RONA INC.
TSX : RON

RONA INC.

August 26, 2010 08:30 ET

Young Leaders Play Key Role in RONA Network's Future

Unique approach includes succession planning program for independent dealers

CALGARY, ALBERTA--(Marketwire - Aug. 26, 2010) - RONA inc. (TSX:RON), the largest Canadian distributor and retailer of hardware, renovation and gardening products, is setting new standards to make sure its network is ready for whatever the future has in store. A 5-day "President's Forum" summer retreat for young business leaders, currently being held in Kananaskis, Alberta, is part of the process. The retreat is a way to enhance participants' commitment to the retail business by engaging them and showing independent dealers they are never alone at RONA. With RONA, they know they'll get what they need to face today's market realities, including a $100 million development fund to help finance buyouts by the next generation, as well as access to a team of experts and a greater degree of support than anywhere else in the industry.

The development of the affiliate dealer-owner network has always been one of RONA's key growth vectors. "Preparing for the future is above all preparing our people. We prepare the people who build the future in our business. Talent development is at the very heart of our business strategy and why young people have such an important role to play in our preparations for the future," said RONA President and CEO Robert Dutton.

Company studies and other research findings show the effects the aging of the Baby Boom generation (1946 to 1964) is having on Canada's demographic makeup. Unlike Baby Boomers, Generation X (1961 to 1981) and Generation Y (1976 to 1999) are increasingly demanding and have a greater sense of entitlement, in terms of both the service they expect in store and the social responsibility they demand from the companies they buy from. In addition, the recession and financial crisis have made consumers much more cautious. These two factors – more expectations and more cautious behaviour – add up to increased demands in terms of shopping experience. In order to lead in the future, companies must adapt the way they recruit and retain managers and employees as well as how they attract customers.

"Our existing affiliate dealer network reflects the aging demographics of the Canadian population at large," Dutton said. "If we wish to sustain strong network growth – and RONA's role as industry consolidation leader – we need to identify and attract bright, dynamic, young people from within and outside our organization, and provide them with the tools they need to succeed as entrepreneurs. Our succession-planning initiative is designed to build on the market leadership we enjoy and ensure the continued growth of our network. It also clearly shows RONA's strong commitment to and support for the ongoing development of independent dealers in Canada."

Summer retreat for tomorrow's leaders

RONA's 5-day summer retreat for young leaders is designed for those following in their predecessors' footsteps. This is the second year that Robert Dutton is holding his "President's Forum". Last year's retreat was held in Quebec. This year's camp, modeled after the company's Canada-wide development plan, is from August 25 to August 29 in Kananaskis, Alberta. Participants are young people representing the next generation of RONA leaders. Their challenge: build the future. Dutton believes RONA's successful future depends on understanding the perspectives of young people – both as employees (and future leaders) and consumers ­– and, together with them, exploring what motivates them, along with characteristic features and cultural cues of the next generation. The retreat consists of active working sessions with senior members of RONA's management committee as well as exchanges with industry experts and Canadian business leaders.

Dutton developed this innovative approach to planning because the future of any current business is always in the hands of those taking charge of operations tomorrow. "Our young people need to be involved now in the design and operation of the business so that when their turn comes to lead, they will be prepared," he said.

Succession planning program

Succession can be especially problematic for family-owned businesses, typical of the kind you find in the highly fragmented hardware and home renovation industry. RONA's succession-planning program encompasses three levels: personal, legal and financial. The program covers everything from identification of potential successors to training and mentoring new owners. From a legal aspect, the program looks at reference resources for drafting contracts and agreements. The financial part covers the preparation of a business plan, tax planning and the financial structure of the buyout transaction. The succession planning program also includes a $100 million development fund to facilitate store acquisitions over a 10-year period. The fund is supported by RONA affliliate dealers and a consortium of leading Canadian financial institutions. This program is off to a good start with four recently approved projects representing nearly 40% of the annual budget.

About RONA

RONA is the largest Canadian distributor and retailer of hardware, renovation and gardening products. RONA operates a network of some 700 corporate, franchise and affiliate stores of various sizes and formats. With close to 30,000 employees working under its family of banners in every region of Canada and more than 16 million square feet of retail space, the RONA store network generates over $6 billion in annual retail sales. For more information, please visit rona.ca.

Contact Information

  • RONA inc.
    Media: Daniel Richard
    Director, Corporate Communications
    514-599-5900, ext. 5751
    daniel.richard@rona.ca
    or
    RONA inc.
    Financial Community: Stephane Milot
    Senior Director, Investor Relations
    514-599-5951
    stephane.milot@rona.ca