One stop shopping

By Lisa Haarlander - The Buffalo News

Saturday, November 16, 2002

In industry lingo, Home Depot and other mass retailers are known as "category killers." Such stores dominate their niches in the market to the point where they drive out smaller competitors.

But a group of local home improvement retailers are attempting a novel way to compete with the hardware giant by banding together to offer their own form of one-stop shopping.

Buffalo Hardwood, Caroll Rug, Tile Shoppe and Ellicott Paint Co. are knocking down the walls between their stores and renaming their shopping plaza at Walden Avenue and Transit Road in Depew the "Walden Design Center."

"When a big box moves in, that isn't great news for the community because it steals from the local businesses," said Jim Caroll, who owns Buffalo Hardwood and with his wife, Carolyn, owns the shopping plaza. "We wanted to have a location that would draw people who weren't necessarily looking for a rug or floor that day."

But simply being in the same location would not be enough to keep customers from going to Home Depot. The stores also chose their merchandise carefully so they can offer customers items not sold by a mass retailer.

Of the seven different manufacturers that Buffalo Hardwood carries, only one is sold at Home Depot - Bruce, the largest manufacturer of hardwood floors in the United States.

"They do it by size, not quantity," Caroll said. "We have lower-end goods but that's not our main focus. We can carry more specialty items."

The concept of a home-improvement design center is not that much different than the idea of a mall or an old-fashioned Main Stree, said Arthur Judelsohn, president of Berlow Real Estate.

"The concept of a design center is not a new one," he said. "A lot of major cities around the country have design centers, and they're very successful and very popular. One of the reasons that there has been market resistance in this market is that the designer business is less than in other places."

Such design centers are typically located in wealthier sections of the country, such as parts of California, New York City, Boston and Chicago, said Armen Babaian, president of the Oriental Rug Retailers of America.

"I guess we're seeing more of the design centers pop up because more places like Home Depot are supplying everyone with everything," he said.

While Western New York may not be the wealthiest area of the country, it has other characteristics that make it ideal for a design center.

"People in Buffalo are very quality conscious," said Carolyn Caroll, owner of Caroll Rugs, a company she started in 1998. "People aren't as transient as in San Francisco, Chicago, New York and L.A. They invest more in their homes."

Caroll Rug recently won the Retailer of the Year Award for a specialty store from Americasmart, which sponsers the largest area rug show in the country. Among the reasons Caroll Rug won are the racks on which her Oriental and area rugs hang. Customers can easily flip through the hanging rugs instead of having a sales person dig through a pile on the floor. Her store is also bright and modern, focusing shoppers' attention on the rugs.

The Tile Shoppe, which has been around for more than 50 years, moved to the plaza in 1998 and is now in the process of doubling the size of its store.

"I like the idea that I'm in with other companies that do home remodeling and interior finishes," said Paul Birrer, owner. "Anybody in the plaza who advertises and brings in people helps all of us."

Home Depot carries Daltile, a mass-produced tile, while the Tile Shoppe focuses on Walker Zanger, a specialty manufacturer. The Tile Shoppe also carries tiles made of stone, glass, porcelain and even leather in addition to the traditional ceramic tile.

Elicott Paint Co., which has six locations in the area, takes much the same approach.

"We try to stock a selection of products that doesn't overlap with what they sell," said owner Carl "Rocky" Nagel. "In some cases that means carrying different brands. In some cases that means carrying different quality levels."

Elicott Paint carries Benjamin Moore and a brand called C2, which is made by a small, local company.

While premium C2 costs $30 a gallon, it covers 15 to 20 percent more surface area because it contains less water than other brands and also leaves fewer brush marks, Nagel said.

Different merchandise combined with related stores in one location allows the company to flourish in the shadow of a Home Depot.

"We each attract different customers are different points in time," Nagel said. "If someone is looking for an area rug or floor tile, odds are that they're probably looking for other decorator products."

In fact, since Home Depot entered the Buffalo market in 1994, these stores have seen their business increase most years. And if Lowe's were to open a store here and trigger a price war with Home Depot, that might be good news for these small retailers, Jim Caroll said.

"Because Home Depot came, we became better. If Lowes comes we'll be better yet," he said. "If they advertise and promote hardwood floors like crazy, it would be the best thing for us."