The power of “one”
Most businesses would be delighted to grow from one hardware outlet to 10 — but Bretts Timber & Hardware in Brisbane, Queensland, has cut back from 10 outlets to one during its 85-year history — and it’s all part of a strategic move toward specialisation…
Store: Bretts Timber & Hardware, Qld
Owner: Diverse (majority family) shareholdings
Some businesses achieve success with scattergun growth tactics in all directions. And then there are those such as Bretts Timber & Hardware, located in inner-Brisbane, which has refined its activities to target niche markets with almost arrow-like precision.
The lock machine shop is always busy
In an era when growth in the hardware industry is typically characterised by a “more outlets are better” philosophy, Bretts has taken the opposite view that a single, large, comprehensive outlet in a key location is better than multiple stores in less prominent surroundings.
The approach is vindicated by the company’s turnover statistics: Bretts, as a group including several non-retail hardware interests, packs an annual $70 million punch, about half of which is the direct contribution of the timber & hardware store. The strategy is obviously working well.
According to Bretts Timber & Hardware Executive Director, Bill Nutting, the company has undergone numerous growth and shrinkage cycles since the business began in 1918. Bill’s forebears, brothers J.F. and B.C. Brett, entered into partnership with Colonel J.E. Christoe at the end of WW1 and founded the timber company B.C. Brett & Co, which sourced logs from the Mary Valley region of Queensland.
The enterprise expanded to include a large sawmilling business on the site of the current hardware store in Windsor, and the mill became one of the most important suppliers of timber to the Brisbane housing market by the 1930s.
Timber is a major department in the store
Businesses including plywood manufacturing facilities and even 10 hardware outlets came and went over the ensuing decades, culminating in a more patient and less volatile business ethic by the 1970s…but there was one more major change to come. Having occupied the prime Windsor site (nearly 10 acres) for so many years, the land was sold several years ago and redeveloped to create a business park of over 20 retail outlets, including a Kmart Garden Centre and a Super Cheap Auto outlet. Bretts Timber & Hardware now leases two and half acres of the site alongside its new retail neighbours.
Bill says the current store, with 80 full-time and 20 part-time employees, was built from scratch as part of the full site redevelopment, presenting plenty of opportunities for him and his colleagues to evaluate the business and finalise its aims.
Customised timber cutting in action
The consensus was to avoid dramatic diversification in favour of a more streamlined store specialising in Timber, Paint and Door Furniture. Other store departments of particular note include Fastenings and Hand Tools (though the latter category is diminished due to competition from Kmart and Super Cheap Auto).
Rather than expand the store to include added departments like Outdoor and Garden, Bill says the policy has been to “stick with the traditional strengths” of the business.
The strength of timber
Bill Nutting says customers demand specialised service
Timber, unsurprisingly, is the feature department, and the company still maintains a cypress milling operation at Inglewood.
“Our ‘Timber & Hardware’ area is a major point of difference between us and our competitors,” explains Bill. “We’re particularly strong in structural timbers and we only stock those species we know are reliable in terms of durability and structural integrity. At any particular time we would carry 2,000 cubic metres of timber.”
The range depth and quality are highly prized by trade clients, who make up 70% of overall custom. “For example, we have over 20 cubic metres of 2” hardwood slabs, up to 4’ wide and 12’ long,” says Bill. “Try finding that in one of your big boxes.”
Bretts Timber & Hardware – the new premises
In addition, the store features a dedicated “Architectural” Department to inspire trade clients and their customers by showcasing new-release products and design concepts. This special area is complemented by “Totally Floored” (which manufactures and wholesales Australian species engineered flooring) and “Design” spaces catering to the needs of professionals and discerning home renovators. Indeed, the “Design” idea, concentrating on homewares, kitchen and bathroom products, has proven so popular that additional Design outlets have been opened in Maroochydoore and Indooroopilly.
While such floor areas are not designed to provide formal consultancy services, they are intrinsic to the store’s image as a provider of carefully chosen, superior products, all presented by helpful and knowledgeable staff.
Promotions & Pricing
The Door Furniture Department is extensive
Promotions are important and Brett’s handles its own advertising. Trade clients receive product/pricing catalogues, normally hundreds of pages in size, twice a year. General consumers are able to view periodic releases of four-colour brochures.
An impressive website (www.bretts.com.au) also lists products under the broad store categories and is a useful tool to whet the appetites of local shoppers.
“But I’d say our overall success is due to some pretty basic elements, including location, longevity (“we go back 85 years”) and range offer,” says Bill. “If you start fiddling with the formula you’re in trouble. Staff are equally important to our success at Windsor; staff turnover is low, with more than a third of the team spending over a decade with us, and our ethos is to make working here as much fun as possible.”
Competitive pricing is addressed on two levels. On the one hand, Bretts is a proud founding member of National Building Suppliers Group (NBSG), which provides great buying power to the business.
All store layouts feature easy-to-view displays
On the other hand, Bill says pricing is secondary in the minds of clients to location, service and range depth. Even more interestingly, he says his margins have increased thanks to strategic micro-management down to individual line items — and all in the shadow of a big box rival store nearby!
With business booming and customers showing loyalty to the outlet, the main challenge for Bill and his colleagues will be continued growth. He says he has considered starting up specialised stores such as Garden-oriented outlets, however the health of the present business does not require immediate bolstering from other sources.
For the time being, the existing sole outlet is a powerful base from which to make long-term, strategic plans.
By John Power