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Ace History
Ace grows through the decades: General Overview Ace focuses on the future: 1980-2000 As the 1980s began, the nation's unemployment rate was rapidly rising. Ace Hardware weathered the recession with modest but positive sales. By the end of 1980, the company boasted 4,000 dealers, a new warehouse in Los Angeles and 75 new northeast dealers. Later that year, the Ace's Board of Directors began succession planning in earnest. The Board, although it had a solid foothold on setting policies for management, relied on President Krausman's guidance. At 67, Krausman expected to retire in the coming years and the board questioned how the company would survive his retirement. The Board decided to appoint a second-in-command who would assume the presidency under Krausman's watchful eye and would be groomed for leadership after Krausman's retirement. Steve Walton, an eight-year Ace employee who was Executive Vice President and Treasurer, was an ideal candidate. On July 1, 1980, Walton became Ace's third president. But Krausman proved to be a difficult act to follow and Walton found the transition to be rocky. After a year in the position, Walton and the Board mutually decided it would be best for Walton to step down while Krausman agreed to return to the presidential post temporarily. With Krausman reinstated as president, the Board decided that too much of the previous two years had been spent on internal matters and rededicated the company to growth. At this time, Ace was picking up new affiliates at a rate of 350 per year. Ace decided to isolate areas of the country where no qualified hardware retailer was operating, establish an Ace store and, as soon as it was operational, sell the store to a dealer. Known as the Ace Retail Store Concept, this novel and unprecedented approach to expansion was a great way to test new merchandise and Ace concepts. 
In the final months of 1982, Ace made plans to transition its leadership. Larry Gavin, a 33-year Ace veteran, replaced Art Krausman as president, while Theodore "Ted" Costoff assumed Krausman's role as Chairman of the Board in June 1983. By the close of 1983, Ace had reached the $801 million sales mark, with the average Ace store pulling in $818,000 in retail sales annually. Later that year, Ace decided to build its own paint manufacturing operation. By the next year, Ace chemists had developed and improved solvent and latex paint formulas and the company began manufacturing Ace Paint in a state-of-the-art 250,000 square-foot facility in Matteson, Ill. Another large step in 1984 was the launch of the "Store of the Future," an idea conceived by Bill Loftus, Ace's Vice President of Sales. The Store of the Future was designed to draw customers into key areas of the store and the concept pivoted on the establishment of power aisles that pull customers to the rear of the store. To return to the front of the store, customers would be required to pass angled aisles full of tempting merchandise. In December of 1985, a retailer ordering masking tape at a store in Michigan pushed Ace past the $1 billion wholesale sales mark and ushered the company into a new era. Ace launched the largest sales promotion of its history – The Billion Dollar Sell-A-Bration – designed to put Ace on the path to $2 billion. But this wasn't Ace's only achievement during that year. It was at this time that Ace produced a new Ace catalog for commercial customers, opened retail support centers in Little Rock, Ark., and La Crosse, Wis., and broke ground for another in Hartford, Conn. The next few years were filled with changes. In 1986, Larry Gavin retired as President and was replaced by Roger Peterson, who had been elected by the Board of Directors. The next year, John Madden, former NFL coach and popular football sportscaster, became Ace's spokesperson, providing his image and voice to television, print and radio advertising. Ace also added 400 new dealerships in this year and reemphasized a renewed commitment to retail and regionalism. Sadly, in 1987, Art Krausman, died at age 74. His death had a profound impact on Ace employees. President Peterson wrote in memory of "Mr. Ace": "He touched many of our lives very deeply and made us better for it, along with making Ace a much better company during the 37 years he so faithfully served. His imprint is on Ace. His accomplishments and his philosophy will live on." 
The dawn of the 1990s saw a flourishing U.S. economy, and it wasn't long before Ace started feeling the competitive pinch from discount and warehouse stores like Home Depot. Ace's new Chairman of the Board, Kendall King, believed Ace would need to take a more proactive role in the leadership of the company and asking retailers to adhere to high standards. The answer, he said, was Ace 2000. Ace 2000 was a "partnership of vision of the future," which pivoted on a successful alliance between retailers, distributors and vendors. Ace 2000 concentrated on customer service and satisfaction, as well as commitment to quality, and dealers were encouraged to develop well-defined store identities. Ace 2000 also addressed the need for advanced technology. Innovations such as ACENET, the PACE computer system, Retail Pricing Strategy Service, electronic communication and electronic order forms began to save time and money. In 1991 and 1992, the Gainesville, Ga., and Prescott Valley, Ariz., Retail Support Centers were built and a 106,000-square-foot expansion to the Ace Paint Plant in Matteson, Ill., was launched. By 1993, Ace had opened its first retail support "super center" in Princeton, Ill. Spanning 1.1 million square feet, it remains the largest of its kind in the hardware industry. The company continued to strive toward its Ace 2000 goals when the "New Retail Age of Ace" was launched in 1994 to further battle the "big box" chain hardware stores and help ensure the company's growth for years to come. When President and CEO Roger E. Peterson retired in 1996, he left a strong legacy of commitment to distribution excellence. David F. Hodnik assumed the position of President & CEO, a position he continues to hold today. With the year 2000 quickly approaching, Ace was determined to hold true to the company's helpful philosophy, while focusing on brand consistency and further exceeding customers' expectations. With heightened competition it would prove to be one of Ace's biggest challenges to date. |