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Ace Hardware
Ace Hardware stores sell high quality home improvement products while emphasizing a helpful, personalized shopping experience. As the largest retailer-owned hardware cooperative in the world, Ace’s brand strategy is to enjoy the best of both worlds: harnessing the buying power of its thousands of stores while differentiating from the giant big box chains through convenient, locally owned neighborhood locations staffed by personable, expert associates. Ace franchisees have the opportunity to convert from privately owned hardware stores to shareholders within the company. More about the cost of owning an Ace Hardware franchise below.
Facts & figures
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Ace Hardware Franchise Opportunities - History
Chicago’s Richard Hesse, E. Gunnard Lindquist, Frank Burke and Oscar Fisher founded the Ace Hardware organization in 1924. As the company progressed and built a reputable name for itself, the idea of Ace becoming a retailers' cooperative grew into a realistic opportunity. In 1976, Ace hardware stores were officially on the market for entrepreneurs looking to invest in a promising association. There are currently more than 5,000 independently owned Ace Hardware stores operating across the globe (though most are in the United States), making Ace the largest retailer-owned appliance cooperative in the world. Today the Ace Hardware family of stores generates nearly $16 billion in sales (versus approximately $100 billion in revenue for Home Depot).
Ace Hardware Franchise Cost, Requirements And Franchise Profit
To become an Ace Hardware franchise owner, franchisees must have $250,000 in liquid capital, with a minimum net worth of at least $400,000. New Ace Hardware franchise owners can expect to pay a $5,000 franchise fee for the rights to open their own Ace Hardware franchise location, but it costs anywhere from a total of $272,500 to $1,574,230 to open an Ace Hardware franchise, assuming this is a new location. There is no royalty fee with an Ace Hardware franchise; instead, store owners are distributed a percentage of overall profits.
An alternative approach is to convert an existing hardware retail store into an Ace Hardware franchise location. Ace reports that converted stores typically experience an 11% lift in retail sales, 12% increase in gross margins, and a 24% boost in gross profits post conversion. Ace offers special incentives for conversions, depending on the size, setup, and product mix of the store in question.
A final option is to add an Ace Hardware as an extension to an existing independent grocery business, to take advantage of existing foot traffic. There are over 200 Ace Hardware + Grocery combination franchises across the United States. This option requires no franchise fees and no royalties. In addition, Ace will supply free initial inventory.
