NOVEMBER 11, 2024
Here’s how True Value went bankrupt By Ally Marotti
Six years ago, True Value was fresh off a $229 million private-equity infusion, with plans to open distribution centers and invest in its supply chain. But after product shortages fizzled the pandemic home renovation craze, those plans went awry. The Chicago-based home improvement company with almost 170 years of history filed for Chapter 11 bankruptcy protection in mid-October. It is seeking to sell its business to Do It Best, a
hardware rival that offered to pay $153 million in cash for its floundering competitor. True Value has warned that if that deal falls through and it fails to find another buyer, it could lay off 900 employees. Though most hardware companies have seen sales slow since the pandemic — Home Depot, a company with 10 times True Value’s revenue, has reported declining same-store sales for seven straight quarters — experts say True Value's problems likely began around the time it received
MIKE MOZART VIA FLICKR
The retailer’s downfall began with a $229M infusion from private equity six years ago
that capital infusion in 2018. Long owned by a cooperative of retailers, True Value sold 70% of the company to Acon Investments, a private-equity firm with companies such as retailer Spirit
Halloween and cooler company Igloo in its portfolio. True Value used that money to invest in its supply chain and shift its business strategy toward wholesale. The company built new distri-
bution centers and started using a centralized hub to more efficiently ship products. It moved online shopping to the local level, to try to tailor the shopping experience. But hardware stores can be a tricky business to supply. The weather triggers demand for many of the products — think snow shovels or garden spades — and the arrival of, say, the first snowfall or springtime is hyperlocal and unpredictable. Success hinges on having those products in the stores at exactly the right moment. With big-box competitors like Lowe’s and Home Depot See TRUE VALUE on Page 22
Augie and Sylvia Emuwa near their new home in North Carolina
The Great Migration — in reverse LOGAN CYRUS
Black residents who leave Chicago say it no longer offers what they and their families need I PAGE 13
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GREG HINZ With D.C. clout gone, Chicago and Illinois are now entering a new era. So is the CTU. PAGE 2
COMMERCIAL REAL ESTATE In Fulton Market, a sign development site prices may be tipping downward. PAGE 3
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