January 10, 2019
Housing Starts Vary Nationwide
The trend in housing starts was 206,981 units in December, compared to 212,338 units in November, says the Canada Mortgage and Housing Corporation (CMHC). This trend measure is a six-month moving average of the monthly seasonally adjusted annual rates (SAAR) of housing starts. Housing starts in the Vancouver, BC, census metropolitan area (CMA) continued trending lower in December, ending the year with an 11 per cent decrease compared to December 2017 despite that rental units rose by 40 per cent in response to a tight rental market. Edmonton, AB, starts also trended lower at 12 per cent below the same period a year ago, driven by the current economic climate in Alberta. The Toronto, ON, CMA saw the most apartment starts ever recorded and overall housing starts were up six per cent from a year ago. Housing starts in the Montreal, QC, area increased slightly (one per cent)compared to last year. The decline recorded in the construction of condos (six per cent) during this period was more than offset by rental apartment starts which grew eight per cent), hitting a 30-year record high. Housing starts for the province of Quebec were flat compared to 2017. Starts in Halifax, NS, picked up (six per cent) due to a rise in apartment construct while starts in Prince Edward Island were 156 per cent higher in December compared to a year ago. This growth was dominated by multiples which grew 347 per cent).
RONA Gets Manitoba Affiliated Dealer
A Teulon, MB, store has joined the Lowe’s Canada RONA affiliated dealer network. RONA Rockwood was acquired in December by Marc and Lori Palsson, who also own the RONA dealer store in Gimli, MB. They will completely remerchandise and reconfigure the store to provide an expanded offering. “We wanted to bring the Canadian how-to expertise we developed in our Gimli location to more customers in the Interlake region,” says Marc Palsson. “The Teulon location was ideal, already providing stellar customer service with a complementary offering, and optimally located to facilitate transfers of equipment and resources between the stores.” The 10,000-square-foot store features a 130,000-square-foot adjacent lumberyard. The conversion of the store to the RONA banner will bring new product categories such as seasonal and home decor, as well as a wider product assortment in current categories such as power tools, including the introduction of a selection of CRAFTSMAN products. The store will remain open during the transition with a grand opening ceremony planned for the spring.
Consumers Want Simple And Practical Smart Features
When it comes to smart homes, consumers crave smart features that are easy to understand and are a practical and efficient addition to their everyday household tasks, says a survey by Whirlpool Corporation. The vast majority (72 per cent) of consumers are looking for simpler, faster ways to help manage their lives and over half admit to feeling that cooking (52 per cent) and doing laundry (58 per cent) take up more than the preferred amount of time. Consumers are also immensely interested in smart appliances that manage water usage and help them save money. Seventy-four per cent are interested in features that reduce food waste and 78 per cent want smart appliances that save them money. Two in three respondents actively seek out products that can be personalized to their unique preferences.
WD-40 Sales Up Four Per Cent
WD-40 Company had total net sales of $101.3 million for the first quarter of its fiscal 2019 year. This is an increase of four per cent compared to the first quarter of the 2018 year. On a constant currency basis, total net sales for the quarter were $102.4 million, an increase of five per cent compared to the prior year quarter. Net sales for the Americas segment increased four per cent. Net income was $13.3 million, an increase of five per cent year-over-year. Gross margin percentage was 55.1 per cent compared to 55.5 per cent.
Swank Becoming COO
C. Eric Swank is chief operating officer of Beacon Roofing Supply, Inc. He was previously chief commercial officer. As COO, Swank will lead Beacon’s $6 billion roofing and exterior products business, in addition to having company-wide responsibility for sales, marketing, and supply chain. He joined the company 15 years ago.
January 9, 2019
Fraudulent Returns Hurting Economy
Of the $369 billion value of returned merchandise in the U.S. in 2018, $18 billion to $24 billion were fraudulent returns, says a report on organized retail crime by Appriss Retail. The costs do not include the overhead a retailer incurs when receiving, sorting, and repackaging useable goods for resale. The report finds that 38 per cent of retailers have had an increase in online purchases returned to bricks-and-mortar stores. In 2018, return fraud and abuse cost American workers between 607,400 and 789,600 jobs. In addition, return fraud and abuse cost states between $1.1 billion and $1.5 billion in lost sales tax. The report shows that for every $100 in returns, retailers lose $5 to return fraud throughout the year. At the holidays, that amount is estimated to increase to $6.50.
G. D’Aoust & Cia Awarded IHA gia
Sainte-Anne-de-Bellevue, QC-based housewares retailer G. D'Aoust & Cie was awarded the International Housewares Association (IHA) and International Home + Housewares Association’s ‘Global Innovation Award’ (gia) for Canada. G. D’Aoust & Cie is a 117-year-old store that says it is “always on the lookout for the latest trends” in decor and fashion. The store is 20,000 square feet and offers clothing, decoration items, kitchen tools, gourmet products, and high-end furniture. The gia program was created by the IHA and International Home + Housewares Show to foster innovation and excellence in home and housewares retailing throughout the world. Since the launch of gia in 2000, there have been more than 430 gia retail award winners, from 47 countries on six continents.
Consumers Will Rediscover Low-Tech Solutions
Home trends will see a return to tried and true household tools in 2019, as smart appliances, internet of things (IoT), and apps face competition from low-tech solutions, says home and lifestyle expert Vicky Sanderson. She says consumers have technology fatigue. “They realize it's had some negative effect on overall well-being, and they want a less harried lifestyle.” In the home, the movement will be reflected in a renewed enthusiasm for everything from mortars and pestles to hand-operated food processors and coffee grinders. Because simplifying life can also take the form of off-loading household tasks, handyperson services will continue to grow. As well, increased appetite for hand-made home goods will drive décor trends and revitalize boutique retail spaces, and mass merchants will strive to offer more local or regional craft, textile, and tabletop items, says Sanderson. The technology that will flourish will be products that make home tech easier to use, such as switches that turn ‘dumb’ appliances and fixtures into smart versions and those that support health and safety.
PFB Corp. Launches Website
Insulating building products manufacturer PFB Corporation has launched a revamped website. The site, which comes on the heels of the company’s 50th anniversary, has been designed to be full responsive with an interactive experience. It provides simple options, easy-to-identify buttons, and up-to-the-minute stock information.
Rodier Leads Guillevin
Luc Rodier is president and chief executive officer at Guillevin International. Previously, he was chief operating officer. He joined Guillevin in 2017, after 11 years with RONA.
January 8, 2019
GTA Home Sales Drop
There were a total of 77,426 residential transactions in the Greater Toronto, ON, Area in 2018, says the Toronto Real Estate Board (TREB). This is a 16.1 per cent decline compared to 92,263 sales in 2017. Total new listings entered into TREB's MLS System were down by 12.7 per cent over the same period to 155,823. Higher borrowing costs coupled with the new mortgage stress test certainly prompted some households to temporarily move to the sidelines to reassess their housing options. However, market conditions were improved in the second half of the year, both from a sales and pricing standpoint, says TREB. After spiking in 2017, new listings receded markedly in 2018. In many neighbourhoods, despite fewer sales from a historic perspective, some buyers still struggled to find a home meeting their needs. The result was a resumption of a moderate year-over-year pace of home price growth in the second half of the year.
Lowe’s Companies To Fill More Than 65,000 Jobs In 2019
Lowe’s Companies, Inc. plans to hire more than 65,000 associates this year to improve customer service and product availability at its U.S. stores. Supporting its recently announced growth strategy, these hiring investments include more than 50,000 seasonal positions, nearly 10,000 permanent associates as part of a merchandising service team focused on best-in-class inventory management, and more than 2,000 technology roles including software engineers, data scientists, and other digital positions to build and enhance core technology capabilities and deliver on the retailer’s omnichannel strategy. As part of this strategic effort, the company has reduced some in-store support functions to simplify operations, including discontinuing the project specialist interiors program. The company will continue to provide interior installations, such as cabinets, countertops, and flooring, as well as its project specialist exteriors program to support customers in exterior projects such as roofing, siding, fencing, and windows.
U.S. Holiday Retail Sales Grew 5.1 Per Cent
Holiday sales in the U.S. increased 5.1 per cent to more than $850 billion, the strongest growth in the last six years, says Mastercard’s ‘SpendingPulse.’ Online shopping also saw large gains of 19.1 per cent compared to 2017. Home improvement spending continued to surge across the U.S. with spending during the holiday season up nine per cent year-over-year. This trend started before the holiday season and helped the sector power through to a strong finish. Department stores finished the season with a 1.3 per cent decline from 2017. This follows two years with growth below two per cent, some of which can be attributed to store closings. However, the online sales growth for department stores indicated a more positive story, with growth of 10.2 per cent.
Marvin Companies Acquires SIW Windows & Doors
The Marvin Companies has acquired the assets of SIW Windows & Doors and formed a new business venture, SIW Solutions. In partnership with current SIW Windows & Doors ownership, the Marvin Companies is now the majority owner of the new SIW Solutions. Headquartered in Florida, SIW is a manufacturer of impact-resistant windows and doors serving the high-end residential and commercial construction markets. It will form a separate business unit within the Marvin Companies.
Whirlpool Makes Smart Home Voice Commands Smarter
Whirlpool Corporation has made upgrades to its Google Assistant and Amazon Alexa voice capabilities that include simplified command structures and multi-language functionality for regions around the world. Through the upgrades, specific brand names are no longer needed when requesting the Google Assistant or Amazon Alexa complete an action. Consumers will be able to say simply, "Hey Google, preheat the oven to 350 degrees," or "Alexa, set the oven timer to five minutes." In addition, actions for the Google Assistant will be available in multiple languages for owners of select Whirlpool connected appliances in more than 20 countries across the globe.
Bryant Succeeds Gingrich At Home Hardware
Scott Bryant is vice-president, human resources, with Home Hardware Stores Limited. He has been with Home Hardware for almost two decades, most recently in the role of senior director, human resources. He succeeds Stew Gingrich, who retired after 46 years of service.
January 7, 2019
Retail Sales Headed For Low Point
Retail sales were still slowing 10 months into 2018, with gains at just 2.4 per cent year-over-year for the third quarter, says Ed Strapagiel, a retail consultant. “At this pace, annual retail sales growth in 2018 is bound to end up as a recent low point, at less than half the 7.1 per cent gain recorded for 2017. There doesn't appear to be anything on the horizon to indicate that things are going to improve soon, although recently rising gasoline prices may provide some false optimism.” Strapagiel says volatile gas prices have tended to distort the retail sales picture in recent years. If gasoline station sales are excluded, 2018 year-to-date retail sales growth would be just 2.3 per cent. Overall, eCommerce represented about 2.8 per cent of total Canadian retail sales for the 12 months ending October 2018. Canadian eCommerce sales were up 16.9 per cent year-over-year for the third quarter, but this is less than the 26.5 per cent gain recorded in the same period a year ago. eCommerce retail sales gains are still in double digits, and are still much higher than for location-based retail, but growth is slowing down.
Vancouver Home Sales Lowest Since 2000
There were 24,619 home sales in Greater Vancouver, BC, in 2018, says the Real Estate Board of Greater Vancouver (REBGV). This is a decrease of 31.6 per cent form 35,993 home sales in 2017 and a 38.4 per cent decrease compared to the 39,943 residential sales in 2016. It says last year’s sales total was 25 per cent below the region’s 10-year sales average. It says high home prices, rising interest rates, and new mortgage requirements and taxes have all contributed to the 2018 market conditions. Home listings in Metro Vancouver reached 53,614 in 2018, up 1.9 per cent compared to 54,655 homes listed in 2017 and a 6.9 per cent decrease compared to the 57,596 homes listed in 2016.
Griffith Building Supply Joins BMR
Griffith Building Supply has joined BMR Group as a Pro dealer. Owners Derek McGrimmon and John Lacourse say they turned to BMR to give the renovation centre new life. The store’s facade and interior layout will be completely redesigned and turn the 1,500-square-foot store into a 3,500-square-foot store. The expansion, which is already underway, will provide more storage space so that the store can offer a wider range of construction materials. The BMR Pro banner is an iteration of the traditional BMR banner, developed to meet the needs of construction and renovation professionals, as well as seasoned do-it-yourselfers.
Windsor Named President
Frank Windsor is president of Rinnai America Corporation. He joined the company as general manager in 2014 and was promoted to chief operating officer in 2016. Prior to joining the company, he spent 23 years with Kohler Company in various leadership position.
Sales Climb For RPM
RPM International Inc. had sales of $1.36 billion for the second quarter of it fiscal 2019 year. This is a 3.6 per cent increase over sales of $1.32 billion in the second quarter of the 2018 year. Fiscal 2019 second-quarter net income was $49.2 million for the quarter, an increase over net income of $95.5 million in the year-ago period. Income before income taxes (IBT) was $66.6 million compared to $109.2 million. Consolidated earnings before interest and taxes (EBIT) were $96.8 million compared to $131.8 million reported in the year-ago period. The consumer segment generated a 4.1 per cent increase in sales to $432.6 million from $415.4 million in the year-ago quarter. EBIT for the segment was $41.3 million compared to $45.2 million. The company recently launched its ‘MAP to Growth’ operating improvement plan, which is focused on driving greater efficiency and long-term profitability of the business to enhance shareholder value.
January 4, 2019
Manufacturers Experience Renewed Slowdown
Canadian manufacturers experienced a renewed slowdown in growth at the end of 2018, with both production volumes and incoming new work expanding at softer rates than in November. The pace of manufacturing job creation also moderated in December, partly reflecting a drop in business optimism to its weakest since February 2016. At 53.6 in December, down from 54.9 in November, the seasonally adjusted ‘IHS Markit Canada Manufacturing Purchasing Managers’ Index’ (PMI) signalled the weakest improvement in overall business conditions since January 2017. A moderation in output growth to its slowest for two years was a key factor weighing on the PMI in December. Purchasing manufacturers commented on less favourable demand conditions, particularly in the energy sector. There were also reports that global trade frictions had held back export sales during the latest survey period. However, new business volumes continued to rise in December, but at one of the slowest rates seen over the past two years. This partly reflected a stagnation in export sales.
Home Improvement Retailers Maintain Positions
Canadian Tire Corporation Limited (seventh), Lowe’s Companies Inc. (eighth), The Home Depot, Inc. (ninth), Home Hardware Stores Limited (10th), Federated Co-operatives Limited (14th), and Castle Building Centres Group Ltd. (54th) maintained their positions from 2016 to 2017 in terms of estimated retail sales size in Canada, shows the Centre for the Study of Commercial Activity’s (CSCA) ‘Retail 100 Profile:2017.’ TIMBER MART moved up one spot from 2016 to 22nd place and J.D. Irving (parent company of Kent Building Supplies) moved up five places to 44. The top three retailers in Canada (based on sales) are Weston Group (parent company of Shoppers Drug Mart, Real Canadian Superstore, etc.), Walmart Inc., and Costco Wholesale Corp.
Housing Affordability Remains Tight
This year is unlikely to provide much housing affordability relief in Canada, says the latest ‘Housing Trends and Affordability Report’ by RBC Economics. The Bank of Canada is expected to hike interest rates further in 2019 which will sustain upward pressure on ownership costs. However, housing prices in several key markets should soften somewhat and household income should continue to rise, providing some offset. RBC's aggregate housing affordability measure increased slightly to 53.9 per cent in the third quarter of 2018, which is up 1.5 percentage points from a year ago. The housing affordability measure is calculated as a share of household income. A higher number means that buying a home is less affordable. Higher interest rates accounted for the entire increase in RBC's measure in the past. Add the mortgage stress test on top of this and the picture gets even more daunting for many Canadian buyers. The considerable loss in housing affordability in Canada's priciest cities in recent years has prompted many buyers to shift their focus to lower-priced housing options, including condos. The increased demand for condos in turn has fueled prices for these units. RBC's affordability measure for condos in Canada increased by 3.6 percentage points in the past year, compared to only 1.2 percentage points for the single-family detached measure.
Roseburg To Acquire Del-Tin Fiber
Oregon-based Roseburg Forest Products has reached an agreement with PotlatchDeltic Corp. to purchase the assets of its subsidiary Del-Tin Fiber LLC, including its medium-density fiberboard (MDF) plant located in Arkansas. The parties expect the sale to close in the first quarter of 2019 after required regulatory approval. The El Dorado MDF plant will continue to operate independently of Roseburg until the transaction closes. Upon closing, the acquisition will be Roseburg's third MDF plant purchase in three years. The company acquired Pembroke MDF in eastern Ontario in early 2018 and a plant in Oregon in 2015. Roseburg currently produces the Arreis, Medite, Medite FR, and Medex product lines. The EL Dorado MDF plant was built in 1998 and features a nine-foot-wide Kusters continuous press.