Now that construction has begun to convert the former General Electric campus, Do it Best Corp. executives can start planning the move into their future headquarters.
But before the hardware cooperative can start packing boxes bound for Electric Works, executives must manage unexpected explosive growth fueled by the coronavirus pandemic.
During the shutdown, when consumers couldn't spend money on travel, concerts or sporting events, many invested in home improvement projects. Member hardware stores, which were deemed essential businesses, reaped the rewards.
Do it Best, Indiana's largest privately held company, has rung up double-digit sales increases every month since March 2020 – as compared with the same months in 2019.
Dan Starr, the cooperative's CEO, sat down recently with The Journal Gazette at the Electric Works campus to discuss strategy for scaling up to handle demand without overextending the operation.
While sitting on a folding chair in the former GE Club's gymnasium, Starr also talked about the company's big move, which is scheduled for fall 2022.
Managing the move
“How do you flip a switch and go into immediate productivity?” Starr said, posing a rhetorical question.
The 75-year-old cooperative won't even attempt it.
“I don't think we'll unplug everything and march everyone out at the same time,” he said. “We'll stage it. We'll do it in waves.”
Do it Best's project management office is experienced at managing major milestones and the steps needed to get there, Starr said, adding it's not too early to begin planning the move.
Electric Works, a $286 million mixed-use development, will comprise office, co-working, research, retail and entertainment space along with a food hall and public market, a STEAM high school, primary care clinic and pharmacy.
The west campus includes more than 700,000 square feet. Other tenants will include Parkview Health, Fort Wayne Community Schools, Medical Informatics Engineering, Ruoff Mortgage, Fort Wayne Metals, IU Ventures and Indiana Tech.
Do it Best doesn't have a deadline for leaving its New Haven headquarters, so some of the 450 headquarters employees will remain in that building until the first ones are settled at Electric Works, ensuring business continuity.
“We've just got to be able to perform,” Starr said, adding that members rely on them.
The eight divisions in the headquarters building are information technology, finance, human resources, logistics, lumber and building materials, merchandising, marketing, and sales and business development.
The pandemic provided a trial run, of sorts, for the organization. Its white-collar workforce, which includes more than 100 technology employees, shifted to remote working twice, a process that allowed staff to encounter and resolve resulting issues.
The experience gained could prove valuable in the staged move roughly 18 months away.
Hiring spree
In February 2020, Starr announced Do it Best's planned move to Electric Works. The company forecast it would add up to 100 headquarters jobs in the next few years.
No one expected the hardware co-op would have to hire more than 200 additional warehouse workers in the coming months to meet customer demand prompted by the pandemic. Including employees at its eight distribution centers, Do it Best's nationwide workforce is about 2,000.
Increasing capacity has meant expanding facilities in some cases and adding workers to additional shifts in others, Starr said.
In Medina, Ohio, for example, the cooperative invested in its existing distribution center to expand offices, restrooms, break areas and the parking lot to accommodate additional staff.
Do it Best is on pace to set a sales record in fiscal year 2021, which ends June 26. The cooperative also expects to issue a record rebate to member stores.
Although the corporation nailed $3.6 billion in fiscal 2020 sales, that wasn't a record. Do it Best's fiscal 2018 sales were $3.7 billion, for example.
Rebates to members exceeded $128 million in fiscal 2020.
Do it Best contributes to the bank accounts of more than just its member stores. A 2020 study by the Community Research Institute at Purdue University Fort Wayne found Do it Best's annual economic impact on Allen County is almost $100 million.
The amount will be even higher after the organization hires an estimated 90 white-collar workers in coming years, the study found. Company officials declined to disclose how much Do it Best pays for those positions, citing competitive reasons.
Skilled tech workers are vital to the company's success because they drive efficiencies across the operation: Products are sourced from suppliers worldwide, packaged and shipped to member stores, and marketed to the public, officials said.
Solid foundation
Starr isn't worried that Do it Best store sales will snap back to prepandemic levels after consumers get vaccinated and resume traveling and attending entertainment events.
“We've got reason to believe the growth isn't just someone painting their living room who isn't going to do it again next year,” he said, adding he believes “we're going to continue to see sustained growth in sales.”
Starr, an attorney who joined Do it Best in 2005 as its general counsel and human resources director, cited reasons for his optimism.
The co-op has added 125 new locations in the past year, a combination of new retailers, additional stores opened by existing members and businesses formerly part of competing organizations. Although the new member stores are located throughout the country, many are in the Midwest and clustered along the East, West and Gulf coasts.
The supplier to thousands of independent home-improvement stores also keeps an eye on new home starts, which are strong, and consumer trends, which favor supporting locally owned small businesses.
Now that more shoppers have ventured into Do it Best hardware stores, they are likely to return after encountering prices comparable to big box stores and service that is superior, Starr said.
As a result, the cooperative is more concerned about the on-time shipment of door hinges, hand drills and patio furniture to member stores than it is on its upcoming headquarters move.
“Right now,” Starr said, “we're in high-growth mode.”
Feeling the love
Juergens Hardware & Rental in Huntington has been a Do it Best member since before it was Do it Best.
Juergens joined the co-op in 1964, when it was Hardware Wholesalers Inc. That's also the same year the 75-year-old retailer added hardware to it inventory of blinds and paint, co-owner Dan Juergens said last week during a phone interview.
Hardware Wholesalers officially adopted the Do it Best Corp. name in 1998, more than 15 years after member stores started using the brand in their marketing. The new corporate name coincided with Hardware Wholesalers' merger with the Our Own Hardware cooperative.
Juergens represents the third generation in what is now a fourth-generation, family-owned business.
Although the retailer also buys from other suppliers, management prefers to buy through Do it Best, the source of about 90% of Juergens inventory, he said.
Juergens Hardware, which employs 15 in its 14,000-square-foot store on Huntington's north side, is far from the largest co-op member. But that doesn't seem to matter to headquarters staff.
“What I like is that no matter who I talk to or when I call, they make me feel like I'm a priority,” Juergens said. “They never make me feel like I am bothering them.”
“They've just always treated me with respect,” he added.
By combining members' orders, the cooperative can negotiate lower prices from suppliers worldwide. It also offers expertise in numerous aspects of doing business, allowing members to focus on the nuts and bolts of selling.
“They have so many programs with design and marketing and customer relations,” Juergens said, adding that he doesn't have time to take advantage of all the support Do it Best offers members but is grateful for the services.
“I don't know how you'd be able to operate without Do it Best,” he said.
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