Hardware Retailing

JUL 2017

Hardware Retailing magazine is the pre-eminent how-to management magazine for small business owners and managers in the home improvement retailing industry.

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Page 44 of 96

HARDWARE RETAILING | July 2017 40 T o field this research and crunch the numbers, NRHA and Independent We Stand enlisted the services of Civic Economics, a well-known research firm that provides data to clients throughout the country about the impact of businesses on community development. Over the years, Civic Economics has developed a reliable methodology for evaluating the level of economic impact particular businesses will have on their local communities. NRHA and Independent We Stand first worked with Civic Economics on the original Home Sweet Home Study, which was conducted in 2015 and showed that for every dollar a consumer spends at a locally owned home improvement store, nearly twice as much of that revenue stays in the local community versus spending that same dollar at a big-box store. (See more on page 42). This time, the study applies the same principles of research, but examines the local economic impact created when builders and professionals concentrate their purchases at locally owned merchants versus big-box chains. To determine this impact, Civic Economics first creates a hypothetical building project and determines the different areas where expenditures for this project are allocated. For this study, the hypothetical project budget was $1 million, and these expenses fell into four different buckets. • Labor: This accounted for 45 percent of the overall project budget and included the hiring of subcontractors and other laborers to finish the projects. Because local labor is used regardless of where products and materials are acquired, these expenses would not have a measurable impact on the outcome of our study. • Building Materials: This accounted for 35 percent of the overall project budget and included all of the lumber, cement and other building-related materials required to complete the home. • Hardware and Finishing Materials: This accounted for 15 percent of the overall budget and included all of the various fasteners, supplies, fixtures and other items required to construct a home. • Power Tools and Equipment: This accounted for 5 percent of the budget and included the purchase of any specialty tools or power equipment that might be needed on the job site. Methodology Building Materials . . . . . . . . . . $350,000 Hardware Supplies . . . . . . . . . . $150,000 Power Tools/ Equipment . . . . . . . . . $50,000 Professional Fees/Labor . . . . . . . . $450,000 Project Budget $1 Million Budget for the Home Sweet Home Study's Hypothetical Project Source: Home Sweet Home Pros' Edition, NRHA and Independent We Stand Methodology

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