CHHMA - EYE ON OUR INDUSTRY
Volume 14, Issue 35, September 17, 2014

Inside This Issue:

• Join Us in Remembering Home Hardware’s Bruce Webster and the Other Honourees at this Year’s Industry Memorial Golf Classic – October 1st
• Hudson’s Bay Lowers Losses in Q2 with Help from Saks
• Dollarama Profit and Sales Increase in Latest Quarter as It Sticks to a Winning Formula
• Ontario Court Green-Lights Sears Class-Action Lawsuit
• Software Used by Home Depot Hackers Different from Target Attack
• Why the Boomers May Not Leave Home as Fast as We Think
• OECD Cuts Canadian and Global Economic Forecasts 
• Canadian Home Resales Surge in August, CREA Boosts Annual Forecast
• Canadian Housing Market Momentum Continues as Home Prices Rise
• New Home Prices in Canada Unchanged, Toronto Sees Drop
• Latest U.S. Economic News



Association News

Join Us in Remembering Home Hardware's Bruce Webster and Other Honourees at this Year's Industry Memorial Golf Classic - October 1st     
 
Terry Davis, Ray Gabel, Joel Marks, John Dyksterhuis and several of the buyers from Home Hardware will be in attendance at the 13th Annual Industry Memorial Golf Classic taking place on Wednesday, October 1st at the Blue Springs Golf Club in Acton, Ontario.

The Home Hardware executives will be on hand to help honour their former colleague who passed away just prior to last year’s event.

Bruce Webster spent most of his career in the home improvement industry. He worked at many companies, including being a buyer at Homecare and Cashway. He then joined TSC Stores as a senior category manager, and finished his career as a product manager at Home Hardware Stores.

The Industry Memorial Golf Classic is held on behalf of the hardware and housewares industry and honours stalwarts from the industry who have passed away. CHHMA members and non-members are welcome to attend.  Money raised from hole sponsorships and the silent auction will go towards the CHHMA Scholarship Program which provides support for children of CHHMA member company employees to attend university or college.

The other honourees this year are:

Tom Ross - Served for 33 years as the Executive Director of the Canadian Retail Hardware Association (CRHA). Tom passed away on June 26 of this year.

Ray Ceolin – Over his 40 year career, was an active member of the hardware and housewares community. Together with his brother Leo, they built a successful sales agency, Phaeton Limited, representing varied lines through many classes of trade. Ray passed away in October of 2012.

Read more on further details and how to register.
  




Industry News
 
Hudson’s Bay Lowers Losses in Q2 with Help from Saks   

The Hudson’s Bay Company reported last Friday an 87% jump in retail sales and a much smaller loss in the second quarter ended Aug. 2, helped by its purchase of U.S. luxury chain Saks Inc. last year.  Hudson’s Bay acquired Saks for $2.4-billion last year to revive big-name department stores. The company, which affirmed its outlook for 2014, said consolidated same-store sales increased by 1.9% in the second quarter.

Same-store sales at Saks Fifth Avenue rose 2.2%. OFF 5th, Saks’ outlet business, posted a 14.9% growth in same-store sales, helped by strong growth in e-commerce sales.  Same store sales at Hudson’s Bay’s department store business, which includes the namesake stores and the struggling U.S.-based Lord & Taylor chain, rose 1.1%.

The company announced that it will open its first U.S. luxury Saks Fifth Avenue and sister discount Saks Off Fifth stores in Canada in the spring of 2016, putting pressure on this country’s fast-expanding luxury retail market.  Read More >>


     
Dollarama Profit and Sales Increase in Latest Quarter as It Sticks to a Winning Formula 
 
Canadian dollar-store operator Dollarama Inc. reported a 15% rise in quarterly profit last Thursday as its number of stores increased and customers spent more per visit.  The company, which sells items priced up to $3, said same-store sales rose 4.2% in the second quarter, ended Aug.3. The number of transactions increased 1.1%.  Dollarama said the average spending by customers per trip rose 3.1% as it sold more products priced higher than $1.

The chain said 18 net new stores were opened during the second quarter of fiscal 2015 and 43 so far this fiscal year. It remains on target to expand its Canadian store network by 70 to 80 stores this year.  Read More >>


      
Ontario Court Green-Lights Sears Class-Action Lawsuit     

A lawsuit against Sears Canada Inc. and its U.S. counterpart by its Hometown Store dealers has been granted class action status by an Ontario court.  The lawsuit by more than 250 current and former operators of Sears Hometown Stores allege Sears Canada and Sears Roebuck and Co. made it “virtually impossible” for them to operate their Hometown Stores profitably. The dealers allege that Sears lowered commissions, reduced advertising for local stores and bypassed the franchises by selling directly to customers who are located within their markets.  They also claim that Sears set their compensation and work conditions, without abiding by labour laws or franchise protection laws.  Read More >>


Software Used by Home Depot Hackers Different from Target Attack 

Home Depot Inc. was hacked with a malicious software program that plunders store registers while disguising itself as antivirus software, according to two security researchers.  The credit card-stealing program used in the attack on the Atlanta-based retailer is being dubbed FrameworkPOS, and differs significantly from the software used last year to hack Target Corp., said Dan Guido, chief executive officer of Trail of Bits, an information security company.
 
Guido, who reviewed technical information about the Home Depot incident, said the differences in the malware are strong indicators that the hacks are probably the work of two different groups.   Read More >>

 
Marketplace Stats & Trends
 
Why the Boomers May Not Leave Home as Fast as We Think 
 
A million-dollar home sure doesn’t look like it used to. In some cities, it can be downright dowdy. For example, $1 million — $1,012,172 to be precise — in April would have bought an average single-family home in Toronto. Not a mansion on the Bridal Path, not even a nice place in the tony Rosedale or Forest Hill neighbourhoods; just an average single-family detached home. And those places are selling like mad, with the Toronto Real Estate Board reporting 19.2% growth from a year earlier. 

Fortunately, those numbers tailed off in subsequent months, hitting an average of $865,635 in mid-July, still up 8.8% year over year. The reason for such price appreciation is simple: There is a limited supply of detached homes because no one is building them anymore. Even the suburbs are being covered with semi-detached homes, a move by homebuilders to maximize the potential profits of their land holdings. The demand for stand-alone homes in the big cities simply outstrips the current supply and there won’t be much new stock added in the coming years.  But some market watchers expect that dynamic to change in the coming years as the baby boom generation starts unwinding.   Read More >>




Economic News

 
OECD Cuts Canadian and Global Economic Forecasts

 
Canada’s economy will be among the top performers in the G7 this year, the OECD says in a new forecast on Monday. But hold that thought.  The Organization for Economic Co-operation and Development (OECD) trimmed its 2014 outlook for Canada, to economic growth of 2.3% from 2.5%, but that should be second only to Britain’s projected 3.1%. The U.S. economy is forecast to grow by 2.1%, Germany by 1.5%, Japan by 0.9%, and France by 0.4%. Italy’s economy is projected to shrink by 0.4%. While Canada may sit near the top of the G7, that’s still just moderate economic growth. Next year, according to the group’s forecasts, economic growth in Canada will pick up to 2.7%, trailing America’s 3.1% and Britain’s 2.8%, but still outpacing the rest.  Read More >>



Canadian Home Resales Surge in August, CREA Boosts Annual Forecast

 
Sales of existing homes in Canada rose in August month-over-month for the seventh month in a row, bringing sales to their highest level since January 2010. The strength that the housing market is showing has prompted the Canadian Real Estate Association (CREA) to boost its forecast for sales this year. It now expects that 475,000 existing homes will sell in 2014, up 3.8% from last year. In June it expected that number to be 463,400.  CREA reported on Monday that August’s sales were 1.8% higher than July’s on a seasonally-adjusted basis.  Prices continued to climb with the average national sales price in August coming in at $398,618, 5.3% higher than a year earlier. The MLS home price index, which seeks to create a more apples-to-apples comparison of price gains than the average, also rose 5.3%.  Read More >>


Canadian Housing Market Momentum Continues as Home Prices Rise    

Canadian home prices rose in August and the pace of 12-month home price appreciation accelerated, a report showed last Friday, suggesting robust demand for housing is carrying through to the second half of the year. The Teranet-National Bank Composite House Price Index, which measures price changes for repeat sales of single-family homes, showed national home prices rose 0.8% last month, exceeding the historical average for August.

Prices were up 5.0% from a year earlier, a pickup from July’s 4.9% price gain. August was the ninth month in a row in which the composite index did not fall. The price increases, on top of robust housing starts data in the spring and summer, have surprised economists who have been calling for a slowdown in Canada’s long housing boom.  Read More >>


New Home Prices in Canada Unchanged, Toronto Sees Drop      
 
New home prices in Canada were on average unchanged in July from June, with declines in the major cities of Toronto, Vancouver and Ottawa offsetting hikes in Calgary and elsewhere, Statistics Canada said last Thursday. Year-on-year prices were up a modest 1.4%.  Statscan reported that its New Housing Price Index (NHPI) was unchanged in July, following a 0.2% increase in June. Monthly price increases in eight metropolitan areas offset decreases in seven areas, resulting in no change to the Canada level index. Read More >>


 
Latest U.S. Economic News
 
U.S. consumer prices edged down in August, the first monthly drop since the spring of 2013, as gasoline, airline tickets and clothing prices all fell. It was the latest evidence that inflation remains under control. Consumer prices edged down 0.2% last month following a tiny 0.1% gain in July, the Labor Department reported Wednesday. It was the first decline since a similar 0.2% drop in April, 2013.
 
U.S. retail sales rose in August as Americans bought automobiles and a range of other goods, which should ease some concerns about consumer spending and support expectations for sturdy growth in the third quarter. The Commerce Department said last Friday that U.S. retail sales increased 0.6% last month after an upwardly revised 0.3% gain in July.

U.S. consumer sentiment rose in September to its highest in more than a year on more upbeat views on the domestic economy in the coming year, a survey released last n Friday showed. The Thomson Reuters/University of Michigan's preliminary September reading on the overall index on consumer sentiment came in at 84.6, the highest since July 2013, up from 82.5 in the final August reading.  Read More >>  

 


 Upcoming CHHMA Events 


Industry Memorial Golf Classic
Wednesday, October 1, 2014
Blue Springs Golf Club, Acton, Ontario

Industry Cocktail
Thursday, December 11, 2014
Casino de Montreal, Montreal, Quebec

Canada Night
Held in Conjunction with the International Home+Housewares Show
Sunday, March 8, 2015
InterContinental Hotel, Chicago, Illinois

CHHMA Ontario Golf Tournament
Tuesday, May 26, 2015
Angus Glen Golf Club, Markham, Ontario

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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