Hardware Retailing

DEC 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 53 of 70

December 2017 | HARDWARE RETAILING 49 E xpansion can mean more than just adding a location or moving into a new market. For Gold Beach Lumber, the idea of adding a second location was initially based on market evaluations and opportunity. Yet when the economic situation shifted in 2008, the added product variety and customer base of the second location was a boon for the entire company. Owner Ryan Ringer's first expansion was opening a lumberyard in Brookings, Oregon. Ringer had been hoping to expand his family's business into Brookings for some time, and by chance, he saw land for sale that had previously been used for an auto dealership. He went to his father, then-owner of Gold Beach Lumber, with a business plan and enthusiasm to add a new location. Gaining his father's blessing wasn't Ringer's largest obstacle, however. The land was being scouted by a local auto dealer for their own expansion into the town, so his plans were accelerated. "They said I had 48 hours to put money in escrow and 30 days to close. I knew it was a good deal. I knew we were doing 70 percent sales in pro trade, but we weren't selling lights, paint and maintenance products that people need," Ringer says. The deal closed in January 2008, just in time for the Great Recession. "On paper, having a new business in 2008 wasn't ideal, but we captured those homeowners and maintenance types that we needed," Ringer says. "It helped solidify us through the downturn, because our transactional growth just skyrocketed." Gold Beach Lumber followed the Brookings expansion with two more in the coming years. First was a store in Port Orford, Oregon, where Gold Beach bought out a retiring owner of a retail hardware location. The most recent was the acquisition of two Cascade Home Center storefronts. For his expansions, both groundup builds and acquisitions, Ringer analyzed how quickly a new store can be self-sustaining. In Gold Beach Lumber's first expansion, he factored in that the new store would cut sales in the area from the original location. Ringer determined that the new store could still be profitable. In another acquisition, he determined the location was already viable, but a new infusion of products and services would bring its sales into a more sustainable level. Most importantly for Ringer was a location's ability to quickly be profitable and self-sustaining. He warned that opportunities in some locations could become burdensome to the entire business and should be approached with a healthy amount of skepticism. "There's a lot in this industry that say you won't turn a profit in two years, but I'm not interested in that. We're conservative in the fact that we don't like to take risks," he says. Gold Beach Lumber owner Ryan Ringer, second from left, and his family celebrate their newly acquired storefront along with its former owners. Location, Location

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