Hand, Power & Trade Tools – Trades welcome innovation
The highly competitive Hand, Power & Trade Tools sector remains one of the most innovative spaces within the hardware industry. In this report, industry leaders explain why trades and DIYers are so attracted to new and upgraded products.
CSS (Construction Supply Specialists) Managing Director, Jeff Wellard recently outlined some of the latest trends, saying that while he did not believe there were any new products launched onto the market recently, plenty of upgraded products had been introduced.
“This is always an interesting topic for discussion as it is often difficult to really ascertain what a new product is. New products can also be recognised as revolutionary ‘new products’ as opposed to ‘upgrades/improvements’ of old products. While I cannot recall any revolutionary new products launched onto the market recently, there were certainly plenty of upgrades and improvements particularly in the ‘outdoor power equipment’ section of the market with Makita and Ryobi leading the way with relevant power tools and accessories,” Mr Wellard said.
When reflecting on the last 18 months and the impact that COVID has had on CSS members, Mr Wellard said a vast majority of members claim that even though stores are primarily industrial and trade focused, just about all of them have seen an increase in non trade related foot traffic over the past year.
“It was, and still is, very apparent that DIYers were looking to do ‘bigger projects’ in the past year or so and are also very keen to seek professional advice from companies with close ties to industrial and commercial users of products and services. This is a trend that appears to be continuing,” he said.
“Generally speaking, we have all been quite fortunate given all that has happened in our industry over the last year. Thankfully we have not been held back by shortages on everyday products where there are alternatives to cover gaps. Obviously, power tools, where users have stable battery platforms in place, create challenges but the key players appear to have managed their inventories quite well. Our understanding is there is also a growing shortage of timber for the building industry and this will have a substantial impact if a solution cannot be found,” Mr Wellard said.
When discussing significant issues surrounding the launch of inferior products, Mr Wellard said CSS members are more likely to stock quality hand, power and trade tools because customers are primarily professionals who prefer to use efficient products.
“Most CSS members are commercial and/or industrial focused and as such stay with quality tools from well-known suppliers across the power and hand tool range. This is also the case in the industrial products market where abrasives and cutting equipment fall,” he said.
“What we have found of late is that there is an emerging ‘new sense of worth/value’ in the minds of industrial users, with all users looking at quality and fit for purpose attributes before price. The construction industry, and its allied industries, are full on cordless when it comes to power tools and they need and want more power, longer run times and corded tool reliability from their tools and equipment. Down time means a loss of money so it is more important than ever to have reliable products. This is the same for hand tools and power tool accessories like cutting tools, abrasives and grinding equipment. There is a genuine push for quality that is for sure.”
“Brand loyalty still exists but the brand needs to stand up from a quality and value for money viewpoint. All product manufacturers must ensure they stay current and relevant through innovation, adaption and understanding where the industry is heading,” he said.
Looking ahead, Mr Wellard said it is becoming more apparent that Australian Made products are a growing factor in the decision-making processes of many buyers from all manner of industries. However, this will always be tempered with the need for quality, reliability, durability, ‘platform compatibility’ and value for money going forward, he said.
TradeTools sees innovation drive sales
Trade Tools Chief Executive Officer, Jeremy Stewart agrees that new product launches have continued for many suppliers over the last 12 months, with consumer demand primarily coming from tradespeople who are constantly on the look-out for innovative products.
“New product launches have been introduced by many suppliers over the past year – some more than others. Australians are known as early adopters and tradespeople generally look out for new products and gear that makes a job easier, safer or faster to complete. Some new product releases can generate a tremendous amount of interest as well as a lot of pre-orders throughout all TradeTools stores,” he said.
“There are suppliers and brands who are very actively driving new product development by introducing innovative ideas and enhancements to products that have essentially remained un-changed for decades. It is great to see and I think it should, and will, continue as a trend. If an innovation increases safety, or productivity, then this helps tradespeople and end users do their jobs better, earn more and improve their business all round. That is a great thing,” Mr Stewart said.
When reflecting on the past 12 months, Mr Stewart said he believes there was definitely disruption throughout the industry as a result of the pandemic.
“Just some of the disruptions we have experienced included a reduction in supply due to factory shutdowns in Asia. Then we quickly saw demand rapidly increase as renovations and construction began to boom. The increase in sales has sustained across all TradeTools stores to date.”
“Supply has generally improved and we are well stocked, however there are still challenges, particularly when it comes to shipping. Rising commodity prices are placing pressures on pricing and this sustained pressure may begin to flow through in the coming months,” Mr Stewart said.
When discussing the launch of inferior products on the market and how TradeTools combats this low-cost competition, Mr Stewart said the group simply does not range any products that will not meet the expectations and demands of its customers.
“There have always been poor-quality, cheap products out there. We will not range products that do not have the ability to withstand the demands of trade and industrial users. An item has to be fit for purpose and you need to have a deep understanding of what that purpose is in order to determine if you offer it to your customers or not,” he said.
Looking at the growth and expansion of the TradeTools business moving forward, Mr Stewart said he believes that a slow and steady expansion in ethos is the only proven and sustainable method of growing and evolving the business.
“If any company expands too quickly, especially in a specialised market like the tool industry, it runs the very high risk of baking in ongoing commercial and weaknesses. For instance, we only now open a new store where the freehold site fully belongs to TradeTools, and that always takes longer to find and set up,” he said.
“We then spend a lot of time, money and energy recruiting and training staff who are usually there from the outset. That is the reason that TradeTools, on average, only opens one new store annually. It is simply the old and tested principle of building a house of bricks and mortar. Instead of choosing the much easier option of quickly constructing a temporary shelter from straw. Of course that is when the economy is strong and expansionary both systems can work, but when economic storms hit hard, as they always eventually must do, ancient wisdom tells us that anything built of straw is quickly swept away.”
“It took us ages, for instance, to find, purchase and prepare our new Browns Plains store, but it hit its sales targets after only the second week of trading and should continue to do so for many years into the future, regardless of storms or otherwise,” Mr Stewart said.
Premium Tools tackles supply issues as demand increases
Premium Tools Director – Australia and New Zealand, Andrew Cordes spoke to AHJ, not only on the newest products to be launched by the company, but also the post-COVID shipping challenges.
He said some of the biggest challenges faced by manufactures currently include ongoing limitations in raw materials that have an on flow of supply challenges for suppliers.
“In regards to the shipping crisis, the supply of product is boom or bust at the moment. I am sure it is the same for all suppliers. Many manufacturers globally are having raw material shortages due to COVID. This means longer lead times, stock shortages, a big on-flow effect for everybody; suppliers, retailers and end users,” Mr Cordes said.
“To combat the challenges around global shortages, we have no choice but to carry additional stock levels. Suppliers really need to have a balanced approach when it comes to stock levels. We are not seeing a decrease in sales so there is no real choice but continue to carry a heavy amount of stock,” he said.
Premium Tools, established in 2013 by a New Zealander and an Australian, is dedicated to distributing quality tools to the trade and DIY channel across Australasia. Premium Tools has continued to distribute a number of high-quality brands, including global leaders such as Wiha Tools, Unilite Portable Lighting and Veto Pro Pac Tool Bags (NZ Only), as well as LYRA marking systems.