An independently owned hardware store that has opened on the northern edge of downtown Indianapolis is hoping to build a customer base in a city and industry dominated by national chains.
North Meridian Hardware opened this month at 1433 N. Meridian St. The hardware store occupies 7,500 square feet of space on the first floor of the two-story structure. Store owner Keith Payne, who is purchasing the building, is renovating the second floor to lease to office tenants. The building is being sold by Metropolitan Indianapolis Public Broadcasting Inc., which used the building to house part of WFYI's staff until the station moved to a new headquarters in 2008.
Near North Development Corp. is the lone tenant so far and occupies 2,000 square feet. Payne also operates contractor-supply firm Affordable Building Supplies LLC at 55 S. State Ave. on the near-east side of the city.
The 40-something Payne said his investment in the building tops seven figures.
“We see a need to be here,” he said of the high-traffic location that thousands of commuters pass daily. North Meridian Hardware also hopes to cater to the growing downtown population occupying new and redeveloped condominiums and apartment buildings.
Payne worked extra hard to give the store a traditional yet urban feel that patrons would be hard-pressed to find at a large competitor. Hardwood floors and an open ceiling complement the bright paint schemes, contemporary signage and four flat-screen televisions displaying home-improvement and sports programming.
The store’s inventory ranges from paint and household cleaning items to larger wares such as toilets and hot-water heaters. Payne plans to begin selling name-brand appliances and lumber within the next few months.
He hopes to attract commercial customers to his store as well, stocking inventory that includes concrete wedge anchors too large for residential use.
In addition, he employs a plumber and retired electrician to make service calls.
Payne, an Indianapolis native, graduated from North Central High School and Dillard University in New Orleans, where he earned a degree in regional development planning. He’s been a business owner for several years and is a licensed real estate broker.
He thinks his store can achieve $1.5 million in annual revenue within the next few years, based on a feasibility study by Near North Development Corp.
But it won’t be easy, said Steve Fusek, who in 2004 opened Fusek’s True Value on East New York Street, the downtown area's only other hardware store.
“It’s a struggle,” he said. “Anytime you start from scratch, it’s a long process. It’s not an easy road.”
Although both stores are independently owned, Fusek at least benefits from the True Value brand.
True Value and competitor Ace Hardware operate as cooperatives instead of franchisers. As participants in a cooperative, owners pay no franchise fees and have the autonomy and flexibility to run their stores the way they wish. Store owners pay franchisers to supply their products.
Fusek acknowledged that the True Value brand gives his store credibility but said his name on the moniker provides personality that big-box competitors lack.
Big-box retailers such as Lowe's Home Improvement, Home Depot and Menards dominate much of the home-improvement turf. Together, the three chains count more than 30 locations in central Indiana.
But smaller players such as Ace, True Value and Do It Best Corp. in Fort Wayne have found a niche by touting better customer service and convenience.
“Smaller hardware stores are all built on service and convenience,” Fusek said. “If you don’t offer that, then you’re going to get beat on price. That’s really the key.”
As for whether two hardware stores can co-exist downtown, only “time will tell,” Fusek said.
Roughly 36,000 independent home-improvement retailers operate in the United States and Canada. Ace, True Value and Do It Best comprise about a third of the total, said Bill Lee, president and CEO of the Indianapolis-based North American Retail Hardware Association.
The number of independent stores has remained stable the past decade, debunking the notion that Lowe’s and Home Depot have driven them out of business, he said.
“There’s a place for a retail format that is totally different,” Lee said. “It’s like Aeropostale selling clothes even though Wal-Mart and Target sell a lot more.”
Payne is confident North Meridian Hardware will be successful. He believes luring customers to the store is a lot like fishing.
“They do what I call a 'recon,'” Payne said. “They come in here, and once they feel comfortable they finally bite.”