Jun 2011 Financial News

H&L reports sales boost from remodelled store

Jun 08, 2011

Upbeat on market prospects

Sales revenue at Rapid True Value in Lane Plaza jumped 20 per cent after its makeover and relaunch last year, an early sign of success for the chain's ongoing remodelling programme on which operating company Hardware and Lumber Limited is banking to regain market momentum.

Don Wehby, the group chief operating officer of GraceKennedy whose portfolio includes the hardware chain, said the next store, Montego Bay, was expected to do even better after its relaunch.

"The economy in MoBay is much stronger, hence, I am expecting more than 20 per cent growth (in revenue)" said Wehby at H&L's annual general meeting in Kingston on Monday.

GraceKennedy and its partner True Value Inc are collaborating on the project for the redesign of Rapid True Value stores to reflect that of its American counterpart operation. Lane Plaza was the first to be remodelled.

The initial announcement was for the elimination of small stores in favour of large operations across the network of some 13 stores.

Next in line is the operation in Mandeville, where Wehby expects the retail sector to be re-energised, mainly filtering from the uptick in bauxite production.

Hardware and Lumber recorded a small profit of J$48 million off depressed revenue of J$5.7 billion last year - a turnaround from a loss of J$226 million - at the tail end of experiments with new inventory management systems, combining some operations with sister chain AgroGrace, and the ongoing remodeling plan.

Slight uptick

First-quarter revenue registered a slight uptick from J$1.43 billion to J$1.47 billion - retail turnover grew six per cent, and agriculture nine per cent - and losses of J$9.6 million at March 2010 were transformed to a tiny profit of J$732,000 at March 2011

H&L is bullish on business in the year, saying the agriculture and construction sectors where its markets lie are seeing increased demand.

It has one more initiative to roll out this year - a customised service for residential clients whereby Rapid True Value will install kitchens and other fixtures and fittings on request.

The company is aiming to maintain or increase its market share in the retail and wholesale business by delivering "exactly what the customers need and even what they didn't realise that they need," said Simon Roberts, chief executive officer of Hardware and Lumber.

Roberts signalled that Rapid True Value would be positioning to reclaim market share from smaller and mostly single-store operators.

"The truism 'time is money' is no longer relevant, but rather 'time is worth more than money'," he said. "Hardware and Lumber is positioning itself to get to our customers and our competitors customers first and make them happier by delivering to their expectations and needs."


Source:
marcella.scarlett@gleanerjm.com
Jamaica Gleaner
Wednesday June 8, 2011

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