Retail Focus: Largest Thrifty Announced
Plans have been unveiled for the largest Thrifty-Link store in Australia – and it’s a huge vote of confidence in rural hardware retailing…
Store: Riordan Hire & Hardware (Thrifty-Link)
Owners: Riordan family, Colac, Victoria
Group: John Danks & Son
There is an interesting phenomenon taking place in many parts of regional Victoria: rural townships are regaining an economic spring in their step.
In towns like Bendigo, Ballarat and Colac, where the effects of drought are less overwhelming than in other regions, rural communities are thriving on the back of improved transport networks; the availability of proximate tertiary education facilities; and safe, affordable family living environments.
Nowhere is this invigorated regional spirit more evident than in Colac, a town of 10,500 people about 150kms west of Melbourne, where plans have been revealed for Australia’s largest Thrifty-Link outlet.
The $12m project is being undertaken by Peter and Marg Riordan and family, fourth-generation Colac residents and owners of Riordan Hire & Hardware, which was established in 1976 on the eastern outskirts of town. The new store will be built on the site of the existing outlet and its sizeable curtilage, and complement two smaller outlets owned by the family in Lorne (purchased in 1995 and managed by son Dan) and Aireys Inlet (acquired last year and managed by daughter Susan) on Victoria’s southern coastline.
In June the family teamed with senior Danks representatives to announce publicly the construction of the new 6,000m2 development. The precinct fronting Princes Hwy will include a 3,500m2 undercover retail area (up from the current 400m2), a 300-space carpark, café, extensive garden nursery and building materials yard.
According to Richard Riordan, who manages the day-to-day Colac operations with his brother Anthony, the time is ripe for a major upgrade. “There are about 150 new homes being built in the town, which is a far cry from when I was growing up and seeing about 10 new homes a year going up,” Richard explains. “And our development is just one of half a dozen major projects being planned for the town, representing a total investment of about $60m, so we thought ‘It’s now or never’ and decided to take the risk. We live in a pretty stable town – there are no boom times…but there aren’t any busts either – and you see that reflected in the streetscape with signs of new renovations in the 1920s, 1930s and right through to the 1960s and 1970s and the modern era.”
Richard says he believes owners of small hardware stores must embrace a fresh change in direction, following the consolidation of large-format stores and an associated shift in client expectations. Bigger, Richard says, is definitely better in order to satisfy his local mixed market of farmers, trade customers and general consumers.
“We had 20% retail growth in the last 12 months, but we found we hit a ceiling because we didn’t have a building supplies area,” says Richard. “So we started to investigate what it would cost to fix up the current premises, and we realised very quickly that if we only rebuilt a shop of the same size then the next threat would be the arrival of big [format] competition. We thought, ‘What makes the competition come to a town like ours and why can’t we do the same?’” In this regard, the family’s decision to upgrade to a much larger store is a pre-emptive strike against potential new arrivals. “I guess our inspiration is to go to Safeway in Colac and see that the carpark is always jam-packed seven days a week,” Richard adds. “People are used to extended hours – they’ll buy a product if it’s there on the shelf, so the days of small mum and dad operations are numbered.”
The upgrade is also a tremendous vote of confidence in the support and loyalty of the local community. Richard says the lion’s share of current trading (60%) is with account customers, compared to 40% cash. “I’d aim to reverse those figures so we have more general consumers coming into the store.” The final product selection will also recognise the specific needs of Colac consumers, with 30% of the overall 21,000 SKUs customised to suit the local agricultural and building markets.
The new outlet will embrace Danks’ XL large-store format, catching the eye of passers-by with a 7-metre-tall façade. An important aspect of the development is its allowance for a number of other retail outlets on the large property, paving the way for complementary businesses to help create a hardware-centric commercial hub – “though I’m a hardware retailer first and a property developer second,” Richard admits. “Still, it’s good to have future options.”
“I must say the partnership we’ve had with Danks has been fantastic, not only through their help in providing us with plans and drawings, but also in terms of their assistance with everything down to employee relations; they’ve come through with everything asked of them,” says Richard.
Speaking at the unveiling of the development plans, Danks’ State Manager (Vic. & Tas.) Peter Richards said he was aware of the synergy between Danks, a fifth-generation family company, and the Riordan family business. He noted that Danks now has approximately 360 Thrifty-Link members throughout Australia, including 100 in Victoria, and operates the largest independent hardware distribution business in the Southern Hemisphere.
The new Riordans Thrifty-Link store is due to open in October next year.
By John Power