Ace Hardware closed 2024 with record-breaking financial results, reporting fourth-quarter revenue of $2.3 billion, up 7.6 percent from the previous year. The company’s full-year revenue reached $9.5 billion, reflecting a 3.9 percent increase. Alongside these gains, Ace distributed a record $357 million in patronage dividends to its shareholders, reinforcing the financial strength of the cooperative.
“Strong comparable store sales during the fourth quarter from our hardware format stores, accelerated new store growth, and our continued digital advance fueled a very encouraging 7.6 percent increase in revenue for the quarter,” said Ace President and CEO John Venhuizen. “With record revenue, record shareholder dividends, record contributions to the Ace Foundation, and nearly a 39 percent pre-tax return on shareholder equity, the Ace team is to be commended for the discipline, productivity, and stewardship with which they managed our resources and opportunities.”
The results offer key insights into retail trends that could impact independent hardware stores, including shifts in consumer spending, the continued strength of outdoor categories, and the role of digital expansion.
Ace Retail Performance: What It Means for Independent Hardware Store Owners
Ace’s strong fourth-quarter performance had comparable store sales rise 1.6 percent in the U.S. The increase was primarily driven by a 1.9 percent increase in average ticket size, though it was slightly offset by a 0.3 percent decrease in transactions.
This data suggests that customers are spending more per purchase, but it’s unclear whether this reflects a shift in shopping behavior or the impact of inflation on prices. While fewer transactions could indicate that consumers are consolidating trips, rising prices in key categories like outdoor power equipment and grilling could also be contributing to the higher average ticket size.
For independent retailers, the key takeaway is to focus on customer retention strategies—whether by reinforcing loyalty programs, driving in-store engagement, or offering promotions to encourage more frequent shopping. Understanding whether local customers are adjusting their behavior due to inflation or convenience will be crucial in refining sales strategies for 2025.
Outdoor Power Equipment, Grilling, and Generators Drive Growth
Category trends provide another major takeaway for independent hardware retailers. Ace reported the largest revenue gains in outdoor power equipment, grilling, and generators—consistent with broader industry trends that show growing consumer investment in home improvement and backyard living.
For retailers looking to align with these trends, ensuring strong merchandising and promotional efforts around premium outdoor brands, power tools, and seasonal home upgrades could help increase sales.
Store Expansion and Digital Growth: Key Areas for Investment
Ace’s continued expansion played a role in its financial performance. The company opened 215 new stores in the U.S. while closing 65, bringing its total domestic store count to 5,144 by the end of 2024. Globally, Ace now operates 5,966 locations.
Wholesale revenue from new domestic Ace stores contributed $238 million to overall 2024 revenue. However, store cancellations accounted for a $32.9 million loss, highlighting the challenges some retailers face in maintaining long-term sustainability.
Digital expansion also contributed to Ace’s growth, with Ace Wholesale Holdings (AWH) reporting a $23.6 million revenue increase due to higher e-commerce and professional lumber sales. Independent retailers looking to grow in 2025 may want to prioritize online sales capabilities and ensure they are meeting the needs of both DIY customers and pro contractors.
Key Financial Metrics: Margins, Debt, and Inventory Adjustments
Ace also demonstrated stable financial management in 2024, with notable improvements in gross profit and operating efficiency.
- Wholesale gross profit for the year reached $1.2 billion, up $48.8 million from 2023, with margins increasing slightly to 13.5 percent.
- Retail gross profit hit $374.7 million, a $18.4 million increase from the previous year, with retail gross margin slightly rising to 45.4 percent.
- The company also reduced long-term debt by $81.2 million, improving financial stability.
For retailers, Ace’s focus on inventory reduction and financial discipline offers a lesson: keeping margins strong while managing overhead costs is crucial in today’s competitive retail environment.
How Independent Retailers Look Ahead to 2025 and Beyond
Ace Hardware’s 2024 financials highlight several key trends that independent hardware retailers can use to guide their own strategies:
- Invest in high-ticket categories like outdoor power equipment, grilling, and generators to align with consumer spending habits.
- Encourage larger basket sizes with bundled promotions and targeted upselling as shoppers consolidate their purchases.
- Continue expanding digital capabilities to capture sales from e-commerce and pro customers.
- Keep a close eye on inventory management and margins to ensure profitability in a shifting retail landscape.
