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posted: 7/14/2014 5:00 AM

Why Schaumburg, Hoffman Estates struggle to land hardware stores

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  • The Lowe's store in Schaumburg closed in 2011, leaving the village with just one hardware store. Despite their best efforts, economic development officials in Schaumburg, as well as neighboring Hoffman Estates, have been unable to persuade another hardware store operator to move into their towns.

       The Lowe's store in Schaumburg closed in 2011, leaving the village with just one hardware store. Despite their best efforts, economic development officials in Schaumburg, as well as neighboring Hoffman Estates, have been unable to persuade another hardware store operator to move into their towns.
    Bob Chwedyk | Staff Photographer

  • Hoffman Estates is actively searching for a hardware store operator, including soliciting interest on the economic development page of its website.

      Hoffman Estates is actively searching for a hardware store operator, including soliciting interest on the economic development page of its website.

 
 

With their combined population of more than 125,000 and central location in the Northwest suburbs, Schaumburg and Hoffman Estates have attracted a variety of auto dealerships, high-end stores and restaurants, and the headquarters of major corporations like Sears and Motorola.

They're home to a major regional shopping mall, 11,000-seat arena, professional baseball stadium, hospital and convention center.

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But both are begging for even one neighborhood hardware store to serve their residents.

Hoffman Estates Economic Development Director Kevin Kramer says he has to drive 20 minutes get from his home in the village to the nearest hardware stores in other communities.

Hoffman Estates has gone as far in its search as soliciting hardware stores on its website, with an offer to provide incentives to help a potential franchisee with startup costs.

This is the second time Kramer has been through this. When he worked for the smaller village of Barrington, the community development department spent years trying to bring hardware store to town until resident John Brown stepped up two years ago to open an Ace Hardware on Route 14.

Barrington had lost its previous Ace Hardware because the owner of the land where it was located sold the site for a new Walgreens, said Peg Blanchard, the village's economic and community development director.

A hardware store needs exactly the right kind of person to make it successful, and there's no way to guarantee how long that's going to take, she added. Blanchard believes Barrington was fortunate to have that person already in the community.

But why are Schaumburg and Hoffman Estates still searching?

As is often the case, the question suggests the answer.

Erik Butterworth, regional manager for Oak Brook-based Ace Hardware, said his company sees the Schaumburg and Hoffman Estates markets as very desirable. But part of what makes those markets so desirable makes locating there a challenge.

While Woodfield Mall isn't the type of location Ace Hardware prefers, its presence makes nearby sites highly favorable for a wide range of retailers -- and thus, highly expensive.

Because a neighborhood hardware store has narrower profit margins than many of the big retailers who want to be in Schaumburg or Hoffman Estates, it has to work harder to find an affordable niche in that same market.

"The economics of opening a store have to be correct," Brown said. "You have to be able to project that you're going to turn a profit at some point in the future."

There are no absolute criteria for what makes a good hardware store site, Butterworth said, but generally the company would like to have a store within three miles of the people it serves -- taking other natural boundaries into consideration.

While Schaumburg has a Home Depot on the west side of the village at Schaumburg and Barrington roads, neither Mayor Al Larson nor Economic Development Manager Matt Frank consider it a substitute for the kind of neighborhood hardware store they're seeking.

Larson said he considers the big-box stores to be aimed more at professional customers like contractors, rather than the homeowner doing routine maintenance that makes up the bread and butter of a hardware store's customer base.

While he would like to see a Mariano's grocery store fill the vacant Dominick's in Town Square at Schaumburg and Roselle roads, Larson's Plan B would be to see the building divided between a smaller grocer and a hardware store.

Frank's job often involves finding new tenants for large vacant sites or buildings in Schaumburg. While the current search for a hardware store doesn't outweigh that as a priority, he hopes that by bringing big things to town, the village will be more attractive to small businesses as well.

Demonstrating that patience and persistence usually pay off, Frank points out that Schaumburg spent years working to bring in a Trader Joe's and soon will have one near the corner of Golf and Meacham roads.

Butterworth said Ace Hardware is thriving this year, celebrating its 90th anniversary with more than 100 owner-operated stores in the Chicago area. Though Ace strives to be respectful of the presence of big-box home improvement stores, it doesn't consider them competitors in exactly the same market, he added.

Brown said he received no economic incentives to open his store on the Cook County side of Barrington, though he could have looked for a Lake County location just several blocks up the road. He decided his site's visibility and ease of access would outweigh the extra taxes ... but those taxes have risen significantly in the 18 months since he opened. He hopes the continued growth of his customer base will keep him from having to make the move into Lake County.

Nevertheless, Brown said he's very happy to have a six-mile gap between his Barrington Ace store and the nearest big-box store. That played a major role in his decision on where to locate.

Blanchard said she has no doubt that what worked out for Barrington will ultimately work out for Schaumburg and Hoffman Estates.

"They'll get it eventually," she said.

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