Garden toolmaker dishes dirt on big boxes
A Vancouver gardening supplies company will try to grow its business through independent retailers after saying "no thanks" to potential deal with a large U.S. hardware giant.
BroCars International Trading Inc., which says it aims to make gardening fashionable and functional, turned down an offer to exhibit at an invitation only tradeshow exclusively for True Value Co. product buyers. Chicago-based True Value operates 6,000 stores worldwide, mostly under its True Value Hardware Brand.
"Biggest isn't always best," says BroCars owner Patti Harrison.
She was originally excited about the recent offer, but she and U.S.-based sales manager Dan Alden rejected it after scrutinizing True Value's vendor agreement and determining the terms were not acceptable.
"You have to go through the process and get all the details and make sure it works," says Harrison. "For us, it's not going to work."
True Value wanted a three per-cent discount and wanted to pay its bills in 90 days instead of the usual no discount and standard 30 days, says Harrison. BroCars also would have had to buy back items that did not sell in True Value's stores.
"I'm feeling good about the decision," says Harrison. "I don't feel it's a loss."
According to it's 2004 annual report, True Value sold $430 million worth of farm and garden supplies last year.
But Harrison say a deal would have made it difficult to manufacture enough products to meet growing demand from independents.
"I don't consider True Value a big box and the reason I say that is because we don't sell to big boxes as a rule," says Harrison.
True Value describes itself as a co-operative whose stores are owned by individual members. "True Value, although big, is not franchised, nor is it (a large corporation)," says Harrison. "It's independently owned and operated stores, which makes a huge difference in regards to the way we think about them. We support the independents. If we go into Zellers, for example, we're going to kill our independent (retail) market and we're not prepared to do that."
Big-box outlets have a philosophy of "growth just for the sake of growth" she says. "They've damaged a lot of independent situation," says Harrison. "You can be a one-hit wonder with these guys…We've positioned ourselves to work with the independents because we like (selling) mid- to high-end fashionable products."
The philosophy, she says, prevents large retailers from undercutting smaller outlets through drastically reduced retail prices. BroCars received the invitation from True Value after the company's senior vice-president and chief merchandising officer Steve Mahurin stopped at Harrison's booth at the Las Vegas tradeshow.
"There's people out there with all kinds of products who fight for years to get jury (approval) into these shows, so it's a real compliment (to be invited)," says Harrison.
She says True Value offered BroCars free space in its red carpet aisle near the front entrance of the September show in Denver. But BorCars would have had to pay $5500.00 US for another location elsewhere at the event.
True Value also asked Harrison to present products to company officials at its Chicago warehouse.
BroCars sells nine lines of products that range from form fitting gloves and aprons to ergonomic hand shovels to Pot Heads - similar to Chia Pets - that grow grass instead of hair.
The company acts as both a distributor and manufacturer, with products coming from Thailand, India, West Vancouver and elsewhere.
"We find suppliers who manufacture and we contract with them to manufacture our designs," says Harrison.
An avid gardener, she launched BroCars six years ago from her kitchen while completing a four-month entrepreneurial skills program at BCIT. BroCars now has 24 employees with three based out of the office-warehouse at the corner of Ontario Street and Kent Avenue in Vancouver and the rest across North America.
After investing $35,000 with her husband Alex to start up, Harrison has accrued 1200 customers in Vancouver, Calgary, Edmonton, Toronto, and other parts of Canada.
An avid gardener, she stayed home for five years, after giving birth to a son now 13 and a daughter now 11. (She is also a stepmother.)
"I didn't feel I was designed to stay home and do afternoon tea and yoga," says Harrison.
By Monte Stewart
Business Edge