BOUCHERVILLE, Que. — A letter sent out last Friday to Lowe’s vendors addresses the retailer’s efforts to combine the Lowe’s and RONA businesses, and to enhance its stores to drive sales. It then goes on to ask the vendors themselves to support the costs attached to growing the Canadian business by accepting a 2% discount on all invoices. The discount will be applied to all agreements with both Lowe’s and RONA. Called a “business development rebate,” the new terms will be effective January 1.
The letter aims to emphasize the partnership between Lowe’s and its Canadian vendors by enjoining them to “invest” in Lowe’s Canada’s growth. “We are looking to you, our business partners, to help support this … transformation and participate with us as we grow and transform the Canadian home improvement landscape,” the letter says in part.
The letter is signed by Alain Brisebois, EVP operations and central services, and Igor Halencak, VP national procurement and global sourcing. It includes a consent form and a deadline of February 3.
In conversation with HARDLINES, Brisebois said he wants to emphasize a partnership approach and believes that vendors will come on board with the strategy when they meet face to face with his team to understand the upsides.
“It will bring growth and require partnership with the vendors,” Brisebois notes. He adds that Lowe’s will be “a good investment” for this industry, and the support of the vendors in addition to Lowe’s investments will translate into growth for both parties. “These top-line initiatives include store upgrades and conversions, better merchandising, and investment in our staff training for the Canadian market.”
A spokesperson for Lowe’s Canada clarified further with this statement: “Lowe’s Canada intends to make important investments over the next few years, such as an improved IT infrastructure, enhanced omni-channel capabilities, store conversions, store renovations, and most of all investment in our people. These investments will position Lowe’s Canada as the leading home improvement retailer in Canada focused on the diverse needs of the Canadian consumer. We are looking to our business partners to help support this above-stated transformation and participate with us as we grow and transform the Canadian home improvement landscape.
A “Q&A” from Lowe’s Canada added that the initiative, apparently common in the grocery industry, will not go to Lowe’s bottom line, but aim to boost top-line sales and benefit both the retailer and its vendors. As for vendors’ participation, “We will review the accounts accordingly based on the vendors’ decision,” says the statement.
(More on this story in next Monday’s edition of our HARDLINES weekly e-newsletter. —Editor)
