Industry Leader Interview

As part of our Industry Leader interview series, The Hardware Journal caught up with Paul Candon, recently appointed CEO of United Hardware, in what has been a very interesting first few months of his tenure.

Can you tell our readers about your background career and how that experience will help you in your current role as CEO of United Hardware?

Most recently I served as CEO of Bunzl in Ireland. Bunzl is a leading supplier of foodservice disposables, washroom systems, hygiene & janitorial supplies as well as beverage and retail solutions within Ireland. Bunzl Ireland is part of a global PLC that sources, consolidates and sells a large range of products to thousands of customers every day. Before I finished with them in April 2020, I was extremely busy managing the operational challenges brought on by the pandemic while also meeting the massive demand for sanitation and safety products.

Prior to that I was CEO of McCabe’s Pharmacy Group, where I led the development of a strategy to optimise the structures of the business and to drive growth and profitability. We achieved a lot during that time, adding several new locations and implementing new systems, all of which were best evidenced by McCabe’s being recognised as a Deloitte Best Managed Company. In many ways, McCabe’s was a brilliant learning experience for managing a very well-recognised retail brand and operating a nationwide network of locations as we do in United Hardware through our Homevalue brand.

Before McCabe’s, I held senior positions with Statoil, Topaz Energy Group, and Roches Stores, so it’s fair to say I’ve built a career very specifically around the retail and wholesale sectors. With United Hardware I now have the perfect blend of wholesale and retail. Our model puts the members at the forefront of everything we do from our buying function, marketing, supply chain and warehouse support. In addition, our retail services proposition is increasingly critical to our members and more and more are availing of this to help them drive on their businesses.

Throughout the earlier part of my career I was lucky enough to gain exposure to the various functions of running a business; in Roches I held both retail operations and HR related roles; in Statoil I was responsible for supply chain, operations and HR. When Statoil was sold and rebranded to Topaz I was appointed as Sales and Marketing Director and managed purchasing, category management and property. This exposure to different parts of businesses was invaluable to making the eventual leap to becoming a CEO, where ultimately you’re responsible for the overall running of a business.

All that said, the single biggest advantage I had when taking over as CEO of United Hardware was that I was previously Non-Executive Chairman of the Group. This meant I had intimate knowledge of the opportunities and challenges facing the Group as well as relationships with the Board, and very importantly, understood the nuanced priorities of our members, who are all very successful businesspeople with differing needs and expectations.

What main differences do you see when you compare this industry sector to the others in which you have worked?

For me the differences are less about the industry and more related to the uniqueness of United Hardware. Clearly the hardware industry is intrinsically linked to the construction sector which is more cyclical than previous industries I’ve worked in but the core principles remain the same.
United Hardware is no different to Topaz, McCabe’s or Bunzl in that we have suppliers with whom we have important commercial relationships, and then we have customers who we’re focussed on delivering the best possible price, service and offer to. A key difference is that our primary customer at United Hardware is also our most important partner, in that they are our members, and there’s over 150 of them across the country.
Increasingly though, as we’ve evolved into a truly full-service wholesale and retail group, the consumer has become a second customer to us in United Hardware. This is what makes us unique in that we have to deliver on the wants and needs of two separate customer bases. Generally, their priorities are mutually aligned in that they want high quality goods at attractive price points, so this remains our key focus. But consumers also now want and expect rewarding shopping experiences, and this is where we are adding real value and differentiation to our members.

Can you tell us a little about United Hardware today and outline your short to medium term plans for its future?

Truth be told the last year has been like no other. While we’ve faced the same operational and supply chain challenges as every other sector as a result of the pandemic, we’ve been fortunate enough to benefit from some of the more transitory effects such as people spending more time at home and therefore investing more money upgrading their homes. We’ve seen very strong sales growth across all regions and categories and 2020 finished as a very positive year for our members and our overall business.

Many of our members have attracted a new cohort of customer into their businesses over the period and a big focus area at the moment is to look at ways to re-attract and retain these new customers once the current restrictions are eased.

More broadly than that, we’re currently finalising a growth strategy that’s aimed at significantly growing the United Hardware business, Homevalue brand and enhancing the services and product ranges available to our members.

Our greatest strength is our membership; primarily local, Irish family-owned businesses that provide fantastic expert level service and product ranges to their communities. Through the pandemic many have been front line heroes in their communities. Through them, and their unique qualities, we feel we have a genuine opportunity to establish Homevalue as a leading indigenous retail brand. As with the grocery sector, the Irishness factor is becoming increasingly important for hardware, DIY and builders merchants, with consumers wanting and choosing to support Irish where possible, and this is an area where our members stand to benefit most in the marketplace. It was with this in mind that we and our Homevalue brand recently became members of Guaranteed Irish and we have exciting plans to work with them to leverage this going forward.

Part of our mandate is also to grow United Hardware’s membership. The greater our scale, the stronger our purchasing power and indeed the penetration of our retail brand. We’re very strategic around member growth, in that we’re focussed on attracting likeminded business people to the group that share the same characteristics as our wider membership; locally owned, embedded in their community, great at customer service, and ultimately ambitious about their future. We had really strong momentum behind our member growth programme last year and added five new members to our network, bringing in additional revenues to the Group, and we’re now looking to add further members this year.

How will the members of United Hardware see the benefits of these changes in their own individual businesses?

Our members have big ambitions, and we have big ambitions for them. The only way we can help our members realise those ambitions is to provide unrivalled products, services, and benefits. We’re very confident that our current trajectory, in implementing our new strategy and in truly leveraging the unique characteristics of our membership, and indeed the existing strengths of United Hardware, like our 140,000sqft purpose-built national distribution centre, will deliver very significant benefits to our members.

We’re investing in a market leading product proposition that extends all the way from heavy build, to homewares, DIY and garden. We’re working closer than ever with suppliers to enhance the competitiveness of our pricing so that value is one of the first things that comes to mind when thinking of Homevalue. We’re working with our members to strengthen the shopping experience in-store through better branding, merchandising, customer service and overall standards.

We’re developing eCommerce solutions that will enable our members to compete with confidence against some of the more online focussed retail groups. And finally, we’re investing in our own operations so that our service levels are the very best they can be for our members. Put all those ingredients together and you have a very successful membership that will continue to grow and prosper long into the future. That’s a strong promise.

What are the main opportunities and challenges for your organisation, its members and the sector as a whole in the next three to five years?

Outside of any potential further lockdowns the biggest challenge facing our industry will likely be the supply chain. It’s become increasingly difficult to source produce from key manufacturing markets like China as a result of Covid-19, and with the pandemic still raging globally, those challenges will persist throughout 2021. The UK’s recent departure from the EU adds further to the complexities of supply chains but we’ve been doing a huge amount of work in the background to shield our members from the full force of those challenges.

One of our biggest opportunities is to protect the increased trading activity that our members have benefitted from recently. This will become more difficult as discretionary spends such as holidaying, leisure and luxury spends come back into focus for consumers once the economy begins to open fully again. That said, the home has become a source of great pride for people over the last year, and a big opportunity for us and our industry will be to preserve and even grow people’s appetite for home improvement.

Our other big opportunity is to really dig into the untapped value that exists within the Homevalue brand. Research we’ve carried out shows that our brand resonates very strongly with consumers. Just recently, Homevalue received independent recognition from CXi Ireland, www.thecxcompany.com, as being one of the top brands in the country for delivering a rewarding customer experience during the pandemic. Our brand and members are exploding with potential and we’re determined to further develop them into one of Ireland’s leading businesses and brands.