Woolworths signs Hills Hoist deal

Woolworths has signed a deal with Hills that grants the retailer exclusive rights to the Hills brand of garden products including the iconic Hills Hoist.

The licence is for a minimum period of seven years with Woolworths having three options for renewal for further four year periods.

Hills will maintain ownership of its heritage brand and the intellectual property in product patents and designs including the intellectual property in the Hills Hoist clothesline.

In addition, Hills will receive income from the use of the brand and intellectual property by way of an undisclosed annual licensing fee that has the potential to increase if product sales exceed agreed levels.

“This agreement will also allow Hills to focus on building our technology business, particularly our security and healthcare portfolio to achieve our stated growth ambitions,” Ted Pretty, Hills Limited CEO, said in a statement.

“Additionally, we will enjoy greater certainty of earnings and a strengthening of our profit performance. There will be a positive impact on the balance sheet from the reduced requirement for working capital.”

As The Australian reports, Hills invented the rotary hoist 70 years ago. Since then, the product has become a national icon. However, the hoist and the company’s other garden products are now made in China and elsewhere.

Pretty said the agreement with Woolworths takes “a link out of the supply chain.”

Now Woolworths will handle orders, transport, warehousing, distribution and retail. Hills will simply collect a licensing fee.

For its part, Woolworths hopes the deal will help its ailing Masters hardware chain.