Hipster Hardware Store in Austin Has the Big Box Stores Taking Notice



Jason Ballard remembers the time some guys from Home Depot came poking around in TreeHouse, his eco-conscious home-improvement store in a strip mall in southwest Austin. They were wearing suits and trying to act nonchalant, a ruse undercut by their questions to Ballard’s employees. How much of this does the business keep in inventory? How much of that did it sell last week?

“So I marched up and said, ‘Hey, I’m Jason! How can I help you?'” Ballard recalls. With a little small talk, he got them to say they were in town from Atlanta. Then he asked where they worked. They admitted they’d come from the big-box home-improvement giant. Ballard wished them well and cautioned his employees to say nothing more.

A wafer-thin 33-year-old with a deep East Texas drawl and boyish grin, Ballard doesn’t look like a threat to Home Depot. So far, TreeHouse has only the one location. It is on track to do about $10 million in sales this year, compared with Home Depot’s $83 billion.

But many of the most innovative brands in smart-home technology and sustainable design have embraced TreeHouse in a big way. TreeHouse is reportedly the largest single retailer of Nest products, for instance. It was among the first retail partners and is by far the largest of the much-admired Kentucky company Big Ass Fans. Perhaps most impressive, TreeHouse will be Tesla’s sole retail partner for the launch of that company’s highly anticipated Power Wall home battery.

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How To Get Paid Faster from Home Depot

Home Depot is a great company – but let’s face it, they do what a lot of big businesses do: They pay kind of slow. I know this because I have clients who do business with them. Typical terms are around 60 days. These terms are not uncommon when dealing with larger companies. And yet, it’s a huge issue for smaller companies.

That’s because smaller companies need cash. By the time one of my clients sells product to Home Depot or a larger company all of their money has been spent on buying the raw materials, producing the product, paying people, maintaining overhead and shipping the items…and then it’s another 60 days until the cash comes in. Big businesses have greater cash reserves and large credit facilities made available by banks who are more than happy to lend them money. Small companies don’t have these resources at their disposal. They just wait.

Until now. There is an enormous change happening in payments processing, a change that will impact any small business doing business with larger companies. Technology is driving this change and a company named Taulia is right in the middle of it. Taulia, founded by former entrepreneurs who wrote payment processing software for SAP, raised about $15 million in additional financing last January and is now valued at close to $1 billion – and there are rumors that they’re considering a public offering in 2016.

“This company makes a lot of sense,” says Josh Hannah of Matrix Partners, one of Taulia’s earliest investors and a board member. “I love companies that find legacy-related inefficiencies that have persisted for years then make them efficient.”

How is Taulia solving these problems? Take Home Depot (or John Deere, EBay, Grainger, Salesforce, PayPal, Coca-Cola Bottling Consolidated, Hallmark Cards, Johnson Controls, Graphic Packaging, Pacific Gas & Electric – all customers, according to the company). You’re a small company selling product or providing services to one of these giants. You ship your product/do your service, send your invoice…and wait to get paid. Meanwhile, other bills need to be paid. Your bank is offering you less credit (if any credit at all). Factoring and micro-finance options are expensive. You’re trying to grow but you’re restricted. You need the cash now.

But what if Home Depot comes back to you and says “Look little guy – we value you and we’re happy to pay you earlier. Just find your invoice in our online portal and click the button that says ‘pay earlier.’ It’s as simple as that.” And it really is that simple. Taulia’s software is written to integrate with their customers’ back end systems. A portal is provided to the small business suppliers, either by Taulia or from the large company. If a small supplier chooses to be paid earlier the payment will be made, net of a discount. The discount is ultimately split between the big company and Taulia. I’m simplifying a few things here, but you get the point.

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Home Depot, Lowe’s Bring the Internet of Things to DIYers

Home improvement stores, destinations for the do-it-yourself consumer, have long sold the hammers, nails and tools people need to fix up their houses.

Now large chains such as Home Depot and Lowe’s are selling virtual tools — sensors, Wi-Fi enabled appliances and software — to help those customers monitor and control their homes from their smartphones.

It’s an attempt to tap into the Internet of Things — technologists’ term for a network of connected sensors, devices and objects. In its early stages, the Internet of Things attracted tech companies such as Nest, the connected-thermostat manufacturer bought by Google in January for $3.2 billion, and Smart­Things, a District-based start-up selling home automation kits.


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Ace Hardware Profits in a Home Depot World

Ace Hardware Corp., a 90-year-old co-op that oversees nearly 5,000 locally owned hardware stores, never would be mistaken for trendy. But its recent growth proves the adage that everything old eventually becomes fashionable again.

“We are a service-based, high-touch, local business,” says John Venhuizen, CEO of the Oak Brook-based chain. “The shop-local trend is one that has served us well.”

So, too, has the small-box movement, in which recession-chastened retailers began shrinking their store footprints. Except for a failed experiment with a few larger locations in the mid-2000s, Ace always has focused on modest stores. Its average footprint is about 8,000 square feet, a mere couple of aisles in a typical 100,000-square-foot Home Depot. A healthier housing market and a slew of American homeowners empowered by low interest rates certainly don’t hurt, either.

Sitting on the sunny side of retail trends helped propel Ace to record profit and sales in 2013. Net income increased almost 28 percent to $104.5 million as revenue rose 8 percent to $4.15 billion.

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Lowe’s channels science fiction in new Holoroom

The home improvement store announced Wednesday that it has built a “holoroom,” which uses 3-D technology and augmented reality to allow users to “walk” through a floor plan of their home (or dream house). In the 20-foot by 20-foot specially designed room, customers can move anything from furniture to toilets and swap out floors and paint colors with the swipe of a finger on an iPad.

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Home Depot to roll out new Customer Order Management System

Home Depot announced on its Q1 earnings call that it has gone live with its first in-store implementation of a new customer order management system (OMS), with plans to roll it out across its U.S. supply chain by the end of 2014.

The system “is designed for greater visibility and execution of special orders by our associates and a frictionless experience for our customers,” said Craig Menear, Home Depot’s president of U.S. retail, during the earnings call.

“When customers place an order they can understand the status of that order, including where it is in the process of manufacturing,” Menear said. “And our associates will have visibility into store arrival so they can better answer consumers’ questions during that process. It’s also a coordinating effort that drives back into our manufacturers and our suppliers, allowing coordination all the way through the supply chain.”

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Home Depot Cleaning Up This Spring

Home Depot ( HD ) is one of the most fully mature companies on the market, which is to say, they have been around long enough that they have already expanded rapidly in the areas conducive to rapid expansion, fallen into slow growth in areas conducive to slow growth and failed entirely in areas conducive to failure. Their cavernous stores are loved by professionals and do it yourselfers, as well do-it-for-me-ers, and while they do well when people are buying houses, they do just as well when many people are merely renovating. Home Depot shares the market with Lowe’s ( LOW ), of course, and the stores are so similar that they are starkly differentiated only by Home Depot’s deep commitment to a witheringly flat, stale shade of orange.

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