If history is any indicator, Gardner Hardware Co. in the Minneapolis warehouse district will sail through this recession with minimum damage.
After all, the pioneering downtown business has survived 26 recessions, the Great Depression and the Great Bank Panic of 1893 -- not to mention a fire and the Gateway renewal project, which cost it two prime locations on Hennepin and Nicollet avenues.
Gardner has been a downtown icon since 1884, when founder Herbert B. Gardner, lured by a booming economy fueled by flour milling and rail traffic, journeyed up the Mississippi River from St. Louis in search of opportunity.
If a small-business owner of my acquaintance is right in saying that "flat is the new up" in this painful economy, the present-day Gardner Hardware is doing just fine.
Thanks to the recent two-block extension of the light-rail line and the construction of the new Twins stadium, which drew contractors to the nearby Gardner store on Washington Avenue N., sales so far this year are matching the 2008 numbers.
Which is not to say the business has eluded the downturn entirely: Sales of $490,000 last year were down 7.5 percent from $530,000 in 2007.
But Gardner President Stephen Healy, the fourth generation of his family to run the business, is optimistic that the "Twins stadium and the North Star commuter line will attract more and more residential development," which promises continuing growth.
The founding Gardner opened his store on Nicollet Avenue near 13th Street, peddling wood stoves, oversized bicycles and furniture in addition to the standard hardware, then moved two years later to Hennepin Avenue near 5th Street.
In the ensuing 75 years, the business expanded into locations near 3rd Street -- first on Hennepin, until a fire forced it out, and then on Nicollet.
For most of those years, Healy said, "downtown Minneapolis was a shopping destination" for a much-smaller city. Indeed, it supported both Gardner and another large hardware business downtown.
"It was a neighborhood business back then," Healy said, much like the retailers found today in suburban strip malls.
A change in focus
Then, in 1961, came the Gateway project, Minneapolis' first major downtown urban renewal effort, which forced Gardner Hardware out of its Nicollet Avenue location and left it looking for new quarters once again. But this time an alternate location in the center of downtown eluded it.
"The Gateway renewal raised property prices," Healy said. So his father, Lawrence Healy, opted for the store's present location at 515 Washington Av. N., which is eight blocks from the center of downtown activity and was virtually devoid of the foot traffic on which the store had relied for 77 years.
But the elder Healy had a plan: a wholesale division that supplied general contractors with doors, frames, locks and hinges for commercial buildings in the metro area.
By 2002, Gardner's annual gross peaked at $6 million, 85 percent of it from the wholesale business. But by that time, growing competition from the likes of Home Depot, Menard's and Lowe's had squeezed profit margins of the wholesale operation significantly.
"It generated pretty good revenues, not-so-good profits," said Healy, who sold the business in 2005, paid off company debt and downsized from more than 40 employees to the present 10 -- six of them part-time.
So what has kept the store afloat in its remote location?
"Service," Healy said: repairing windows, lamps and small engines and catering to professionals -- carpenters, property managers and industrial clients -- with heavy-duty tools and building supplies. One strength is an expansive line of large fasteners, including machine bolts, carriage bolts and anchors, and a broad supply of cabinetry hardware and specialized plumbing and machine-repair parts.
Perhaps more important, in the past 10 to 15 years, the nearby warehouses have given way to more and more condominiums -- home to a growing supply of affluent shoppers.
"And there are more coming in the next 10 years," as the new Twins Stadium and North Star commuter line attract new development, Healy said.
In short, Gardner is becoming a neighborhood hardware once again. Think of it as "back to the future" in the hardware business.
Dick Youngblood • 612-673-4439 • yblood@startribune.com
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