Mitre 10 footing it with trade supply leaders

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However, Mitre 10 chief executive John Hartmann says the group’s efforts over the past couple of years have been focused on raising its stores’ trade capability on a national level to really become a national player in the trade sector.
“We built the first 22 Megas in eight years, and right now we’re on track to build another 22 Megas in half that time,” Mr Hartmann says.
“Last year we opened the Whangarei Mega — which replaced one of the old small blue stores there — along with another three in Hornby (Christchurch), Rotorua and Manukau.
“That’s 34, with 10 more in the pipeline by the end of 2014, including one in New Lynn, Auckland, and another in Christchurch.
“What goes really nicely with that is the revenue growth of the company, which means that as our scale gets bigger we’re able to offer better products and services to our customers.
“So, along with that four-year timeline (to build the next 22 Megas), we’ll add another 25% to our top line revenue — from $800 million in 2010 to just over $1 billion in 2014.”

Mr Hartmann says another exciting component is that older Mitre 10 stores are also going through a transformation.
“We had a variety of formats typically painted blue over the past 15 to 20 years, and they’re all being transitioned over to the new-look Mitre 10 — which happens to be orange just like its big brother Mega stores.
“That transformation is beyond just a paint job. It’s also improving the quality and the range of products we’re offering, and re-formatting not only the outside but the inside of the stores.
“By the time we get through that process at the end of 2014, 85% of our network would have been touched over, so it’s a top to bottom re-fresh for the group, which is pretty exciting.”

Mitre 10 groups its stores into roughly three sizes — small, medium and large. Certainly, the Mega has the largest offering for trade customers, but there are some pretty large medium-sized stores that have been known as “Home and Trade” stores over the years.
For example, the Onehunga, Auckland, store is a very large Home and Trade store which is a frequent stop for tradies in the area. That store will be re-imaged or, perhaps, one day grown into a Mega but, either way, it’ll continue to serve the trade customer.

Mr Hartmann says Mitre 10 is increasing its resources in order to serve the trade better on a national basis.
“We’re not only opening more locations for tradies around New Zealand, but also focusing on the relationship nature of the trade business, which is quite different from the retail side.”
Trade general manager Andrew Cochrane joined from Carters in late 2010, and a number of resources have been added to his team to focus on developing those relationships on a national basis, including new trade team members in the North and South Islands.
“Additionally, we’ve made a very strong commitment to the Canterbury rebuild. We’ve been fortunate enough to be in the position of being one of the primary suppliers for Arrow International.
“We’ve put in place 30-year trade industry veteran, Kevin Rae, in Christchurch as our point of contact to co-ordinate all our stores’ efforts there, and that’s going well.”

A brand new 11,000 sq m Mega opened in Hornby — ahead of schedule in October last year. The other Christchurch Mega is located in Ferrymead, and there are plans to expand the network in Christchurch, to add to Canterbury-based stores in Rangiora and Ashburton.
Mr Hartmann says that trade now accounts for 45% of the group’s business, and that they are well on the way to growing that.
He says Mitre 10 as a group has recently surpassed PlaceMakers by revenue — “if you look at the numbers then we’ve clearly outgrown them”.

Mr Hartmann’s personal background includes a mix of retail and trade.
“Most recently when I came to New Zealand, I came from the trade industry in the United States. I not only have a knowledge for it but also a real passion for trade. I clearly understand the distinction between our retail customers and the relationships we must have to be successful in the trade sector.
“It’s a clear strategy with our board of directors to grow our trade business and not only continue to be the market leader in DIY, but to give tradies another option — and to be the partner of choice for trade in New Zealand. And we think we’re on our way.”

He says Mitre 10 has not necessarily undertaken any big massive marketing campaigns to stimulate their recent growth.
“We’re doing it the quiet way, by just going about building relationships and earning trade customers’ business. But we have done some pretty unique things over the past couple of years.
“In terms of raising our credibility, we spent a lot of time educating our team members around the country about managing that part of their business, because some of our owners and operators really understand the trade business, but for others it’s very new to them.
“That’s the beauty of what Andrew and our other well-trained guys have brought to our team as they’ve been going around the country raising our trade capability.
“We’re also equipping them with really cool things to communicate with their trade customers, including a Mitre 10 rewards programme and a new IT capability which allows customers to use the one account at any Mitre 10 trade location in the country.”

Each of the stores is now associated with a frame and truss capability which is either Mitre 10-owned or a local production facility that the group has established a relationship with.
Relationships have also been built with the Registered Master Builders Federation, the Certified Builders Association and the Building Industry Federation. An educational trade magazine called In Trade has also been established.

Other relationship-building opportunities put in place include the Export Gold Match Fishing League, sending 80 trade customers to the Bledisloe Cup in Australia last year, and sponsorship of other rugby and motor racing events.
Two trade ute simulators are popular at trade breakfasts and educational and training events around the country.
“Momentum is building, and we’re really excited about focusing on what we perceive as service being so important to our trade customers, Mr Hartmann says.
“We’re adamant that we get it right and go about building that credibility and earning tradesmen’s business.
“Results are coming with a low key approach. We’re getting good feedback, and now it’s just a case of keeping it going.”

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