Regions
WA building up, tradies follow
ABS data shows the value construction in WA's housing sector reached a record high in June
The West Ausralian
Tradespeople are in high demand in Perth
The WA chapter of UDIA anticipates a cooling in the housing market over the next year
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Residential builders in WA are experiencing one of their busiest-ever periods, with record housing approvals, finance applications and developer sales, according to the Urban Development Institute of Australia (UDIA).

The latest Australian Bureau of Statistics (ABS) data shows the value of construction in WA's housing sector reached a record high in June. The value of new homes hit $1.566 billion, while the total for all types of new dwelling construction almost reached the two billion dollar mark, coming in at $1.99 billion.

UDIA chief executive Debra Goostrey credited a major influx of workers to Perth a few years ago for the level of building activity over the past year. She told The West Australian:
We saw a spike in migration about three years ago, and these people are looking to buy now. They have gone through the rental market and they are at the point where they are looking to build or to buy an established home of their own.

There were 15,510 housing approvals in WA between January and August this year, well above the 13,717 approvals during the same period last year.

UDIA chief executive Debra Goostrey said WA's 40 biggest developers have also been on a major selling spree during the past two years. In the first six months of this year, they sold 5087 major development blocks.

This was only slightly down from the record 5605 lots purchased in the first six months of last year.

Both years were well above the traditional average, surpassing the boom years between 2006 and 2010 when lot sales for the first half of the year ranged between 3952 and 4891.

New data shows builders and developers have been busiest in Wanneroo, Swan and Rockingham, which have emerged as the housing hotspots of WA. The suburbs attracted the greatest share of new dwellings in the year to June, with 3414, 2583 and 2468 properties built in the areas in the twelve months to June respectively.

Most of these new lots are located in the outer suburbs. Stirling, 12km from the city, also made the list with more than 2400 new homes. It fits in with plans by the local council to develop the Herdsman and Glendalough areas within council borders and turn Stirling into a satellite city.

But WA is unlikely to continue developing at the current pace with building and finance approvals already falling in October, and Goostrey anticipates a continued cooling over the next year.

Nonetheless, it will still be well above the recent track record, with recent ABS housing finance data showing great demand. It shows that in the 12 months to August, there were 91,943 housing finance applications in WA, the highest since the same period in 2007. Goostrey said:
The development sector is currently running at about 130% of long-term averages, and we think it will drop back to 115% of long-term averages. So the sector will continue running above average, even after it drops back a bit.
Perth tradies wanted

The current housing boom means tradespeople are in high demand in Perth. Bricklayers and other skilled labourers are struggling to keep up with the rate of residential construction.

The busy period of house and apartment constructions is underpinned by high vacant land sales. In WA during 2012-13, there were just over 20,000 sales. That represented the fifth biggest annual turnover in the past two decades, according to data compiled by REIWA.com.au.

The pace of vacant land purchases has since subsided, with just under 17,000 recorded in the last financial year. However, industry experts believe the need for tradespeople will remain strong as the formerly vacant land sites are now being developed en masse.

One of the country's biggest residential builders, Dale Alcock, managing director of ABN Group, said there were some delays in Perth in getting bricklayers on to sites, which put other trades back. He told WA Today:
We are already at capacity. Those land sales have to wash through. We will be very busy on site for the next 12 to 18 months before it returns to more normal levels.

ABN Group is also a major trainer of apprentices. Almost one-third of its 300 current apprentices are bricklayers.

The increased demand for trades in the residential market coincides with a downturn in demand for construction workers on resource projects in WA's mineral-rich Pilbara. This decrease was the result of a sustained decline in the iron ore price which led to fewer projects.

There is a risk that residential construction work could dry up once the current cycle declines. Turnover in the broader market, including land sales and house and apartment sales, dropped in 2013-14 and agents are reporting subdued interest in the first few months of 2014-15.

BankWest chief economist Alan Langford said the state economy would hit a "soft spot" within two years if there were no new major resources projects and the housing market cooled.
Retailers
Kingfisher's sustainability approach
Making sustainability mainstream is a key ambition for Kingfisher and its businesses
Retail Times
Environmental values are integrated across Kingfisher-owned B&Q stores
2degrees has built the world's largest online community of sustainability professionals
Click to visit the Globel Industries website for more information
Kingfisher Group has appointed 2degrees, a global online community platform to help drive the progress of its "restorative, Net Positive" approach across its entire business.

Being "restorative, Net Positive" refers to companies making a more positive environmental or societal impact through sustainability strategies.

Making sustainability mainstream and part of the new norm is a key ambition for Kingfisher. It is looking for smarter, more integrated ways to accelerate the implementation of Net Positive across its geographically diverse businesses.

They include B&Q, Screwfix, Castorama, Brico Depot and Koctas which are located in 10 different countries. Richard Gillies, group sustainability director at Kingfisher, said:
There's no silver bullet for the type of transformational change that is necessary to our becoming a restorative business. We're asking our colleagues to worry about things they've never had to worry about before and so we have an ever-increasing group of people looking for answers to the sustainability questions they are being set.
Collaborative technologies have the potential to accelerate change by enabling ease of access to information and the sharing of best practice. It's not the only tool you need and it can't just be an information dumping ground, which is what we love about 2Degrees - they ensure content is interesting, relevant and easy to find. But more importantly, they work actively with those throughout our business to entice them onto the platform and then into the conversation. Engagement is a fundamental first step in our...journey to becoming Net Positive.

Using the 2degrees online collaboration platform and expert community management skills, it will work with Kingfisher to leverage the diversity of knowledge and experience which exists across the businesses. It will help develop the retail group's ability to connect and work together.

Kingfisher hopes the platform will quicken progress particularly around timber, energy and innovation. The retail group has aspirations to become restorative by 2050.

The web-based program will be run on the Kingfisher Exchange, a private online hub developed by 2degrees for Kingfisher staff. It builds on the success of an existing 2degrees program, launched in 2012, to embed sustainability best practice across Kingfisher's businesses.

The exchange is actively managed by 2degrees who work closely with Kingfisher staff to ensure the program supports effective team work across different operations. It is designed to save time and resources, and provide practical solutions to sustainability challenges. Martin Chilcott, CEO of 2degrees said:
We are delighted to be working with the world's third largest home retailer...As well as the environmental benefits that can be made through efficient and effective collaboration, the costs savings and revenue opportunities available for those pursuing sustainable business are substantial, and we are looking forward to helping Kingfisher realise these.
Companies
PPG to acquire US paint store chain
PPG's acquisition of Westmoreland Supply is expected to be completed in Q4
Trib Live
The acquisition is part of PPG's strategy to improve its position in the home and business markets
The outlets will be rebranded under the company's new PPG Paints store name
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PPG Industries recently announced that its North American architectural coatings business has reached an agreement to acquire Westmoreland Supply, an independent architectural paint distributor headquartered in Pittsburgh, Pennsylvania. Financial details of the deal were not disclosed.

Following completion of the acquisition, the 12 Westmoreland Supply outlets will operate as part of PPG's network of more than 900 company-owned stores in North America. They will be rebranded under the company's new PPG Paints store name.

It is PPG's second purchase of a local chain this year, as part of a strategy to improve its position in the home and business markets. PPG is targeting professional painters and expanding products at independent dealers, and home improvement centres.

In June, PPG announced the purchase of the 13-store Masterwork Paint Co., another Pennsylvania-based retail group. Pete Ciccaglione, president of Westmoreland Supply said:
PPG approached us because they are starting to get back into company-owned stores. I thought that was a good plan. We were building something good here, and you just can't sell to anybody. Once they bought Masterwork, we knew they would like to buy us. It was a win-win for them and for us.

Westmoreland Supply has operated its headquarters store since 1890. It is owned by Ciccaglione with this brother Jim, and partner Mike Gubanic, an accountant.

The stores employ more than 40 workers, and PPG said most will continue working once the deal is completed. Scott Sinetar, PPG's vice president, architectural coatings said:
Customers who know Westmore-land Supply will continue to benefit from a great product selection and excellent customer service.

PPG's expansive distribution network includes 5,000 independent dealers and all major home improvement centres. Its Glidden, Olympic, PPG Paints and PPG Pittsburgh Paints brands are on all these store shelves. Paint accounts for nearly 93% of PPG's sales.

Analysts believe PPG is trying to better compete with Sherwin-Williams Co., which has 4,100 company-owned stores and uses independent dealers.
Reports
Outdoor living trends
Open-plan areas connected to the garden remain the classic format for outdoor areas
Yahoo News Australia
Oversized outdoor furniture pieces are popular this year
Customers are now thinking of outdoor kitchen while planning homes or renovations
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The alfresco area is becoming the most popular room of the house for families to spend their time, according to Ciaran Brennan, from WA-based Pyro Designs. He said:
Most if not all new home builds now come with power and gas points ready for an outdoor kitchen to be installed, which tells us that people are now thinking of their outdoor kitchen while in the planning stage of their new home or renovation.
The popularity of outdoor living has simply grown due to its affordability and modern design options.

Brennan advises his customers to look into the new and innovative, durable and UV-stable materials over the more historically used, and high- maintenance commercial-looking stainless steel. The modular systems are still popular, due to improved manufacture and guarantees now being offered with some systems. He said:
The custom outdoor kitchen is now the most popular choice. We have found that people enjoy designing an outdoor kitchen around their preferred barbecue and appliance choices, while also having the luxury of choosing colours to suit their home.
Design and finishes

Nick Jolley of Patio Living said open-plan areas connected to the garden with the ability to enclose and protect in the cooler months via blinds, shutters or bi-folds are still the classic format for outdoor areas.

However Jolley said decorative screening was making ground, with screening materials such as laser-cut metal replacing simple lattice and timber more like garden art. It doubled as a feature and a privacy screen. He said:
Cedar lining is also popular, along with white lining options in both timber and gyprock, especially where the alfresco extension is over a deck and clients want a contrasting ceiling.

Travertine and granite paving tiles were almost completely replacing poured limestone and limestone pavers. Jolley said:
They offer a more durable, smarter finish, and laid on cracker dust or cement they eliminate the old drama of weeds and ants completely.
Furnishing and fabrics

Katie Rowley of Eco Outdoor said oversized outdoor furniture pieces are popular this year. She said:
Think luxurious outdoor sofas, which are beautifully simple pieces made with quality materials. Features such as chunky rope weave, solid teak frames and beautifully soft outdoor linens are key to this look.

Raw materials such as teak, and outdoor linens are also ideal for this season. She said:
Natural materials age and weather beautifully with time and are always the perfect complement to outdoor spaces, year-round...

Sam Stabler of Drovers Inside and Out said an industrial palette of recycled teak, metal, and rustic boat wood and slab tables were on trend. She said:
Lounges and day beds seem to be getting stronger every year as people want to relax and be comfortable.
Keruing hardwood timber lounges and dining suites are still very popular as they are traditional yet still stylish.

Poly resin wicker in more natural-looking weaves and colours were popular for modular lounges, day beds and dining. Stabler said:
We're seeing shades such as neutrals, greys, turquoise, coral and citrus colours like lime, yellow and tangerine dominating.
Styling and accessories

Greg Baker of Angove Street Collective, who has just finished his own outdoor cafe, Miss Watson's Garden, said some of the trends that inspired the space included painted timber planters and monochrome furniture. He said:
We have styled with custom-made painted timber planters in ivory, charcoal and amethyst. Planters are perfect for mature fruits trees such as limes, apricots and lemons for a pop of colour in a garden.

Powder-coated metal outdoor occasional chairs in black or white, with timber features in mango wood or oak were ideal for outdoor furniture. He said:
The monotone palette of ivory though to black with lots of light oak is a really fresh, stylish look. It can be accented with aqua, turquoise or yellow.

The trend this summer is for bringing the indoors out, with outdoor rugs and picnic baskets creating a garden dining experience at home.

Michael Donatelli of Oggi Stone Craft, said that while contemporary home design was increasingly popular, the trend for classic and traditional garden adornments remain strong. He said:
Pots lined in a row to disguise a fence line along with stone urns and statues are popular because they add a bit of warmth to what can often be a clinical setting of a modern home. Natural and neutral colours never go out of fashion, and the natural hard stones and cement pieces are highly durable with little maintenance requirement.

Water features - from water walls to industrial construction to classic-style fountains - had never gone out of fashion and added a sense of calm and feng shui to an outdoor space. Donatelli said:
The other popular items are gargoyles, which are said to ward off bad spirits. We've been installing these anywhere from cottage gardens to multimillion-dollar new builds.
Companies
Modular building advantages
Australia's modular building industry can expand into high-rise, multi-residential buildings
Sourceable
Modular bathrooms are popular outside Australia
Paul Bonaccorsi is a director at Intelligent Offsite, a modular building company based in Yorkshire (UK)
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Significant opportunities continue to exist in the modular building and off-site construction sector in Australia, according to the director of an international project management firm.

Director Paul Bonaccorsi from Yorkshire-based company, Intelligent Offsite

said Australia's modular building industry has a chance to expand into high-rise, multi-residential buildings.

The modular bathroom industry, in particular is set to benefit from the international experience of companies such as Lend Lease, Laing O'Rourke, Westfield and Multiplex. They have used bathroom pods outside Australia and are becoming increasingly comfortable with their implementation in domestic projects.

Bonaccorsi adds that while clients will always be the driving force behind any push toward use of off-site construction, European experience suggests that manufacturers of prefabricated products need to be flexible in seeking out new markets.

He believes many contractors were more comfortable with traditional construction methods and often had to be coerced into discovering new methods. Bonaccorsi told Sourceable:
The manufacturers have their part to play in constantly innovating. In Europe, the market was stagnant for a few years. Then we [the modular industry] started doing McDonald's restaurants and petrol station shops. That took us into other retail industries such as supermarkets, and permanent modular began to be bigger than relocatable. We then moved into prisons, hotels, hospitals and railway stations - all sorts of markets.

Bonaccorsi's comments come amid increasing debate in Australia about the best ways to address the slow take-up rates of prefabrication and offsite building around the country.

Proponents of prefabrication say it offers faster construction times, reduced labour requirements, fewer defects, less construction waste, higher levels of safety and productivity, and better sustainability.

BIS Shrapnel research analyst James Middleton maintains prefabrication methods are being held back by the relatively small and fragmented nature of the Australian market, the cost of transferring modules over long distances and the perceptions about modular homes being inferior products.

However he said the inclusion of better features and designs are helping to change this mindset, and the prefabrication industry has enormous potential as a contributor to affordable housing.

At the same time, growth in the sector is expected to be gradual and focused more on individual building components as opposed to "apartment buildings that go up in 10 days or fully built houses being dropped off at construction sites by semi-trailers." Middleton wrote on the BIS Shrapnel blog recently:
In short, whilst the reports of a six storey apartment building in Perth being built in ten days are impressive and exciting, they are unlikely to be game changing.
But modular construction will play an increasingly significant role in the Australian building industry moving forward...by being at the cutting edge of new technologies and techniques, so watch this space.

Bonaccorsi encourages manufacturers to look at innovative products such as alternative wiring systems which speed up construction processes and deliver cost advantages. They should also look at what companies like McDonalds, IHG, Hilton and BP have used overseas and offer them something similar here.

He believes manufacturers should also consider ways to offer more such as extended guarantees. He said:
The most important lesson we learned in Europe was to deliver more than traditional construction. Better quality is paramount, and we also provide extended warranties for the end user. If you have faith in the products you are using to make the building or pod, why not pass it on?
Companies
Making house keys obsolete
The August Smart Lock uses a smartphone app and Bluetooth connection
Tech News World
It is powered by four AA batteries
August recently added integration with Logitech's Harmony line of home automation products
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The August Smart Lock replaces the interior portion of existing deadbolt locks but does not require users to change their exterior door hardware. Physical, metal keys will work with the deadbolt as well.

The device is powered by four AA batteries and can be installed in about 10 minutes, according to company co-founders behind the August, Jason Johnson and Yves Behar.

Once in place, the smart lock allows users to control access to their home via a smartphone. It can provide temporary or ongoing access to selected others at will, creating invited guest lists from a user's contacts for a party or event, for example. Johnson explains:
Traditionally, we've had these locks, which are really designed to keep people out, and what we really wanted to do was flip that around and say, 'Can we create a system that brings people in, and how can we reduce the friction to access to the home by making it easy to give a key to someone you want to give access to your home, whether it be a family member or a friend or a service provider and make it really simple?'

Log records show who has entered and exited. A guestbook feature, meanwhile, lets users write thank you notes, leave instructions and invite comments.

Last month, August added integration with Logitech's Harmony line of home automation products as well.
Six million devices

Smart home products are gaining considerable momentum as prices drop and usability improves, according to Jonathan Collins, a principal analyst at ABI Research. He told TechNewsWorld:
Any of these devices give you that much more awareness of your home environment, wherever you are. We're seeing a broad groundswell of interest now of what smart home automation can be.

The market for smart locks, specifically, will reach more than six million devices shipped worldwide in 2019, up from a little more than 400,000 last year, based on data from ABI Research.
Niche market

In its current implementation, the device "does not appear to be any better than a standard deadbolt, which can be easily accessed with a bump key," Jim McGregor told TechNewsWorld. He said:
Since the outside still has the standard key, the security is only as good as the physical key. The wireless interface, if anything, is just another possible intrusion point.

The only benefit, then, is the convenience of being able to open the deadbolt with your cellphone rather than a key. He said:
At [US]$200-plus, this is likely a niche market for those that value that convenience. If a consumer values their security, they are better off investing in a high-grade double-cylinder lock like those from Schlage.
Range of competitors

The August Smart Lock's availability in Apple Stores is "a real benefit for the business, as they get exposure and reach in a unique retail setting," said Brian Blau, a research director for consumer technology and markets with Gartner.

However there are plenty of competitors already in retail stores including Unikey and Doorbot, Blau told TechNewsWorld. Blau said:
While those smart locks have their own unique features, the August lock will definitely get some traction as consumers start to understand the benefits of including digital technologies into what is traditionally a non-digital function.
Regions
Role of tech in tradies' businesses
Tradies who have been quick to adopt digital solutions are seeing the benefits
Business Insider
IntellitTrac helps monitor tradies' businesses
The latest iPhones are reviewed for tradies
Give to Amnesty International
Mobile technology is transforming the Australian construction sector, helping tradies run their businesses more efficiently and providing insights on projects and staffing that have never been possible before.

Tradies who have been quick to adopt software solutions to manage their teams and jobs are seeing the benefits.

Demand for cloud-based solutions from small businesses is increasing, making room for companies like consultancy TradiePad which sets up trade professionals such as electricians, plumbers and builders, with mobile solutions which cut the paperwork and increase the amount of information they can gather about their businesses.

TradiePad learning and development manager, Joshua Orr told Business Insider that in his experience, builders usually have similar pain points, especially when it comes to costing jobs and monitoring progress on a project. Technology allows them to cost accurately and follow a build in real-time. Orr said:
They've got guys filling out time sheets and they want to be able to allocate that time to a specific area so they can see, at every single stage, exactly where their build is up to, when they're going over [or under] budget.

The management side of the building game is complex, with businesses having to deal with subcontractors, clients, employees and suppliers, often running multiple sites. Owners and managers tend to be on the tools by day and typically on a computer quoting and invoicing at night. Orr said:
They all have exactly the same pain point. It was: 'how do I see exactly where a job's up to at any given point? How do I access that information live?' and typically, at best, it's been tracked in Excel files.

Future Build owner, Brad Mackenzie told Business Insider rolling out tablets to his team and a number of apps, including Xero, Workflow Max and BuildSoft, to his six staff this year improved his operations.

Before using mobile apps and tablets he used hard-copy time sheets, purchase order books and invoicing with all the data checked and entered in manually by his office staff. Here's what he's noticed since upgrading his technology.
Less paperwork

Mackenzie said the manual processes meant he never had a clear view of job progress and how he was tracking against cost plans at any point in a project. He realised there are easier ways to run parts of his business that were becoming a time-sapping risk.

All his staff now have tablets on site which they use to enter time sheet information, purchase orders and leave applications which are all sent straight back to the office and stored in the cloud. He said:
There's no requirement for a hard copy of anything. It just gives you a heaps better dashboard of where you're up to in your business.
Knowing where staff are, and what they're doing

Running on average about 10 jobs at a time worth about $450,000 each, Mackenzie has a lot of subcontractors, clients, orders and information to deal with. Each hour and order needs to be billed out to a client, and by digitising everything he now has an accurate way of monitoring time spent on each task.

Staff now enter time spent on each job daily and the information is available immediately to Mackenzie and his team, ready to be billed.

The real time flow of information enables him to "keep a better eye on costings".
Order tracking and better client management

Getting rid of paper purchase order books and going digital makes reconciling orders and keeping tack of costs easier.

All Mackenzie's work is done on a quoted basis and being able to see where the bottle necks are in terms of time spent on different tasks and material costs, he's able to be more transparent with his clients and get a better insight into his business.

He is able to remain on top of his costs and using apps and cloud software with mobile technology gives Mackenzie a real time view of how a specific job is tracking against a quoted cost.

Mackenzie has the tech bug and he's now looking at taking that level of insight and transparency further by developing a client login so owners can see what's happening at the site and what's scheduled for next week.
A leaner, better business

Using technology on site is enabling tradies to systemise, centralise and scale their business and not waste time pricing jobs. Mackenzie believes it is making his business more competitive.

He believes his office is more efficient and his staff aren't dealing with paperwork and communicating or clarifying information manually, which are time-consuming tasks.

Having all the information in one place also means less doubling up. Orr said:
The other really big benefit...is being able to template a lot of this stuff they do day-to-day. Once they've done a bathroom renovation, the next one is almost identical.
The cost might change...because it might be a different sink but really they can kind of 'cookie cut' this stuff. They can just tick, tick, tick, tick, tick and it builds an entire project for them in a couple of seconds, where previously that would've been hours sitting there with an Excel file.
Taking out the guesswork

By looking at the data, tradies and managers are able to get smarter and boost accuracy when it comes to costing and estimating jobs. Orr said:
They know exactly where their costs are going and where their expenses are going. If they've been guessing wrong for ten years straight they now know that.

Longer term, Mackenzie hopes all this technology will enable him to "take a back seat eventually" and get a helicopter view. He said:
There's no limit to it. You think you're at the cutting edge of it but you're just scratching the surface.
Bigbox
Home Depot investor overview 2nd half 2014
Home Depot strategy overview slide
Home Depot's overview of the US housing market
Cash flows generated by Home Depot
Click to visit the ITW website for move information
Home Depot has made a number of presentations to investors over the past month or so. This includes a Q&A session with Frank Blake, the outgoing CEO and ongoing chairman, held by Goldman Sachs, and presentations to investor markets in the USA and various Asian markets.

Three main things stand out from these presentations: Home Depot's ongoing commitment to its "interconnected" strategy, with an emphasis on building out its e-commerce area (with a $300 million investment); its subtle strategy for the Pro (tradesperson) market; and its continued belief in its existing network of stores as the fundamental of market growth.
Online strategies

A the core of Home Depot's online strategy is its ongoing development of logistics, with a focus on the changing relationship between individual stores, distribution centres (DCs), and stores as distribution centres.

Historically, one of the revolutions Home Depot brought to the US market was opening stores that were large enough to function as their own warehouses. Today it has evolved a complex mix of delivery types, including:
  • Bought Online, Shipped from Store (BOSS)
  • Bought Online, Picked-up In Store (BOPIS)
  • Shipped direct from DC
  • Shipped from vendor

  • An example Mr Blake gave of how this provided flexibility was for Home Depot's sales of what in the US is known as "patio furniture", which corresponds closely the the Australia category of "outdoor furniture". The strategy the retailer employed during the Northern Hemisphere spring/summer was to stock stores with furniture only for store displays, and then ship any orders from the nearest DC direct to the customer.

    Another area of online sales Mr Blake highlighted was the need for vendors to also adjust their business models to cope with the change. This related both to products stocked, and systems of bulk and non-bulk delivery.
    Pro (trade) market

    As with many home improvement retailers, its Pro market represents a small proportion of overall customers (around 4%) but provides an outsized proportion of revenue (from 35% to 40%). According to statistics, the addressable market for Home Depot is US$260 billion, of which US$80 billion is in the Pro sector.

    Mr Blake reiterated the familiar story about the Pro customer in the US: Seven years ago, shortly after the collapse of investment banker Lehmann Brothers, the Pro market almost collapsed. Two years ago it came back, and grew at a much higher rate than the consumer market. Today, according to Mr Blake, it is growing at the same rate as the consumer market.

    Home Depot continues to see a lot of growth opportunities in the Pro area. Mr Blake says this is being pursued mainly through offering better levels of service. In particular he highlighted two main requirements from Pro customers: fast in-and-out service, and the ability to order and obtain same-day delivery on job-lot orders.

    In the Home Depot slides for its presentation to US investors, the following issues are mentioned:
  • Reserved parking
  • Fast in-and-out
  • Loading assitance
  • Simplify sales process
  • Customize solutions
  • Job site delivery
  • Rebates / volume discounts

  • While the company was clear that measuring growth within particular market segments remains difficult, it did reveal that "high-spenders" (over US$10,000 a year) in the Pro market were growing at a faster rate than those in the consumer market.

    Mr Blake also revealed that the margin rate on Pro retail is the same as that for consumer retail. He also mentioned that Home Depot had tried getting into the direct to trade, wholesale market, but had sold off that business two years previously, and had no intention of re-entering it.
    Store network

    One of the major decisions taken at Home Depot and implemented this year was to cease building any more stores in the US so as to concentrate instead on growing online sales. The only stores Home Depot is building currently are one in Canada and five in Mexico.

    However, Home Depot has reiterated its satisfaction with its current store network. Most of these are quite established stores, with most of the original foundation stores still in operation today. Every store, according to the company, is meeting and exceeding its return targets.

    This comes, however, at the price of continuous re-investment. Home Depot continues to be "slammed" to investors by Lowe's for its poor store fitout, which, the competitor claims, are not appealing to women customers. Home Depot has invested substantially in improving the amenity of its stores, and plans to continue this investment.

    The company wholly owns over 90% of its stores. One function of these stores is to act as a good place to experiment with new product lines. A good example of this is the cleaning product line, which Home Depot has entered into in a major way during 2014.
    Efficiency

    As with most retail, the company's major costs relate to staff. Home Depot started a big push five years ago to transform its staff from working 40% of the time on sales and 60% of the time on logistics and other processing work, to working 60% on sales and 40% on logistics.

    It has now achieved that goal, and is concentrating on improving how well its staff produced in both activity areas, while making sure the customer service scores remain high. In its presentation slides, Home Depot identified these changes:
  • Reduced store reports by 40%
  • Decreased store manager emails by 20%
  • Eliminated unnecessary meetings and conference calls
  • International expansion

    Mr Blake was very clear in saying the company had few plans to expand beyond the North American market - the USA, Canada and Mexico. It had tried to expand into China, opening 100 stores, but simply could not work out how to make money there. He said Brazil had been considered, but the economy was not stable enough to take on that risk.

    In particular he emphasised that the growth potential in the US market remained so high, it made investment elsewhere less attractive. Home Depot achieved US$5 billion in growth during 2012 to 2013.
    Economic overview

    The company has predicted that its second half 2014 numbers will be slightly better than the first half 2014 numbers. Indications are that the housing market was still in the early stages of recovery, with indicators continuing to fluctuate each quarter. However, it suggested this was actually a good thing, as it indicated the already strong retail numbers could continue to improve in 2015 and 2016.
    Retailers
    Rona turns 75 years old
    Rona celebrated its 75th anniversary recently
    Hardware Merchandising
    Rona president and CEO Robert Sawyer
    Special in-store promotions and activities marked Rona's 75th anniversary
    Click to visit the Globel Industries website for more information
    Canadian hardware and building materials retailer, Rona celebrated an important milestone in early October. On the occasion of its 75th anniversary, president and CEO Robert Sawyer said:
    In the world of retail, there is no status quo. We have to constantly reinvent ourselves to stay relevant, to improve our offering and adjust our strategies. For 75 years, RONA has been doing this successfully.

    Since its beginnings in 1939, Rona has seen many changes and operated under a few different corporate names, but the company said one thing has remained constant: It has always been passionate about serving its customers. Sawyer said:
    Rona enjoys a tremendous legacy. In honour of this, we want to work even harder to continue to merit the trust of our customers. I want to take this opportunity to thank the more than 24,000 employees who contribute to RONA's success every day.

    In 1939, a half-dozen dealer-owners created Les Marchands en Quincaillerie ltee to get around a monopoly that was threatening their supply chain. Their mission at the time is still relevant today: To combine orders to obtain the best prices.

    A few years later, Rolland Dansereau and Napoleon Piotte took control of the company, and in 1960 they created Ro-Na, a new entity that took its name from the first syllables of their first names.

    In 1988, Ro-Na merged with Dismat, another group that was working mainly in construction materials, and became Ro-Na Dismat.

    The 1990s was the era of big box stores, ushering in Rona L'entrepot. The first decade of 2000 saw rapid growth for Rona, as it made acquisitions, built new stores and recruited new dealer-owners. In 2002, Rona went public when its shares began trading on the TSX.

    During its expansion years from 2000 to 2005, Rona acquired 66 Cashway Building Centres; 51 Revy outlets; Lansing Buildall and Revelstoke stores; 20 Reno-Depot/The Building Box big box locations; and 16 Totem Building Supplies stores.

    This year, with the transformation of all Reno-Depot stores complete, a better banner positioning, and as the master licencee for the Ace Hardware brand in Canada, Rona continues to consolidate its restructuring efforts.

    Rona has a country-wide network of more than 500 corporate, franchise and affiliate stores. With eight distribution centres, Rona serves its network as well as many independent dealer-owners operating under other banners. The corporation generates consolidated annual sales of approximately C$4.2 billion.
    Products
    Bosch wireless charging system hits stores
    Bosch wirelessly charging tools are being rolled out into stores in the US and Europe
    Forbes
    Designed to address dead or dying batteries experienced by professional users
    Bosch developed the wireless-charging technology in-house
    SpotOn is your source for laser levels and other tools
    Bosch has started shipping wirelessly charging drills, batteries and chargers to Lowe's, Amazon, Grainger and other retailers. The new kits should be on store shelves by November 1 in both the United States and Europe.

    Robert Bosch Tool Corp, the North American branch of Robert Bosch, designed the wireless charging system to address the number one problem that professional tradespeople said they faced on the job - dead and dying batteries. Jason Feldner, a group brand manager at Robert Bosch Tool Corp, said:
    Before wireless charging, the user had to take the battery out of the tool and walk over and put it in the charger and basically plug it in. This took time and interrupted the flow of work.

    Over the last eight years, Bosch has managed to almost double the amp hours delivered by each battery, but user research showed the improvements weren't enough.

    Professionals still had to carry up to half a dozen batteries and battery chargers just to make it through the day. They struggled to remember which batteries were charged and which weren't, even developing systems to jog their memory like turning the batteries upside down or laying them on their side.

    Bosch first demonstrated a set of power tools that could be recharged without removing them from their case at CES in January 2009. At the time, Bosch had teamed up with Fulton Innovations, a Michigan-based technology company and a member of the Wireless Power Consortium, which supports a global wireless power standard known as Qi. David Baarman, director of advanced technologies at Fulton Innovation said:
    Bosch is an amazing engineering company, and we did many prototypes for them and with them. But they are a company that needs to work through the engineering themselves.

    Feldner said Bosch developed the wireless-charging technology in-house and is not working with any standards body. He said:
    Systems for power tools have always been proprietary.

    The Bosch system is based on the principle of electromagnetic induction, first discovered in the 19th century. An electric current generates a magnetic field in a transmitter which in turn generates an electric current in a receiver. The battery charger still needs to be plugged in, but it's not necessary to remove the battery to recharge it. Feldner explained:
    Every time someone sets a tool down, it's charging back up again.

    Feldner said one of the reasons it took so long to bring the prototypes to market was the challenge of figuring out how to efficiently transfer 50 Watts of power. The Qi specification currently addressed low-power transfers up to 5 Watts. He said:
    This battery will charge from zero to 100% in 50 minutes. It'll charge 80% in 30 minutes.

    The time was comparable with traditional charging methods, except that with wireless charging, the batteries are easily topped off during moments of downtime. That should keep overall charging times to a minimum.

    Another challenge was foreign object detection - making sure the transmitter can detect if a metal washer, a screw or any object besides the battery has been placed on top of the transmitter and, if so, turn itself off. Feldner said:
    It was a very complex process to get there.

    Among the patents Bosch has submitted related to wireless charging is one for foreign object detection, filed in June 2011 in the United States and Europe. Bosch also filed an application with the World Intellectual Property Organization on "wireless power transmission" in May 2013.

    Bosch has a range of products that will work with the new wireless charging kit, from impact drivers and hammer drills to saws and grinders, but the mobile holster that allows someone to rest a tool on the charger and top off a battery only works with drill drivers and impact drivers. Feldner said:
    This is our first step. It is just the beginning.
    Companies
    Skylights, windows and doors take centre stage
    The Abedian School of Architecture in QLD won the AISF Best Use of Anodising award
    Architecture and Design
    SIA recognised Solatube for the Best Use of Skylights at the Sydney headquarters for R&W Traders
    AWA's Best Use of Windows & Doors - Residential award went to the Pole House in Fairhaven (VIC)
    Subscribe to HNN weekly e-newsletter
    The winners at the 2014 Fenestration Australia Design Awards indicated an increase in customer awareness of windows, door finishings and skylights.

    Highlighting innovative products in both residential and commercial construction, the awards includes other associations including the Australian Windows Association (AWA), the Australian Institute of Surface Finishing (AISF), and the Skylight Industry Association (SIA).

    Winners include G.James for the Abedian School of Architecture in QLD, which took out AISF's Best Use of Anodising prize. Praised for the use of modern techniques that overcame the anodising challenges in the construction and use of large frame elements, the building features window walls that provide light and visibility to the surrounding areas.

    These, combined with the unique "wave" shape, colour consistency and subtlety of the frame colour, make for a highly visual effect.

    SIA recognised Solatube for the Best Use of Skylights at the new Sydney corporate headquarters for R&W Traders, which owns The Cheesecake Shop. The jury noted:
    The playfulness of the Swiss cheese effect combined with thermally efficient daylighting devices to deliver natural light into a central atrium provides a technically good solution.

    The Ultimate Sashless Window from Jewel Windows took out the AWA Most Innovative Window System award. Offering unbroken views, the product also takes into consideration environmental concerns - natural cooling ventilation is achieved with the windows venting stale hot air through the top opening, and allowing fresh cooler air to enter via the bottom.

    AWA's Best Use of Windows & Doors - Residential award was given to Bradford Glass and Aluminium's Pole House project in Fairhaven (VIC) which was honoured for its wide expanses of glass capturing 180 degree views despite its beachside location and height.

    Exposure on all sides to the elements, including sea salt, heavy rain and wind speeds of up to 100kph, created a challenging environment for the project, but the brief was met and enhanced by the use of solid and reliable windows and doors that ensure longevity and structural integrity.
    Full list of 2014 winners
    AISF Best Use of Anodising
  • G.James - Abedian School of Architecture, Robina (QLD)
  • AISF Best Use of Powdercoating
  • Commercial winner: Decorative Imaging - Wet Paint Restaurant, Bronte (NSW)
  • Commercial Highly Commended: Aluminium Industries - Medibank, Docklands (VIC)
  • Residential Highly Commended: Decorative Imaging, Mackay (QLD)
  • SIA Best Use of Skylights
  • Solatube - Lisbon Street, Villawood (NSW)
  • SIA Skylight Showroom of the Year
  • Small: Skydome Hunter Coast - Brunker Road, Broadmeadow (NSW)
  • Medium to Large: Solar Bright International - Progress Circuit, Prestons (NSW)
  • AWA Most Innovative Component
  • Breezway - Powerlouvre Aptivate Control Unit and Powerlouvre App
  • AWA Most Innovative Window System
  • Jewel Windows - UItimate Sashless Window
  • AWA Showroom of the Year
  • Small: Trend Windows & Doors - Cavendish, Coorparoo (QLD)
  • Medium to Large: BetaView Aluminium Windows and Doors, Dale Street, Brookvale (NSW)
  • Highly Commended: ACME 1 - Woodward Road, Bendigo (VIC)
  • AWA Best Use of Windows & Doors (Commercial Renovation)
  • Evolution Window Systems, UWS Outreach Camp Lithgow (NSW)
  • Highly Commended: Southern Windows - Ulladulla Civic Centre, Nowra (NSW)
  • AWA Best Use of Windows & Doors (Commercial New Construction)
  • Up to $5 million: Hanlon Windows - Wellgate Avenue, Kellyville (NSW)
  • Over $5 million: Breezway - Iglu Student Accommodation, Chatswood (NSW)
  • Highly commended: Paarhammer - Nishi Complex, Canberra (ACT)
  • AWA Best Use of Windows & Doors (Residential Renovation)
  • Bradford Glass and Aluminium - Banool Road, Fairhaven (VIC)
  • AWA Best Use of Windows & Doors (Residential New Construction)
  • Up to $500,000: ACME1 - Koorook Lane, Bendigo (VIC)
  • Over $500,000: Paarhammer - Blairgowrie (VIC)
  • Editorial
    The Block 2014: Two showerheads for every bathroom
    The Block Glasshouse series echoed the state of the home improvement retail industry itself
    There was an almost complete lack of any kind of environmental awareness in the latest series of The Block
    There was greater ethnic diversity in The Block Glasshouse
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    In many ways, the 2014 edition of Channel Nine's epic "reality" home improvement series The Block echoed something of the state of the home improvement retail industry itself. In a commercial/ratings sense, it did quite well, but it also gave some strong indications of not quite knowing what it was about.

    This was also reflected in what seemed a relatively weak use of the medium for promoting home improvement stores. While Mitre 10 continued to have a good presence, it might have been a little blunted by lack of an adequate budget, and one or two poor advertising choices (in particular a paint ad).

    Metcash, Mitre 10's owner, continues to struggle as its IGA supermarkets battle it out against Woolworths, Coles and now Aldi as well, so the possible financial restraints are understandable, if unfortunate.

    The only real home improvement "winner" was The Good Guys. Without intruding on the TV episodes directly, this company nonetheless managed to present itself as a high-finish, stylish, helpful company, prepared to go the extra mile to help its customers.
    The social score

    It was evident from the beginning of this series that Channel Nine had received the message about potentially using more people who, to utilise an American expression, looked more like "what Australia really looks like".

    Not only was there greater ethnic diversity, but it also featured women who not only would not fit into size 0 short-shorts, but would have no inclination to do so in the first place.

    However, there was one almost shocking and persistent social lapse: an almost complete lack of any kind of environmental awareness. It was pretty evident that a project engaged in turning a 1970s office building into a set of six apartments was perhaps never going to be described as "eco-friendly", but there did not seem to be a single concession to environmental awareness.

    It seems unlikely that anyone who actually lives in Melbourne did not look at those eight-plus metre high ceilings and know its eventual owners would be condemned either to very high heating bills or chilly rooms for eight months of the year. Insulating the walls really isn't going to do much in those circumstances.

    Just to give a single example of the kind of slack thinking employed in terms of environment, every single showerhead in every bathroom wasn't just non-efficient, they seemed designed to blatantly waste as much water as possible. It was amazing.

    Added to this were a number of comments that most of the bathrooms really needed to feature twin showerheads to accommodate their residents. (Is everyone showering together, these days?) So much for finding creative and interesting ways to save water.

    Hello, Channel Nine? "Global warming" ring a bell at all? "Drought"? Any takers?
    The other social score

    This preference for "luxe" over conscience tags into another difficulty with this series. There seemed from the start to be a kind of total confusion over who would actually eventually buy the apartments.

    The original sense, as far as one could tell, was that potential buyers would be the younger, trendier couples with aspirations to eventually make it into upper-middle class Australia. Think lawyers trying to get on partner track, recently appointed executives who want to make it into the boardroom and perhaps become CEO some day.

    If you know anyone who is on that kind of career path, the first thing you know is that they can be utterly remorseless entertainers. They don't so much live in their houses, as use them to establish useful social connections. That means entertaining at home at least 12 times a year, and frequently 15 or more times.

    Those people really do not care that much about fancy bedrooms or luxury bathrooms. What they need are "high-end" functioning living-rooms, dining-rooms, outdoor areas and kitchens. Those are the "working" parts of their houses.

    Due partly to the order in which the rooms were completed on this series of The Block, the apartments were designed with over-styled bedrooms and bathrooms, and with living-rooms and dining rooms that were essentially a cheap afterthought.

    The kitchens were somewhat more functional, but it seems unlikely most of the contestants understood that, with the given market, those fancy ovens would primarily be used by the catering staff, and not as part of creating a homey atmosphere on late Sunday afternoons.

    The core reason for this, of course, is that - barring a few top professionals - people largely design spaces for themselves. Thus from the perspective of the contestants most of the design really fell into the category of "blue-collar aspirant" design; ie. those moving beyond their blue collar origins.

    There is nothing particularly wrong with this, except that no one who is a blue-collar aspirant is going to drop $1.5 million on an apartment in a repurposed office building in Prahran.

    While that kind of confusion is almost acceptable in contestants who are, for much of the time, responding to the conditions of the competition itself, there are fewer excuses for the judges of the competition.

    They seemed equally unable to understand the idea that people might want to buy an apartment with a specific purpose in mind. They seemed to think the eventual occupants would be wannabe socialites and, perhaps, members of the more minor aristocracy, who would want to spend time in delicately appointed rooms when serving tea to their contemporaries.

    Given this, it is hardly a surprise that the final sale of the apartments was borderline disastrous, with only two of the five apartments exceeding their reserve prices by any significant margin. It seems unlikely that anyone from the declared markets actually showed up as buyers.
    The show as industry

    One of the better, clear-sighted analyses of the results was provided by The Property Observer:
    The most profitable selling market would have been student style - or Gen Y workers - rather than vast luxe given its proximity to Swinburne University with the 6 route tram out front and the railway very close via the Percy Street garage exit...[T]he deep-pocketed baby boomer buyers that are the traditional recent Block apartment auction attendee either understandably didn't turn up or showed suitable reserve and mostly kept their hands in their pockets given the mediocre Prahran location...[P]roperty success is often premised on population trends so those big three bedroom apartments were perhaps oversized for the very obvious Prahran composition of households without children. It sits at around 70% compared to the 50% Melbourne average. Ditto the lone person households category in the last census sat at around 40% of Prahran households compared with the Melbourne 23% average. There were just the 99 households in Prahran with five or more occupants.
    Property Observer

    Part of what is interesting in this analysis is its dismissal of the "Gen Y workers" as potential purchasers of this kind of apartment. The older Generation Y "workers" would be in their early- to mid- thirties, and some of these would be in this market - as would much of the "mysterious" Generation X.

    But the Property Observer - and presumably many others - simply can't help thinking about the whole situation through the eyes of the (still-dominant) baby-boomer generation.

    To a large extent, this is a problem that continues to afflict the home improvement retail industry as well. It is not just the question of whether in the demographic stakes the baby-boomers dominate the actual purchasing market, but more whether their values remain dominant.

    What retailers - not only in home improvement - are just now beginning to understand, is that the values of younger generations - X, Y, and the Millenials - are now starting to strongly influence the overall culture.

    Even baby-boomers themselves are taking some of their attitudes from these other generations. This change is what is really behind, for example, the steady decline of the department stores, the move to higher-density housing, the rise in popularity of inner-city areas.

    That market is something that every retailer, especially in home improvement, should consider as an expansion opportunity.

    Until next time,

    Betty

    For any feedback, comments or story tips, you can contact me directly via email betty@hnn.bz or Twitter @HNN_Australia

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    HNN iPad App
    Statistics
    HNN Home Improvement Index
    HNN Market Index for October 17, 2014
    Harvey Norman is world's best stock to short
    Rheem temporarily blocked from acquiring Dux
    Subscribe to HNN weekly e-newsletter
    The ACCC has made a number of decisions temporarily blocking joint ventures and sales in an effort to protect competition. A decision regarding the joint-venture between Boral and CSR will be stall until 18 December 2014, while the ACCC seeks further submissions. A decision on the sale by GWA of its Dux hot water manufacturing to Rheem has also been delayed until 20 November for similar reasons.

    Downer EDI has acquired privately-held Tenix, a utilities company. The Goodman Group has helped IKEA find further warehouse space to service the growing China market.

    Harvey Norman is in the news for all the wrong reasons. It has been highlighted as an overpriced stock after after someone entered a "best short" competition with its stock as the centrepiece.

    The most significant stock price change was for GUD Holdings, which rose 7% in the week from 13 October 2014 to 17 October 2014.
    Adelaide Brighton
    Possible purchases of Boral roof-tiles business

    The company has been mentioned as one of the less-likely entities to purchase the Boral roof-tiles business, which will be spun off sometime in the next year. The mostly likely purchaser would be Brickworks. See the Boral section below for more details.
    Boral
    ACCC doubtful on joint venture with CSR

    The ACCC has extended the revue period for the potential merger of the brick producing businesses of Boral and CSR. According to ACCC Chairman Rod Sims:
    The ACCC is seeking further information to determine whether the proposed joint venture is likely to substantially lessen competition in the supply of clay bricks. The proposed joint venture would result in a duopoly in eastern Australia. The ACCC s preliminary view is that this would be likely to lead to an increase in the price of clay bricks as well as a reduction in the product range available to residential builders, architects, and end-consumers.

    The statement issued by the ACCC goes on to set a timeline for the review:
    The ACCC invites further submissions from interested parties in response to the Statement of Issues by 6 November 2014. The ACCC s final decision will be announced on 18 December 2014.
    ACCC statement

    Boral responded to the ACCC with a statement of its own. In part this statement said:
    CSR and Boral are reviewing the Statement of Issues and will continue to engage with the ACCC to address issues identified. CSR and Boral consider that the merits of the transaction are significant and that the transaction would not result in a substantial lessening of competition. Australian brick manufacturers have experienced a sustained structural downward trend in demand for brick products over the past 30 years. With bricks becoming an increasingly smaller component of the highly competitive cladding market, lower brick demand has resulted in declining capacity utilisation, reduced profitability, plant curtailments and closures. The proposed transaction will enable both Boral and CSR to access additional operational and overhead efficiencies that would otherwise be unavailable to the parties acting independently. The joint venture will be a more sustainable business positioned to deliver returns that recover the cost of capital through building cycles.
    Boral may sell roof tiles division to Brickworks

    According to a report in The Australian, Boral stil intends to sell its roof tiles business, and Brickworks is seen as the company most likely to buy. A report in FP Markets suggests this division has revenues of around $100 million a year producing around $5 million in profits. The sale price is expected to be above $70 million.
    The Australian
    FP Markets
    Charter Hall Group
    Starting office fund and industrial fund

    Charter Hall has launched a $200m capital raising for an existing unlisted office fund that it hopes to grow to $600m of asset, and is also looking for $150m for a new $250m industrial fund.
    The Australian
    Completes $603 million acquisition

    Property investor Charter Hall Group (ASX:CHC) and its new partner super fund HOSTPLUS have tied up a $603 million acquisition. The purchase was announced last month and includes a portfolio of 54 hospitality assets across Australia bought from Woolworths Limited (ASX:WOW) subsidiary ALH Group.
    Finance News Network
    CSR
    ACCC doubtful on joint venture with CSR

    See news listing above under Boral
    Downer EDI
    Downer acquires Tenix

    According to Downer CEO Grant Fenn:
    Tenix is a leader in the electricity, gas and water sectors in Australia and New Zealand. There is little overlap between the two companies and Tenix will be foundation for a new core utilities business for Downer.
    Fairfax Media
    Fletcher Building
    Jobs to go at Pink Batts factory in Christchurch

    Fletcher will cut jobs at its factory in Christchurch, New Zealand, while ramping up production at its Auckland facility.
    The Australian
    Goodman Group
    Goodman helps IKEA expand in China

    Logistics property developer Goodman Group has helped IKEA expand its warehousing facilities in China by providing 118,000 square feet in the city of Chengdu.

    IKEA operates 16 stores in 13 Chinese cities. Philip Pearce, managing director greater China for Goodman, credited the ties between the two companies in Australia for laying the basis of the Chinese engagement. He said:
    We continue to see growing demand for prime logistics space in Western China, and have invested a significant amount of capital and resources in this region, ensuring we are well positioned to take advantage of market opportunities and deliver long-term return for our customers and investors.
    JOC Group
    GWA Group
    ACCC raises objections to GWA's sale of Dux to Rheem

    The ACCC is concerned the acquisition by Rheem of the Dux hot water manufacturing business which is currently owned by GWA could lessen competition. According to ACCC Chairman Rod Sims:
    The proposed acquisition would lead to Rheem being the only Australian manufacturer of the more common vitreous enamel storage heaters. Market inquiries have indicated that there are few imports for the larger-size storage water heaters commonly used in Australian homes.

    Rheem responded by stating the acquisition was vital if an Australian alternative to imports was to be viable into the future. According to Matt Sexton, Rheem s CEO:
    Today around 45% of the total Australian water heater market is supplied by imports. This highlights the need for a strong local water heater industry. Smaller, standalone local businesses are unlikely to survive in an open and competitive market such as the Australian water heater market.

    The ACCC statement laid out the timeline for approval:
    The ACCC invites further submissions from the market in response to the Statement of Issues by 31 October 2014. As a result, the ACCC s final decision will be deferred until 20 November 2014.
    ACCC
    Appliance Retailer
    Harvey Norman
    Company receives award as most over-priced stock

    A short-selling strategy based on Harvey Norman has taken out the top prize in a competition to find over-valued stocks.

    Sid Choraria, who works for the Singapore-based boutique fund management firm APS Management made the entry in the competition underwritten by New York-based SumZero. His entry read in part:
    At three-year highs of $3.70, we believe Harvey Norman stock seems overvalued and a compelling short.

    Mr Choraria believes the shares will come down to $2.20 over the next several years. The primary weakness in the company, he believes, is its franchise structure. To quote from the winning entry:
    Over the last 3-4 years, as rising tides lift all yachts, HVN stock and valuation sits at 3 year highs likely assisted by a potential housing bubble in Australia (discussed in catalysts) and A$ sales internationally boosted due to FX "translation" gains due to a weak A$ in FY2014. Indeed, management highlight performance in the recent results presentation in part to sound strategic decision making and omni-channel (note: online is only approx. 1 % of sales). We recall the quote by Mr. Buffett on "don t be fooled by that Cinderella feeling from great (recent) returns". Management is compensated million dollar salaries while over 10-15 years shareholder returns have underperformed the ASX.
    Fairfax Media
    SumZero
    Metcash
    Metcash gets some zing

    PR agency Zing has been awarded a contract with Metcash's IFGA supermarket division for seasonal and in-store campaigns.
    mumbrella
    Pact Group Holdings
    Pact loses contract to Visy

    Pact Group is rumoured to have lost a contract with drinks group Lion, which is owned by Japanese company Kirin, worth $55 million to arch-rival Visy.
    The Australian
    Stockland Corp
    Stockland makes deal with AMP Capital

    Stockland has sold a half share in the Stockland Townsville Shopping Centre to the wholesale AMP Capital Shopping Centre Fund for $228.7 million. Stockland managing director Mark Steinert said:
    AMP Capital is a secure, high-quality capital partner and the divestment of this 50 per cent stake in Stockland Townsville will enable us to recycle capital into accretive opportunities.

    The Townsville Shopping Centre is anchored by Myer, Woolworths and Big W stores.
    Super Retail Group

    The Super Retail Group will hold its annual general meeting in Brisbane on 22 October 2014.
    Reports
    Mag Review: Aussie classics not so classic
    House & Garden November 2014
    Home Beautiful November 2014
    It is possible to capture flowing water in an image
    Subscribe to HNN weekly e-newsletter
    Magazine editors in Australia tend to do it tough. If you look at the page listing employees - which in Australia is called "the skite box" and in the USA is called "the masthead" - you'll see that the average US magazine has about five times the workers of the average Australian magazine.

    It's the circulation figures that are really daunting, however. Magazines such as Australian Home Beautiful has a circulation of under 92,000. Better Homes and Gardens, the leading home decor magazine in the US has 7.6 million readers.

    So one can imagine that there is a bit of a difference in budgets. There is also a big difference in the available pool of homes to use as inspiration. Australia had 7.6 million households in 2013; the US had 132.8 million.

    Yet the Australian editors have the task of producing magazines that somehow live up to the standard of their American counterparts in terms of style, design and production values.

    Beyond the difficulties created by the numbers, however, there is also a problem simply with the style approach of the editors in many Australian design magazines. There is really something that is unique and Australian in home design, but at the moment this remains elusive. You know it when you see it, but most of the time what you see are reworked designs from other nations, or an update to the British "nice" houses of the 1960s.
    Australian Home Beautiful
    November 2014

    This is really a very good Australian style photograph.
    From Australian Home Beautiful November 2014

    It combines elements of their lives that Australians are not even that aware are special: the beautiful tree, the glistening pool, the weather furniture and deck, the windows opening the house to patch of the outdoors. It is also unique in the way the natural texture of the tree extends through the space, repeated in the rough wood, and contrasted with the sleek elements of the bench, the glass pool fence, and the backdrop of lush green foliage. It is also, as a photograph, exceptionally good: the time of day captures the dappled shade cast by the tree over the table and chairs, and the focus/exposure renders it slightly soft and lush.

    However, there is not a single other image in this edition of the magazine that comes close to this. The next best things is this image of an alcove:
    Australian Home Beautiful November 2014
    Australian House & Garden
    November 2014

    The situation, photographically, is a little worse at this magazine. One of the problems is that white rooms tend to dominate style at the moment (though European stylists have evidently moved beyond that). White rooms present a particular difficulty to design magazines: you need to get the brightness/contrast in the photographs exactly right. The walls need to show some degree of texture, but with too much shadow and texture they end up looking almost "dirty".

    In this magazine virtually all the white-walled rooms have what are known as "blown" images. That is where the brightness is turned up and the contrast turned down so that the white walls lose virtually all of their definition. It is light and bright, but it's also dazzling.

    The one white room where everything works well is the also the best picture in the magazine:
    Australian House & Garden November 2014

    Not that there aren't a few images that come close. For example this image looks like a very interesting space - a partly outdoor shower:
    Australian House & Garden November 2014

    It took me something like three minutes to locate the showerhead at the top of the photograph, and to work out from that what was going on. Again the image is very blown, with the tiled walls receding into a blur of overexposure. The real "miss" is the absence of any definition of the water streaming down from the showerhead. Some of this is due to poor post-production, but the angle of the shot is wrong - it should be downwards - and there are a number of tricks to make water droplets stand out better, such as using a flash at an angle to the camera, and a small fan to slightly mist the stream of water.
    Reports
    Online Review: iPad magazines
    The houzz iPad app
    Typical navigation page in UKED iPad app
    Dwell magazine iPad app
    Subscribe to HNN weekly e-newsletter
    When the idea of using the iPad to produce publications was first announced, many publishers were quite excited. However, it soon turned out that Apple was not providing very much in the way of aid to actually producing publications. Newsstand on the iPad provided a place to put the publications, but the technical "hill" that needed to be climbed to actually produce a publication was quite steep.

    That remains the case today, though a number of companies have stepped into the breach to offer systems to make iPad publishing a little easier. The difficulty is that all these systems require compromises, which tend to sharply limit the attractiveness of these publications.

    For Australians, however, iPad publications can be quite an attractive option. Readers get nearly instant access to the latest edition of a magazine, and the price is (usually) substantially less expensive than buying individual issues at the newsstand.
    Houzz iPad app

    Houzz in its pure online form seems to be something a great many people really enjoy and use creatively. For others, however, it remains a little uninspiring. It falls into a class of software apps which includes flipbook, which rely on the reader doing a great deal of filtering of content. The trick to these apps is that they make that filtering process very easy to do, and very effective.

    The image below is one of the typical full-screen images that great readers when they first open the app (which is, incidentally, free).
    Typical houzz image

    You will notice that it provides a few buttons on the image. One enables you to share the image, another to save it to your "ideabook", and the third provides additional information.

    The next two images illustrate what happens when you tap the info button.
    using the app
    using the app

    The final image shows the menu options available in houzz down the left side of the screen in portrait orientation.
    Portrait view of houzz

    This image also indirectly shows how frustrating houzz can be. The chair featured is a Herman Miller Embody chair. However, doing a search for that kind of chair brings up not a single image, not even this one.
    Dwell newsstand app

    Dwell is a design magazine with something of a northern California sensibility to it. It is a half-good/half-bad kind of magazine. It has an almost oppressive number of ads in it, and consequently a number of rather disjointed single-page articles. However it usually has between six and ten very good pages in it.

    These are some of those pages. The way the pages display on lower-resolution iPads is very poor - the text is not readable until the page is zoomed. However, the quality of the good pages almost makes up for all these problems. These pages show a restored house in the Napa Valley, a wine region to the North of San Francisco.
    Dwell magazine iPad app
    Dwell magazine iPad app

    Dwell offers a free trial subscription for one month.
    Elle Decoration UK

    Elle Decoration makes use of a magazine production system provided by Adobe. This has some basic advantages, but also disadvantages.

    One of the disadvantages is that the reader can find his/herself constantly engaged in trying to work out how a particular "page" wants to be interacted with. Does is scroll down through multiple pages? Does the text scroll? While Elle provides small symbols to help with this navigation, but these are actually a little annoying.
    Typical page in UKED iPad app

    This shows a static page that features scrolling text on the right.
    Typical page in UKED iPad app

    This is the kind of page that does work very well, as it is self-contained and interesting.
    Typical page in UKED iPad app

    On this page you can see a number of "+" signs. Clicking on these brings up the information about the items to which they are "attached".
    Typical navigation page in UKED iPad app

    One of the side benefits of the production system is producing this kind of navigation, using thumbnails of the pages.
    Products
    Apple Pay is underway
    Apple explains Apple Pay
    AdWeek
    What using Apple Pay will look like.
    Apple Pay will also work with the upcoming Apple Watch
    SpotOn is your source for laser levels and other tools
    Starting on 20 October 2014 Apple will be unleashing its new payment system, Apple Pay, on the world. Apple Pay makes use of a unique combination of Apple hardware, software and cloud systems to make paying for goods more anonymous and more difficult for criminal hackers to exploit.

    Prior to the development of Apple Pay, the company pushed into the world of retail commerce with its Passbook functionality in its mobile operating system iOS. Passbook was developed, in part, to enable loyalty systems that would make use of mobile devices to deliver customer incentives such as coupons.

    While the system has had a generally slow adoption rate, Pep Boys, a US-based automotive parts business, has made extensive use of the system, and reports it has seen encouraging results. With Passbook, customers download a custom app for the store. This app interacts with Passbook on the customer's Apple mobile device to make available notifications of discounts and other specials. For example, Passbook can use the mobile device's GPS to "know" when the customer is near the store, and popup a discount offer onto the device's homescreen.

    With the release of Apple's iBeacon technology, the Passbook became slightly more useful. Passbook could then be triggered by the presence of specific iBeacons, which means a customer could move around in the store, and as he or she came into proximity with the iBeacon, receive an informative message or a coupon based on what they were looking at.

    According to Pep Boys, these features of Passbook have been paying off for them. Based on its customer database of over 36 million members, the company has found that 26% of clients who saw a Pep Boys Passbook pass added this to their Passbook, and of those 30% subsequently redeemed them when in a Pep Boys store. That is an overall takeup rate of 7.8%, which is thought to be very good in the industry.

    It's likely the adoption of Apple's retail technology suite will accelerate after the release of Apple Pay. Some 200,000 locations will support the new system on launch day, with many of the US's premium brands included.

    Apple Pay is thought to be more secure due in part to Apples fingerprint sensor, which can be used to better assure the identity of the person making a purchase. The system also does not directly expose the information on a credit card at any time during a transaction, instead generating a secure token for each transaction. Further, this information is stored on a special secure chip inside the latest mobile devices, making it difficult to access that information even if the device itself is stolen.
    Careers
    Regional training program for traders
    Bendigo retailers will benefit from a state governement funded training proegram
    Bendigo Advertiser
    The training program will be facilitated by the Australian Retailers Association
    The City of Greater Bendigo is the recipient of a $20,000 initiative or its retailers
    Visit the Mecca Website
    A unique training program is set to help Bendigo retailers attract and retain customers.

    The Victorian state government has provided $20,000 to the City of Greater Bendigo as part of its Streetlife initiative.

    The training program will be facilitated by the Australian Retailers Association and will comprise five tailored workshops and mentoring sessions by experienced business coach Brian Ambler.

    Bendigo Traders' Association incoming president Antony Adolf said the initiative is a positive step. He told the Bendigo Advertiser:
    This is a practical, results-oriented opportunity for retailers to learn how to gain and keep more customers, make more from those they have, and improve their operations to do so. Local and visiting consumers will also benefit from this improvement in bottom lines because their purchasing experience is improved.

    Adolf said fierce competition between online vendors and brick-and-mortar stores, limited resources, fragmentation and apprehension rather than cooperation were among some of the challenges faced by small business.

    He said the program would form a foundation on which future initiatives would be built.

    City of Greater Bendigo tourism manager Kathryn MacKenzie said with the onset of online, the retail industry faced new challenges compared with five years ago. She said:
    Bendigo retailers are no different to retailers around the nation and are also feeling the pressure and this is one way, the City of Greater Bendigo can assist them to navigate their way into the future.
    The City of Greater Bendigo is committed to working with business to create a diverse, strong and growing economy that generates jobs and entices people to live and work in our region.

    The workshops will take place in October and November and into next year, and were developed following the establishment of a retail focus group by the city's tourism unit.

    They will focus on the visual sensory experience of modern retail; retail marketing; understanding and reducing retail loss; and embracing digital retailing and business planning.
    Products
    Smart sprinkler controller at Lowe's
    Skydrop is a water irrigation solution for consumers looking to save water, time, and money
    PR Web
    Skydrop has wi-fi connectivity that offers perpetual access to localised weather intelligence
    It is now available at more than 1,700 Lowe's stores and on Lowes.com
    Click to view details of the SpotOn golf ball competition
    The skydrop[tm] smart sprinkler controller is now available at more than 1,700 Lowe's stores and on Lowes.com. It was created to conserve water and promote a healthy gardens while freeing households and professional landscape operators from trying to adapt outdated, simplistic sprinkler timers to constantly shifting weather conditions.

    Skydrop differentiates itself from the competition with wi-fi connectivity that offers perpetual access to localised weather intelligence, tailored to the user's location.

    Sophisticated processing allows the skydrop smart sprinkler controller to continuously adjust a watering strategy and ensure gardens and lawns stays optimally hydrated, while using only the amount of water needed to keep a landscape healthy.

    Instant control via the web, smartphone app, or the built-in interface offers powerful configurability that is easy to set-up and use.

    Skydrop's proprietary technology is embodied in modern hardware that dramatically redefines the look and feel of a sprinkler controller. Bret Cloward, chief executive officer of skydrop said:
    The skydrop smart sprinkler controller represents a fundamental change in the way people water their landscapes, by delivering new technology that allows DIY customers to save time, money and precious water resources. The skydrop smart sprinkler controller enables seamless water conservation while appealing to the Lowe's consumer with its highly intuitive, 10-minute installation.
    News
    Interesting links
    Masters and Home Timber and Hardware group recall Olsent brand powerboards
    HNN Sources
    Fletcher Building will close its Pink Batts insulation factory in Christchurch, NZ
    Home Depot's rewards TTI's Ryobi One+ Lithium-Ion range
    Subscribe to HNN weekly e-newsletter
    An additional selection of stories about the home improvement industry in Australia and overseas markets. This week, both Masters and Home Timber & Hardware group recall Olsent brand powerboards; construction companies are being scrutinised by the Fair Work Commission; Fletcher Building closes Christchurch plant in New Zealand; and Home Depot acknowledges Techtronic Industries as a top vendor for its range of Ryobi products.

    For further information, simply click on the images provided.
    Local News
    Powerboards recalled by Masters, HT&H

    The Olsent 6 Outlet Powerboard has been recalled by Masters due to a risk of overheating and fire. It is the fourth recall for Olsent products in recent months. The ACCC recall notice states: "The electrical contacts of the sockets are poorly aligned and the plastic enclosure does not meet the flammability requirements of the applicable standard."

    A number of Olsent powerboards have also been recalled by the Home Timber & Hardware group. The products were sold in Home Timber & Hardware, Plants Plus and Thrifty?Link stores across Australia from July 2011 to September 2014.
    Masters has recalled Olsent powerboards again
    Checking on construction companies

    Hundreds of construction businesses will be audited as part of a national campaign by the Fair Work Ombudsman. Fair Work inspectors will check that employers are paying the correct minimum hourly rates, penalty and overtime rates and allowances. Compliance with record-keeping and pay slip obligations and other workplace laws will also be monitored.

    Up to 700 businesses in every capital city and selected regional areas will be earmarked for auditing at random, with some site visits planned. Both residential and commercial builders will be monitored, as well as electricians, plumbers, painters and decorators, tilers and carpenters, bricklayers, concreters, landscapers and plasterers.
    Fair Work Commission turns its focus on construction companies
    New fitout franchise

    A commercial fit-out franchise was created when Queensland-based building companies, G.J. Gardner Homes and Smith & Sons joined forces. Total Fitouts currently has six franchisees on board and is hoping to reach $10 million turnover in its first year. Australia-New Zealand managing director Jeremy Dyer said: "Total Fitouts is the perfect solution for an existing builder wanting to leave behind the hassles of the residential building industry such as home warranty insurance, in favour of more commercial work."
    Total Fitouts is a new commercial fit-out franchise based in Queensland
    International News
    Fletcher closes Christchurch plant

    Fletcher Building will close its Christchurch insulation factory, as it consolidates its Tasman Insulations operations. Around 29 workers would lose their jobs manufacturing the company's Pink Batts insulation, while its Auckland factory will become an around the clock operation, according to a statement from the company. Fletcher will offer redundancies, but said it had over 200 vacancies within the business, of which more than 50 which were in Christchurch.
    Fletcher Building closing insulation factory
    Techtronic Industries is top vendor

    Hong Kong-listed Techtronic Industries (TTI) received six coveted awards at The Home Depot annual supplier partner meeting held in Atlanta recently. The world's largest home improvement retailer recognised TTI with its Marketing Innovation Award, Vendor of The Year Award for the lawn and garden category and three product innovation awards including a store-wide innovation award.

    The Marketing Innovation Award relates to the Ryobi One+ Lithium-Ion launch. TTI received product innovation awards for a range of other Rybobi products including the HJP001K 12-volt lithium-ion drill; 18-volt lithium-ion P813 Drill Kit; P843 Combo Kit; and Touch Start[tm] Gas String Trimmer.
    TTI wins Home Depot vendor awards for its Ryobi range
    Lowe's launches Mexican website

    Lowe's is expanding its international online presence with a new localised site for shoppers in Mexico. Lowe's has shipped to Canada via a localised site since late 2012, the only other country besides the United States in which it has an e-commerce operation. The move comes six months after its chief competitor, The Home Depot rolled out its own online store for Mexican shoppers.

    Lowe's can now ship online purchases from Lowes.com.mx to local stores, ship from stores to consumers' homes and offer in-store pickup. It also can ship to customers from fulfilllment centres or by drop-shipping. Lowe's says it plans to expand into other geographic locations, noting that the web will play a big role in its global growth.
    Lowe's launches website for Mexican customers
    Screwfix expands with Irish website

    Screwfix is expanding into the Republic of Ireland with the launch of a dedicated website. The move follows the launch last month of four trial stores in Germany and the announcement of plans to open over 50 more stores in the UK next year. Kingfisher-owned Screwfix already has over 350 UK outlets.
    Screwfix creates localised Irish website
    Kingfisher joins sustainability group

    B&Q and Screwfix owner Kingfisher has joined a coalition of some of the world's biggest companies that aims to drive sustainability via a website, www.collectively.org. The coalition brings together the non-profit, global sustainability organisiation, Forum of the Future with companies including Unilever, BT Group, Coca-Cola, Marks & Spencer, Carlsberg, Google, Facebook, Microsoft, McDonalds, Nike, Pepsi, Nestle and now Kingfisher. Collectively is designed to allow people to act more sustainably in whatever way they can, from buying, investing and campaigning to sharing an idea they believe in. The ultimate aim is to make sustainable living the "new normal".
    Kingfisher joins international sustainability group
    Leroy Merlin re-organises for multichannel

    French DIY chain Leroy Merlin competitive is transforming itself into a multichannel retailer and is completely disrupting its traditional way of operating. Speaking at The Everywhere Store Conference in Portugal, Luis Herrero, CIO and supply chain director at Leroy Merlin Spain, says this is having huge implications on the supply chain of the business that has a global portfolio of 600 outlets and e-commerce operations. He said: "It is changing the whole supply chain, distribution centres and stores. We are on an interesting and fascinating turnaround. With the flows of stock cross-channel we need a transformation in technology."
    French home improvement chain is reorientating itself to becoming a multichannel retailer
    Kohler wins sustainability award

    For the second year in a row, the US-based Environmental Protection Agency has bestowed Kohler with its Sustained Excellence Award, recognising the company's commitment to the development of water-saving products and the education of consumers on water conservation issues.

    Since WaterSense was introduced in 2006, Kohler has engineered nearly all of its toilets, bathroom faucets, urinals, and many of its showerheads to use far less water. The labels make it easy for consumers to identify and purchase products that are water efficient.
    Kohler wins sustainability award from the EPA
    Masco sees home repair trends improve

    Masco is the largest supplier of non-commodity products to Home Depot and kitchen and bath aisle to Lowe's. In early October, Masco announced some transformative actions which included a tax-free spin-off of its Installation and Other Services segment into a separate company. The maker of home improvement products also plans to buy back shares and reduce its workforce.
    Demand for Masco's home improvement products is set to improve
    Products
    Water-saving rubber bio-brick
    Drop-A-Brick is made of a sustainable bio-based rubber and helps save water in toilets
    Digital Trends
    The Drop-A-Brick campaign is encouraging Californians to reduce their water usage
    A special hydrogel additive solidifies in the brick when water is added to it
    SpotOn is your source for laser levels and other tools
    In an attempt to encourage Californians to reduce their water usage, a team of San Francisco-based entrepreneurs has launched the Drop-A-Brick campaign. It revolves around a simple idea: If you drop a brick (pun intended) in your toilet tank, you save a lot of water from going down the drain each time you flush.

    The only problem is, dropping a brick into your toilet tank can cause a few problems. They can dissolve, cause clogs, and ultimately lead to costly repairs - which might explain why most people don't put them in their tanks to begin with.

    So the founders of the Drop-A-Brick project developed a safe, eco-friendly alternative: a brick made of a sustainable bio-based rubber and is filled with a special hydrogel additive that solidifies when water is added to it. When placed in the tank of a toilet, the brick displaces water and tricks the toilet into using less water for every flush.

    The extra weight is enough to displace about two litres of water, which, for a family of four, adds up to saving approximately seven and a half litres per day and 190 litres per week.

    Each brick is outfitted with a dye tablet to help homeowners spot leaks, and they are flexible so they can fit in almost any tank.

    For a pledge of just US$15 on crowdfunding website Indiegogo, the team will ship one of these bricks (which compress down and fits in an envelope) to drop in a tank.

    The creators are currently seeking US$80K for their crowdfunding campaign, but since it's through Indiegogo, they've opted for a "flexible funding" campaign, so there's no success or failure - they get to keep any money they raise and put it toward the project.
    Bigbox
    Big box update
    Local councillors may not support a proposal for Bunnings to build a second store in Halls Head (WA)
    HNN Sources
    A Masters store site at 72-82 Mulgoa Road in Jamisontown (NSW)
    Bunnings' new store in Coffs Harbour is being stocked in preparation for its opening
    Click to visit the ITW website for move information
    Bunnings may not get the support it needs for a development in Halls Head (WA). In other news, Woolworths is selling a Masters store site near Penrith (NSW) and Bunnings' new store in Coffs Harbour (NSW) is about to open. Aldi also announced it is building stores and distribution centres in South Australia and Western Australia.
    Bunnings store set for refusal

    Mandurah councillors in WA have given their strongest indication they will not support a proposal for Bunnings to build a second store in Halls Head. Speaking at a recent Planning, Community Development and Sustainability Committee meeting, the Mandurah Mail reports that councillor Don Pember has a bid to reject the proposal. Under the proposal, a bulky goods precinct site would be approved to abut the current Halls Head Shopping Centre with a modified road network plus 170 new homes and relocation of retained bushland also recommended.

    Council received 57 submissions opposing the development, just nine in support and a further petition against the proposal with more than 1300 signatures. Councillors are now expected to refuse the Precinct Plan proposal at the next full council meeting on October 28.
    Masters Penrith site to be sold

    A Woolworths spokesman confirmed to the Australian Financial Review (AFR) it is selling a Masters site at 72-82 Mulgoa Road in Jamisontown (NSW). The site is to be sold in a sale-and-leaseback deal. The sale is also the first Masters site owned by Woolworths to be marketed in a public campaign. It is understood more sites will come to the market.

    The spokesperson described the move as "business as usual" adding the business prefers long-term lease arrangements over owning assets outright. Woolworths won approval from Penrith City Council in March to build a large-format hardware store and bulky good centre, with construction now under way.

    Sources close to the retailer told the AFR that Woolworths has developed and owns about 85% of Masters' sites around the country, and has a view to offload the bulk of them on completion, with long term lease arrangements in place.

    Large-scale property groups are expected to be in contention for the Penrith site, in a sector showing tightening yields and higher turnover. In Melbourne, another Masters store sale is close to being finalised. CBRE agents Mark Wizel and Justin Dowers confirmed that an agreement had been reached with unconditional exchange pending on a site within the Harvest Retail Centre in Dandenong.
    Bunnings Coffs Harbour almost done

    Bunnings' new store in Coffs Harbour is being stocked in preparation for its opening. It is one of the hardware chain's largest regional outlets, and 30% larger than the existing Coffs Harbour site, spanning 14,000sqm.

    Complex manager Dean Dannevig told the Coffs Coast Advocate it would make a seamless transition in closing the existing warehouse and opening the new one. The project has cost approximately $41 million. Construction of the warehouse and its fit-out created more than 200 building jobs. Dannevig said the Bunnings workforce in Coffs Harbour also increased from 120 employees to a staff of 200.
    Aldi expands store network

    Aldi recently announced a major expansion into South Australia and Western Australia with an investment of $700 million. As part of the plan, it will open two distribution centres and 130 additional stores.

    South Australian construction firm BADGE will build a 35,000sqm to 40,000sqm distribution centre at Regency Park, capable of supplying up to 50 stores. Aldi has also signed a contract with Western Australian construction company Georgiou Group to build a 45,000sqm to 50,000sqm distribution centre at Jandakot Airport, that can supply as many as 100 stores.

    The company is seeking to open around 70 WA stores in locations such as Cannington, Souther River, Halls Head, Kwinana, Rockingham, Australind, South Lake, Joondalup, Camillo, Midland, Mundaring and Ellenbrook.

    Up to 50 stores are planned for SA with potential locations including Seaford Heights, Kilburn, Parafield Gardens, Blakeview, Hallett Cove, Woodcroft, Gilles Plains, Salisbury, Modbury, St Agnes, and Noarlunga.

    The first stores are expected to open in 2016. Aldi already has 319 stores across Victoria, NSW, and Queensland.
    Retailers
    Indie store update
    Penhalluriack's Building Supplies is being sold
    HNN Sources
    Dahlsens Mitre 10 in Myrtleford has won State Store of the Year 2014
    Kennards Hire has expanded its store network in Christchurch, New Zealand
    Click to visit the Globel Industries website for more information
    Penhalluriack's Building Supplies has been placed on the market by its owner, Frank Penhalluriack. In other news, Dahlsens Mitre 10 in Myrtleford (VIC) has won a state-based award and Mitre 10 Forbes will be closing its doors after 14 years in business. Kennards Hire has also acquired three stores in Christchurch, New Zealand.
    Penhalluriack's to be sold

    Frank Penhalluriack has put his well-known hardware store in the Melbourne suburb of Caulfield on the market. It is the first time the property has been for sale in 70 years. The 5152sqm site is for sale by tender, closing November 13.

    Penhalluriack told the Herald Sun that it is time for him to move on but his store, Penhalluriack's Building Supplies will continue to trade for at least two, possibly three, more years. He said: "Age was a huge influence and my family, but it's becoming harder and harder to run a small business and comply with all the rules and regulations."

    The hardware store and garden centre buildings are expected to be demolished. The site is in a residential zone which has a mandatory three-storey height limit and Penhalluriack has applied for a planning scheme amendment to change it to a commercial zone without height limits. Penhalluriack's Building Supplies was formerly part of the HBT buying group.
    Mitre 10 state winner

    The award for best Mitre 10 store in Victoria has been given to Dahlsens Mitre 10 in Myrtleford. The in-house award is conducted annually and involves stores being scored by a panel of assessors who conduct inspections across the country. Store manager, Bruce Manning explains: "They look at things like cleanliness of the store, the layout, the range of products we carry, staff and signage.

    "We are thrilled to have received the 2014 State Store of the Year for Victoria, considering we've only been back under the Mitre 10 umbrella for about a year. We were up against six other stores who made it to the final, so it's a great win, especially because we are based in a small country town and were up against the larger stores in Melbourne."
    Closure for Forbes Mitre 10

    Mitre 10 Forbes will officially close for the last time at the end of the month. Store owner Jeff Nicholson said the town is simply "not big enough" to support the business. He told the Forbes Advocate: "There is over 15,000sqm of hardware retail space in Forbes, which is equal to half of our business area in town. The pie's not big enough."

    Nicholson believes competition in the market is important, but that it must happen on an even keel. He said: "It's always good to have competition, as long as it's fair competition. Multinationals should not get a hand up and some should not receive more benefits than others...we should all be on a fair playing field." In 14 years, Mitre 10 Forbes has sold almost $25 million in stock.
    Kennards Hire grows in NZ

    Kennards Hire has expanded its store network in New Zealand through the acquisition of City Hire in Christchurch which has three stores. The branding of each location will be changing but Kennards Hire will be maintain its staff. Kennards Hire New Zealand general manager, Tom Kinross said: "Customers are our number one priority and we want to make sure their hire needs are met first and foremost. All local DIYers and trades people can expect the three new Kennards Hire branches to be in full operation with an even wider range of quality tools and equipment. Kennards Hire is a family business, so we treat our customers like family.
    Careers
    Ladies win in construction
    A number of women have been recognised for their work in the construction industry recently
    Sourceable
    Raquel Rubalcaba won the Crystal Vision award at the NAWIC NSW Chapter
    Caroline Andrews is the winner of the Master Builders' Award for Women in Building
    Visit the Mecca Website
    This year's winner of the Crystal Vision award at the National Association of Women in Construction (NAWIC) NSW Chapter has a clear message about working in the construction industry today:
    You don't have to be the company CEO to drive change in the construction industry.

    The Crystal Vision Awards are held annually to celebrate the top achievements of women in the construction industry.

    Raquel Rubalcaba is a senior project manager and trained engineer, and has been recognised for her work implementing an industry-leading 26-week paid parental leave and flexible working policy at Laing O'Rourke. The policy combines paid parental leave with a keep-in-touch program, return to work coaching and flexible work options for all employees. She told Sourceable:
    We do work in male-dominated industry - but I think change is occurring as more organisations acknowledge the strength in diversity.
    My passion is to applaud diversity in all its forms and to work collaboratively with my teams to get the best out of a broad range of skill sets...it's about encouraging people to be who they are.

    Global research points to a positive relationship between women in leadership roles and financial performance. Consulting firm McKinsey, for instance, has found organisations with the most gender diversity outperform those with the least. Dow Jones also argues that a start-up's odds of achieving success increases with more female executives at senior levels.

    Despite this, just 11% of workers in the construction industry are female - and this figure has remained static for a decade.

    NAWIC's discussion paper, "What women want in a construction career", found that encouraging flexibility, embracing diversity and investing in attraction programs are the three most important steps that companies can take to increase the number of women in the construction workforce.

    Having "lived and breathed" the quest to achieve work/life balance herself - juggling motherhood and high-pressure projects - Rubalcaba understands the challenges women face. She said:
    Being an engineer or a project manager is intense and demanding work - and you need to be able to put in the hours. Finding the right balance can be tough
    While there have been lots of conversations about quotas and selection criteria, until we recognise that women do want to raise families, we'll continue to have the problem of women leaving the industry and then struggling to re-enter the workforce. This is particularly challenging in the construction industry, due to the nature of the working hours and operational functions.

    Dismantling the cultural barriers to women's participation - such as inflexible workplaces and lack of female role models - takes time, but evidence shows that organisations that encourage diversity, support mentoring programs and promote female-friendly networking opportunities reap the benefits.

    Laing O'Rourke established its diversity council in August 2013 with representation from across all arms of the business, and Rubalcaba says that there has been a measurable impact on the business. The paid parental leave policy is case in point. She said:
    Within weeks of it being introduced, two people on my own team were taking advantage of the new policy.
    I think it's important for people to understand that your level within the organisation doesn't matter as much as your determination to make a difference. Small steps do add up to large changes. Don't sit back and wait for people more senior to do it - drive the change yourself.
    Master Builders recognise women

    Another recent award winner, Caroline Andrews is a contract administrator at FDC Construction & Fitout. Andrews won the Master Builders' Housing & Construction Award for Women in Building. She has worked in the construction industry since 2003 on small and large scale projects. Architecture and Design spoke to her about what winning the award means to her, challenges for women in the construction industry, and achieving a work/life balance.
    What does winning awards like the Master Builders' Housing & Construction Award for Women in Building mean to you?

    Winning an award like this is extremely satisfying on both a personal and professional level and it's fantastic to receive recognition for all the hard work that I have put into the industry over the last 10 years. Given that the industry is male dominated, it's good to see that the industry body is acknowledging the important role that women play within it.
    What is the greatest challenge for women in the industry at the moment?

    Stepping into more senior managerial positions such as general manager or construction manager. Women seem to get to a certain point and then it's hard to progress further into the upper echelons.
    Can you talk about any negative experiences you've had in the industry as a woman and how you dealt with it?

    To be honest, I've been lucky to have not been involved in any unfortunate experiences during my time in the industry. Whilst in the beginning there may have been small conflicts, I think times have changed and men have the same level of respect for women in the industry as their male counterparts and are treated as equals. If you're good at what you do you'll get the respect you deserve.
    In an ideal world, what would the construction industry look like in terms of gender equality?

    More of a balance, in terms of women in managerial roles, would be ideal. If we can get women in those more senior positions, that would be my idea of gender equality within the construction industry.
    You like to raise awareness about work/life balance. How hard is it to achieve that in the construction industry?

    It can be very hard at times because projects don't stop when we stop. For example, we might be working an 8-5 day but quite often, projects start well before and after those times. Because we are often 'on call' outside of our normal work hours, it's so important for our mental wellbeing and productivity to take some time out and switch off.

    At FDC, every couple of Fridays we have a BBQ in the morning so employees can step away from their desks and take some time out to socialise and recharge. It can be difficult at times to remove yourself from your work, but you have to have those opportunities available to you to take a social break with your colleagues.
    What tips for working in the industry do you have that people might not have thought about before?

    I guess in my role as a contract administrator, it's important to put yourself in the shoes of other people. For example, I treat the company's money and resources as if they were my own. So, whenever I'm working on a project I think: "If this was my personal project, would I want to be spending that money or using those resources?" That way, whenever I have to make decisions, I know they are the right ones because I know it's not a waste of my time or the company's money or resources.

    I also treat people the way I like to be treated and that, in turn, builds positive relationships.
    What is one personal challenge you'd like to tackle in the next two years?

    One of the many aspects of my role sees me mentoring and guiding FDC's junior staff and cadets, so a personal challenge for me is to ensure some of those younger employees step up from cadet positions to become contract administrators. I enjoy guiding and mentoring those new to the industry so I would love to be key contributor to helping them get their careers off the ground.