True Value CEO Chris Kempa took time to speak to Hardware Retailing before the company launches its 2021 Spring V-Union.
Learn more from Kempa about what to expect from this year’s virtual event, how True Value is adapting to better serve retailers during the COVID-19 pandemic and the critical role technology will play for retail success in the years to come.
You stepped into your new role at True Value at a very interesting time in a lot of ways. What would you say have been the biggest takeaways you’ve had after your first six months or so on the job?
Certainly, it has been an interesting time having started as CEO during a pandemic and all the challenges and learning brought on by COVID-19. I’m most impressed by the perseverance of our customers and employees. We are centered on doing all we can to keep our employees safe and do the best we can to help our customers serve their local communities. In addition, the independent channel is healthy, and our customers are excited yet stressed by the sustained elevated traffic they are seeing in their stores. Lastly, our customers are vocal and regularly tell me what is working and what is not. The good news for me is the feedback has helped accelerate my learning and are driving our top priorities.
But prior to the pandemic, I would say that True Value has been focused on the right areas: supply chain in order to provide great service, enhancement of the sales team to offer further support and the best product assortments in the industry. At the core, that is what our customers expect—the right products, at the right price when they need them, and we continue to strive to be best in class in those areas. At the same time, I’m not satisfied with our performance in these key areas in terms of consistency and the standard we need to hold ourselves to.
There is no doubt the pandemic has had a major impact on our industry in a number of ways. How have you, and True Value, responded to the challenges presented by doing business in this environment?
The surge in sales has brought on a number of challenges for the whole industry, from supply chain delays to vendors’ ability to keep us in stock. Despite the challenges, I think we can all agree the outcomes would have been much worse if the industry didn’t band together so quickly to ensure we were deemed essential and I’m humbled by the leadership role True Value took in initiating the urgency and collective effort by all of us to work together to support the entire independent channel.
Throughout the pandemic, we have continued to invest in additional resources to ensure we can service our retailers to the best of our ability. The volume is forcing us to improve our responsiveness and problem-solving at an accelerated pace while exposing gaps in our capabilities when volume spikes like it did and continues to do. In addition, our dependency on the manufacturers and transportation partners to serve our customers is vital and we are centered on making sure all the external dependencies get the same attention as what we have control of within our four walls.
Additionally, we used our capabilities in our paint factory to manufacture hand sanitizer and cleaning supplies to help fill in for vendor delays in key COVID-19 product lines. These actions were great examples of how we can leverage our competitive advantages to serve our customers in a differentiated manner.
One of the challenges to emerge during the pandemic has been the stressors placed on the supply chain. What is True Value doing to work through these issues?
We have invested continuously to ensure we can service our customers to best of our ability, including continued hiring in our RDCs and the use of a 3PL (management platform) to help with the massive increase in inbound and outbound volume.
We have put a number of health and safety precautions in place to ensure our associates feel comfortable and protected when coming into work, including regular health screenings, the use of masks and regular deep cleanings of our facilities.
We are working with our external partners to mitigate all we can and collaborate in new ways to minimize the product and transportation capacity impacts. We are identifying as many alternate products and transportation options to serve our customers when our normal options are strained or not functioning as they should in a stable demand environment.
What are some of the lessons you think the industry, and True Value, have learned from operating in this COVID environment?
If anyone was equipped to help serve their communities in a time of need, it is independent hardware retailers. They have been on the frontline for years supporting their communities in times of need. The pandemic has been unlike anything else we have seen, and we have all had to adapt and change in order to continue to serve our customers.
I think local e-commerce and an online presence are perfect examples. If anyone was questioning whether they need a website to effectively operate before the pandemic, they may not now. Consumers’ shopping habits have changed and likely for good. For example, the ability to have curbside pick-up or check inventory before heading to the retailer are becoming more critical as consumers decide where to shop.
We are taking a hard look at what we have in place today and what we can do to create scalable solutions for our customers in a more cost-effective manner compared to them doing it on their own.
When you first stepped into your position, what were some of the goals you were looking to accomplish for the company?
True Value has a long history supporting independent retailers and doing it better than anyone else. Job No. 1 for me is to validate what is working and identify what needs to be improved. Our customers have choices, and it is our responsibility to demonstrate every day we understand their needs and support them better than anyone else can. I will continue to center the entire True Value team on what matters to our customers and seek to improve every day.
Have those goals changed now?
The complications brought on by the industrywide surge in demand during the pandemic have definitely added to the complexity as we progress forward. The good news, the pace and urgency we need in order to be responsive to our customers is getting hardwired throughout the organization and will serve us well in the future.
Another area that is getting a lot more intention is how and what we communicate with our customers. Customer feedback on this topic has really helped the team understand what is critical and assess all the tools we use and need to have in place in this environment of constant change.
What would you like to make sure that independent home improvement retailers know about you and your executive team’s vision for True Value?
The customer experience is at the heart of everything we do. If we don’t look at everything through the lens of the customer, we won’t get it right. We have a relentless focus on process improvement, which will continue to enable advantage over the competition. We are on a path to set the standard for simplicity and exceptional customer service, enabling our customers to consolidate their buying and value-added capability needs with us.
In addition, my role is to make sure True Value is delivering on our value proposition, has the talent needed to execute it and is making the necessary investments to thrive for the next 100 years.
Where do you see the company going over the next few years?
We will continue working to be best in class in the core areas of our business: having the right product at the right price when our retailers need it. And again, making it easy to do business with us is crucial. Our retailers are busier than ever, and they need to trust they can rely on us.
How do you continue to differentiate what True Value offers retailers?
If we focus on the core and get the basics right, we can then continue to hone additional service offerings such as marketing and e-commerce. And I’ll repeat, having customer experience at the heart of everything we do and valuing true independence are paramount.
Additionally, we manufacture our own paint, Easy Care. The quality is as good as any product out there, but the brand is not as well-known as other brands in the marketplace. For our customers who recognize the potential to offer a great value for their customers and increase their margins, they’re able to convert customers who trust their advice. We have invested heavily in our paint capability and we are more coordinated internally to make sure our customers take full advantage of this unique capability True Value has when it makes sense for them.
What are some of the challenges you feel independent retailers are currently facing and how can True Value help them overcome those challenges?
Finding good quality employees has always been one of the top challenges for our retailers and that has become even harder during the pandemic as employees worked through their personal circumstances and fears. At our Fall V-Union, our presentations on people management and hiring in a time of COVID-19 were the top educational session retailers attended. In addition, our role is to appreciate their business from their view and anything we can do to save them time and effort allows them to leverage their resources on the most critical aspects of running their operation.
We also must continue to focus on making sure our retailers remain stocked so they can serve all of the new customers coming into their stores.
If retailers didn’t understand the importance of local e-commerce before the pandemic, they certainly do now. We are working to give our retailers a turnkey, customizable solution for their e-commerce needs and even more robust marketing tools so they can keep all of the new customer they have recently gained.
What sorts of opportunities do you see for independent home improvement retailers?
I would continue with the theme of marketing. Over the last eight months of the pandemic, retailers have had a huge influx of new customers into their stores and online. True Value is working to help our retailers keep those newfound customers with a mix of marketing approaches, including more robust local online presence and digital targeting.
True Value has great product assortments and our customers continue to reinforce that with us. We have an opportunity to do more to help retailers appreciate the gaps in their assortments or opportunities to increase solutions available to customers in their stores. We are working with our sales teams to appreciate the tools we have and support customers when we identify opportunities.
Do you have any updates on the relationship between ACON and True Value that you might like to share?
ACON is supportive of the management team and depends on us to run the business. I’m very impressed with their thoughtful approach and support we receive. ACON’s support enabled our ability to return the equity investment made by our customers, allowing investment in their business to thrive for years to come. ACON is focused on providing the resources and strategic support to accelerate a profitable growth-oriented business, for the benefit of everyone connected with the company.
Register Now for the 2021 Spring V-Union
True Value’s 2021 Spring V-Union takes place Feb. 22-25. Register today to attend the online event.