Sunshine Ace Hardware eyes more acquisitions as the industry consolidates. How will it keep its family-business culture as the company grows?
When Joe Waksler called Michael Wynn earlier this year and told him he was ready to sell his Ace Hardware store in Port Charlotte, Wynn was ready.
Wynn, president of Naples-based Sunshine Ace Hardware, had been talking to Waksler for two years about the possibility of buying his store, called Morton's Ace Hardware.
Waksler, 55, is typical of many baby boomer entrepreneurs: they're close to retirement, have no children eager to take over the business and they're worn out by the grueling recession. Waksler says he was working so hard lately that even planning a Saturday night out was iffy. “There's a shower in the bathroom,” Waksler chuckles.
By contrast, Wynn, 43, is the third generation of his family to operate Sunshine Ace, and the Port Charlotte store is now the seventh in the chain that stretches south to Naples and Marco Island. “We're focused on getting to 10 [stores],” says Wynn.
Within 15 years, Wynn says he hopes Sunshine Ace will have 20 stores in Florida. He's scouting opportunities all over the state, including for companies that own multiple stores.
Wynn says Morton's has special connections with the customers it serves because of its knowledgeable staff, including longtime General Manager Tom Brown, who has worked there for 30 years. “We're buying those relationships,” Wynn explains.
Waksler has owned and operated Morton's Ace Hardware for 35 years. It's named after his father's first name because he says Waksler is hard to spell. “It's always about the team and keeping good people,” Wynn says. “Those are the people who have watched their customers' kids grow.”
In addition, Charlotte County is in the path of growth between Sarasota and Fort Myers, and Wynn points to the massive Cheney Brothers distribution center under construction near the Punta Gorda Airport as one example of the development that's coming. “Charlotte is a couple years behind Lee and Collier,” Wynn says. “We're going to see accelerating growth.”
The challenge for Wynn is to keep that family-owned local hardware store culture of customer service as the company grows. He's balancing that with the need for corporate structure and formal accountability to tie them together.
A way Wynn does that is by using data from personality tests that every employee must take. Using the results of these personality profiles helps Wynn gain insights into each store's culture.
Terms of the Port Charlotte acquisition were undisclosed, but Wynn says he took advantage of current low interest rates to finance the deal in part with a loan from First Florida Integrity Bank in Naples. “Right now it would be silly not to attach debt to this deal,” he says.
Wynn also had to persuade the second generation of his family to agree to make acquisitions because they're eyeing retirement. “You're risking their assets,” Wynn says.
But after five years of rising sales, Wynn says the family is agreeable to the expansion. “This has been part of an ongoing dialogue,” Wynn says. “We've been building confidence with the family board.”
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