Ace's Venhuizen takes over the reins
On March 31, John Venhuizen will step from behind the scenes into one of the most front-and-center posts in the hardware business — that of CEO of Ace Hardware Corp. After standing and delivering a motivational presentation to thousands of dealers at the co-op's Spring Convention & Exhibits in New Orleans, he sat down with HCN.
HCN: What worries you as you step into the CEO role?
Venhuizen: I think the theme of the day here is momentum and continuity. Change in leadership doesn't necessarily mean change in direction. We feel like we have momentum. That's not to say everything is rosy. We've got challenges.
HCN: You have stated that the industry's declining transactions and store count are two of them.
Venhuizen: Our challenges and the retailer's challenges are the same thing. There is pressure on our industry. It's consolidating. There's pressure on transactions and profit, and operating expenses, health care. But when has our business not had some sort of challenge? We need to focus on what we think we're great at. We're optimistic about our future despite all those challenges.
HCN: You also emphasized the idea of keeping score with money. Can you explain that?
Venhuizen: In business, we keep score with money. And we encourage our stores that they shouldn't feel bad about that. But business is not about money. It's about people. And people are why we keep score. Because in the end, for a lot of our owners, what they're most proud of is what they can give back to the community. And they have the ability to give back because they run a successful hardware store.
HCN: A big buzz at your show is the introduction of Valspar.
Venhuizen: Without doing anything, because of our partner, you get 10% more gross profit on the No. 1-rated paint in America (according to Consumer Reports), Clark & Kensington. That's a big win. They get a year and a half to sell Valspar before they have to pay for it. Third, they're going to get the whole department for free — tinters, racks, decor signage and a free reset. And our dealers believe we are going to do what we say we are going to: drive footsteps into the store with the paint lineup.
HCN: Why are some on the fence about bringing it in?
Venhuizen: The issue is whether the brand they also have already will allow them to bring in Valspar. And that's causing some consternation, understandably. That's really the only tension. Outside of that, I'd say reaction is wildly enthusiastic.
HCN: Would you agree the No. 1 story today is the battle with the big boxes?
Venhuizen: The growth of Home Depot, Lowe's and Menards has made it more difficult in our industry. But their days of large new store growth are largely behind them. In the $300 billion pie in home improvement in the U.S., we are going after the $40 billion that is the convenience hardware segment. Our stores get about $10.5 billion of that in the U.S. We're going after the rest.
HCN: What's your current home improvement story in your house?
Venhuizen: I just told the story [during the general session.} While I was traveling, I had my wife go painting with the No. 1-rated Clark & Kensington.
HCN: I didn't know if that was a real story or just an entertaining story.
Venhuizen: It's real. And it's a project that is going on right now. Do you think I make that stuff up?
HCN: You look like you have fun up there speaking to the members. Is that a prerequisite for the job?
Venhuizen: No, but it helps. When you get a great team together and they love what they do, the energy comes through and that's what you see.