Vol.137 No.1 Jan 2022 SINCE 1886 www.hardwarejournal.com.au
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DEPARTMENTS Newsmakers Features 4 Viewpoint 6 Retail Focus 10 Behind the Counter 12 US News 14 NZ News 16 Timber Update 52 News 60 What’s New 18 Australian Made The popularity of Australian Made products is stronger than ever as Australians continue to seek out locally made products, particularly as imports remain difficult to source due to ongoing shipping delays. In this edition’s Australian Made report, AHJ investigates how local manufacturers plan to cope with this unprecedented demand, particularly as the pandemic remains the primary driver of buying locally made products. 52 T otal Tools mega-store planned for Gladstone. 55 P inks family stands strong 160 years on. 56 Melbourne International Garden and Flower Show returns. About the Cover For more than 30 years, the AMAG logo has helped thousands of brands communicate their Australian credentials to consumers, businesses and all levels of government. It does this instantly and clearly, making it a powerful sales and marketing asset for authentic Aussie brands, and a helpful shopping aid for consumers around the globe. Australian Made Ad_HR.pdf 1 10/1/22 4:23 pm Vol.137 No.1 Jan 2022 SINCE 1886 www.hardwarejournal.com.au 59 6 10 18
CAB Audited Glenvale Publications and Australian Hardware Journal are pleased to provide the articles contained in this publication to keep its subscribers up to date on issues which may be relevant to their businesses. This publication is supplied strictly on the condition that Glenvale Publications and Australian Hardware Journal, its employees, agents, authors, editors and consultants are not responsible for any deficiency, error, omission or mistake contained in this publication, and Glenvale Publications and Australian Hardware Journal, its employees, agents, authors, editors and consultants hereby expressly disclaim all liability of whatsoever nature to any person who may rely on the contents of this publication in whole or part. Published by GLENVALE PUBLICATIONS A.B.N. 31 218 591 688 11 Rushdale Street, Knoxfield Victoria 3180 Phone: (03) 9544 2233 Editor: Christine Bannister Phone: (03) 9544 2233 Email: firstname.lastname@example.org Journalists: John Power Hartley Henderson Jamie Della Online Communications & Production: Justin Carroll Email: email@example.com ADVERTISING Harry Rabiee Email: firstname.lastname@example.org Phone: (03) 9544 2233 Mobile: 0403 000 444 ACCOUNTS Melissa Graydon Email: Melissa.Graydon@glenv.com.au SUBSCRIPTIONS Melissa Graydon $93.00 – 12 issues email@example.com ART AND PRODUCTION Justin Carroll PRINTING Southern Impact Pty Ltd 181 Forster Rd, Mount Waverley VIC 3149 Phone: (03) 8796 7000 Happy New Year to all of AHJ’s loyal readers and supporters. While most within the hardware industry may look back on 2021 as another bumper year of healthy sales and category growth, ironically, I think we are also breathing a sigh of relief that independents and suppliers have successfully tackled another year of COVID chaos. With COVID already reaching record numbers this year, independents are once again bracing for on-going supply issues, staffing shortages and more importantly, keeping up with the ongoing demands of the DIY and building sectors as consumers continue to build and renovate. Incredibly, I believe many new home starts will not begin until May this year due to the back-log of demand. Despite the challenges, one outstanding positive to come out of the pandemic is how local communities have reunited and come together during this time, with independents benefitting substantially from a newfound loyalty. Local residents have discovered that their nearby independent hardware store has the ability to provide so much more than they initially thought. Repeat business is now on the rise, particularly as COVID numbers soar and customers opt to shop in their hometown in an effort to stay out of potential COVID hot spots. It is great to see independents fully embracing the influx of local customers, and maintaining this local support by ensuring all of their customers’ needs are met. While independents continue to celebrate some of the positives to come out of the pandemic, there are still many challenges to be overcome including the struggle to retain quality, well-educated staff in-store during this time of huge demand. It is for this reason that updating technology in-store has become essential for many businesses in an effort to not only improve customer service, but also open up a store’s online offer as the unprecedented popularity of online shopping continues to grow years ahead of its time. Fortunately, retailers are now experts at adjusting on a whim to ensure their businesses run smoothly throughout this time. 2022 will be no different. Despite the ongoing uncertainty, several independent groups continue to plan their 2022 conferences and trade shows in the hope that the events can be run in a safe and orderly manner. While the iconic Independent Hardware Group’s (IHG) EXPO - scheduled from February 8 – was recently cancelled due to rising COVID numbers, the EXPO will now proceed online in a similar format to last year. All going well, and at the time of writing, just some of the events AHJ will partner with this year include the Paint Place Group of Stores Conference to be held from March 18 to 20 in Townsville, Total Tools Conference scheduled from April 20 to 21 on the Gold Coast and the Hardware & Building Traders (HBT) Conference to be held from May 3 to 5, also on the Gold Coast. Despite the rising cases, the AHJ team remains hopeful these groups, and more, can proceed with their much-needed conferences and trade shows throughout 2022. Christine Bannister - Editor
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Business: Dipper’s Home Timber & Hardware Owners: Rebecca Diprose Location: Moree, NSW Buying Group: Independent Hardware Group (IHG) Dipper’s Home Timber & Hardware – rising through adversity The hard-working team from Dipper’s Home Timber & Hardware have endured their fair share of tragedy and natural disasters since the store opened almost a decade ago. Their efforts to overcome hardship and build a thriving business for the community of Moree gained state-wide recognition in 2021, being named IHG’s Home Timber & Hardware Store of the Year for the NSW and ACT region. After purchasing the store in November 2012, Rebecca and her husband Anthony (dec) doubled the store’s turnover in just 18 months after the couple saw an incredible amount of untapped potential within the business. It quickly went on to win Home Timber & Hardware National Store of the Year (over 1000 square metres) just 18 months on in 2014. Anthony (Dipper) was already a well-known personality in the district and, with the help of a friend, pushed the business hard during the first two years of operation. The store grew to its full potential in a short amount of time through the implementation of the right products, store relay and upgrade, high-quality customer service, while also maintaining a close connection with the local community. The business continued to grow, but in 2017 Bec and Anthony became concerned about predictions of the drought in the local area and began to prepare themselves for a downturn in business. Then the unimaginable happened not long into the year when Anthony passed away from a sudden heart attack at the age of 47. Rebecca was not only left to try and comprehend the sudden loss of her husband, but also take on the business by herself while also bringing up three
03 9555 3351 detailretail.com.au Brighten your garden centre with our modular garden display stands. In stock and available for immediate delivery ‘The Boat’ Available in Medium or Large sizes For close to 20 years, Detail Retail has designed and supplied affordable and reliable garden centre display stands. Comprising of 8 units, display as a boat or two single sided wall units! prices held whilst stock lasts Detail Retail 09_21.indd 1 10/9/21 3:26 pm RETAIL FOCUS young children aged just three, six and seven years old. To complicate matters further, the family were only months away from embarking on a new home build. “We had to make some very quick decisions in regards to the shop and the new house,” Rebecca said. “I had been working in the shop a day or two a week prior to this, but more with the accounting side of the business. Luckily, I did sit down with Dipper and he showed me a lot of the businesses systems that were in place before he passed away. Just six weeks after Dipper died in 2017 we had our fifth birthday celebration at the shop which gave me the opportunity to thank all of the staff that had supported my family throughout this time,” she said. The support from the IHG group at the time was unwavering, particularly from nearby members, including owner of MacKenzies Home Timber & Hardware in Goondiwindi, Clive Quartemaine, who is situated about 120 kilometres north of the store. Clive was helping in the store the day after Dipper’s passing to ensure everything was running smoothly, according to Rebecca. “Clive’s business is very similar to mine so I only have to pick up the phone and ask advice on things such as wages or where a certain department should be at and he just helps out. I often take our store managers for a day trip to his store because Clive is so clever with store presentation and the general running of the store. He is an inspiration to our business.” “IHG’s State Manager Ian Back has also been on the Dipper’s journey since we bought the store and has been an enormous support, while our Business Development Manager, Chantel Jackson is also super passionate and genuinely interested in making sure all is OK, coming on-board just three months after Dipper died. She is so clever on sourcing all the right products, store layout, HR and merchandising because she worked in a trade centre,” she said. While Rebecca says even though she runs an independent business she feels like she has the benefit of the entire IHG team behind her, particularly when it comes to IHG having the ability to secure stock and prices and utilising IHG’s warehouse as well. When it comes to support, Rebecca is grateful for the talented leaders helping guide the business. “Site Manager Mark Baker has really stepped up, particularly in the trade area, and has been a stalwart of our store for 20 something years.” “Luke Cubis is another young leader I rely on who started out as a junior at the store before embarking on a traineeship and is now the Retail Manager at the store. At 22 years old he has a maturity beyond his years.” “I also have our office manager Margaret O’Neill who has been with us since we bought the business. Her attention to detail is incredible,” she said. When Dipper was alive he would come home with great ideas and Rebecca said that often she would be the one who was left to make ideas happen. “But now I have slipped into that position of seeing the bigger picture and Mark and Luke are very much the detail. We just seem to bounce off each other including changing the store from a trade-based store to also implementing a female-friendly shopping environment.” “They respect me enough to make the decisions on evolving the store’s bigger picture, but I also give them enough freedom to do what is right for the business,” Rebecca said. Agricultural district Dipper’s Home Timber & Hardware has continued to evolve over the years and is incredibly different to what it was when it first opened in 2012. “Initially the store was part rural supplies, part hardware. The business needed a bit of love and we have got it as far as we can,” she said. JAN '22 | HARDWAREJOURNAL.COM.AU 7
As a remote business located in the farming community of Moree, 700 kilometres northwest of Sydney, the store continues to be a great example of a rural business catering to locals’ needs to ensure money stays in the town. Moree remains solely reliant on agriculture so if dryland and irrigated farmers experience good times, so too does the town. However, after the drought began in 2018, the area became dire by the following year and locals just stopped spending money. “We had to make some pretty big business decisions throughout this time and when people moved on from our business, we just did not replace them. We did have to cut hours which was hard.” “The drought made me analyze the business and look at things that you probably would not normally look at, including dead stock and our ranging to make sure we were up to date with what the IHG group was putting forward. Thankfully in early 2020 it rained a lot throughout our district which set us up for a great year ahead. Being a regional town, we rely on agriculture and it meant everyone would have their winter crop plant for the first time in two years. Imagine being without an income for two years.” “COVID then hit us in March last year like a steam train, with hardware being one of the winners of the pandemic. We went from our worst month in February to our best month in April. It was so hard to comprehend our worst month on record and our best month on record were only eight weeks apart. As people lost their jobs during the drought families just left town so trying to find staff to fill roles was difficult as well,” Rebecca said. Before the rain arrived in early 2020, local farmers did not have the funds to maintain and upgrade on-farm accommodation, so when the drought broke the Moree community were desperate to invest in their surrounds. “In early 2000 the population of Moree was 12000. Due to advancements in agricultural practices and the drought this number is now 8000. We could not control the drought and how this affected our business. What we could control is the shopping experience for our customers and ensuring we have the right products at the right price, good customer service, and store standards are at a level that discourages customers from shopping with a competitor, either online or out of town. The pandemic has also encouraged people to support local businesses because they know that if they do not shop locally, we will not be there anymore,” she said. While Dipper’s Home Timber & Hardware does compete with a coexisting IHGmember, Moree Mitre 10, Rebecca says she sees this store as more of a partner than the competition. “We help each other and work alongside each other more than anything. They are a smaller DIY offering while we are a large retail and trade offering. Our direct trade competition is Bunnings in Inverell, about 140 kilometres away, but they do deliver here three times a week.” “COVID has prompted more people to come back to our store and shop locally. Our job is to make sure we retain them with a shopping experience that keeps them loyal to us,” she said. Future plans While the store continues to thrive postCOVID, Rebecca said she is planning to grow the business even further . “What is preventing us frommoving forward is our current infrastructure. While we do have a massive site of 12000 square metres and 3000 square metres of trade, it can be a curse because products can easily be dumped in the wrong spot. We have outgrown our current infrastructure within the trade space so we are looking at the next stage of where we take this business.” “When we bought the business in 2021 it was 60 per cent retail and 40 per cent trade, but now it is the opposite,” she said. Rebecca believes the way forward for Dipper’s Home Timber & Hardware now is to continue to improve on everything it has worked on for years. “We often order our framing weeks in advance so our lead times in a regional area can be at two weeks at least. We are lucky with the retail side of the business because we draw out of the IHG warehouse and receive two drops a week. If we do not have what our customers need, they can potentially drive over 100 kilometres to source their needs from another store.” The future looks positive for Moree, particularly with the inland rail project underway which will upgrade all railway lines between Melbourne and Brisbane. This will see big industry come to the western side of the Great Dividing Range and transport local grain in an affordable manner. For now, Rebecca says she is looking forward to the store evolving throughout its next chapter, alongside her three, beautiful kids, and the amazing teamwho continue to push the business into the future. RETAIL FOCUS 8 HARDWAREJOURNAL.COM.AU | JAN '22
Just over four years ago the Timber Merchants Association (TMA) integrated into Master Grocers Association (MGA). At the time, the TMA had 80 active members who primarily comprised of saw millers, timber wholesalers, frame and truss makers and hardware businesses. MGA TMA educates members in 2022 All of the TMA businesses are family and privately owned and are completely embraced by the MGA today. Impressively the MGA TMA now has over 200 members employing 2000 staff and generating $4 billion in sales. It continues to grow steadily thanks to its on-going efforts to support and champion family and privately owned businesses. 2022 webinars When looking to the year ahead, the MGA TMA aims to continually place its members at the centre of everything that it does. The MGA TMA also understands that a knowledgeable workforce is highly important, which is why it has also planned a series of training sessions for the year to assist business owners and managers. The sessions include the MGA TMA’s continued webinar series on current and emerging topics of interest. The first ‘member only’ webinar for the year is set to discuss sexual harassment in the workplace. In this webinar, the MGA TMA will advise members on current health and safety laws and discuss proactive policies to reduce the risk of sexual harassment in the workplace. 10 HARDWAREJOURNAL.COM.AU | JAN '22
BEHIND THE COUNTER When: February 9, 2022 Time: 11am (AEDT) Duration: Approximately 40 mins including Q&A Presenter: Aimee Lyons, Workplace Relations Lawyer To register go to: www.mgatma.com.au Recordings of previous webinars hosted by the MGA TMA legal team are also available for viewing on the member portal area of the MGA TMA website and include training in customer service and how to improve your bottom line. Short courses Following the success of our ‘Apply Wood and Timber Product Knowledge’ training in 2021, MGA TMA have again partnered with Timber Training Creswick (Toid #4168) to offer the short course: FWPCOT2241 Apply Wood and Timber Product Knowledge. The two day course is designed for timber and wood product salespeople who are required to provide comprehensive advice to customers on the correct timber to use for their applications. At the end of the course, when the assessment is complete, participants will receive a Statement of Attainment in FWPCOT2241 Apply Wood and Timber Product Knowledge. Date: 29 & 30 March 2022 (9:00am – 4:30pm approx.) Venue: Day 1 - Suite 5/1 Milton Parade, Malvern. Day 2 - To be confirmed closer to date (on-site field trip to a timber processing facility). Please note: Registrations will open in January 2022. Spaces will be limited. Cost: MGA TMA Member: $650 per person or group bookings $575 per person when two or more people book together. Non-Member: $750 per person or group bookings $675 per person when two or more people book together. All training courses will be listed on the MGA TMA website, so please keep an eye out for details. Superannuation law change A change of law during 2021 that affected every Australian employer was superannuation stapling. Changes to superannuation stapling laws came into effect on November 1, 2021, and change the on-boarding process for new employees. It has altered the way all Australian businesses are required to pay super to new employees. If your new employee does not use a Choice of Fund form, you will need to check if they are already a member of a super fund by logging into the ATO's online services. If they are, that is the account you will need to pay super into. This is a change from automatically defaulting new employees to your chosen workplace super fund. This requirement also applies to members that have an enterprise/ collective agreement, even if the agreement specifies a default fund. These new laws are called 'stapling' and it is all part of the Government's Your Future, Your Super reforms to stop people ending up with multiple super accounts whenever they change jobs. For further information from our corporate partner, First Super, visit their website at www.firstsuper.com.au/employers/ superannuation-stapling/ Exciting New Year The previous two years have been incredibly challenging for everyone and with the demands on the timber and hardware industry, our members have been resilient and pivoted with the changing requirements to operate their businesses along with facing timber supply issues. We, like everyone else, are hoping that 2022 will see more normality return to the world. MGA TMA has been on an exciting path looking at our brand. We also look forward to re-launching our new and exciting brand later this year.
US NEWS Former Home Depot and Chrysler Chief Executive Officer, Bob Nardelli recently warned that 2022 is going to be "tough" amid rampant inf lation and that he has "never seen pricing and cost issue pressure on our companies" more than the current time, according to a recent FOX Business report. Mr Nardelli made his predictions on ‘Mornings with Maria’, just one day after it was revealed seven in 10 American voters believe 2022 will be another challenging year, with over half predicting rising prices and escalating crime rates would see them struggle financially, a new FOX Business poll has revealed. During the show, Mr Nardelli said that in his 50-year career he has never experienced business having "to deal with so many issues at the same time," noting that the biggest one is inf lation and that businesses are being forced to pass higher costs to consumers. Consumer prices in the US have surged at the fastest pace in nearly four decades in November, with Americans paying more for practically everything from groceries to cars to gasoline, according to the report. A Labor Department report released late last year also reported that the consumer price index rose 6.8 per cent in November from a year ago, making this the fastest increase since June 1982, when inf lation hit 7.1 per cent. The CPI – which measures a bevy of goods ranging from gasoline and health care to groceries and rents – jumped 0.8 per cent in the one-month period from October, according to the report. It seems that the price increases are currently widespread, according to the report, with energy prices jumping 3.5 per cent in November and have risen 33.3 per cent yearover-year. Gasoline prices have also sky-rocketed 58.1 per cent higher than a year ago, while food prices have climbed 6.1 per cent higher over the year, according to the report. The Bureau of Labor Statistics also revealed that the producer price index increased 9.6 per cent in November over the previous year and 0.8 per cent on a monthly basis. Mr Nardelli pointed out that a shortage of workers is also contributing to the challenging climate for companies, with the latest JOLTS report on job openings now sitting near a record 11.03 million. The number of people quitting their jobs fell slightly late last year to 4.2 million, from 4.4 million in September, the third-highest number of monthly resignations on record, according to the report. Mr Nardelli said in the report that "not having enough workers" is leading to increased pay for workers, noting that the situation "is really challenging both large and small companies” while vaccination requirements are making the situation even more challenging. Unprecedented pricing woes predicted for 2022 Home improvement spike set to cool – Lowe’s Lowe’s sales outlook for the year ahead is raising concerns that the pandemic-fuelled boom in DIY is cooling, according to a recent CNBC report, after shares dropped by up to four per cent in pre-market trading in late December. However, stocks rose later on as new data from homebuilders showed a healthy demand for housing despite the typically slow season and a period of inf lation. That backdrop coupled with Lowe’s executive comments about the possibility for market share gains helped the stock bounce back, according to the report. In a recent analyst meeting Chief Financial Officer Dave Denton said while he thinks the retailer will win more business from home professionals, he also believes Lowe’s is preparing for a “modest sector pullback in 2022” when compared with a year of such high demand with sales fuelled by government stimulus, along with Americans tackling DIY projects throughout the pandemic. The company forecasts that samestore sales could drop by as much as three per cent or be roughly f lat in fiscal 2022 compared with this fiscal year, according to the report with total same-store sales ranging from $94 billion to $97 billion in 2022. The sales fell below analysts’ estimates of $97.64 billion, according to Refinitiv. Lowe’s now estimates overall sales of about $95 billion for this fiscal year, which is one week shorter than next fiscal year. For fiscal 2022, Lowe’s expects to earn between $12.25 and $13.00
US economic experts have reported that increased COVID cases due to the new Omicron variant may cause more slowdowns to supply chains, potentially causing additional challenges for businesses nationwide, according to a FOX59 report. Owner of Akard True Value Hardware in Zionsville, Indiana, Leigh Ann Akard says the pandemic has pushed retailers to exhaustion, particularly now supply chain issues are at an all-time high. Ms Akard said in the report that the front of her store is normally filled with Christmas decorations over November and December but that is not the case this season. “We have over 700 items that have been out of inventory. Some of them going back to the beginning of COVID,” Ms Akard said in the report. While it seems Hoosier business owners are starting to see some improvements with supply chain issues, they are still dealing with slowdowns, according to Kevin Brinegar, President and Chief Executive Officer of the Indiana Chamber of Commerce. “It is impactful on Indiana because we are the most manufacturing-intensive state in the country,” Mr Brinegar said in the report. While it is way too early to tell exactly how the Omicron variant may impact supply chains and Indiana businesses, Mr Brinegar said he believes a surge in cases could stall the supply chain recovery. “That will potentially pull people, truckers off the road and people off the loading dock,” Mr Brinegar said. While experts say it will likely take until at least the middle of next year for the supply chain issues to be resolved others remain optimistic Omicron will have minimal impact – as long as widespread shutdowns are reduced significantly. “We are already having a lot of supply chain issues, so I do not see it exacerbating or increasing the problem beyond that,” Executive Director of the Indiana University Business Sustainability and Innovation Lab, Amrou Awaysheh said. Meanwhile, business owners are trying to stay positive. “We have just kept adjusting our sales and trying to keep on top of what the trends are, what people are doing, how we can be as nimble and responsive as possible,” Ms Akard said. Omicron to impact supply chain per share. On average, analysts were expecting Lowe’s to earn $12.93 per share, according to Refinitiv. Chief Executive Officer, Marvin Ellison said the company could keep driving growth by launching new private labels, expanding its e-commerce business and becoming a one-stop shop for supplies to help older adults age in their own homes. Some examples of this include debuting a modern decor brand called Origin 21 while also speeding up deliveries of big and bulky purchases, such as appliances, with a new pilot in Florida and Ohio. That more efficient process is boosting profits and customer satisfaction, he said. Mr Ellison also pointed out that Lowes will benefit from a favorable backdrop too, including more money in consumers’ savings accounts, historically low interest rates, rising home values and an aging inventory of US homes. About two-thirds of the company’s sales are driven by repairs and maintenance, he said in the report. “There has been a longer-term shift in the consumer mindset about the importance of the home. Our view of the home is a sanctuary that may need to serve several multiple purposes: residence, office, school, gym, and a gathering place for indoor and outdoor entertainment. And given the extension of remote work, we are expecting a permanent step up in repair and maintenance cycle,” Mr Ellison said in the report. Lowes recently reported that the pandemic fueled DIY boom is now cooling. JAN '22 | HARDWAREJOURNAL.COM.AU 13
NZ NEWS Fletcher Building's national retailer, PlaceMakers, has recently warned customers that all James Hardie products imported across the Tasman will see a 10 per cent price increase this year. Merchants contacted customers late last year to inform them of the latest price increases that were set to be imposed by Australian-headquartered James Hardie Industries in the New Year, according to a recent NZ Herald report. In the letter to customers, PlaceMakers cited the cost of importing the products to New Zealand outlining that, "like many suppliers, they are currently experiencing significantly higher freight prices and it is not sustainable for them to continue to bring in product from Australia without recovering these costs.” "They are therefore adding an additional 10 per cent onto all James Hardie products by way of a freight surcharge for orders placed from December 1," the PlaceMakers' letter indicated. PlaceMakers also pointed out in the letter that as a sign of goodwill towards its customers, it would absorb the sudden price rise in the short term. "We understand the impact this late notification of a price increase will have on our customers and as such PlaceMakers will hold our current prices until February 1, at which stage the additional 10 per cent freight surcharge will be added to our pricing," the chain wrote. Just some of the James Hardie products currently sold by PlaceMakers include Stria cladding, weatherboards, fibre cement facade panels, galvanised nails and blades, fastenings and hardware, with the Australian manufacturer already under extreme pressure due to high building rates on both sides of the Tasman, according to the report. “From a supply point of view, James Hardie is at capacity and many products are on allocation to us, meaning we are already purchasing all we can of these products," PlaceMakers wrote. "Therefore, it is unlikely that despite our best efforts we will be able to purchase any additional product prior to the December 1 increase. As you are probably aware James Hardie's lead times are extending and it is challenging to get accurate estimated time of arrival information, so supply is constrained despite James Hardie distributing more than ever before," the PlaceMakers letter said. In August last year, PlaceMakers warned of a price rise of up to 15 per cent, when a PlaceMakers manager said price increases looked set to continue due to suppliers charging more and trouble sourcing stock continued, according to the report. By October, fastenings including collated nails and brads were set to rise in price by eight to 10 per cent, while plywood prices would go up 15 per cent, timber decking 10 per cent, polythene eight per cent, strand floor 10 per cent and Gorilla adhesives, sealants and foams eight per cent, according to PlaceMakers. The PlaceMakers manager also said that the retailer had already seen price increases from many suppliers, "and sadly this is going to continue. The freight and raw material costs are still the main reason for the price rises, driven by increased demand, both in New Zealand and overseas. This demand is also continuing to create supply challenges for some time to come." Late last year, James Hardie Industries was trading on the ASX at A$55.43, up from A$21 in 2017. It has a market capitalisation of A$24.6b, with its New Zealand website marketing the company as, “the world's number one producer and marketer of highperformance fibre cement and fibre gypsum building materials.” Just last month the NZ Herald also reported on the EBOSS survey of 219 New Zealand suppliers which indicated an upcoming forecast of 28 per cent in price rises, with a 16 per cent price rise already evident in the last three months of 2021 and a further 12 per cent in the first six months of 2022. Today PlaceMakers continues to grow and evolve within the New Zealand market, employing more than 2100 people at 62 stores, where it sells 74,000 products and serves more than 300,000 customers a year. It seems PlaceMakers is not the only retailer to warn customers of pending price rises with major building product supplier, Carters, also writing to customers advising they can expect to pay more for many items over the next three months, according to the report. Just one indication of the upcoming price rises came from one manufacturers' silicone sealant product price which is expected to rise 27.5 per cent from February 1, Carters said in the report. The letter from Carters’ East Tamaki national support office named many products and the exact price increases planned. Just some of the products expected to see price increases include timber, fastening systems, polycarbonate roofing, building wraps, underlay, laminated goods and door hardware products are all listed by the national supplier as products that will soon cost more, according to the report. "As a supply partner in your business, we wish to give you prior notification of upcoming marketwide price movements affecting various suppliers," Carters wrote in its letter to customers. James Hardie prices increase by 10 per cent 14 HARDWAREJOURNAL.COM.AU | JAN '22
Demand for employees in logistics, manufacturing and transport will sky-rocket this year as demand for e-commerce puts more pressure on supply chains, a recent Newsroom report has indicated. Just last year jobs within IT, manufacturing, transport and logistics rose 46 per cent in New Zealand, according to a recent Seek employment data report, which is the highest among all industries within New Zealand compared to the same time last year. General Manager for Asia Pacific logistics group TMX NZ, Caleb Nicolson said in the report that his business has been looking for experienced supply chain professionals for months as it grows in the New Zealand market. “Knowledge in the area has become hot property in the last couple of years. Even in our team of 15 we have taken on an undergrad. There is high demand for experienced people in this industry because people are having to rethink their entire logistics systems,” Mr Nicolson said in the report. According to logistics company DHL, in the United States, demand for talent is expected to outstrip supply by six to one. Launching in New Zealand last year, the TMX business has 190 advisers across Australia, Singapore and Vietnam and, according to the report, has also worked with Bunnings, NZ Post and Cool Pak logistics in procuring distribution centres. Volatility in the global shipping industry is also continuing, with congestion at ports causing delays and prices of freight skyrocketing. Late last year, shipping giant Maersk told customers it was going to stop forward booking and would only allow spot pricing. Mr Nicolson said in the report that all businesses are now grappling with how they can manage the rising costs of getting goods. He said that global supply chains were already under pressure before the pandemic and then increased e-commerce consumption during lockdowns placed additional pressure on retailers who constantly struggled to keep up with growing demand. “Suddenly when a lockdown happens, requirements for online [orders] increase up to eight times, it is phenomenal. And that is what is challenging business leaders. It is no longer just in time; it is just in case. We have got clients who have three times the warehousing space that they had two years ago,” he said. Mr Nicolson also pointed out in the report that the supply chain problems coupled with labour and skills shortages will push industries towards investing in automation. "The wage rate inflation and the general inflationary pressures. That would be if I am setting an executive table that is top of mind, because my - if I am in retail and warehousing - wages are a significant proportion of my spend, and I am going to be looking to how to mitigate that." According to Mr Nicholson, Amazon’s Kiva system has been a game-changer for the industry and will likely be the future for managing logistics systems. Demand for supply chain jobs soar in 2022
TIMBER UPDATE Managing the pandemic over the last two years has made the bushfires fade a bit in our collective memories. However, those bushfires came very close to home for our employees and also had a big impact on their communities. For now, there continues to be so many rumours along our supply chain that, “Tumut is closing or will never recover”. This article will hopefully put some of these ongoing negative rumours to bed for good. For AKD, the areas of Tumut and Gilmore are positioned for the long term, and both have a promising future. The team at Tumut has resiliently fought the challenges of the last couple of years to now be at the centre of our universe – both literally and figuratively. AKD Tumut’s location make it the natural geographic centre to service the East Coast markets due to its central proximity to both the Sydney and Melbourne markets. Today, there is a renewed sense of purpose and commitment at the AKD Tumut site and this is being felt by both the seasoned sawmillers who have already committed much of their careers to this business, the industry and their community. This is because we have committed to a $30 million capital investment program for the site, which we understand is the single largest improvement project at the Tumut site in its history. “Tumut might be described as just another “timber town” but its prime regional location and lifestyle, along with its people, make it a great place to live and work”, AKD Tumut’s Facility Manager, Rab Green said recently. The industry in the region did a stellar job recovering and processing salvaged logs and extracting value for the forestry and construction industries. The recovery operations required the AKD Tumut sawmill run more hours than it ever has in a year, resulting in record volumes of sawlogs processed and timber produced. Tumut’s fighting spirit means it is creating a future. The fact that ongoing log supply to the AKD Tumut mill for the foreseeable future has halved just means the goal posts have shifted, but we are now just starting to play a new game. In a global industry that has typically applied capital investment to gain volume efficiencies, AKD has now committed approximately $26 million to the Tumut sawmill, which will focus on processing less logs but extracting much higher recoveries and value from the changing log diet. AKD’s footprint in the Tumut area includes the Gilmore processing site just a few kilometres down the road from the sawmill. This is where the company’s well-known Ironwood® sleepers are made. We are pleased to advise of several developments being undertaken for this part of our business as well. Given that Tumut is the centre of the universe, in terms of servicing both New South Wales and Victoria demand, AKD is investing approximately $4 million in the 30-acre Gilmore site as a warehousing and distribution centre (DC). The new DC set-up complements the direct delivery service offer and enables AKD to hold a much higher volume of inventory, proving a superior outcome for a wide range of customers. The site is quickly evolving to meet this new service offer. There has also been ongoing product development at the Gilmore site with the new Ironwood Edge™ sleepers Tumut - the centre of Australia’s timber production universe In this special report, AKD Softwoods reveals how the company has recovered from the 2019/20 bushfires and how they expect to keep up with heavy supply demands throughout 2022 and beyond. AKD’s Gilmore site launched its new Ironwood Edge sleepers to the market in November last year.
Timberlink investment for Bell Bay A $63 million capital investment at Timberlink’s Bell Bay manufacturing plant in Tasmania will see an increase of more than fifty per cent in on-island sovereign timber manufactured from sustainability managed pine plantations. The project will commence in 2022 with commissioning expected by the end of 2025. The expansion project installation and construction will run in two stages, from 2022, with full output achieved at the end of 2025. The upgrade includes: • Offline log debarking and sorting. • Saw mill expansion. • Residue and energy optimisation. • Additional continuous kiln for drying of timber. • Planer infeed systems. • Site infrastructure improvements. Timberlink Chief Executive Officer Ian Tyson said once the project is completed, the combined output of Timberlink’s manufacturing facilities in Bell Bay Tasmania and Tarpeena South Australia will position Timberlink to increase supply of manufacture of structural timber for use in the construction of homes in Australia. “The project has been brought forward by over two years in order to support additional supply into the Australian market,” Mr Tyson said. Federal Member for Bass, Bridget Archer said the significant investment is yet another example of Timberlink committing to the region. “As an elected representative, I have had a long-standing relationship with Timberlink since they began production in Bell Bay in 2008 and I appreciate the ongoing economic and social benefits the company provides to our local area,” Ms Archer said. The upgrade is expected to increase both the volume of renewable plantation pine logs that can be processed and the yield per log, creating a workplace of the future, with high tech machinery, improved accuracy, safety and job security. The planned investment is in addition to major upgrades completed two years ago and the construction of Tasmania’s first Wood Plastic Composites manufacturing facility announced earlier this year for the Bell Bay site. In addition to the creation of 25 contractor jobs during the capital upgrades and expansion, Timberlink expects that this project will create 18 new permanent full-time jobs at the facility for the next generation. It is estimated that the Timberlink Bell Bay manufacturing facility supports approximately 600 direct and indirect jobs within the region. AUSTRALIAN MADE in Tumut delivered to market last November. It is undoubtedly the marriage of the Ironwood® product range, new technology to maximise structural recovery and the Gilmore DC, that will ensure that Tumut remains the centre of the universe. In addition, AKD recently announced 30 new apprentice and graduate positions for 2022. Tumut is part of this process recruiting for additional apprentices and university graduates, as is every other AKD sawmill site on the East Coast. Well done to the AKD Tumut/ Gilmore teams for not just surviving the challenges of the past two years but for thriving under duress to create a future for themselves and the industry in this region. Timberlink Chief Executive Officer Ian Tyson with Bridget Archer MP and The Hon Michael Ferguson MP announce the $63 million investment at Timberlink Bell Bay. JAN '22 | HARDWAREJOURNAL.COM.AU 17
AUSTRALIAN MADE The popularity of Australian Made products remains stronger than ever as Australians continue to actively seek out locally made products, particularly as imports remain difficult to source due to ongoing shipping delays. Aussie made prospers as imports slow Recent Roy Morgan Research shows that more than half of the businesses that manufacture products licensed to carry the Australian Made logo reported that their customers now actively seek out, request and buy Australian products on a daily basis. Australian Made Campaign Chief Executive Officer Ben Lazzaro says those surveyed in the recent research cited the COVID pandemic as the primary driver of enhanced interest in buying local. “One of the positive outcomes of the pandemic is that Australians appear to be more mindful of what they are buying and where products are made. What is most encouraging is that this pro-Australian sentiment has been in the marketplace for some time and is now translating through to the cash register, whether this is online or in bricks and mortar retail environments,” Mr Lazzaro said. It seems last year’s increased popularity of Australian Made products has evolved from consumers simply wanting to support local business throughout the pandemic. This year, that pro-Australian sentiment has been complemented by the lack of availability of imported products, according to Mr Lazzaro. “While supply chain disruptions have made it difficult for both importers and exporters, this has also presented further opportunities for local makers. As a result, in many sectors Australian products have become a more attractive choice as they are readily available and often accompanied by local after-sales support and service. Buying local means consumers are not waiting around for imports or relying on overseas suppliers for after-sales care should the product fault.” “This is particularly the case when it comes to building supplies and construction materials. Over the last 12 months we have seen an inf lux of building products registering 18 HARDWAREJOURNAL.COM.AU | JAN '22
Over the past year, we learnt that having strong local manufacturing is critical to all Australians’ well being and our growth. AKD makes plantation structural timber which holds up Australian houses and having local supply to build Aussie homes is pretty important we think. Thanks for your support and buying local Australian timber from AKD really makes a positive difference. Providing Australians with the timber that builds their homes!
AUSTRALIAN MADE to carry the logo. These include windows, blinds, doors, roofing and fencing, through to insulation, ducting, air conditioning and walling systems,” Mr Lazzaro said. Just some of the prominent brands to join the Australian Made family in recent months include Clarendon Homes, Temperzone, Rondo Building Services, Fielders, Kingspan and many more. It seems that Australians now also perceive Australian Made products as creating ongoing employment, with 97 per cent of Australians associating the logo with ‘supporting local jobs’, according to the Roy Morgan Research. The research also found that 95 per cent of Australians associate the logo with a product that is ‘high quality’ and ‘safe’, while 89 per cent of Australians associate the logo with ‘ethical labour’, and 78 per cent of Australians associate the logo with ‘sustainability’. “Ethical labour and sustainability have become a major part of the consumer’s purchase decision. While the logo’s job is to market the ‘Australian Made' status of the product, it conveys a number of other positive attributes as well, including supporting local jobs, quality, safety, use of ethical labour and sustainability” he said. “The renewed focus on climate policy and sustainability presents a number of new challenges for Australian businesses and many Australian manufacturers are well placed to communicate their commitment in this space through the use of the Australian Made logo,” Mr Lazzaro said. While Australia is widely known as a clean and environmentally friendly place to live and work, Mr Lazzaro acknowledges that many other countries are not so fortunate and do not have the opportunity to utilise these same attributes. “So yes, we are leveraging our assets here in Australia and highlighting some shortfalls in other parts of the world in respect to their manufacturing processes, which is why Australian Made products are well-known for not only being high quality but safe to use,” he said. As international borders remain uncertain and Australians can no longer holiday overseas, it seems consumers are now spending their holiday savings on purchasing higher quality products instead. “When it comes to using tools, reliability is paramount, particularly in the hands of professional tradespeople who rely on tools for their livelihood. When there are safety and reliability concerns, the Australian Made option is often the product consumers will source.” “Mumme Tools is a prime example of an Aussie manufacturer producing high-quality tools that are made with safety in mind. Many of their non-sparking tools are used in applications where a spark may have a catastrophic outcome. We understand that some worksites and mine sites will deliberately choose safe, high-quality Australian Made products as part of their risk mitigation strategy. Often, the imported option cannot meet these safety requirements. As a result, those on-site can get on with the job with confidence Australian Made Campaign Chief Executive Officer Ben Lazzaro. 20 HARDWAREJOURNAL.COM.AU | JAN '22