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CHHMA NEWS

CHHMA - EYE ON OUR INDUSTRY
Volume 16, Issue 29, August 4, 2016

Inside This Issue:

• TIMBER MART’s Bernie Owens to Speak to CHHMA Members in Montreal – October 26
• Join Us on September 13th for a Seminar on the Future of E-Commerce/Digital
• Industry Memorial Golf Classic - September 27th at Blue Springs G.C.
• CHHMA Announces Scholarship Program Recipients for 2016
• Canadian Tire Profit Beats Estimates as Sports Gear, Apparel Sales Rise
• Amazon Reports 31.1% Jump in Revenue as Cloud Sales, Prime Subscriptions Take Off
• Dollar General to Acquire Former Walmart Express Stores
• Loblaw Says Move to Cut Grocery Prices in Top-Tier Stores Starting to Pay Off
• HBC’s Bonnie Brooks Named New LCBO Board Chair
• Sears Canada Makes Top Executive Changes - Again
• Canada’s Economy is Growing at the Slowest Pace in 60 Years and the Only Thing Holding Us Up is Housing
• Vancouver’s New Residential Tax on Foreigners Now in Effect, Here’s What to Expect
• Canadian Economy Sees Biggest Monthly Drop Since 2009 on Alberta Wildfires
• Retail Sales in Canada Hit a Speed Bump
• High House Prices Spreading to More Markets, CMHC Warns
• Fort McMurray Set for Largest Home Building Boom in Decades: CMHC
• Latest U.S. Economic News


Association News

TIMBER MART’s Bernie Owens to Speak to CHHMA Members in Montreal – October 26 

The CHHMA is pleased to announce that Mr. Bernie Owens, President of TIMBER MART, will be our next guest speaker at a CHHMA Breakfast Seminar to be held at the Hôtel Holiday Inn Montréal-Longueuil on the morning of October 26th.

Mr. Owens began his career in the building-supply industry over thirty years ago, serving a long tenure at building-material manufacturer, CertainTeed – a subsidiary of multinational corporation, Saint-Gobain.Throughout his 21 years at CertainTeed, Mr. Owens served various roles including, General Manager - Finish Products for North America and Vice President of Sales for the company’s gypsum and insulation business units. Over the years, Owens adopted global best practices and fostered relationships with buying groups and building-material suppliers nationwide. Owens also went on to further his studies in business at international business school, INSEAD and York University’s Schulich School of Business.

Today, as the president of TIMBER MART, Mr. Owens leads the organization with a global industry perspective, fresh ideas, clear vision, and a relentless drive to make TIMBER MART the buying group of choice for Canadian independent building material and hardware entrepreneurs.

We look forward to hearing from Mr. Owens and his update on the organization. Further details and registration information will be available next week.



Join Us on September 13th for a Seminar on the Future of E-Commerce/Digital

The digital world continues to transform retail in and out of the physical store and this trend will continue well beyond 2020. Traditional brick and mortar retailers are evolving their e-commerce operations and global third party marketplaces are fundamentally disrupting the retail landscape, resulting in a completely reshaped retail environment that will require distinct capabilities to compete.

In order to position for growth in this new seamless, digitally integrated retail environment, retailers and suppliers need to understand how fast e-commerce is growing, and get answers to crucial questions related to e-commerce and the digital transformation, including:

• How fast is e-commerce forecast to grow around the globe and in Canada?
• What is the size of the e-commerce opportunity?
• Which retailers are leading the change and driving the innovation?
• What capabilities will be critical for retailers and suppliers to win in the future digital landscape?
• How will e-commerce impact logistics and fulfillment business models of the future?

The CHHMA along with the Canadian Office Products Association (COPA) and RetailNet Group will be bringing the answers to you in a workshop on the future of e-commerce/digital on the morning of Tuesday, September 13, 2016, 9:00 a.m. – 11:00 a.m., at the Centre for Health & Safety Innovation, 5110 Creekbank Rd., Mississisauga, ON., CHHMA Members: $99.00 + HSTRead More >>



Industry Memorial Golf Classic - September 27th at Blue Springs G.C.  


The 15th Annual Industry Memorial Golf Classic is taking place on Tuesday, September 27th at the Blue Springs Golf Club in Acton, Ontario.

The event is held on behalf of the hardware and housewares industry and it honours stalwarts from the industry who have passed away. CHHMA members and non-members are welcome to attend.


This year’s honourees are: David Holden (Hamilton Beach), Leonard Lee (Lee Valley Tools) and Warren Parr (D.H. Howden/TSC Stores).

Past honourees include: David Fry, Ted Kennedy, Geoff Somers, Ray Ceolin, Tom Ross, Bruce Webster, Chris Hrushowy, Mike Pullen, Jim Ypma, Bill Caldwell, Brayl Copp, Ed Hardison, Stuart North, Joseph Kuchar, Shelly Lush, Jack Pountney, Christof Vanooteghem, Ian Hay, Trygve Husebye, Bernie Carpenter, Don McDonald, Les Groves, Bob Hilton, Doug Straus, Mel Boshart, George Giles and Ed Barnes.

The day allows family, friends and colleagues to honour these gentlemen while enjoying a fun day out on the golf course followed by a dinner and silent auction.

The event will start off with registration and breakfast at 8:00 a.m. with a 9:00 a.m. tee off. Dinner will commence at around 2:30 p.m.

Money raised from the event will go towards the CHHMA Scholarship Program which provides support for children of CHHMA member company employees to attend university or college.

Click here for a PDF registration form.      Click here for a PDF silent auction pledge form.

Online registration will be open shortly.



CHHMA Announces Scholarship Program Recipients for 2016

The CHHMA Board of Directors is pleased to announce the Scholarship Award recipients for 2016. The finalists were chosen by ballot draw and this year we are pleased to award five scholarships.

Since 2001, the CHHMA has awarded $170,000 towards scholarships and some 85 young people have benefited from the scholarship program. Recipients receive $1,000 per year for the first two years of study at an accredited post-secondary institution.

Here are this year’s winners ....  Read More >>



Industry News

Canadian Tire Profit Beats Estimates as Sports Gear, Apparel Sales Rise   


Canadian Tire Corp. posted strong sales of sporting goods and beat analyst estimates in its second quarter results released Thursday, despite the surprise exit of its CEO.  Net income in the period ending July 2 rose 8% to $179.4 million, or $2.46 per share, compared with earnings of $166 million ($2.15) in the same period a year earlier. That eclipsed average analyst estimates of $2.33, according to Thomson Reuters.

“Current initiatives, the collective strength of our brands, coupled with our leadership in and commitment to product innovation today, and for tomorrow, represent an incredible opportunity for growth,” said Stephen Wetmore, who was reinstated in the CEO role last month after Michael Medline abruptly exited the role after the board reportedly disagreed with the pace and direction of the retailer’s e-commerce initiatives.  Read More >>



Amazon Reports 31.1% Jump in Revenue as Cloud Sales, Prime Subscriptions Take Off

Amazon.com Inc. reported a better-than-expected rise in quarterly revenue last Thursday, powered by blockbuster growth in its cloud services unit. Amazon’s web retail sales in the U.S. and internationally, the core of the company’s business, also topped expectations, and it forecast revenue ahead of expectations for the third quarter. Shares of Amazon, the world’s biggest online merchant, were up 2% in after-hours trading.

“They crushed estimates,” said Michael Pachter, analyst at Wedbush Securities.  Read More >>



Dollar General to Acquire Former Walmart Express Stores

Following Dollar Tree's acquisition of Family Dollar in 2015, Dollar General has been fighting back to try and regain its leading position in the Dollar stores channel. It plans to open 900 new stores this year and 1,000 in 2017, both organically and through acquisitions including some Walmart Express Stores. By opening stores at this rate it could match Dollar Tree's store numbers by 2018 and be back in the lead by 2019, depending on whether Dollar Tree also accelerates its openings. Dollar General plans to relocate 40 of its existing stores into the purchased sites and enter one new market.   Read More >>



Loblaw Says Move to Cut Grocery Prices in Top-Tier Stores Starting to Pay Off

A move by Loblaw Cos. Ltd. to cut grocery prices in response to sliding food inflation is beginning to pay off, according to Galen Weston. The country’s largest grocery and drug retailer began making strategic price cuts at its top-tier stores in the second quarter after customers became increasingly resistant to paying higher food prices, company president Galen Weston told analysts last Wednesday after Loblaw’s second-quarter results were released.

“We had successive years of inflation leading up to high food prices and consumers were starting to feel a ceiling,” in the first quarter of 2016, Weston noted, and shoppers were tightening their belts and shifting into more discount brands and banners, particularly in areas of Western Canada hard hit by a downturn in the oil economy.  Read More >>



HBC’s Bonnie Brooks Named New LCBO Board Chair

The government of Ontario last week named Hudson’s Bay Co. vice-chairman Bonnie Brooks as the new LCBO board chair, one day after announcing the launch of an online site where customers will be able to order alcohol.

Bonnie Brooks, who has spent 40 years in fashion and retail marketing, has held senior roles with Hudson’s Bay Co. since 2008 when she joined the company and became its first female president and CEO. Brooks is known for engineering a turnaround for the retailer, dropping its moribund apparel brands and bringing in mid-to-high end fashion products.

Brooks was set to retire from her role as vice-chairman before agreeing to take on LCBO role. She said this new opportunity would allow her to help “build on the great work that has already been done, and to take this exciting retail powerhouse to the next level,” with its expansion online and its new role as wholesaler to grocers.  Read More >>



Sears Canada Makes Top Executive Changes - Again

Sears Canada’s revolving door reputation is only getting worse after announcing last week that Carrie Kirkman is on the way out less than a year into her role as president of the retailer.

Kirkman, an experienced fashion executive formerly with Nine West Canada, Jones Apparel Group and Hudson’s Bay, was named president and chief merchant of Sears Canada in November. At the time, she was keen to discuss the retailer’s latest strategies to draw in its two target customers, nicknamed ‘Linda’ and ‘Amy’, the former a longtime Sears customer in her 50s with grown kids, the latter a younger mother of school-aged children.

But the shrinking department store chain shifted course yet again last Monday, when Kirkman’s pending exit was announced in the middle of a statement to reaffirm the company’s strategic objectives of real estate development, ongoing cost controls, and an overhaul of its digital commerce and IT platform.  Read More >>  



Economic News

Canada’s Economy is Growing at the Slowest Pace in 60 Years and the Only Thing Holding Us Up is Housing


Canada is in the midst of one of its weakest expansions ever, and only the housing boom keeps it from getting worse.

That’s one of the key takeaways from Friday’s GDP report. Two years since oil prices started plunging, Canada’s economy is almost completely reliant for growth on bank lending and the hot Vancouver and Toronto housing markets generating fees for brokers.

Real estate and financial services now account for 20% of the economy, levels not seen in the data since the early 1960s. That could be a problem, with household debt at a record and policy makers scrambling to slow price gains that are making homes unaffordable for all but the wealthiest buyers.   Read More >>



Vancouver’s New Residential Tax on Foreigners Now in Effect, Here’s What to Expect 

The new tax on purchases of residential property in metro Vancouver by foreigners that took effect Tuesday is expected to cause further disruption to Canada’s most expensive housing market.

Vancouver realtors spent the past week and much of the holiday weekend scrambling to close deals to beat the 15% tax — at one time bringing British Columbia’s land registration system to a near halt, forcing people to close deals by hand.

Dan Morrison, president of the real estate board of Greater Vancouver, which decried the lack of the notice given to the industry about the new tax, said the sudden shift in policy announced July 25 pushed many deals forward to Friday.  Read More >>



Canadian Economy Sees Biggest Monthly Drop Since 2009 on Alberta Wildfires 

Alberta wildfires torched the Canadian economy in May, driving the country into its worst one-month performance since the darkest days of the Great Recession seven years ago. Statistics Canada’s latest reading for real GDP last Friday showed a contraction for the month of 0.6%, a number that revealed the extent of the economic fallout caused by the blazes that roared through the heart of oil sands country.  The dip in the economy was a little deeper than expected. Economists had predicted real GDP to recoil 0.4%, according to Thomson Reuters.  Read More >> 



Retail Sales in Canada Hit a Speed Bump

Well, it had to happen. Total year-to-date Canadian retail sales were up a revised 5.8% on a not seasonally adjusted basis after 4 months of 2016. This really was higher than the market could bear, given less than sterling economic conditions. The latest data from Statistics Canada show that May retail sales were up just 1.5% year-over-year. The initial surge in 2016 retail sales has now hit a speed bump.

The 3 month trend softened considerably in May, although it is still well ahead of 2015 levels. The underlying 12 month trend, which had been improving since late last year, has stalled somewhat. The outlook for 2016 nevertheless still looks positive and is running ahead of last year.

The retail speed bump is apparent in all retail sectors and is not caused by just one store type. Every province and region also had lower sales growth in May than in the first 4 months of 2016.  Read More >>   



High House Prices Spreading to More Markets, CMHC Warns

Canada’s federal housing agency has raised new alarms about Canada’s housing market, warning that euphoria over real estate is spreading beyond detached homes in Toronto and Vancouver to townhouses and condos, and to other cities.

The Canada Mortgage and Housing Corporation (CMHC) said in its quarterly market assessment released last Wednesday that it sees what it calls “moderate evidence of problematic conditions” in the housing market after months of soaring demand have pushed national home prices up 14% compared with a year earlier, faster than what economic drivers such as employment and income growth should support.

While CMHC said most of the problems in the housing market remain concentrated in Toronto and Vancouver, it also raised red flags about Hamilton and the national market.  Read More >>
 



Fort McMurray Set for Largest Home Building Boom in Decades: CMHC

Fort McMurray’s fire-ravaged housing market could see a resurgence as returning homeowners snap up empty rental units and the community undergoes largest home building boom in decades, Canada’s federal housing agency predicted.

Housing starts in the heartland of Canada’s oil industry could soar to 2,500 as large-scale efforts get under way to rebuild after wildfires swept through the region in May, the Canada Mortgage and Housing Corporation (CMHC) recently said, although much of the rebuilding isn’t likely to start until next year.

“This is expected to be the highest new home construction activity Fort McMurray has seen in twenty years,” wrote market analysts Tim Gensey.  Read More >> 
     


Latest U.S. Economic News 
       

U.S. consumer spending rose more than expected in June as households bought a range of goods and services, suggesting consumption will likely remain strong after surging in the second quarter.

The U.S. economy grew far less than expected in the second quarter as inventory investment fell for the first time in nearly five years, but a surge in consumer spending pointed to underlying strength.

The Federal Reserve left interest rates unchanged while saying risks to the U.S. economy have subsided and the labour market is getting tighter, suggesting conditions are getting more favourable for an increase in borrowing costs.

Contracts to buy previously owned U.S. homes rose far less than expected in June, another sign that a lack of inventory is crimping activity despite mortgage rates being at near-record lows.

U.S. consumer confidence held steady in July and new single-family home sales hit their highest level in nearly 8-1/2 years in June, suggesting sustained momentum in the economy.  Read More >>                     
 
  

 Upcoming CHHMA Events 

Future of E-Commerce/Digital Seminar
Tuesday, September 13, 2016
Centre for Health & Safety Innovation, Mississauga, Ontario


Industry Memorial Golf Tournament

Tuesday, September 27, 2016
Blue Springs Golf Club, Acton, Ontario

Bernie Owens (TIMBER MART) Breakfast Seminar
Wednesday, October 26, 2016
Hôtel Holiday Inn Montréal-Longueuil, Longueuil, Quebec

CHHMA Industry Calendar

To register for all events visit our website at www.chhma.ca or call Pam Winter at (416) 282-0022 ext.21.


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"Eye On Our Industry" is published by the CHHMA as an information resource for our members. Member input regarding content and format is welcomed. Please contact Michael Jorgenson by email: mjorgenson@chhma.ca, or call at (416) 282-0022, ext. 34. CHHMA is located at 1335 Morningside Ave., Suite 101, Scarborough, ON, M1B 5M4 www.chhma.ca

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Canadian Hardware & Housewares Manufacturers Association | 1335 Morningside Ave., Suite 101, Scarborough, ON M1B 5M4
Telephone: (416) 282-0022   Email: pwinter@chhma.ca