidated operating earnings were $209.1 million, or 21.3 per cent of revenues for the quarter, compared to consolidated operating earnings of $208.2 million, or 23 per cent of revenues, for the year-ago period. Net earnings were $133.4 million compared to net earnings of $131.7 million a year ago. The tools group segment sales were $392.7 million, a 1.1 per cent decrease.
Masonite Sales Climb
Masonite International Corporation had net sales of $518 million for the third quarter of 2017, a six per cent increase over net sales of $490 million in the third quarter of 2016. Net income was $29 million for the quarter, a decrease compared to net income of $32 million. North American residential net sales were $364 million, an eight per cent increase year over year.