Knives: Putting an edge on hardware sales

While the utility knife is a staple of home channel tool sales, an array of pocket knives, multi-tools, folding knives and the like are getting shelf space at hardware retailers.

Brands like SOG, Buck and Gerber are finding their way into national retail chains where they say customers are looking for more options in cutting tools—and they’re not afraid of higher price points.

“We see the hardware business expanding,” said Bill Raczkowski, category manager for Gerber. “We have seen several stores being more open to offering more branded knives and tools. This tells me the consumers are asking retailers for more options other than the $5 knives.”

Raczkowski said one of the reasons the sporting category of knives is expanding in hardware stores past the traditional utility knife is their versatility.

“We call them ‘sporting’ knives, yet they are applicable to all uses,” he said.

Another reason is their aesthetic appeal. Raczkowski said that a lot of effort has gone into their style as well as their function.

“The sporting goods market is highly competitive, and one thing we need to do is differentiate with aesthetics and design,” he said.

He also pointed to the knife’s appeal as an impulse item, albeit a higher-end one.

“Hardware consumers also hunt, fish, bike, hike and spend time not working,” he said. “When they’re shopping for light bulbs and wrenches, if they see a knife they can use for these activities, they’ll buy [it].”

Gerber’s multi-tools are featured prominently in big-box retailers like Lowe’s and Home Depot, but the company sees the potential in utility blades as well. Currently, Gerber offers two products along its E.A.B. utility line, which stands for “Exchange-A-Blade.”

And while some retailers may view knives as items of opportunity, others use them as a hook to draw in customers. Retailers like Emory, Texas-based Hooten’s Hardware have seen their knives department become a customer attractant. They recently bulked up the department with the addition of a Case Knives shop, which features more than 800 varieties of knives.

But it’s not just the big knife brands like Gerber or Case that are eyeing independent retailers. Olympia Tools, which already has a large market share in utility knives, sees the potential in the other arenas of knives as well.

“I believe that [independent retailers] can compete because you really get into a specialty type of customer,” said Tony Lee, marketing director for Olympia. “You’ve got all different kinds of varieties and handles, and you really get into the high-end segment, where going upwards of $100 isn’t out of the question. It allows the independents to compete for a consumer who’s not in the big-box stores.” He also pointed out that sporting-type knives usually top out at $50 at the big home centers.

Olympia is eyeing the potential on the side of multi-tools and folding knives that sit at the under-$20 price point. It has even expanded into smaller knives, like its iWork hook knife, which features a multi-function carabiner.

Lee said that there’s a fine line between the sporting good and the hardware knife. He pointed to the development of the folding utility knife 10 years ago as an example of how one tool can marry both functions.

“It’s now the No. 1 tool at Home Depot,” he said.

But Lee said he believes there’s an opportunity for the utility knife to become a lifetime product, a perception Brett Seber, of Seber Design Group, is working to build.

“The only thing that’s really disposable is the blade. I liken it to buying a new car and throwing the car away when the tires wear down; that’s just not what you do.”

The problem, as Seber put it, is the retail market is locked by price point, with utility knives topping out at $14.99, making Seber’s latest model a hard sell at $29.99.

Seber’s newest take on the utility knife is its folding knife with rotation lock. The ratcheting lock system allows for the knife to be locked in any position, much like the brand’s sporting-type knives. In addition, the blade holder has a relief grind for more cutting clearance, allowing for 30% more cutting surface availability. The new relief grind also created the ability to introduce serration into the blade’s design.

The company is currently working on a private-label version with the same features that is made with more affordable materials and can compete at the $14.99 price point.