DEL.ICIO.USAce Hardware expanding in metro Atlanta
Four new stores coming this year in Home Depot’s backyard
The Atlanta Journal-Constitution
Sunday, April 26, 2009
At a time when retail vacancies are soaring, Ace Hardware, the largest independent hardware chain in the nation, is making a major play in metro Atlanta.
The “helpful hardware place” is opening four stores this year in Home Depot’s headquarters town, after opening four stores last year.
Bob Andres/bandres@ajc.com
At the new Canton store are owner Bob Calvanese and Darin Workman, Ace’s market development manager for the Atlanta region.
Bob Andres/bandres@ajc.com
As a franchise, the new Ace Hardware in Canton is allowed to choose much of its inventory, from garden materials – carried by associate Mike Newman – to mountain bike gear. ‘We have more creativity,’ its co-owner says.
Bob Andres/bandres@ajc.com
A typical Ace Hardware store carries about 20,000 products. Franchisees need a minimum of $400,000 to qualify, with about $250,000 cash.
Ace Hardware, a chain of independently owned hardware stores, is breaking new ground in Georgia, opening a record six stores in six months. The "helpful place" will soon have 54 stores in the metro area, including these eight new stores:
• Braselton
• Canton
• Cumming
• Dacula
• Dallas
• Kennesaw
• Sandy Springs
• Stockbridge
Source: Ace Hardware
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“Atlanta seems like it’s always been a good area for us,” said Tom Knox, director of retail development for the Oak Brook, Ill., company. “That’s funny, as it’s Home Depot’s backyard.”
Unlike its big-box rivals, Ace grows only through franchising. Ace is a wholesale cooperative, similar to rival True Value.
Owned by their independent retailers, the chains cooperatively buy inventory through their home offices. Home Depot and Lowe’s, by contrast, don’t franchise.
Ace stores also are more about repairing home sweet home than doing a jumbo renovation.
In Canton, northwest of Atlanta, Bob Calvanese opened his first Ace store at 100 Ridge Road, in a new retail development.
His store has an eclectic assortment of goods — from wine-themed gifts to garbage cans to weedkillers.
He recently was preparing for the store’s April 17 grand opening.
After a long career in law enforcement and a second career as a salesman for a printing company, Calvanese is embarking on a third career as a small retailer.
He and his wife, Sherre, sank their nest egg into Ace. They liked the board of directors, made of store owners, and wanted the level of franchisee support.
Bob Calvanese said he went to several Ace store-owner meetings and interviewed lots of owners before sealing the deal. It convinced him that as an Ace franchisee, he wouldn’t be forced into a retail formula.
For example, his wife used a corner of their new 12,000-square-foot store to carry small furniture and gifts. They are also carrying a lot of fishing and mountain bike gear because of the nearby lakes and trails. In the 3,000-square-foot outdoor garden space, she’s stocking Mexican-made ceramic planters and fountains.
“We have more creativity as a part of Ace,” he said.
But he also was “attached at the hip” for a year, he said, with Cheri Kliman, Ace’s regional retail project manager, and Keith Davis, the district manager. They helped him build the store from the ground up, from choosing the site and constructing the building to putting up shelves and displays. They were all in the store as Calvanese prepped for the grand opening.
“We’re a mom-and-pop business with a corporate structure behind us,” Calvanese said.
Knox, in Ace’s corporate office, said franchisees need a minimum net worth of $400,000 to qualify, with about $250,000 cash. Start-up fees can get to $1 million. A typical store carries about 20,000 products.
Stores in Cumming, Dacula and Dallas also are having grand openings this spring. Stores in Braselton, Kennesaw, Sandy Springs and Stockbridge opened in the last six months.
Darin Workman, Ace’s market development manager for the Atlanta region, said it’s the fastest pace for this region he’s ever seen, and he’s looking to open another eight stores in Atlanta in the next two years.
The reason for the new store openings? He said it’s a complicated mix of having qualified owners and good retail locations converge. Atlanta has a lot of available retail spots right now, he said.
By philosophy and size, Ace Hardware stores are more concerned with helping customers fix their leaky toilets than selling lumber for grandiose home improvement projects. (The chain doesn’t sell lumber at all, in fact. But it does have everything from tiny screws to patio furniture.)
“We’re more into preservation,” said Knox. “They’re into renovation,” he said of Lowe’s and Home Depot.
But he doesn’t really consider the big-box chains rivals.
“If you’re interested in totally gutting and remodeling your bathroom, most of our stores will not be able to satisfy every need you’ve got,” Knox said. “But if you’re ready to fix or repair that bathroom, that’s where we come in.”
Of the $300 billion home improvement market, chains like Ace and True Value chase a $60 billion piece of the “convenience hardware” market, Knox said. He said Ace is getting about $13 billion of that, meaning, “there’s a whole lot more of it to go after.”
Workman believes the recessionary economy plays to Ace’s strengths: As more people have forgone big makeovers in favor of basic home maintenance (or doing it themselves instead of calling the plumber), Ace’s expertise comes into play.
The company’s annual revenues show Ace’s profits suffered last year, but not as much as Home Depot’s.
In 2008, Ace Hardware’s net income dropped 1.3 percent to $85.8 million as the chain shed about 100 stores. Meanwhile, Home Depot, which also closed some stores, saw net income fall 7.8 percent. Lowe’s, which continued building new stores, saw net income fall 0.1 percent.
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