Under the umbrella of True Value, a handful of the co-op’s brands represent niche businesses beyond the nuts-and-bolts of DIY hardware retailing. In the rental business, they are Grand Rental Station, Taylor Rental and Just Ask Rental. Commercial businesses are more familiar with Induserve Supply. Party Central and Home & Garden Showplace round out the specialty brands.
One of the many jobs of Eric Lane is to grow these businesses in a way that helps True Value members grow theirs. Lane was tapped for the position of VP specialty business in February of this year, after learning the ropes during a 24-year career.
In his new position, Lane also oversees the fast-growing international business. Together, the areas account for about 20% of True Value’s volume. How does one person do it? “It’s a challenge. I can do it because I have good people on staff,” he said. Good answer. Here’s the rest of the Q&A.
Home Channel News: How do you describe your role within the co-op?
Eric Lane: The role is multifaceted. We’re attempting to bring the co-op model to some of the other industries — and these are strong independent industries, much like the hardware industry. And at the same time, we’re also leveraging the knowledge from rental, nursery and certainly our international division into the hardware space.
HCN: You have 24 years in the co-op business. What speech did they give you when you were asked to oversee specialty businesses and international?
Lane: There wasn’t a specific speech. I typically have been in areas that are growing or areas that we think have potential for growth. So, my belief is I was tapped on the shoulder for this role because of the potential in the specialty businesses. I don’t know how to cut or retrench; it’s not a core competency I have. So True Value sees growth opportunity in these businesses, and we just need to tap into those opportunities.
HCN: How accurate is it to say some of the specialty businesses are flying under the radar, and is that a challenge or an issue?
Lane: It is accurate to say that. But I also believe that we’re not in these businesses for industry recognition. I think as long as the membership of True Value knows the value that the businesses are bringing in, that’s what these businesses are for. These are local, independently owned businesses that in their own marketplaces are known for what they do.
HCN: Of the specialty niches — party, rental and garden — which is the fastest-growing right now?
Lane: The fastest-growing piece of the rental business is party, no doubt about it. With the economy the way it is, people may be having smaller parties, but they still have parties. It’s an area where our stores see growth. And it’s not just parties; a lot of people are now doing their own weddings, instead of renting a banquet hall. They’re putting up a tent and tables and decking it out, and our stores can play very well in that.
HCN: The word from the front lines is, rental is a great business, but only when you do it right. How much would you agree with that?
Lane: There is a high degree of operational efficiency that has to be done right. Not only dealing with the customer, but keeping the equipment maintained. The longer you can maintain the inventory or the assets, the more profitable the asset is. That’s why we have training opportunities here at our headquarters and in Cary, Ill. We do training at our markets, and we also have online training available. We want to touch our dealers in all the ways we can, because it’s such a significant piece.
HCN: What are some of the most important items for retailers to stock in their rental departments?
Lane: Certainly having party-related items — tables, chairs and tents and bouncy houses for the kids. The other thing is, many of these businesses have not only made an investment in the equipment, they’ve made investment in the operation. The expectation of a consumer that’s renting for a party is very different from the consumer that’s renting a tiller to work in the back yard. Some have actually hired planners into their businesses.
HCN: What about the garden spending?
Lane: Home and Garden Showplace and the nursery business in general are extremely weather-dependent. Any business where you do 75% to 80% of your annualized volume in about a 60-to-90-day window, weather is important. You want to control your own destiny, but if you can’t get out on that weekend, that’s Mother Nature, and it will wreak havoc on that business.
HCN: What are the trends affecting your international business?
Lane: International has been a growth area for us in a few ways. A lot of the countries we sell to are investing in their infrastructure. We are strong in the Caribbean and Panama and places where weather can cause damage; that helps lumber sales. Also, the world has gotten smaller and communications have increased. We’re able to get the product from our DCs from a port and into their country a lot quicker than before. So, our customers who used to just buy at our markets and stock up, they are looking at the same metrics used in the states — ROI and inventory turns. So they’re leveraging our DCs here in the States and ordering more frequently with us.
HCN: Where was your last trip?
Lane: Panama. We have an operator opening five additional stores over the next five months. The only way you can learn the business and support the business is to be in the stores and see what’s going on.