• Home > eNews
  • >
  • Flying high with Ace Hardware

Flying high with Ace Hardware

An airline pilot, an empty building and an NCB loan connect to create a new Houston business

Greg Farrell got tired of waiting for something good to happen in the airline industry.

A commercial pilot since 1996, Farrell had witnessed airline failures, new security restrictions and the industry’s turmoil. Even after he moved to Houston, Texas, in 2006 for a better flying schedule, he was determined to find another line of business.

"My wife, Tammy, and I always knew there was something different, something better out there for us," Farrell says.

Farrell’s search has paid off. Today, the 39-year-old maintains his commercial pilot’s license. But these days, he’s also flying high with a new business he calls "my piece of the American dream."

The Farrells are two of the nation’s newest Ace Hardware store owner-operators. With the help of a $710,000 Small Business Loan through NCB, the couple opened Lone Star Ace Hardware in December 2008 in Spring, Texas.

The young entrepreneurs expect to exceed $2 million in revenues for 2009 and are already dreaming of one day owning multiple Ace stores.

Taking on the retail venture has taught him "diligence, persistence, patience, humility and humor," says Farrell. "I’ve learned from Ace and from NCB that, at the end of the day, everybody wants a success story. Ace and NCB did everything they could to help us be successful."


When Farrell was growing up in St. Louis, Mo., it seemed to him that an Ace Hardware store sat on nearly every corner. "Ace was the place to go with my parents," Farrell recalls.

Years later, while searching for his post-pilot career, Farrell remembered the Ace stores where he’d shopped over the years. Intrigued with the home improvement chain, Farrell did a little homework. He learned that Ace’s 4,400 stores are independently owned and operated by local entrepreneurs. Houston, the nation’s fourth largest city with 6 million people, counted only 31 of the "helpful hardware" stores.

Farrell’s homework also revealed that Spring, a north Houston suburb, was home to many new and first-time home-buyers and young families, "people who would attempt to do home-improvement projects themselves before paying others to do it," Farrell says. Moreover, the closest home improvement or hardware store was a 30-minute drive through heavy traffic.

The Farrells soon identified a vacant Eckerd Drug store in their community as a prime location for a hardware business. Closed after CVS/pharmacy bought the Eckerd chain in 2004, the building sat in a high-traffic area of retail businesses, including a Kroger supermarket, CVS store, gas station and banks. The couple was sure the area would continue to grow.


Farrell took his first official step toward Ace late one Monday night in January 2008, submitting an online application to be a store owner-operator. The next morning, Alberto Vidal, business development manager for ACE’s Gulf Coast region, called Farrell. By Wednesday, Farrell and Vidal were meeting.

Things happened quickly after that. A face-to-face meeting with the property developer who owned the vacant Eckerd building resulted in a successful lease. In March 2008, the Farrells attended an Ace New Investors Conference in Dallas. There, Vidal introduced Farrell to NCB vice president Brian Misenheimer.

NCB specializes in financing U.S. cooperatives and their members. The bank could particularly understood Farrell’s needs as he began his Ace venture. Over the past 20 years, NCB has handled 101 loans totaling more than $69 million with Ace retailers.

NCB and the Farrells clicked. The bank was impressed with the couple’s high personal credit scores, their willingness to inject significant equity into their new Ace business, and their plan to remain partially employed -- Greg as a pilot, Tammy as a registered nurse -- during the early stages of growing their new business.

The Farrells immediately began the process of securing a Small Business Loan through NCB. They submitted plenty of paperwork, including a business plan. "But NCB made it as painless as they possibly could to get us into the store," Farrell recalls.


While waiting for his loan to go through, Farrell and his father-in-law, Craig Roth, spent five days in April 2008 in a New Owners Institute training class at Ace headquarters in Oakbrook, Ill. Roth had agreed to be the new store’s full-time manager. His career includes 25 years in the Air Force and 14 with Circuit City.

In July, Farrell and Roth spent another week at Ace in the co-op’s "Top Gun" retail training program. The two men also began an eight-week mentor training process through Ace. The co-op connected them to Houston’s Central Ace in Houston, whose owners, Ron, Mike and Sandra Williams, operate four stores in the city. Farrell and Roth worked two to four days a week at Central Ace.

"We did everything from front to back door," Farrell says. "That was the best, most informative, priceless training we could have gotten as new Ace investors and owners."

Finally, in September 2008, the Farrells closed their NCB loan and signed the building lease, all in the same week. The renovation of the 13,000-square-foot store was completed by Nov. 16, 2008. The Farrells and their family members went to work, putting fixtures and merchandise into place, and hiring what would eventually be 24 employees.

On Dec. 16, 2008 - just 11 months after Farrell first reached out to Ace -- Lone Star Ace opened for business. A grand opening followed on the weekend of March 6-8, 2009.

"It was outstanding," Farrell says. "We did $50,000 in sales over those three days."


Today, the Farrells are charging ahead with their new store and reveling in the community’s response.

"If I had a dollar for everyone who told me, ‘Thank you for opening a neighborhood hardware store,’ I could retire today," Farrell says.

High seniority at the airline gives Farrell a flight schedule that allows him to be home every night. He still flies cross-country and into Mexico and Canada too. But since the store opened, he’s averaged only three flying days per month. The rest of the time, the Farrells are at the store. Tammy has quit her nursing job and is a full-time mother and store owner. Even the couple’s three young children help out, wearing Ace’s trademark red aprons and name tags.

Business is strong, with the store seeing 600 customers on a typical Saturday. Farrell projects sales revenues to increase to more than $3 million in 2010.

"Our goal is to pass on this business to multiple generations of our family," he says.

Farrell credits his father, Byron, for mentoring him through his new Ace venture. "He has been a vital part of our success," the younger man says. "Without his assistance, support and guidance, this would not have been possible."

The Farrells are still learning about the daily challenges of the retail business, from vendors to employees to customer relations. And Farrell is sure that continuing growth in the Houston area will someday bring another independently owned hardware store to the neighborhood. But when that competitor opens its door, it will have to reckon with Lone Star Ace, where "customer service is our No. 1 priority on everything," he says. "That will bring our customers back."

For NCB, Lone Star Ace’s successful launch reaffirms the bank’s mission to strengthen the nation’s communities.

"Lone Star Ace is a perfect example," Misenheimer says. "It’s a beautiful store in a great neighborhood and a great opportunity. Greg was great to work with. Despite the current economy, businesses are still starting and doing well where the location and market concept are right."


For more information, contact NCB’s Brian Misenheimer at (703) 302-1956 or bmisenheimer@ncb.coop. Learn more about Ace Hardware at http://www.acehardware.com.