True Value 2007 Annual Report Download - page 6

4 | 2007 ANNUAL REPORT
TRUE VALUE COMPANY
You spoke, we listened. Through quarterly member satisfaction
surveys, retailers rate the service and support that True Value
provides. This feedback – as well as input from member roundtables
and retail growth conferences – directly informs and guides
adjustments we make to continue improving retail support. Many
of the initiatives below were born as a result.
In merchandising, the product line review process enhances
the competitiveness of products available to members in their
Regional Distribution Centers (RDC). Since the reviews began
in 2004, the co-op has reviewed 110 product categories and
implemented more than $54 million in cash and product cost
reductions. These savings lower the everyday cost of products
to members and help maintain consistent retailer patronage
dividends. Twenty-four categories were reviewed in 2007, and 24
more are slated for review in 2008.
A key result of the line review process is the Certifi ed True Blue
(CTB) program, which ensures the most up-to-date products are
available within a specifi c product category. CTB assortments are
merchandised using a good-better-best sell-up strategy. This helps
increase the average ticket and profi tability of the category for the
retailer. Since the CTB program launched in 2004, more than 73,000
CTB assortments have been sold to True Value members. More than
40 percent of products within Destination True Value are CTB.
Having the right amount of the right products in stock at the right
time captures sales. This goes hand in hand with accurate inventory
and delivery – top member concerns. The co-op works diligently to
keep its fi ll rate among the top in the retail industry, striving to
provide members an increasingly high degree of satisfaction. To
meet this goal, True Value is continuing its commitment to convert
its 12 RDCs to an automated warehouse management system that
saves time and money and produces more accurate ordering,
tracking, fi lling and delivery of orders.
The retail pricing game can be tricky. Price too high, a product
won’t sell. Price too low, it isn’t worth selling. The Retail Price
Enhancement Program targets the right retail price. Scott Allen of
Paxton Hardware & Rental, Paxton, Ill., appreciates the program’s
ability to model pricing changes, compare current pricing to
suggested levels and recommend a pricing strategy based on the
local competitive landscape. To date, more than 1,600 members
have implemented the program and experienced an average
increase of 2 percentage points in their gross margin.
In 2007, True Value continued the simplifi ed ordering system
rollout to create a more effi cient ordering process. Now retailers
can view all open orders, including Market-only specials and CTB
orders; easily search for promotions and receive order deadline
reminders. The new system also provides complete order confi rma-
tion and a view of all ‘ship later’ items. This program exemplifi es the
co-op’s commitment to deliver on its reputation as a company that’s
easy to do business with.
IMPROVING RETAIL SUPPORT
In the competitive world of retailing, you’re only as good as your reputation. True Value retailers – just like their
customers – have options when it comes to buying products and solutions. Whether a retailer or customer, the same
decision-making criteria infl uence the purchasing decision: cost, quality and service. That’s why everything we do
aims to make True Value a co-op that’s easy to do business with.