Irish builders’ merchants and DIY groups Associated Hardware plc - operator of the Homevalue brand - and National Hardware Ltd - operator of the Arro brand, have concluded an agreement to establish a joint venture buying group on behalf of their respective members representing nine independent businesses in Mayo.
The merging of the buying functions of the two companies into United Hardware Ltd, as the new vehicle will be known, is seen as one of the most significant developments in the independent trade in recent years. This strategic move will allow both parties to achieve significant buying synergies, will ensure better relationships with their suppliers, and ensure that their increased size secures better prices for their member stores. The obvious benefit for suppliers will be the more efficient access to the enlarged customer base.
United Hardware will operate as an independent sourcing and buying operation on behalf of over 150 Irish owned and operated independent builders’ merchants, DIY and hardware stores throughout Ireland. It will have a buying power in the region of €300 million per year.
“This joint venture is an excellent strategic fit,” said Conor Whelan, chairman of Associated Hardware plc. “There are obvious opportunities for benefits of scale from two complementary businesses, for enhancing our respective product ranges and for providing better service to our customers. We intend to harness the respective strengths of both companies through United Hardware while retaining the identity of the Arro and Homevalue brands. This joint venture will create an Irish builders’ merchants and DIY buying group of sufficient scale to ensure that we have the ability to compete against major Irish and international operators in the difficult Irish market.”
Willie Telford, chairman of National Hardware Ltd, said: “This is a very positive development in the troubled construction sector. By combining our buying resources to create United Hardware, we are helping to secure the position of independent operators throughout Ireland in the face of very challenging conditions for our members. We felt that establishing this joint venture was essential to the continuing operation of both Associated Hardware plc and National Hardware Ltd. Suppliers, our members, and customers all stand to benefit from the efficiencies that United Hardware will deliver.”
The builders’ merchants and home improvement market in Ireland is currently worth an estimated €3.5 billion.
“We do not have the scale of the Grafton Group, Wolseley, and B&Q in Ireland,” said Mark Delaney, chief executive of Associated Hardware plc and joint CEO of United Hardware. “What we have achieved in combining our buying and sourcing functions, is that we have ensured our ability to compete against these much larger rivals in very difficult conditions. We have approximately 300 Irish suppliers who will benefit further from being able to trade with a strong independent buying group.”
