Menards Growing Through An Interstate Bigger Box
For years the top three retailers listed in Chain Store Guide’s database of Home Center Operators and Hardware Chains have been The Home Depot, Lowe’s and Menard respectively in that order. The former two companies are publicly held and national in scope, while the regional Menard continues to insist on the privately-held independence it has enjoyed since its inception by founder and still visionary leader, John Menard.
All three companies thrived through the 90’s into the early part of this century, as did most of our industry. However, Home Depot’s first-ever changing of its controlling executive guard at the turn of the century and the changes new management brought about ultimately led the company to stray from the roots set by the company’s founders, who had handed off corporate control and ultimately corporate destiny. Home Depot’s then reversal of good fortune coincided with and was hastened by the financially industry-specific, stifling terrors of the subprime crisis followed by the recession.
When the executive guard changed once again and new management pledged a swift return to the company’s roots, it was expected that even without the suffocating conditions of the recession, financial and psychological recovery would be many years away. With the worldwide effects of the recession, few were calculating that Home Depot’s ship would be righted any time soon.
Of course management stayed true to its pledge and vigorously reworked its policies to realign with the company’s founding values. With the help of high recessionary unemployment, management was able to restock its depleted employee ranks with qualified, experienced industry veterans who could better help cash-strapped do it yourselfers. Thus we have seen consistently strong financial reports in recent quarters accompanying solid, encouraging in-store performances, led by Home Depot’s current management style. The previous administration had padded the bottom line by minimizing tenured employees and employee presence on the sales floor, while easing on employee training.
Lowe’s on the other hand continued to thrive well after the start of the new century. However recent financials have seen the company seriously struggle, as most of the industry has during this recessionary era. Again this can be seen as a mirror of management’s workings and at times meanderings. When highlights and lowlights are compared between Home Depot and Lowe’s, seemingly simple planning and execution by management from headquarters to the store level often underlies the differences.
This has been especially significant when merchandising seasonal goods. Here Home Depot has noted its post-storm store preps as key reasons for strong quarterly reports. Lowe’s on the other hand has at times been caught short or out of stock on products needed for cleanups and recoveries. During several heat waves last summer, several Lowe’s outlets were caught under-stocked on cooling equipment while competing Home Depots were running promotions at the front of the store.
Menard on the other hand has managed to consistently grow and expand throughout. Though heeding stifling market conditions particular to this industry, Menard has managed to continue to open new locations at a consistent pace. At the same time while growing the number of locations the company continues to grow individual new store footprints to greater physical dimensions. While physically expanding the size of its prototypes and far exceeding virtually any that Home Depot and Lowe’s have ever considered, Menard continues to build and stock each location to meet what the company sees as the needs and aspirations of the communities it newly serves.
Recently a news story broke of some growing pains Menards has experienced as it expands its brand within North Dakota. Despite relatively high unemployment in most areas of our country, North Dakota’s employment picture is quite healthy, not just for a time of recession or recessionary recovery but at any historical point. Late last year The U.S. Labor Department confirmed that of the 10 markets with the lowest unemployment rates nationally four were in North Dakota. Bismarck was the lowest of all, with a jobless rate of 2.2 percent
While this may be impressive news for the politicians in North Dakota, it does create a strain on companies trying to hire staff. Menard found itself struggling to find enough strong candidates to fill its Minot, ND location and so the company decided it had to think and recruit outside its bigger box
Thus the company went back to its home-based drawing board and began to fly in staff from its home state of Wisconsin on the renowned company jet. A determined effort began as the company held a special job fair in Wisconsin to recruit workers for four-day shifts. One group flies in Tuesday and leaves Friday, when the other group takes over. Beyond this effort, the Menards store in Minot is trying to hire locally as well.
Menard’s ingenuity and versatility can certainly be seen through this act of bringing in the best talent it can, even at the store level, regardless of hindering circumstances. However flying in store talent is just one of the many advantages this very private retailer has accrued from its swanky corporate air transport. Long ago the company began using this private transport as a customer loyalty reward. Customers who met certain high-purchasing criteria were rewarded with high flying rewards to desirable locales strictly to enjoy the fruits of their labors Menard style.