CRAIG T. KOJIMA / CKOJIMA@STARBULLETIN.COM
City Mill stores are aiming to attract customers from the federal government, after competitor Home Depot told store managers not to do business with the government. City Mill employee Lyla Domingo holds up the store's promotional materials at its Nimitz Highway location.
Home Depot Island hardware stores are offering a big aloha to what they see as a group of important customers spurned by one of the mainland newcomers of recent years, Home Depot.
spurns feds;
competitors
go for market
The Atlanta chain said it won't do
business with the federal governmentBy Russ Lynch
The Atlanta-based chain over the past few weeks has notified the managers of its 1,400 home improvement supply stores, including those in Hawaii, that it does not want any of the stores selling to the federal government.
The company's main concern is the "Impact Card," also called GSA SmartPay, that thousands of federal employees in Hawaii use to buy goods and services for their bases in the Air Force, Army, Navy and Marines and for civilian agencies.
Home Depot appears worried about affirmative action and other hiring requirements that it might be able to avoid if it is not seen as a federal contractor or subcontractor.
Home Depot officials said the policy is nothing new and has been in place since the company was formed in 1978. But apparently the retailer felt a reminder was needed.
All the more business for us, say the big-box chain's competitors.
City Mill outlets yesterday were getting set to put up posters welcoming purchasers from the military and other parts of the federal government, said Carol Ai, vice president of the 100-year-old local company.
"We can't understand what they're doing," she said of Home Depot.
City Mill learned that Home Depot was telling its stores not to do business with the military through the purchase card -- which is required now for all federal purchases under $2,500 to avoid the costly paperwork involved with purchase orders.
"But we take the cards. Since we've learned that (Home Depot was dropping out) we're telling everybody we take it. We're putting up posters," Ai said.
"They (Home Depot) must realize the lack of sales that will occur" in this community where military purchases are a big part of the economy, she said. "And we really don't understand, but we see it as a good opportunity for us," Ai said.
The policy at Home Depot seems well thought out, she said, but she and other retailers can't see the logic. "We are baffled, honestly," she said.
Barry Lundquist, chief operating officer of Hardware Hawaii and a member of the family that founded the business in the 1950s, said he doesn't see Home Depot's decision as any reason for his stores to change their open sales policy.
"We do accept basically all customers and I don't think we'd have any problems. We have a lot of veterans working for us and we don't even think about these issues," he said. "We welcome all customers and it doesn't have anything to do with the federal government or not."
His company's flagship store in Kailua is just a few miles from Marine Corps Base Hawaii in Kaneohe.
At Kilgo's, another old local hardware store, Kari Kaauwai, operations manager, said she had not heard about the Home Depot policy but she knows the federal card as a good source of revenue for her business and has no reason to change.
"There are a lot of people who use it," she said.
The Lowe's Home Improvement Warehouse stores in the islands also accept the cards as well as purchase orders from the military or other federal agencies, said a spokeswoman, Chris Ahearn.
Military purchasing officials said the purchase cards have sped up and simplified purchasing and Home Depot has been a major source of supplies.
No figures were available about how much business Home Depot has been doing locally through the card.
Late yesterday, a West Coast spokesman for Home Depot said the policy is old.
"We are not a federal contractor, nor do we intend to become a federal contractor, and as such we cannot do business with the federal government," said Chuck Sifuentes, a Home Depot spokesman in Orange, Calif.
Sifuentes confirmed that the recent reminder to store managers included wording about three sections of the federal law that outlaw hiring discrimination and require specific affirmative action by contractors or subcontractors to federal agencies.
One of those rules requires favoritism for some veterans if the company doing the hiring does business worth $25,000 or more with the federal government.
"But if you look at our stores, we hire veterans. It's more of a compliance" matter, Sifuentes said.
