The Tassie Independent

The Tassie Independent

Lloyd Pegus has created a flourishing timber and hardware business in Burnie, Tasmania, by “fiercely and jealously” protecting his independence…

Store: Timberland Hardware & Building Supplies, Tas.
Owner: Pegus family
Group: Hardware & Building Traders

Visitors to Timberland Hardware & Building Supplies in Burnie, Tasmania, will find a sprawling business precinct covering both sides of a road, complete with a warehouse, general hardware store and timber yard. Like the trees that provide the dominant product for the business, the operation has expanded slowly and organically over the years, taking up more land whenever the prevailing climate has warranted a growth spurt.

Timberland’s Managers Lloyd Pegus, Allan Radford and James Allan

Lloyd started Timberland in 1975 after running a successful joinery company, and maintained joinery as the core element of the new venture. Over time he took on timber reselling to service a large market on Tasmania’s north-west coast, and then six and a half years ago he opened his general hardware store across the road to capitalise on a burgeoning DIY clientele.

According to Lloyd, the fundamentals of the business have always been his chief preoccupation: plentiful (free) parking, ample land for warehousing and expansion purposes, high-quality merchandise, careful stock selection and “top notch service”. By keeping a close eye on these basic components of the business, Timberland has enjoyed an annual growth rate of about 10% since its inception — “except for the last couple of years,” Lloyd explains, “when we’ve doubled that rate.”

These days the various components of the operation are staffed by 16 employees, six of whom work in the hardware store.

The main hardware store is well established and sizeable

“There are about 20,000 people in Burnie, so we’ve needed to target the trade customers,” says Lloyd. “But, on the other hand, you can’t rely on that alone; you’ve got to allow for a downturn and that’s why we started the hardware store for the DIY customer. Overall business would be about 50% trade and the rest is the DIY market.

“I’m happy where we are with that mix, though we do try to build it [DIY/consumer custom] with new products that are in demand.”

The Treated Yard forms a major part of overall business

At the end of 2003 Lloyd took a radical step and decided to join Hardware & Building Traders. “I looked upon it more as joining a co-op than a group,” says Lloyd, indicating that he values the independence to make buying and promotional decisions without encumbrances.

“We’ve always done our buying directly through the companies and their reps, and as members of HBT we can continue to do that with all the benefits that come from being in a buying group. We have always been fiercely and jealously independent and we want to stay that way.”

No Problem
With independence comes flexibility to alter stock inventories and advertising schedules, and Lloyd says he has never had a problem with either facet of the business.

Ben Hayes, Barry Dick, Callun Beswick and Peter Wilson in the hardware store

“With timber, which is our principal stock, we’re simply resellers (though we do cut to size in our workshop,” he explains. “That allows us to be very selective about the types of timber we carry and its quality—we’re always very careful about accepting only the highest-quality timber. We still wheel and deal but you can’t compromise on quality. At the end of the day that’s what sets us apart from some of the bigger companies that get bogged down because they’re spread all over the place.”

Delivery services also constitute a powerful commercial service, satisfied by three Hino trucks of 15, 9 and 4-tonne capacities. Two vans service outer areas under contract, broadening the catchment area of potential customers to about 100,000 people. Dominant categories in the hardware store are General Hardware, Garden, Hand Tools and Power Tools.

The range of bulk hardware is immaculately presented

As far as advertising is concerned, Lloyd finds that TV is inappropriate because State-based coverage is unnecessary and there are no regional options available. “We do continual radio and spot newspaper ads, but word of mouth is our biggest endorsement,” he says, noting that the spate of TV DIY shows provides a welcome boost to sales. “They’re doing the advertising for us!”

By far the biggest ‘point of difference’ between Timberland and rival stores, explains Lloyd, is the level of service he can provide through the expertise of his staff.

“I can see…everything”

He says he has little patience for adolescent employees who know nothing about the industry, and would not waste his customers’ time with inexpert assistance on the floor. A knowledgeable workforce, he insists, is necessary to maintain store credibility and long-term loyalty.

Paint is a dominant Department of the store

This high-class level of expertise has helped create ancillary services like an estimating service, which is extremely valuable when advising clients about realistic project budgets and stock requirements. Of course, well-founded and reliable estimates often lead to solid orders. Lloyd is now in the enviable position where he can let the business grow according to its own pace. There is free land in the area for store redevelopments or expansions if the need arises, with none of the pressures to relocate that often confront metropolitan storeowners.

“It’s just the way I like it,” says Lloyd. “I can see the warehouse out the window and the timber facilities and store are right here in front of me. Everything is where I can see it.”

By John Power