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From: www.theglobeandmail.com/s...iness/home
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Rona hammers out bold strategy
U.S., women and green in its sights
MARINA STRAUSS
From Wednesday's Globe and Mail
TORONTO — Robert Dutton is mapping out a bold expansion plan for home improvement retailer Rona Inc. that will see it enter the U.S. market by next year, and launch new specialty stores geared to women and the environmentally conscious.
It's a bid by the Rona chief executive officer to reach out to a younger generation of hardware shoppers while also bulking up the chain's operations as it prepares to face a big new U.S. competitor in Canada in 2007.
"In the next 10 years, we're going to have lots of change in the way we're going to sell our products -- home renovation products and garden products," Mr. Dutton said yesterday after speaking at the Retail Council of Canada's annual conference.
"It's going to be a revolution."
Mr. Dutton is searching for growth opportunities at a time when the sizzling home improvement retail market is showing signs of a slowdown. At the same time, Lowe's Cos. Inc., the second-largest U.S. chain in the field after Home Depot Inc., will put added pressure on Canadian retailers as it gets ready to open its first stores here next year.
The challenges don't stop there. A younger generation of homeowners will be shopping more, bringing with it its own expectations and demands.
Mr. Dutton is preparing for the shifts. He said Rona is well positioned with its array of different-sized stores, from big boxes to small shops, all catering to a wide range of customers and communities.
In the coming years, Mr. Dutton will focus more on small and mid-sized stores partly because he believes that they appeal to Generations X and Y -- those born between 1965 and 2000 -- who value the service and convenience of a compact boutique.
Smaller stores work well in so-called lifestyle shopping centres, an emerging mall concept in North America. They feature shops in a simulated old-time main street setting, and cater to a well-heeled customer.
"If we want to be there, we're going to have to adapt our store with a different approach," he said.
Specialty stores are one approach, he said. A green store will carry products that are designed to limit harm to the environment, he said, while a store geared to women may carry more home decor items.
Rona will launch these new concepts next year or the year after, he said. "We're going to have a change in the behaviour of the consumer. We're going to have to adapt our stores."
South of the border, Mr. Dutton will be hunting for a chain of smaller-sized stores too, he said. He expects to be in the U.S. market by next year, he said. The move will be "prudent," but he also has big dreams.
He wants Rona to become the third-ranked U.S. home improvement retailer. "We can be third place."
He plans to begin the U.S. expansion in the Northeast and East Coast areas because consumers there have buying habits similar to Canadians, he said. "For the next 10 years, North America is going to be a good playground."
At that point, the chain, based in Boucherville, Que., could consider going further abroad, he said.
But before it enters the U.S. market, it needs to boost its operations here, he said.
Rona is rapidly buying up smaller Canadian hardware retailers, recruiting new operators and building 20 new stores annually. It is aiming to ring up $7-billion of sales by the end of 2007, up from the current $5.2-billion.
Rona's stores already try to cater to handywomen with its highly visible home decor sections and an emphasis on personal service. About 52 per cent of the chain's customers are women.
By next year, it will set up in-store boutiques with specialized home security products, while also focusing more on energy-saving and other environmentally friendly merchandise, he said.
It's an attempt to respond to customers' evolving needs, he added. "We adapt our stores to those needs."
_______________
Rona hammers out bold strategy
U.S., women and green in its sights
MARINA STRAUSS
From Wednesday's Globe and Mail
TORONTO — Robert Dutton is mapping out a bold expansion plan for home improvement retailer Rona Inc. that will see it enter the U.S. market by next year, and launch new specialty stores geared to women and the environmentally conscious.
It's a bid by the Rona chief executive officer to reach out to a younger generation of hardware shoppers while also bulking up the chain's operations as it prepares to face a big new U.S. competitor in Canada in 2007.
"In the next 10 years, we're going to have lots of change in the way we're going to sell our products -- home renovation products and garden products," Mr. Dutton said yesterday after speaking at the Retail Council of Canada's annual conference.
"It's going to be a revolution."
Mr. Dutton is searching for growth opportunities at a time when the sizzling home improvement retail market is showing signs of a slowdown. At the same time, Lowe's Cos. Inc., the second-largest U.S. chain in the field after Home Depot Inc., will put added pressure on Canadian retailers as it gets ready to open its first stores here next year.
The challenges don't stop there. A younger generation of homeowners will be shopping more, bringing with it its own expectations and demands.
Mr. Dutton is preparing for the shifts. He said Rona is well positioned with its array of different-sized stores, from big boxes to small shops, all catering to a wide range of customers and communities.
In the coming years, Mr. Dutton will focus more on small and mid-sized stores partly because he believes that they appeal to Generations X and Y -- those born between 1965 and 2000 -- who value the service and convenience of a compact boutique.
Smaller stores work well in so-called lifestyle shopping centres, an emerging mall concept in North America. They feature shops in a simulated old-time main street setting, and cater to a well-heeled customer.
"If we want to be there, we're going to have to adapt our store with a different approach," he said.
Specialty stores are one approach, he said. A green store will carry products that are designed to limit harm to the environment, he said, while a store geared to women may carry more home decor items.
Rona will launch these new concepts next year or the year after, he said. "We're going to have a change in the behaviour of the consumer. We're going to have to adapt our stores."
South of the border, Mr. Dutton will be hunting for a chain of smaller-sized stores too, he said. He expects to be in the U.S. market by next year, he said. The move will be "prudent," but he also has big dreams.
He wants Rona to become the third-ranked U.S. home improvement retailer. "We can be third place."
He plans to begin the U.S. expansion in the Northeast and East Coast areas because consumers there have buying habits similar to Canadians, he said. "For the next 10 years, North America is going to be a good playground."
At that point, the chain, based in Boucherville, Que., could consider going further abroad, he said.
But before it enters the U.S. market, it needs to boost its operations here, he said.
Rona is rapidly buying up smaller Canadian hardware retailers, recruiting new operators and building 20 new stores annually. It is aiming to ring up $7-billion of sales by the end of 2007, up from the current $5.2-billion.
Rona's stores already try to cater to handywomen with its highly visible home decor sections and an emphasis on personal service. About 52 per cent of the chain's customers are women.
By next year, it will set up in-store boutiques with specialized home security products, while also focusing more on energy-saving and other environmentally friendly merchandise, he said.
It's an attempt to respond to customers' evolving needs, he added. "We adapt our stores to those needs."
