Retailers jostle for the DIY dollar

By EUGENE BINGHAM

The scrap for the DIY dollar has become fierce, with two rivals fighting all the way to the Court of Appeal.

Hardware retail giant Mitre 10 and an Australian newcomer, Bunnings Warehouse, traded legal blows over Bunnings' use of advertising which compared its prices with Mitre 10's.

The dispute has lifted the lid on the level of competition in the hardware market.

With high-rating television programmes wooing viewers into renovating their homes, New Zealanders are spending more than $950 million a year at hardware stores.

"It would be fair to say things are hotting up," said Bunnings New Zealand general manager Brad Cranston.

"We've got a fairly aggressive expansion programme, as has Mitre 10 and Placemakers."

The major chains jostling for the Do-It-Yourself and trade dollar went on alert last year after the arrival of Bunnings, a major Australian warehouse-style hardware retailer which bought Hardwarehouse and Benchmark.

Bunnings has taken over the three Auckland Hardwarehouse stores and is slowly converting the 32 Benchmark stores.

Mitre 10, which also has stores in Australia, took legal action against Bunnings over what it said were illegal advertising techniques.

Bunnings had used Mitre 10 brochures in its stores, showing the Bunnings' price alongside the Mitre 10 figure. But Mitre 10 accused Bunnings of using incorrect prices, and comparing products of different brands. Mitre 10 also alleged that Bunnings had breached copyright.

The High Court issued an injunction preventing Bunnings from using Mitre 10 brochures for comparative advertising on the grounds of possible trademark breaches.

But the Court of Appeal has overturned the decision, saying Bunnings had not infringed the trademark laws. The court ordered Mitre 10 to pay Bunnings' costs.

Mitre 10 chief executive Craig Wilson said he was disappointed, but believed the legal action was necessary to prevent certain unfair practices.

"I don't think [what Bunnings was doing] was necessarily playing fair," said Mr Wilson. "We've got no issue with comparative advertising, but play a fair game."

Mr Cranston said Bunnings would start up its comparative advertising techniques again in light of the court ruling.

"We don't feel we did anything wrong and the court verified that," said Mr Cranston.

"All we were doing was ensuring our customers understood that we do deliver on our promise of having the lowest prices."

A retail analyst said it would be interesting to watch the introduction of Bunnings into the hardware sector, but it seemed all the participants in the market were doing well at the moment because people were spending more on home improvements.

"A rising tide lifts all the boats," said the analyst, who spoke on condition of anonymity.

Each of the retailers seemed to be positioning themselves for different sectors of the market, he said. Placemakers, for instance, seemed to be going after the people who knew what they were doing, whereas Carters had placed a big emphasis on the fact that they could give advice.

Mr Wilson said the home improvement television programmes had played a part in the hardware boom. Mitre 10 sponsors three programmes - Changing Rooms, Dream Home, and DIY Rescue.

"I would have to say that in terms of enabling a customer to believe they can do it, [the programmes] have been absolutely outstanding," said Mr Wilson.

He said another change he had noticed was the number of women who were tackling home-improvement tasks.

"A lot of women say, 'I'm sick of asking, I'm going to do it myself'.

"An example of that is my brother - his wife has repainted their whole house. She got sick of asking him and just did it."


MEASURING UP


Mitre 10

Branches: 123 nationwide with plans to build 12 megastores in the next four years.

Slogan: "You'll come out better off."

Background: Introduced from Australia in 1974, now a members-owned co-operative.

Prices: Ponsonby store: Three-step ladder: $39.99 (range up to $109); 500g galvanised flathead nails 50mm: $6.50; 10 litres white acrylic paint: $79.98 (on special).


Bunnings Warehouse

Branches: Three in Auckland and expansion plans.

Slogan: "Lowest prices are just the beginning."

Background: Moved in from Australia last year, rebranding the Hardwarehouse stores in green and red colour brand and switching to the lowest-price, warehouse-style approach of Bunnings.

Prices: Mairangi Bay store: Three-step ladder: $99.48; 500g galvanised flatheads 50mm: $7.64; 10 litres white acrylic: $94.50.


Benchmark

Branches: 32 nationwide.

Slogan: "See the team."

Background: Taken over by Bunnings last year, but stores have retained their own branding so far. However, Bunnings has plans to gradually replace some Benchmark stores with Bunnings.

Prices: Henderson store: Three-step ladder: $82; 500g galvanised flatheads 50mm: $7.65; 10 litres white acrylic: $148.


Building Depot

Branches: Eight.

Slogan: "No one beats a Depot deal."

Background: Founded by a former Mitre 10 franchise owner and based on American hardware giant the Home Depot, one of the largest retailers in the world. Recently bought from Fletcher by Aucklander Mark Taylor, the Building Depot targets home improvements - kitchens, bathrooms and landscaping in particular.

Prices: Mt Roskill store: Three-step ladder: $74.99; 500g galvanised flatheads 60mm:$5.49; 10 litres white acrylic: $68.99.


Carters

Branches: 37 stores nationwide.

Slogan: "Your building partner."

Background: Owned by Carter Holt Harvey, Carters has marketed itself as the place to seek advice as well as the products for renovations.

Prices: Henderson store: Three-step ladder: $109.95 (special); 500g galvanised flatheads 50mm:$7.84; 10 litres white acrylic: $99.95.


Hammer Hardware

Branches: 92 nationwide.

Slogan: "It's your local."

Background: Opened more than 25 years ago, Hammer Hardware is a members' co-operative within the Mitre 10 chain and prides itself as the local hardware store.

Prices: Mt Eden store: Three-step ladder: $99.95; 500g galvanised flatheads 50mm: $7.75; 10 litres white acrylic: $89.95 (on special).


ITM

Branches: 80 stores nationwide.

Slogan: "We'll see you right."

Background: A chain of independent timber, hardware and building supplies merchants which has rapidly expanded since it was founded in 1991. Aims for trade and home improvement markets.

Prices: Avondale store: Three--step ladder: $149.10; 500g galvanised flatheads 50mm: $6.35; 10 litres white acrylic: $99.75.


Placemakers

Branches: More than 50 nationwide.

Slogan: "Know how. Can do."

Background: Stores operate on a joint-venture basis, part-owned by a local operator and construction industry giant Fletcher. It targets the trade sector, but also caters for DIYers.

Prices: Auckland City store: Three-step ladder: $139.95; 500g galvanised flathead nails 50mm: $7.78; 10 litres white acrylic paint: $79.95 (own brand).

* Prices as at October 22.

Further reading: nzherald.co.nz/property