A former Spokane boy is looking to make it easy for you to buy that cordless drill, lawnmower, or metric tool set youve been wanting, while sitting at home in your bathrobe and slippers.
Sam Heerensperger, son of former Spokane businessman and Eagle Hardware & Garden Inc. founder David Heerensperger, has joined with a couple of other investors to take a whack at on-line sales of home-improvement products.
About three months ago, the investor group bought Superbuild.com, a Seattle-based company regarded as one of the leading ventures in that emerging industry. Since then, the new owners have been expanding the companys staff, revamping the look of its web site, and making sweeping changes to its merchandise mix.
Distribution is being handled through warehouses in Spokane; Memphis, Tenn.; and Frederick, Md. Superbuild is working with Spokane-based wholesaler Jensen Distribution Services for its shipping needs here, the younger Heerensperger says.
Obviously enthused about the new venture, he says, The e-commerce market is still in its infancy. Its just beginning to realize its potential. The home-improvement end of it realistically is only about six months old.
He adds, though, that its projected to become a $5-billion-to-$10-billion-a-year industry within about five years. That compares with current estimated revenue of $170 billion to $200 billion a year for the overall U.S. home-improvement market, he says.
Superbuild.com was started last October by longtime lumber industry executive John Kueber, who has been involved in a number of other on-line ventures. It claims to be the Internets largest home center, with a virtual inventory of almost 40,000 products for the home, ranging from hammers and nails to blenders, coffee makers, alarm clocks, and calculators. It also offers helpful tips on a variety of do-it-yourself projects.
Heerensperger declines to divulge how much the investment group paid for Superbuild, but Tom Todaro, who heads up the group, told the Puget Sound Business Journal in a recent interview that it was between $1 million and $10 million.
Todaro is a former Merrill Lynch consultant who later ran a Canadian dairy for four years, and more recently was a top manager at Targeted Genetics Corp., a biotechnology firm in Seattle. He told the Seattle business newspaper that his varied experience has given him a comprehensive knowledge of materials distribution.
He now is president of Superbuild, and Heerensperger is vice president of merchandising, basically the same title he held with Eagle Hardware when he retired from that company in 1996 after seven years of employment there. He says he was just starting to give some thought to what I was going to do next when he was approached about the Superbuild venture, so the timing was right.
Im the product guy here, for all practical purposes. Its a very consuming job, Heerensperger says. He says his father, who opened Eagle Hardware & Gardens first store here in 1990, now is retired, spending a lot of time on his boat, and will not play a role at Superbuild.
Heerensperger, now 41, says he was 2 years old when his family moved to Spokane. The family moved to Seattle about eight years later, and Heerensperger says he didnt return to Spokane for any extended period until 1990, when he came back to help with the opening of Eagle Hardwares first store and spent about eight months here. I found out what a wonderful place it really is. I really like Spokane, he says.
From here, Eagle Hardware grew rapidly, expanding to 37 stores before being acquired by Lowes Cos., a big North Carolina-based chain, last April for $1.4 billion.
It was a good (business) plan, and we were very pleasantly surprised all along at how fast it grew, Heerensperger recalls. It was a great American success story.
He says his younger brother, Joe, still is employed by Eagle Hardware as an electrical and lighting buyer. He also has an older brother, who lives in Calgary and works in the oil industry, and two sisters, the youngest of whom, Julie, lives in Spokane.
Superbuilds other investors are Chairman Mike Pickett, who formerly headed a computer-parts distribution business in Los Angeles, and a person who prefers to remain anonymous while wrapping up current commitments.
Heerensperger declines to discuss Superbuilds revenue figures, but Kueber told Forbes magazine before selling the business that its projected sales for this year would top $1 million.
Superbuild was offering about 80,000 items for sale until its new owners began reorganizing and cleaning up the web site.
Heerensperger estimates the on-line inventory dipped to less than half its previous size, but he says items will be added that should bring that back up to 65,000 or better.
Superbuild last week launched the next generation of its web site, which we feel is a pretty good improvement over the site as we acquired it, Heerensperger says. He adds, We will be working hard on technical issues, product issues, and will be launching a completely new version of the site around the first of the year.
Visitors to the newly revamped Superbuild web site can click on any of several prominently displayed feature products, nine general shopping categories, or themed areas such as Lifestyle Buys, Staff Picks, Sale Items, and Brand Focus.
In the Lifestyle Buys area, products are grouped under headings such as Bachelors, Backyard Barbecuers, Garden Gurus, Homemakers, and Outdoorsmen. The site also has a search function and product index that visitors can use to locate specific items.
Purchases are made using a shopping cart and checkout setup like that provided on other on-line retail sites, and most deliveries are via United Parcel Service.
In addition to the shopping-related areas, the Superbuild web site has a How To section that offers information on 200 do-it-yourself projects and a Community Forum section with message boards where people can exchange information.
One of the new management teams top priorities is increasing the traffic capabilities of Superbuilds server system. The team also is exploring two possible new areas of revenue-generating opportunity for Superbuild. One is partnering with brick-and-mortar lumber yards to generate e-commerce for them. The other is business-to-business services that Superbuild could provide to professional contractors.
Heerensperger says Superbuild now has about 30 employees, up from 11 when the investment group bought the business. He says its adding about two employees a week and likely will have a staff of about 60 people by the end of the year.
Other regional players
Some other noteworthy regional players also are looking to carve out a piece of the on-line home-improvement market. Richard Takata resigned his position as Eagle Hardwares president and chief operating officer several months ago to start a new hardware-oriented virtual store, called CornerHardware.com, with former investment banker Peter Hunt. The site, which is to be based in San Francisco, isnt active yet.
Separately, Bothell, Wash.-based Thurman Industries Inc. has launched an on-line store, called paynpak.com, that it says it developed out of loyalty to former customers who continued to lament the loss of their local Pay N Pak Home Center.
Pay N Pak Stores Inc., of Kent, Wash., closed 102 stores, including 10 in Eastern Washington and North Idaho, in 1992 after being unable to overcome mounting financial problems and filing for bankruptcy. Stan Thurman had founded the chain in 1962, but left it in 1970 after a rift developed between him and business partners David Heerensperger and John Headley.
Heerensperger had opened Eagle Electric & Plumbing in Spokane in 1960, but that company was merged into Pay N Pak in 1969, and Pay N Pak also went public that year.
Heerensperger later became chairman of Pay N Pak and built it into a $460-million-a-year business. He resigned in August 1989, shortly after which he founded Eagle Hardware.
In 1992, when the Pay N Pak chain was liquidated, Thurman Industries bought five of its stores and also acquired all rights to the Pay N Pak name. It now operates 16 Pay N Pak Home Center and Thurman Home Center stores in the Northwest.
Bret Thurman, grandson of Stan Thurman and paynpak.coms chief operating officer, says that because the company runs its own warehousing and distribution operations, most orders are shipped the same day theyre received.
The web site currently has an inventory of more than 5,000 items, but Thurman Industries says thats expected to grow to at least 80,000 items by years end.
Considering that Superbuild.com, cornerhardware.com, and paynpak.com are only a few of the many hardware e-retailers springing up on the Internet, it seems apparent that finding a way to stand out in the crowd will be one of the keys to survival.
Sam Heerensperger says, We feel that ultimately to be successful you have to be doing more than just selling screwdrivers for the lowest price in the world. You have to provide a very high-end customer service experience and sell top-quality merchandise.
Time will tell whether, through Superbuild and the Internet, he can duplicate some of his familys brick-and-mortar success.