In the 1990s, strip malls and commercial store fronts sprung up around the country, promising suburban homeowners fast access to everything they needed. Fast forward to today, when towns and cities across America are left with shuttered stores of all sizes. It’s not just Main Street that is imperiled.
While the demise of a retail company represents a loss of jobs for employees and a loss of choice for consumers, it also represents opportunity. Abandoned store fronts can easily be transformed, if the right retailer comes along with the right strategy to connect with customers.
Pleasants Hardware Finds the Right Fit
Darrell Campbell, general manager for Pleasants Hardware, had been like a lion lurking in the tall grass, waiting for the right opportunity to pounce on his prey. He spent several years looking for the right store location to expand in Pleasants’ Richmond, Va., trade area, but the right fit never materialized.
Pleasants Hardware is a Century Club retailer that dates back to 1908. Any plans for expansion got put on hold when the seven-store chain was acquired by Taylor’s Do it Centers of Virginia Beach in February 2016.
On January 2, 2020, Pleasants Hardware opened its eighth store in Mechanicsville, a suburb of Richmond. That capped off a six-year odyssey for Campbell, as he played the long game and saw his determination rewarded. It was the first new store for Pleasants since Taylor’s took over.
“Even in 2014 and 2015, we were looking at this market (Mechanicsville), but just couldn’t find the right real estate,” he says. “I had been browsing the internet and I knew when Walgreens bought Rite Aid in 2018 that this site might come available, because there’s a Walgreens nearby.”
Sure enough, Walgreens closed that Rite Aid location in early 2019. Campbell remembers photographing it empty on March 19. With the backing of its new owners, Pleasants closed on the deal in September.
“It’s a great location for us,” explains Campbell. “It’s well-positioned in between the boxes, which are three-plus miles in any direction. It has good road frontage with high traffic in a shopping center anchored by Food Lion.”
The location in the Hanover Commons Shopping Center features a 10,000-square-foot sales floor plus 1,500 square feet for warehouse and office space and only required a minor buildout. “We had to take out coolers and the pharmacy and build a wall to cordon off the warehouse. The building itself is pretty square,” he points out.
Campbell notes that the new store’s assortment is very similar to Pleasants’ other stores. “We try to tailor the assortment to the market. This store is in suburbia, so there is a big emphasis on lawn and garden and outdoor power equipment.”
He adds, “The community has embraced this store so much. A lot of people have expressed appreciation that we took over this shuttered location and turned it into a new store. They really wanted a hardware store here.”
The Richmond market is thriving right now, according to Campbell, who points out that people are very familiar with the Pleasants Hardware brand since the company’s roots stretch back 112 years.
“We’ve constantly got our eyes open. We looked at other Rite-Aid locations, but they weren’t the right fit,” Campbell says. “Life for independents is not too bad these days, whether there’s a revolution or just evolution.”
A New Era of Store Closings
The rise of Amazon and online shopping has caused the retail landscape to change dramatically over the past few years, with chain retailers taking much larger lumps than independents.
In 2017, Walgreens bought 1,932 stores from Rite Aid and closed about 750 of them.
Shopko filed for bankruptcy in January 2019 and closed all stores by June 2019. It had operated 363 stores in 24 states, mainly in small to mid-sized communities.
Lowe’s also closed 51 big-box stores in 2019: 20 in the U.S. and 31 in Canada.
Sears and Kmart have closed more than 3,500 stores in the past 15 years, with Sears closing 107 and Kmart 127 locations in 2019.
Walmart closed 269 stores in 2016 to concentrate on Neighborhood Markets and Supercenters. It closed 22 stores in 2019—all Neighborhood Markets and Supercenters—as it still struggles to find the right size store format to succeed in an ever-changing retail environment.
In February 2020, Pier One Imports entered bankruptcy and began closing up to 450 stores. Toys R Us closed all 735 stores in 2018.
Here are some of the 9,300 retail chain stores that closed in 2019: Bed, Bath & Beyond: 60; Payless Shoe Source: 2,100; discount chain Fred’s: 557; Walgreens: 200; CVS: 46; Office Depot: 59; J.C. Penney: 27; and Family Dollar: 390.
Orchard Supply Gets New Life
Orchard Supply Hardware was started in California as a non-profit farmers co-op by a group of orchardists and fruit tree ranchers in the middle of the Depression in 1931. The co-op transitioned to for-profit status as Orchard Supply Hardware (OSH) in 1950. OSH had seven stores when it was acquired by W.R. Grace & Company in 1979. The company was flipped to Wickes Companies in 1986, then the Wickes managers bought the company in a leveraged buyout in 1989.
Next up was Sears in 1996, which expanded the chain to 84 stores. Orchard Supply was spun out of Sears Holdings and became a public company in 2012, but was forced to file bankruptcy in 2013. Lowe’s spent $205 million to buy most of Orchard’s assets, with 17 of the 91 stores closing.
In 2016, Lowe’s announced plans to expand into Florida, eventually opening eight stores in that state. All 99 OSH stores were closed by Lowe’s by February 2019 so the big-box retailer could concentrate on its core business.
The 99 vacant OSH stores, mostly in the 30,000 to 35,000-square-foot range, created an opportunity for home improvement retailers who wanted to make a bold move. So far, Central Network Retail Group (CNRG) has snapped up 10 OSH locations in California and opened five Outdoor Supply Hardware stores to date, while Westlake Ace Hardware has opened stores in 11 former OSH sites in California.
Although technically chains, CNRG and Westlake are both backed by two of the industry’s largest wholesalers for independents: Orgill and Ace.
John Sieggreen, executive vice president of retail for Orgill and president of CNRG, says they were attracted to the fact the Orchard stores had a long track record of success in these communities.
“Throughout the store we’ve made a concerted effort to make it feel familiar to former Orchard customers. We didn’t change the checkouts or paint the walls and we hired a lot of former OSH employees at the associate, management and buying level,” says Sieggreen. “The result is to make those stores feel familiar to customers. The reception by customers so far has been super positive.”
Outdoor Supply Hardware offers the benefits of a small hardware store but features a larger fastener set and strong lawn and garden assortment, he adds. It was intentional to have the Outdoor Supply Hardware name so similar to Orchard Supply Hardware.
“Employees feel a sense of mission. They went from wondering what happened to my job to becoming part of something special again. There is an identity to these communities that is unique, and we wanted to retain that while providing a local option for hardware and lawn and garden,” Sieggreen says.
What CNRG learns from these Outdoor Supply Hardware stores can be applied to other CNRG brands and to Orgill retailers, Sieggreen points out. “We can go to our dealer base with a case study. We can be transparent about where it’s been successful,” he adds.
Charlotte Wells, brand manager for Tyndale Advisors, says it meant a lot to customers to see these stores reopen. “We had customers lined up outside the doors on the first day.”
She adds, “We requested feedback from customers: how can we better serve the customer to make sure these stores have what they need? So far, the Outdoor Supply Hardware stores have been very well-received.”
King’s Ace Maintaining Traditions
For a hardware retailer in Big Sky Country, Skip King knows a lot about meeting sky-high expectations and maintaining a legacy in an area where mountains are viewed as destinations and not obstacles.
As King prepares to open his sixth store in Billings, Mont., on March 16, he is most proud that the historic retail site is getting a new life. While most recently home to an IGA grocery store since the 1980s, it previously housed Odegaard’s Pharmacy and Hardware, which was known for having everything under the sun.
“There’s a huge tradition of hardware there. At Odegaard’s you would find an all-around general store with lumber and hardware and you could find fish in an aquarium—they were ahead of their time,” King says.
The 34,000-square-foot store will be 10,000 square feet larger than King’s next largest store, but he’s got a plan for that extra space. “We will have a huge pet department, frozen and soft foods, a Traeger store and a boutique like our Zimmerman Trail store,” he explains.
That store has found a niche with Montana-made and hard-to-find items, hats, scarves and even women’s jeans.
King is retaining one of the most popular features of the IGA store, which had been a local gathering place for coffee and donuts. King is leasing space to a couple to operate the newly remodeled Evergreen Cafe, which will offer soup, sandwiches and even kombucha to attract the younger generation.
“I think it will be a good mix. The older folk want tables and chairs to have their coffee and donuts, so we’re keeping that. We may even do soft-serve ice cream for kids in the summer,” he says.
King’s Ace Hardware’s newest store will feature a huge fastener department, because King wants to ensure it’s viewed as a hardware store first. He is working to put a U.S. Postal Station in there like he has in two other stores.
Taking advantage of another retailer’s misfortune, King snapped up four greenhouses from a recently shuttered Shopko in South Dakota and is planning a huge greenhouse area.
King took over the building last August and started tearing it completely apart, doing most of the work himself. “We tore the floor up and redid the parking lot, roof and HVAC. All the sprinkler heads had to be replaced. It was in pretty rough shape,” he says.
Sears Hardware operates two blocks down the street, but King says that store has been dying a slow death the past four or five years. This downtown location at 13th and Grand Avenue was the one spot King did not cover with his remaining stores—all are in Yellowstone County.
“There are 15,000 rooftops within a mile of this location. It was definitely underserved,” says King, who adds that independent hardware retailers have to be convenient or customers will buy online.
“Our business is good regardless of the economy, as long as you give good service and provide value,” he says. “We have products in stock for people when they need it.”
King is not done capitalizing on opportunity. He has an offer in right now on a shuttered Shopko building in Montana, which will hopefully turn into store number seven.
Ambridge Do it Best Home Center Solidifies Backup Plan
David Strano knows that even the best stores need a backup plan. Ambridge Do it Best Home Center has been serving Allegheny and Beaver counties for more than 65 years, but has been in Ambridge, Pa., since the early 1980s, according to Strano, a co-owner.
They moved to their current 40,000-square-foot location in 1995, but it’s still an area affected by steel mills closing. The population has declined 13.5 percent since 2000, as people move away after jobs are lost. “We had growth the first 10 years, but it’s getting tougher and tougher,” Strano says.
His first backup plan came in 2010, when he opened an InCom Supply business with salesmen on the road to meet the MRO (maintenance, repair and operations) needs of the area. Then in 2016, Benjamin Moore convinced him to open a standalone paint store in Pittsburgh.
“These were opportunities that arose and fell into our laps, but really I just wanted a fallback plan if the hardware business started declining,” he explains.
Strano had his eye on the Allison Park market, which is about 40 miles away from Ambridge. His Do it Best territory rep told him about a Sears Outlet location there that was shuttered. It had been vacant for less than six months after operating for 20 years.
Pouncing on the opportunity, Strano ended up with a 25,000-square-foot store that features an additional 2-3,000 square feet of outside patio space. In February 2017, Hampton Do it Best Home Center opened to an appreciative community.
“It required a normal amount of retrofit. We had to buy a lot of new fixtures and do a paint job. With help from Do it Best, we were able to open in a few months,” he says.
The new store doesn’t have lumber or rental like the Ambridge location, but everything else is the same, according to Strano. “We’re still trying to figure out who we are with that location, but people do seem to like the store. We send out monthly ads and do a lot with social media.”
Strano says their status as an independent retailer is a strength, not a weakness. “We listen to customers and invest in the community. We really try to go the distance to take care of the customer,” he says. “Employees are empowered to make decisions and make buying suggestions.”
With several backup plans now in place, Strano feels more comfortable with his business future. “I would consider another chain site if it comes available. We know how to connect with customers,” he says.
Third Time’s the Charm
With backgrounds in corporate finance, Chad Ford and Dan McLaughlin did not set out to be hardware retailers. Chad is also an attorney, but they had family in the hardware business who operated a True Value store in New Hope, Pa. “The time was right,” as Ford explains.
They opened their first store together in September 2014: Doylestown True Value in Doylestown, Pa. Accepted well by the community, that store gave Ford and McLaughlin the confidence to tackle expansion.
Richboro True Value opened in Richboro, Pa., in 2018, filling the space vacated by Rite Aid. “The opportunity arose and it’s a good market,” explains Ford. “We filled an immediate vacancy when Rite Aid closed.”
Their first retrofit came with challenges, as they discovered asbestos tile had been used at some point. “It didn’t end up being too much of an issue,” he says. They started the retrofit work in January and opened the 8,000-square-foot Destination True Value store in June 2018
Ford says True Value does a nice job of providing data on site locations to help them determine if a store will be successful. “They proposed several different locations and Richboro was one. There’s not another hardware store in that town, so we were able to fill that void. Customers are glad that we’re local owners and we’ve continued to grow,” he says.
Ford adds, “The average customer appreciates the fact the store is very shoppable and it’s laid out well. Everything we stress to our staff is about customer service and striving to provide the best experience.”
The second store has done so well that Ford and McLaughlin are working to open store number three in Blue Bell, Pa. Blue Bell True Value will open in early May in a former location for Pet Supplies Plus, a franchise chain.
The new store will be a little smaller than 8,000 square feet. Fixtures come in March 19, the inventory is scheduled to arrive March 30 and then Ford and McLaughlin put the finishing touches on a process that is becoming familiar to them.
“We’re in the stores every day making sure customers get the answers they need,” Ford says. “So far it’s been a lot of fun and very rewarding.”
Out With the Old, In With the New
Independent hardware retailers have been taking advantage of abandoned chain locations all across America, as the owners who have survived the invasion of the big boxes and the rise of Amazon find themselves positioned well to zig where others have zagged.
Lee Kennedy of Kennedy Ace Hardware in Worland, Wyo., is getting ready to open a new store in Worland that previously housed Shopko.
Mike and Gina Wilmes of Wilmes Do it Best Hardware in South Sioux City, Neb., are working to open their second store in Sioux City, Iowa, in a shuttered Shopko store. It will feature a 30,000-square-foot sales floor when it opens later this spring.
Harps Food Stores is opening its first free-standing Ace Hardware store this month in Charleston, Ark., in a former Walmart Express location.
Walter Toole was honored with the 2019 Beacon Award for Best New Store after he opened University Ace Hardware in Oviedo, Fla., in a former Walgreens location. That store nearly doubled Ace’s proforma in the first year. Toole is planning to open his 11th store, Aloma Ace Hardware, in Winter Park in early May.
Sherry and Dennis Bishop and Robin and Eric Smith were also honored with the 2019 Beacon Award for Best New Store for Petersburg Do it Best Hardware, which moved to a new location in Petersburg, Ind., that previously housed a Shopko.
After originally planning to lease some of the space, the Bishops and Smiths ended up using all 28,000 square feet of sales floor, a big jump from their previous 6,000-square-foot location. They filled it with lumber, riding mowers, workwear, appliances, toys and more, turning their store into a one-stop shop for locals. It may be a big store for a town of 2,400 people, but Petersburg Do it Best Hardware has been a smashing success so far.
Scott County True Value opened last November in a former Walmart location in Waldron, Ark., that had been shuttered since 2017.
In Lincoln, Neb., Q.P. Ace Hardware was able to open a new store on March 2 in a former Ideal Grocery site despite having a car crash into the building the week before. That had been the city’s oldest grocery store until it was destroyed by fire in 2016.
Last April, Busy Beaver opened a new 33,000-square-foot store in a former Big Kmart location in Elkins, W. Va. That was followed in May by a new Busy Beaver store in Calcutta, Pa., taking the place of a shuttered Kmart. In October, Busy Beaver closed a store in Canton, Ohio, that had previously housed Stambaugh Hardware so it could move to a bigger location that formerly housed Sears. That store carries the True Value brand identity.
As the retail landscape continues to change, independent retailers are discovering a simple truth: you are either a buyer or a seller. For those unwilling or unable to capitalize on opportunities, they may not like what moves in down the street.
Westlake Ace Expands to California
The Hardware Connection interviewed Westlake Ace Hardware President and CEO Joe Jeffries about their expansion into the West Coast. Ace Retail Holdings, a division of Ace Hardware Corp. that owns and operates Westlake Ace, has been busy opening 32,000 to 34,000-square-foot stores in former Orchard Supply Hardware locations.
THC: How many former Orchard Supply Hardware locations will Westlake Ace be opening new stores in? How many have opened so far?
Jeffries: We opened 11 stores in California in 2019. The stores are operated under the Ace brand and are located in Chico, Fresno, La Crescenta, Mountain View, Pinole, South Pasadena, Thousand Oaks, Turlock, Van Nuys, West LA and Woodland.
THC: How have the stores been received so far in these communities?
Jeffries: The reception we’ve received has been overwhelmingly positive. We are thrilled that our new customers once again have a local hardware store, full of friendly and familiar faces, and an exciting blend of products. Most importantly, we look forward to being part of these communities and showing our new neighbors how we live the Ace Helpful Promise every day by delivering reliable service, helpful advice and products to help them get their projects done right.
THC: What is different about the product assortment and niches carried in these stores compared to your typical Westlake Ace stores in the Midwest?
Jeffries: In addition to carrying a wide variety of local and regional products our California customers are familiar with, the stores all carry traditional hardware products such as fasteners, electrical supplies, tools and plumbing supplies. We’ve also introduced several exciting “store-in-a-store” concepts and departments such as Garden Centers, Pet Supply, Backyard BBQ, Outdoor Power Equipment, The Tool Shop, The Paint Studio and Kitchen Essentials. A select number of stores feature Hallmark Gold Crown Stores.
THC: Are these stores in former OSH locations a springboard to more expansion for Westlake and the Ace brand in California?
Jeffries: Our growth in California is the latest example of the vibrant and positive evolution Westlake has gone through in the past several years, and we are continually looking at opportunities to continue that growth in a way that makes sense for our business and the communities we hope to serve.
THC: Isn’t it nice to see the Ace brand take over locations that were shuttered by a large corporate chain?
Jeffries: The most important thing about this trend is that retailers like Ace are able to serve communities that have lost local retail hardware options. It’s gratifying that we can once again bring these communities a fresh and new retail option that delivers a blend of familiar and local products, exciting new products and world-class service.