Beyond the traditional hardware mix - TruServ - Brief Article

Home Channel News, June 18, 2001 by Lisa Girard

Arizona dealer-member Prescott True Value offers a bridal registry, rental center and high-end merchandise to compete with influx of big-boxes

When choosing where to register for an up coming wedding, most prospective brides wouldn't even consider the local hardware store. Unless, of course, they live near Prescott True Value in Arizona, a local TruServ member that, in the face of competition from several major home improvement dealers, has developed a niche in housewares, specialty foods and other unique gift items.

The store carries hardware and building supplies, too. But its owner, Ben Andre, noted that unique household items have allowed his store to stay afloat, and even prosper, in this highly competitive central Arizona locale.

"There's an overlap of items at retail. You walk into Walgreen's and they're selling everything but drugs," said Andre, who along with his wife, Jane, purchased the business 20 years ago. "You've got to have niches. That's how you survive."

When Andre bought the existing True Value hardware store, it was a 6,500-square-foot building that he soon expanded to 15,000 square feet. As the town continued to flourish and attract more and more retirees, Andre decided his store needed more space and parking for his growing customer base. So he went down the street and purchased the current building, a 30,000-square-foot structure with 100 parking spaces.

Prescott currently has a population of 35,000, and there are 80,000 people within a 50-mile radius, compared to the 17,000 who lived in Prescott when Andre bought the company in 1981, and the 40,000 who lived in surrounding communities. That population growth has been trailed by an influx of large retail stores, including a Wal-Mart, Kmart, Costco, Target, PetsMart, Office Max and Office Depot. The real blow came three years ago when a Home Depot opened its doors, giving Andre more incentive than ever to serve his customers and offer unique products that can't be found at other local outlets.

"Of course, Home Depot took some of our hide, but we didn't roll over," he said. "To survive with this size operation, you have to differentiate yourself from the Targets and Wal-Marts of the world. For us, it's been housewares and gourmet foods."

Prescott True Value bills itself as "Arizona's premier hardware & housewares store," and the house wares department -- located in the center of the store -- features small appliances bearing the Cuisinart and Kitchen Aid brands, fine china, picture frames and silver trays. These and other products are part of Prescott True Value's bridal registry, which is something that has developed over the years, according to Andre. Even though Prescott is considered a retirement community, an average of 15 to 18 brides-to-be register during the busy spring and summer months.

The housewares section, which stocks 7,500 of the store's 42,000 skus, features 12 running feet of gourmet foods, including specialty jars of jams and jellies, coffee syrups, hot sauces and packaged soups. Complementing these is a variety of cooking gadgets like grinders, graters and pepper mills, as well as larger items such as George Foreman-branded barbecue grills.

Andre said he's discovered many of these items at the Gourmet Show, which he claims is the industry's best trade show for up scale and unique items. "We move things and make changes all the time, especially in the housewares section. It's kind of like a department store," Andre said. "And we use a lot of accessories, like dish towels and plates, to make the displays more appetizing."

Some of the suppliers Andre buys from on a regular basis are Steven's Linens, Enclame (pot racks), Burndice (nonstick pans) and Kaiser (bakeware). To further bolster his store's housewares offering, he has partnered with EK, the German buying group, which he said is the largest purveyor of housewares products in Europe. TruServ has a reciprocal distribution agreement with EK, which gives Prescott True Value the opportunity to bring German crystal and other high-end items into the store and sell them at a reasonable price.

"We can sell German crystal at $6 or $7 a stem and more than double our money," Andre said. "It's a good profit margin, and we continue to buy from them, not on an everyday basis but quite often."

The store has other niches as well, including TruServ's popular "Just Ask" rental program, which it installed three years ago. People may go to Home Depot to rent larger equipment, but Prescott True Value succeeds at leasing a variety of small power tools, plumbing supplies and carpet cleaners. Among the more popular rental items at this time of year are vibrating sanders, roto-tillers and thatchers for the lawn.

An even more important niche Prescott offers is personalized service that Andre -- like independent dealers around the country -- insists big boxes can't match. His store offers repair of small outdoor power equipment engines, windows and lamps. Its staff of full-and part-time employees is trained to address customers individually.