Home Depot

The original stores stocked around 25,000 products and were attached to Treasure Island stores. As of January 29, 2006, Home Depot operated 2,042 stores, including 2,984 Home Depot stores (137 in Canada and 54 in Mexico), 34 EXPO Design Centers, three Home Depot Supply stores, 11 Home Depot Landscape Supply stores, and two Home Depot Floor stores.

Home Depot is the world's largest home improvement retailer, with revenues in excess of $80 billion. The company mainly operates retail warehouse-type stores that sell a wide assortment of building materials, home improvement and lawn and garden products. Stores average approximately 105,000 sq. ft., plus 23,000 sq. ft. of garden center and storage space. It stocks 35,000 to 45,000 items, including brand name and proprietary items.

Home Depot stores serve three primary customer groups: Do-It-Yourself (DIY) customers, typically homeowners who complete their own projects and installations; Do-It-For-Me (DIFM) customers, usually homeowners who purchase materials and hire third parties to complete the project and/or installation and; Professional Customers, consisting of professional remodelers, general contractors, repair people, and trades people. By product group, plumbing, electrical, and kitchen (29% of FY 06 revenues) represented Home Depot's largest source of revenue, followed by hardware and seasonal (27%), building materials, lumber and mill work (24%), and paint, flooring and wall covering (19%).

As the world's largest home improvement retailer, Home Depot's competition runs a number of lumber yards, specialty interior stores that concentrate on one aspect of the home (kitchens, lighting, flooring, etc.). Their competition also encompasses other retailers such as Sears, Ace Hardware, Frank's Nursery, and Lowe's. Lowe's companies are Home Depot's largest competitor. Home Depot and Lowes have very similar product offerings and large warehouse formats. In many major markets Lowes and Home Depot go head to head both vying for the patronage of the do-it-yourself customer.

Because of the competitive nature of the retail industry, Home Depot's success depends on price, store location, customer service, and wide product selections. In each market that Home Depot serves there is a plethora of specialty home improvement stores that have the potential to cutting into Home Depot's market share. Home Depot's overlap with primary competitor, Lowes, poses a potential threat.

In the minds of consumers, Home Depot may be seen as interchangeable with Lowes which in turn decreases customer loyalty. Also when a Lowes enters a market that is only served by Home Depot, Home Depot's sales have a tendency to decrease by up to 15%.

Home Depot Direct offers customers expanded merchandise selection and extra time convenience through Website and catalog shopping, with direct product delivery ot the home, office, or job site. It also provides customers with online information about home improvement topics and merchandise for sale in local Home Depot stores.

Its primary website is located at homedepot.com. The site offers an assortment of products available for sale, information about its products and projects, calculators to estimate the amount, and kinds of materials needed to complete a job, as well as information about the Home Depot and links to other Home Depot Direct online businesses. Through homedepot.com, Home Depot Direct offers an assortment of over 30,000 items for sale. These items are selected bases on their potential for online sales.

In the last twenty-five years Home Depot has stayed on top by developing marketing strategies that attract customers. The key to their success in the past has been short waiting times in the checkout line, friendly, knowledgeable sales help, easy credit, liberal return policies, and post purchase services.

However, in 2002 sales at Home Depot dropped because customers were dissatisfied with the service they were receiving. In 2003, Bob Nardelli, CEO of Home Depot, started implementing innovative technology in order to speed up waiting times and make the shopping experience at Home Depot easier for the customer. Based on this information, continued gain in stock value, and a constant demand for home improvement products I would invest in Home Depot.

Home Depot is a company of high moral standards and is constantly giving back to the community. For instance, they have a strict policy on where they receive their wood from. To protect endangered forests and ensure that there will be timber for future generations they only accept wood from forests managed in a responsible way. When Katrina devastated much of the Gulf Coast Home Depot sent millions of dollars of materials to help rebuild. They also supply our troops in Iraq with millions of dollars worth of tools to help rebuild.

Finally, Home Depot gives back to the community. Their programs bring together volunteerism, do-it-yourself expertise, product donations, and monetary grants to meet critical needs and build affordable communities.

Community efforts focus on four key areas: building and refurbishing playgrounds; ensuring the safety and accessibility of community gathering spaces, building and refurbishing affordable and transitional housing; preparing communities for emergencies.