Member Login
Username
Forgot Password
GO

CHHMA News


 

 

Volume 10, Issue 38, September 30, 2010   

CHHMA EYE ON OUR INDUSTRY

Inside this issue:

  • Economic News
  • ÉEQ 2008 Company Reports Due October 5
  • Increasing Profits: The 1% Solution
  • Industry Memorial Golf Classic

 

Economic News

 

GDP Falls for First Time in 11 Months

Canada’s economy contracted in July for the first time in almost a year as factories, home builders and consumer activity all posted declines. Statistics Canada reported earlier today that real GDP edged down 0.1% in July, the first monthly decline since August 2009. Manufacturing, retail and wholesale trade, construction and forestry all posted decreases. Increases were recorded in the mining sector and, to a lesser extent, in some financial industries and the public sector.

 

Manufacturing fell 0.7% in July, with 11 of 21 major groups within the sector posting declines. Construction declined 0.5%, led lower by residential building construction, which fell 2%. Home resales declined for a third straight month, with activity by real estate agents and brokers dropping 8%. The output of this industry stood at about two-thirds of its level recorded at the beginning of 2010. Retail trade declined 0.5%, after a 0.7% advance in June. Decreases were recorded in furniture, home furnishings and electronic stores as well as building and outdoor home supplies stores. Increases in general merchandise stores, clothing stores and car dealers tempered the declines. Wholesale trade edged down 0.2%. Wholesaling of automotive products, building materials and personal and household goods declined. On the other hand, wholesale sales of food and petroleum products increased.

 

Canada’s strong rebound from the recession occurred mostly at the end of 2009 and early part of 2010. Since April, the economy has largely been treading water. Economists expect July to be a one-month dip caused by poor exports and the introduction of the HST in Ontario and B.C. However, growth going forward will be very incremental due to highly indebted Canadian households and a weakening outlook in the U.S.

 

Consumer Confidence Declines

Consumer sentiment fell for a fourth straight month in September dampened by the slow pace of economic recovery according to the Conference Board of Canada’s latest consumer confidence index released yesterday. The index fell 1.2 points to 78.1 and now stands 18.5 points below where it stood in January.

 

The mood of consumers deteriorated in all regions except Atlantic Canada, where the index rose 7.5 points to 88.2 in September. Overall confidence in B.C. dropped 7.7 points from August to 79.4 this month and has fallen 30 points from the start of the year. The Prairies remain Canada’s most confident region with a reading of 96.3, while Ontario remains the weakest at 67.3. Quebec’s index remained relatively unchanged in September.

 

On the question of personal finances, only 13.2% of respondents said conditions had improved in the past six months, down 1.4 points from August. Meanwhile, those who said their financial situation had worsened rose to 23.2%, up 0.5% from last month. The share of respondents who said they saw no change in their financial situation over the last six months rose to 62.6%, suggesting that a majority of Canadians have not benefited from the recovery so far. However, for a second consecutive month, the percent of respondents who said they expect their financial situation to improve in the next six months increased by 0.6 to 24.5%.

 

The U.S. Conference Board also reported this week that its index of consumer attitudes fell to 48.5 in September from a revised 53.2 reading in August as U.S. consumer confidence sags due to deteriorating business conditions and labour market.

 

 

ÉEQ 2008 Company Reports Due October 5

 

A reminder that next Tuesday, October 5, is the deadline to file your 2008 Company Report for the Éco Entreprises Québec (ÉEQ) program. Stewards then have until November 4, 2010 to pay their contribution and avoid and interest charges. ÉEQ would like to remind you that 2007 is the reference year to use for your 2008 Company Report. Updated tools are available to help you prepare your report and answer the new questions on this year’s reporting form. Both the electronic version (Online Information Modules, modules 2 and 3) and the hard copy version (User’s Guides, modules 2 and 3) are available on ÉEQ’s website, have been designed to provide step-by-step guidance to using the ECO-D reporting system.  For personalized support, contact service@ecoentreprises.qc.ca.

 

 

Increasing Profits: The 1% Solution


Your boss gives you a seemingly impossible task: Increase profits by 12.5%. How do you respond? Some managers might spend a great deal of time trying to persuade the boss to reduce her expectations. A more productive response would be to improve management of prices by just 1%.

If the average company captured 1% more in price, without any change in volume and costs, profit would climb by a whopping 12.5%.

 

Pricing is the single most powerful lever a company has for boosting profitability. Yet, most organizations devote much more time and effort to cost-cutting than to pricing.

 

So if pricing has such a dramatic impact on the bottom line, why do so many companies spend so much of their time on other initiatives? Because most executives believe that prices are driven by the market, and that they have very little control over them. Many find it more comfortable to set prices based on cost plus a percentage for profit, rather than conducting the research to determine the value of their organization's product or service, and the price that it can command. As a result, companies engage in "fire-fighting" with price, responding to competitive situations, addressing customer-service shortfalls, driving short-term volume gains -- the list goes on and on.

 

Clearly, pricing is an area of low knowledge and high opportunity for most businesses. If you want to take action, how do you get started? Experience has shown that cleaning up discounts with existing customers offers the greatest potential for most businesses.

 

Three truisms undermine pricing effectiveness in organizations:

 

- It is not the best customers who get the best price; it is the best negotiators.

- Most salespeople negotiate price more aggressively internally than they do externally.

- Companies are not sure of the rationale behind prices because they tend to drift over time.

 

Consequently, pricing is all over the place. Most companies would be embarrassed if their prices were made public. There are tremendous inequities in their pricing, and many bad decisions have been made with very little analysis and rigour.

 

By taking a look at discounting and applying a policy-based approach, most companies can drive a minimum of 1%-2% improvement in pricing. And that, we know, translates into a 12.5% improvement in profits.

 

Knowing this, when the boss asks for an increase in profits of 12.5%, the best strategy for success is to take a hard look at your business's pricing strategy.

 

Article from Paul Hunt, President of Pricing Solutions Ltd.

 

 

Industry Memorial Golf Classic

 

The 9th Annual Industry Memorial Golf Classic took place on September 28th at the Wooden Sticks Golf Club in Uxbridge, Ontario. The weather started off a bit daunting but after a few holes the rain stopped and the sun shone which made for a very enjoyable afternoon of golf with industry friends for a very worthwhile cause.

 

The CHHMA runs this event each fall on behalf of the hardware and housewares industry and it honours stalwarts from the industry who have passed away. This year we remembered two well respected gentlemen who passed away in 2010; Mr. Ian Hay (Northern Marketing & Sales) and Mr. Trygve Husebye (Dahl Brothers (Canada) Limited). Both Ian and Trygve had long and successful careers in the industry and we were pleased that family and colleagues were able to attend to help us honour their memory. In addition, the event continues to remember previous honourees: Bernie Carpenter, Don McDonald, Les Groves, Bob Hilton, Doug Straus, Mel Boshart, George Giles and Ed Barnes.

 

After the golf, a dinner and silent auction was held to raise money for the CHHMA scholarship program and we would like to thank the numerous companies that sponsored and donated items for the auction and all the individuals who bid on them.



 

Further details and photos from the event will be available shortly at www.chhma.ca under past events.

 

Upcoming Events For
2010

Industry Cocktail

 

Tuesday, November 30
Montreal Casino,
Montreal, QC

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



In Memoriam

Industry icon Jack Pountney passed away peacefully with his family by his side on Friday, September 24, 2010. Mr. Pountney began his career in this industry with the Hoover Company, and later moved to Shetland Lewyt. When the company merged with Proctor Silex, Mr. Pountney went on to build a career spanning more than 30 years at Proctor Silex, and it was evident by the gathering on September 29th to celebrate his life that Jack made many friends along the way. Our sympathy goes out to his family and friends.





CHHMA Links


Discount Cellular
Phone Rates


Logo Apparel &
Promotional Products



Freight Logistics Savings
No Obligation Consultation

 

 

 

 

 

  "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

 

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