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Ace Hardware

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Ace Hardware Corporation
Company typePrivately held company
retailers' cooperative
IndustryHardware stores
FoundedChicago, Illinois, U.S. (October 25, 1924; 100 years ago (1924-10-25))
Founders
  • Richard Hesse
  • E. Gunnard Lindquist
  • Frank Burke
  • Oscar Fisher
  • William Stauber
Headquarters
Oak Brook, Illinois
,
US
Number of locations
Over 5,700 (2022)[1]
Area served
International[2]
Key people
John Venhuizen (President and CEO); Steven Burggraf (chairman of the board)
RevenueIncrease US$9.17 Billion (2022)
Increase US$341 million (2022)
Increase US$340.6 million (2022)
Total assetsIncrease US$3.491 billion (2022)
Total equityIncrease US$891.8 million (2022)
Number of employees
12,500 (2022)[2][3]
Website

Ace Hardware Corporation is an American hardware retailers' cooperative based in Oak Brook, Illinois, United States. It is the largest non-grocery retail cooperative in the United States.[4]

Founded on October 25, 1924, as "Ace Stores", the company changed its name to "Ace Hardware Corporation" in 1931. It grew dramatically following World War II, more than tripling its sales between the late 1940s and 1959. After the retirement of longtime president and founder Richard Hesse in 1973, Ace was sold to its retailers, becoming a retailer-owned cooperative. It first reached $1 billion in wholesale sales in 1985 and $5 billion in 2015. As of 2019, it has over 5,200 locations in 60 countries.[1] Ace operates 17 distribution centers in the United States, and additional distribution facilities in China, Panama, and the United Arab Emirates.[5][6]

History

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In 1924, to increase buying power and profits, entrepreneurs Richard Hesse, E. Gunnard Lindquist, Frank Burke, and Oscar Fisher united their Chicago, Illinois, hardware stores into "Ace Stores". The company was named after the ace fighter pilots of World War I, who overcame all odds. Ace Stores was incorporated on March 2, 1928, and the company opened its first warehouse a year later. In 1931, the name was changed to Ace Hardware Corporation.[7][5]

By 1933, Ace had 38 retailers in Illinois, Indiana, and Wisconsin. In 1946, Ace introduced its Super Ace Store concept. By the end of the 1940s, Ace had wholesale sales of more than $7 million from the 133 stores it supplied. In 1954, the stores agreed to change their names from Ace Stores to Ace Hardware. By its 35th anniversary in 1959, the company had more than tripled this figure, with wholesale sales of $24.5 million from 325 stores.[5]

In 1961, Ace relocated its warehouse and corporate offices to Bedford Park, Illinois. By the end of the decade, the company built warehouses in Northern California and Georgia to support its expansion into the Western and Southeastern states.[5]

Founder and longtime president Richard Hesse retired in 1973. Ace relocated its corporate offices to Oak Brook, Illinois the following year and opened a distribution center in Addison.[5][8] The company was thereafter sold to its retailers and restructured as a cooperative, moving its headquarters to Oak Brook, Illinois. Independent retailers became the exclusive shareholders in the company and the corporate entity remained as a wholesaler and distributer.[9] The strategy proved successful, and Ace surpassed $1 billion in wholesale sales for the first time in 1985; it went on to pass $5 billion in 2015.[5][10]

Under CEO Roger Peterson (1986–1995), Ace sales more than doubled from $801M in 1983 to more than $2B in 1993. Needing more space to support its operations in the Midwest, Ace opened a 1.1 million square foot distribution center in Princeton, Illinois in February to serve more than 450 stores.[8] In October 1994, Ace launched a strategic plan known as "The New Age of Ace" with the objective, by 2000, to improve retail performance, more efficient operations, international growth, and a faster pace for new store openings.[9] The company reported a 15% jump in sales from 1993 to 1994.[11]

In 1996, Ace surpassed Cotter & Company to become the largest hardware co-op.[12] Ace overhauled its computer systems in 1999 to accommodate the introduction of the 13-digit barcode. By 2002, the company had 5,100 stores.[13] Ace surpassed $3 billion in annual hardline sales and $100 million in net profits in 2003.[14]

In September 2011, Ace Hardware began selling a new line of premium paints, called Clark+Kensington.[15] It acquired its largest member, Westlake Ace Hardware, for $88 million in December 2012.[16] In January 2013, Ace announced a long-term deal to have Valspar produce the company's paints. Valspar also acquired Ace's paint manufacturing assets, including two facilities near Chicago.[17] The following year, Ace's president and CEO John Venhuizen launched 20/20 Vision, a strategy to use network power to provide better customer service.[18]

In 2014, the company opened a 450,000 square foot distribution center in Wilmer, Texas. The company announced in 2019 it would be doubling the space.[19] Ace launched its wholesale distribution network through the acquisition of the Portland, Maine-based Emery-Waterhouse in 2014[20] and the Spokane, Washington–based Jensen Distribution Services in 2015.[21] Later that year, Ace expanded its wholesale operations coast-to-coast with the formation of Emery Jensen Distribution, LLC. This new distribution arm operates under Ace Wholesale Holdings LLC, a subsidiary of Ace Hardware Corporation, and is dedicated to serving non–Ace Hardware independent retailers.[22] As of 2016, J. D. Power has ranked Ace Hardware "Highest in Customer Satisfaction with Home Improvement Retail Stores" for ten consecutive years.[23]

In June 2023, Ace announced it would build a 1.5 million square feet Retail Support Center in Kansas City, Missouri. The facility is expected to be completed by mid-2025.[24]

In August 2024, Ace unveiled ELEVATE3 Ace, an experimental store concept that elevates popular brands, with plans to begin rolling out the new stores in January 2025.[25]

Advertising

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Lou Manfredini serves as Ace's "Helpful Hardware Man" and media spokesman.

In 1989, Ace's longtime jingle "Ace is the place with the helpful hardware man" was modified, replacing man with the more inclusive and accurate folks.[26] Celebrities Connie Stevens (from 1974 to 1978) and Suzanne Somers (from 1979 to 1982) starred in TV commercials for Ace Hardware.[27][28] From 1987 to 2009, former NFL coach and NFL commentator John Madden also starred in Ace commercials.[29]

In 1999, the American Society of Magazine Editors stripped This Old House magazine of an award nomination after it was deemed an Ace Hardware-branded insert was an inappropriate form of advertising.[30]

In 2016, Ace introduced a new series of commercials featuring associates addressing customers' needs, and a contextually-appropriate version of the Ace jingle (such as, after a customer asks for a lubricant they think is called 10W40, "Ace is the place for the stuff for squeaking hinges that's called WD-40. Not 10-W40, which is motor oil, that we also sell.")[31]

In 2002, home improvement expert Lou Manfredini was hired to serve as Ace's "Helpful Hardware Man" and media spokesman.[32]

International operations

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In July 1969, Ace opened its first international store in Guam.[5] In 1990, Ace created a separate division known as Ace International.[33] Over the years, Ace expanded throughout Asia, the Caribbean, Latin America, and the Middle East regions. By 2002, the company had stores in 70 countries and more than a hundred foreign suppliers.[13]

North America

[edit]

In 2010, Tim-Br Mart Group acquired licensing rights to the Ace brand name in Canada.[34] By February 2012, Ace had 400 locations outside of the United States.[15] Four years later, Rona, Inc., signed an agreement with Ace Hardware for the master license to the Ace brand in Canada.[35] Lowe's completed its acquisition of Rona in May 2016.[36] Rona assigned the Winnipeg office as Ace Canada, formally TruServ Canada, to manage the Ace Brand. As of June 2016, there are 62 Ace-branded stores in Canada.[5] Beginning in 2017, Lowe's Distribution Center began to service Ace Canada retailers.[37]

In March 2020, Peavey Mart acquired Rona and Ace Canada, as well as the master license and began to service the 107 Canadian locations.[38] In June 2024, Peavey Industries announced it would end its relationship with Ace International and the Ace Canada dealers with the license ending at the end of the year. Ace International subsequently announced in October that it will no longer support or supply Ace Canada dealers in 2025.[39]

In December 2021, Ace opened its first location in Mexico using its new turnkey franchise model.[40]

Middle East

[edit]

In 1991, Al-Futtaim Group obtained the licensing rights to bring the Ace name to Dubai. It opened a flagship store in 2006.[41]

Ace came to Israel in 1993, starting with four stores. By 2005, the country had 25 Ace locations.[42] In January 2006, Benny Gaon and Shlomo Zbeda bought Ace Israel, outbidding former owner Gad Zeevi.[43][44] By 2007, the company announced plans to expand into Turkey and debuted its IPO on the Tel Aviv Stock Exchange.[45] However, after a significant economic downturn, the company cancelled its expansion plans and cut 15% of its workforce in 2009.[46][47][48] Ace Israel was eventually sold to Electra Consumer Products in 2012, and then Kedma Capital in 2016.[49][50] By 2021, Ace Israel operated 34 stores and Kedma took the company public again.[51]

Oceania

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In June 2014, Ace Hardware International announced an agreement to be a wholesale supplier for New Zealand's Mitre 10.[52]

Asia

[edit]

PT Ace Hardware brought the brand to Indonesia in 1995 and became a publicly traded company in 2007. By 2010, there were 39 stores in 18 cities.[53] PT Aspirasi Hidup Indonesia Tbk (before PT Ace Hardware Indonesia Tbk) (IDX: ACES), a listed franchisee controlled by local family business PT Kawan Lama Sejahtera [id] (which owns 59.97%), opened the world's largest Ace Hardware shop, 14,695 square metres (158,180 sq ft), in Living World Mall, Alam Sutera, South Tangerang, Indonesia.[54][55] As of January 2023, there were 229 stores located in 56 cities throughout Indonesia.[56]

Giant Ace SDN BHD brought Ace to Malaysia in 1996. By 2010, it had 10 stores in the Kuala Lumpur metropolitan area.[53] Ace Hardware Malaysia currently has 22 branches nationwide as of January 1, 2022.[57]

Ace Hardware Philippines Inc was founded in 1997, opening its first branch in the Philippines at SM Southmall in Metro Manila.[58] Currently, Ace Hardware has more than 100 branches all over the country.[59][60] ACE Hardware is an affiliate of the SM Group of Companies.

Ace spent more than $300 million on products from China in 2006. The following year, the company opened its first outsourcing and storage facility in Shanghai and moved purchasing operations from Hong Kong.[61][62]

Ace Hardware came to Maldives in 2011 through a partnership between the American company and Co-Load Maldives Pvt Ltd. The collaboration opened its third store in 2022.[63] Ace expanded to Vietnam in November 2019, opening a store in Ho Chi Minh City.[64]

References

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  1. ^ a b About Us Ace Hardware.
  2. ^ a b "Ace Hardware Customer Service". ACE Hardware. Retrieved December 3, 2015.
  3. ^ Ace Hardware Craft.
  4. ^ O'Connor, Claire (March 2, 2015). "How Ace Hardware Turned Corner Stores Into A $4.7 Billion Co-Op". Forbes. Retrieved August 10, 2016.
  5. ^ a b c d e f g h "Company History". Ace Hardware. Archived from the original on August 21, 2016. Retrieved August 10, 2016.
  6. ^ "Ace Hardware International Implements Blue Ridge Supply Chain Planning" (Press release). Ace Hardware. August 11, 2016. Retrieved August 12, 2016 – via Business Wire.
  7. ^ Carter, David E. (September 1, 1993). Living Logos: How Corporations Renew Their Images. Art Direction Books. p. 22. ISBN 978-0881081077.
  8. ^ a b Tribune, Chicago (November 17, 1996). "FOR PRINCETON, ACE IS THE PLACE". Chicago Tribune. Retrieved October 30, 2024.
  9. ^ a b Tribune, Chicago (October 28, 1994). "ACE NOT ABOUT TO GIVE UP ITS PLACE". Chicago Tribune. Retrieved October 29, 2024.
  10. ^ Besanko, David; David Dranove; Mark Shanley; Scott Schaefer (September 22, 2009). Economics of Strategy. John Wiley and Sons. ISBN 978-0470373606.
  11. ^ Newman, Andy (October 1, 1995). "Big and Small, Hardware Stores Feel the Boom". The New York Times. Retrieved October 29, 2024.
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  14. ^ "Nuts and bolts of Ace Hardware". Deseret News. January 28, 2007. Retrieved October 31, 2024.
  15. ^ a b Levere, Jane L. (February 29, 2012). "A Splash of Romance in the Search for Paint". The New York Times. Retrieved October 28, 2024.
  16. ^ Vockrodt, Steve (December 18, 2012). "Westlake Ace Hardware sells to Ace Hardware for $88M". Kansas City Business Journal. Retrieved December 3, 2015.
  17. ^ "Company news". www.startribune.com. January 3, 2013. Retrieved October 30, 2024.
  18. ^ Rework America (June 15, 2015). America's Moment: Creating Opportunity in the Connected Age. New York: W. W. Norton. ISBN 978-0393285147.
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  23. ^ "Ace Hardware Ranks Highest in Customer Satisfaction among Home Improvement Retailers For a 10th Consecutive Year" (Press release). J.D. Power. June 7, 2016. Retrieved August 10, 2016.
  24. ^ "Ace Hardware Announces Expansion Plans For New Distribution Center Near Kansas City, Missouri". Ace Hardware. June 22, 2023. Retrieved October 31, 2024.
  25. ^ "Ace Hardware Launches 'ELEVATE3 Ace' Experiential Store Format". Ace Hardware Launches ‘ELEVATE3 Ace’ Experiential Store Format. Retrieved October 30, 2024.
  26. ^ Chimoff, Harvey (March 26, 2013). "Ace Hardware Aims to Win with 'The Help'". Marketing World Today. Retrieved August 1, 2019.
  27. ^ Cummings, Judith; Johnston, Laurie (December 28, 1979). "Notes on People". The New York Times. Retrieved October 28, 2024.
  28. ^ Kleinfield, N.R. (May 18, 1981). "WHEN A CELEBRITY BECOMES NOTORIOUS". The New York Times. Retrieved October 29, 2024.
  29. ^ Hiestand, Michael (March 17, 2009). "John Madden retires as football analyst; NBC taps Collinsworth". USA Today. Retrieved August 10, 2016.
  30. ^ Kuczynski, Alex (March 18, 1999). "Ad Logo on Editorial Insert Kills Award for a Magazine". The New York Times. Retrieved October 28, 2024.
  31. ^ "Ace Hardware's New Ads Remind People Not to Eat Paint or Confuse WD-40 With Motor Oil". Adweek. March 2, 2016. Retrieved September 8, 2016.
  32. ^ Lazare, Lewis (August 4, 2015). "Ace Hardware spokesman Lou Manfredini joins company's Center for Excellence". Chicago Business Journal. Retrieved August 10, 2016.
  33. ^ "Ace Hardware International". www.acehardwareintl.com. Retrieved October 30, 2024.
  34. ^ "Tim-Br Marts Ltd. Acquires Canwell Hardware and Assumes Distribution for its National Dealer Network" (Press release). Timber Mart. October 4, 2012 – via Business Wire.
  35. ^ "RONA and Ace Hardware International Announce Agreement for Master License of Ace Brand in Canada" (Press release). Business Wire. July 29, 2014. Retrieved August 10, 2016.
  36. ^ "Lowe's completes acquisition of RONA". Lexpert. September 2016. Retrieved August 1, 2019.
  37. ^ Klein, Kate (March 6, 2017). "Lowe's Condensing Ace Canada Operations". Hardware Retailing. Retrieved March 7, 2017.
  38. ^ "Peavey Mart: Growth and expansion on the back of creativity and hard work". Retail Council of Canada. November 10, 2020. Archived from the original on April 13, 2024. Retrieved December 19, 2021.
  39. ^ Thompson, Lindsey (October 18, 2024). "Ace International to Discontinue Support of Ace Canada Dealers". Hardware Retailing. Retrieved October 31, 2024.
  40. ^ Corporation, Ace Hardware. "Ace Hardware Opens First Store Under New Franchise Model in Mexico". www.prnewswire.com. Retrieved October 30, 2024.
  41. ^ Serrano, Sofia (August 29, 2021). "Al-Futtaim ACE celebrates anniversary with 30 Years of ACE - Helping Homes Improve campaign". Campaign Middle East. Retrieved October 30, 2024.
  42. ^ Caufield, John (May 2, 2005). "COMPANIES IN THE NEWS". Hardlines. Retrieved October 31, 2024.
  43. ^ Sharvit, Noam (August 22, 2005). "Gaon and Zbeda buy Ace for $20m - Globes". Globes. Retrieved November 1, 2024.
  44. ^ "Gaon, Zbeda Complete Ace, Office Depot Franchise Buy". www.franchising.com. January 30, 2006. Retrieved November 1, 2024.
  45. ^ "Sights set on new growth country". DIY International. June 26, 2007. Retrieved November 1, 2024.
  46. ^ Zomer, Navit (January 11, 2009). "ACE fires 15% of its staff". Ynetnews. Retrieved November 1, 2024.
  47. ^ Dovrat, Adi; Zeno, Lior (November 24, 2011). "After Burning Through NIS 40 Million in Two Years: ACE May Restructure Debt Too". Haaretz. Retrieved November 1, 2024.
  48. ^ Shpurer, Sharon; Sheva, Nathan; Dovrat, Adi (January 20, 2012). "Sources: Ace Owners Profited as Hardware Chain Faltered". Haaretz. Retrieved October 31, 2024.
  49. ^ "Ace Israel to concentrate on DIY". DIY International. May 3, 2013. Retrieved November 1, 2024.
  50. ^ Hayut, Ilanit (December 15, 2016). "Kedma buys ACE from Electra for NIS 190m". Globes. Retrieved November 1, 2024.
  51. ^ Levy, Aviv (March 1, 2021). "Israel DIY furnishing chain ACE files for TASE IPO". Globes. Retrieved November 1, 2024.
  52. ^ "Ace Hardware Named Wholesale Supplier for Mitre 10, New Zealand's Largest Home Improvement Retailer". Business Wire. June 30, 2014. Retrieved October 30, 2024.
  53. ^ a b "Ace Hardware Appoints New President Of International Division, Renews Southeast Asian Licenses". www.franchising.com. May 27, 2010. Retrieved October 31, 2024.
  54. ^ "ACE hardware to open 15 new outlets in Indonesia". Retail in Asia. July 10, 2014. Archived from the original on December 8, 2015. Retrieved August 1, 2019.
  55. ^ "read - IMQ - Indonesia Market Quotes". imq21.com. Archived from the original on July 20, 2018. Retrieved December 3, 2015.
  56. ^ "Ace Hardware (ACES) Bakal Buka 15 Toko pada 2023". investor.id (in Indonesian). Retrieved January 11, 2024.
  57. ^ "Ace Hardware Branches". Ace Hardware Malaysia.
  58. ^ "Company Overview". Jobstreet.
  59. ^ "Ace Hardware List of Branches" (PDF). BDO Unibank.
  60. ^ "A 100 Store Story Of Ace Hardware — Davao Corporate". March 25, 2024. Retrieved March 25, 2024.
  61. ^ "Ace new distribution warehouse". jctrans.com (in Chinese). January 30, 2007. Retrieved November 1, 2024.
  62. ^ "Ace Opens Outsourcing, Storage Center In Shanghai". ChinaRetailNews.com. February 15, 2007. Retrieved November 1, 2024.
  63. ^ Shahid, Malika (March 21, 2022). "Ace Hardware opens "Home Center" with new products". The Edition. Retrieved October 31, 2024.
  64. ^ "Famous US Retailer Ace Hardware Launches First Vietnam Store in Saigon | Saigoneer". saigoneer.com. November 28, 2019. Retrieved November 1, 2024.
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