...Primary Competitor Analysis Competitor Name: The Home Depot, Inc Headquarters: Atlanta (Cobb County), Georgia Locations: 2,200 Retail Stores in U.S., Canada, and Mexico Annual Revenue: 2013-$74,754,000,000 2014-$78,812,000,000 2015-$83,176,000,000 Slogan/Motto: “More saving. More doing.” Primary Products: -Building Materials (40,000 different kinds) -Tools/Hardware -Appliances (kitchen/bath/décor) -Lawn and Garden Products -Electrical, Plumbing, Flooring, & Heating/Cooling Supplies Primary Services: -Home Depot Home Services (national installation service with pre-screened independent contractors) -Free How-To Clinics -Kids Workshops Primary Target Market: The Home Depot’s primary target markets are the do-it-yourself customer, the do-it-for-me customer, and professionals. This mainly includes Generation Y white, Hispanic, and black males, across the United States with pretty much any education level. Distribution Strategy: Network of distribution centers for store replenishment and ...
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...Management Analysis The CEO and leader of Home Depot is Craig Menear. He has more than three decades of experience in the retail and hardware home improvement industry, more than half of which have been with the company. This makes me a smart choice to lead the best home retailor in the country. At age 57 he has a vast experience and knowledge of his craft which makes him the obvious choice to lead The Home Depot. He should be in this position for many years to come seeing how in 2013 under Craig’s leadership, HomeDepot.com sales grew 50 percent and accounted for $900 million of the company’s total sales growth of $5 billion. The Home Depot has a functional structure which maintains a CEO with a small corporate staff along with managers in organizational areas such as production, accounting, marketing, R&D, engineering and human resources. Separating the organizational areas of a company allows for specialization in each functional area. However, this separation can have a negative effect as it makes communication between these areas more difficult. The multidivisional structure consists of different divisions which represent separate businesses which corporate officers that dictate responsibilities to lower level personal. This allows officers to monitor each businesses performance more effectively. Officers can easily compare divisions and help improve the performance of a poorly performing division (Celinski, 2014). The Home Depot typically promotes from within the company...
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...costs of capital, current financial statements, and macroeconomic trends were all used in creating assumptive ratios and growth rates. With five year projected financials, Galeotafiore applied these projections to current company metrics in an effort to publish an accurate forecast. Before finalizing these projections, it is recommended that Value Line produce a detailed qualitative analysis to support the numbers. The purposes of this analysis are to 1) provide detailed forecast analysis for hardware giants Home Depot and Lowe’s. 2) compare these assumptions to the industries previous and potential performance 3) provide a judgment for Value Line readers for potential stock investment actions. Although these two companies have risen to the top of this industry it is recommended that investors hold their current investment position on both companies, as opposed to buy or sell. Problem Formulation As Galeotafiore prepares to release Value Line’s forecasts, there are several important factors that must be taken into consideration. Primarily, are the numbers used in the models for Home Depot, found in Exhibit 7, dependable? Can both companies be expected to achieve similar growth rates or has market saturation been reached? Next, is Galeotafiore properly accounting for macroeconomic trends? In the near future, interest rates are predicted to rise and new housing starts are expected to decline. Both companies perform better when these trends are moving in the opposite...
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...ZhangAlex Zurbuch | Mingle Li | | Fin 470 Oct 16, 2011 Value Line Publishing There are two leaders for retail building-supply industry: Home Depot and Lowe’s, the two companies captured more than third of the total sale of the industry. Home Depot hold 22.9% market shares of the industry and Lowe’s hold 10.8% market share. Two companies are head to head competitor but focus on different market, Home Depot focused on large metropolitan areas and Lowe’s focused on rural area. Two companies both maintained online stores. Lowe’s has its own Web site: “Accent & Style” and focused on professional customer. Home Depot developed new type of retail stores in urban area and provide products and services in a compact format. Home Depot developed its first international retailer in 1994 and 10% of Home Depot international stores were built in global area at the end of 2001. Home Depot has 1,333 stores and 256,300 employees in 2001 and Lowe’s has 744 stores and 108,317 employees in the same period time. Return on equity shows how well a company uses investment funds to generate earnings growth. Generally a return on equity between 15% and 20% are considered desirable. Home Depot’s five year returns on equity all between 15% and 20% and Lowe’s five year returns on equity mostly less than 15%. The data prove Home Depot got higher net earnings than Lowe’s. Gross margin can use to determine the value of increasing sales. The higher gross margin means the company...
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...Lowe’s Home Improvement Stores Sheila Thomas Webster University Abstract Lowe’s exists to help customers improve and maintain their biggest asset- their home. We do this by meeting the changing needs of our customers by providing inspiration and support whenever and wherever they shop. Whether our customers shop in store, online, by phone, or if we’re meeting them at their home or place of business, Lowe’s is ready to help. In our more than 1,830 stores, we have implemented multiple systems to improve the customer experience, including an upgraded store information technology infrastructure that allows customers and employees to access richer product information, enjoy an endless aisle of product choices and manage their projects from inspiration to enjoyment (Lowe’s.com). Online, we are rapidly expanding our assortments to offer customers a broader range of products that can be researched and purchased online, in store or via our mobile app. MyLowe’s makes it easy for our customers to automatically track and store all purchases on their online customer profile. We’ve vowed to “Never Stop Improving” so we can satisfy the ever-changing needs of our customers (Lowe’s.com). Lowe’s operates more than 1,830 stores in the United States, Canada and Mexico. We serve approximately 15 million customers each week and employ more than 260,000 people (Lowe’s.com). Our stores stock 12 product categories ranging from appliances and tools, to paint, lumber and nursery...
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...EXECUTIVE SUMMARY The Home Depot is an American retailer of home improvement, construction products and gardening products. Frank Blake is the Chairman and Chief Executive Officer of the Home Depot. The Home Depot was founded in 1978 and it is considered the largest home improvement retailer globally. Home Depot has 1786 stores within USA, Mexico, Canada, China, United Kingdom and South America. Competitions in the home improvement industry are based on several factors such as price, quality, durability, product features, customer preferences and warranties. The Home depot has shown its excellent past growth with the products involved in home construction, maintenance, renovation and remodeling. The Home depot has its main target market in...
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...case follows the performance-review and financial-statement-forecasting decisions of a Value Line analyst for the retail-building-supply industry in October 2002. The case contrasts the strong operating performance of Home Depot with the strong stock-market performance of Lowe's. Students examine a financial-ratio analysis for Home Depot that acts as a template for generating a comparable ratio analysis for Lowe's. The student ratio analysis is designed to build intuition with respect to interpreting individual ratios as well as ratio interrelationships (e.g., the DuPont framework). The historical-performance comparison suggests that investors are skeptical of the ability of Home Depot to maintain its performance trajectory, yet they project sustained improvements for Lowe's. Students are invited to scrutinize the analyst's five-year income-statement and asset-side balance-sheet forecast for Home Depot. The case expressly focuses on the asset side of the balance sheet as a preview for other cases using free-cash-flow forecasting. The Home Depot forecast exercise exposes students to the mechanics of financial-statement modeling and sensitivity analysis, which they can use in building their own forecast for Lowe's. Finally, the strong-growth assumptions for Home Depot relative to the modest-growth forecast for the industry suggest that the company can be expected to capture massive and perhaps unreasonable market share in the near term. The exercise provides a striking example of...
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...Global Fortune 500 Company Home Depot | Economics for SocietyAyesha MuhammadSeptember 1, 2014 | Global Fortune 500 Company Home Depot | Economics for SocietyAyesha MuhammadSeptember 1, 2014 | Global Fortune 500 Company Home Depot Home Depot is one of the largest home improvement retailer in the world. With stores in the United States, Canada, Mexico and China. Home Depot was founded in 1978 by Arthur Blank and Bernie Marcus, along with investment banker Ken Langone and merchandising guru Pat Farrah. Their vision was to open a store as a one-stop shopping for the do-it-yourself individual. Home Depot opened their first store on June 22, 1979, in Atlanta, Georgia. In 1981 Home Depot went public on NASDAQ and moved the New York Stock Exchange in 1984. Between 1980’s thru 1990’s the company saw tremendous growth, in 1989 the company celebrate their 100th store opening. The company wish to expand their store globally, so they open the first home improvement centers in 1994 in Canada with the acquisition of Aikenhead’s home improvement centers, in 2001 under the acquisition of Total HOME that expand the vision in Mexico, and 2006 the company extended its reach to China by acquiring the The Home Way, a 12 store chain. Their global expansion demonstrates how The Home Depot combines its vast knowledge of the home improvement industry with the needs, shopping trends and customs of each unique geography to best serve customers. They are committed to being a global...
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...Home Depot vs. Lowe’s Retail Home Improvement Financial Analysis Background Introduction The home improvement sector of the economy is large with two major players in the industry and with many smaller local and regional competitors. These two major competitors are Home Depot and Lowe’s. These two companies account for over $110 billion in total sales each year. Even though sales have gone down over the past few years due to the downturn in the economy they have not gone down nearly as much as home sales and this is due to more people deciding to do more home improvements to their own home then buying a new home. Both of these companies have been able to keep up sales and increase them year over year by improving current stores and at the same time expanding both here in the United States and overseas. Company introduction Home Depot The Home Depot also known as Home Depot is a retailer of home improvement and construction products and services. The Home Depot was founded in 1978. The Home Depot operates 2,242 stores across the United States in all 50 U.S. states, the District of Columbia, Puerto Rico, the Virgin Islands and Guam. Sales within the United States were over $77 billion in 2010. The Home Depot also operates internationally in Canada, Mexico and China. Lowe’s Lowe's Companies, Inc. is a retail home improvement and appliance stores and also does construction. Lowe’s was founded in 1946 in North Wilkesboro, North Carolina. Lowe’s operates 1,710 stores...
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...THE HOME DEPOT, INC. Introduction 1. Identify the company’s mission, vision, and primary stake holders. 2. Identify the five forces of competition and how it impacts the company. 3. Create a SWOT analysis for the company identifying the major strengths, weakness, opportunities and threats. 4. Based on the SWOT analysis, recommend how the company may capitalize on its strengths and opportunities, and minimize its weaknesses and threats. 5. Discuss the various levels and types of strategies the firm may use to maximize its competitiveness and profitability. 6. Determine the recent corporate governance issues that are currently affecting the company’s decisions and report how the company is or should be handling the issues. 7. Use 4-5 external sources as part of your assignment. Introduction Home Depot, Inc. is the world’s largest home improvement retailer with 2,246 retail stores in all 50 states in United States, the District of Columbia, Puerto Rico, Virgin Islands, Guam, 10 Canadian provinces, Mexico, and lastly China. HD (Home Depot) provides employment to approximately 321,000 full time employees. HD stock is traded on the New York Stock Exchange (NYSE:HD), is included in the Dow Jones industrial average and Standard & Poor’s 500 index. This company sales a range of building materials, home improvement and lawn and garden. (Poor's, 2011) Home Depot was found by Bernie Marcus and Arthur Blank, on June 29, 1978. Their vision was to create and...
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...10-mar-2015 THE HOME DEPOT, INC. 1. Evaluate The Home Depot's growth strategy. The Home Depot innovated in the home center industry by bringing a new retailing concept. One of the most important decision was to cut out completely the warehouse costs by designing retailing stores in a warehouse format in which all the inventory was already at store. This format helped The Home Depot to keep Overhead costs low and as a consequence, past these savings to their customers. This practice also led The Home Depot to work with a higher volume, lower margin and higher inventory turnover, a good indicator for retail companies which in turn helped to reduce costs even more. Having the warehouse format also helped them minimize out-of-stock occurrences, which helped them to have a stronger relationship with the customer, to whom they offered guaranteed products, by either the manufacturer or themselves. Customer service was so important for The Home Depot that 90% of their employees were fulltime works with special trainings of technical knowledge to help their customers with home improvement projects, and their advertising program included in-store demonstration of do-it-yourself which helped the Home Depot grow successfully in its early years. 2. How well did the company implement its strategy? Analyze The HomeDepot's financial performance and cash flow during the fiscal year 1985. How well did the company perform in 1985 relative to the previous years? How does The Home Depot's performance...
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...look at Home Depot in how they are the leader of their industry. Than it will delve into how they can maintain their leadership over their major competitor Lowes; this paper will include a brief background on each company, and how they stack against each other in history’s timeline. Analysis Brief History The Home Depot was founded in 1978 by Bernie Marcus and Arthur Blank; the first stores that opened were approximately 60,000 square feet having in stock over 25,000 SKUs which made look competition look small. To the consumer they also appeared to have more product than they actually did, as they placed boxes on shelves super high give the illusion of even more product (homedepot.com). Currently Home Depot operates just over 2, 200 stores across all 50 states, Puerto Rico, Mexico, Virgin Islands, and Canada. Compared to their top competitor Lowe’s, Home Depot is relatively young company. Carl Buchan originally founded Lowe’s in 1946, where the first store was in North Carolina originally named the North Wilkesboro Hardware Company. The name Lowes stemmed from that fact they had the lowest prices originally as they eliminated wholesalers and dealt directly with manufacturers (lowes.com). Currently Lowes has just over 1,825 stores throughout the United States, Canada, and Mexico (lowes.com). Somewhere along the lines, Lowes slipped up and Home Depot passed them up, making Home Depot the number one worldwide in their industry. There are several things that Home Depot has started...
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...and Services For most people, their home is the biggest financial and emotional investment they make. Through a variety of innovative merchandise and services, The Home Depot’s goal is to help consumers create the home of their dreams whether they want to do it themselves or have it done for them. In addition we offer specialized support and services for professional contractors and tradespeople to ensure they have the right tools and supplies for the job site. Products: Our store inventory consists of up to 40,000 different kinds of building materials, home improvement supplies, appliances and lawn and garden products for all of your project needs. Selections may vary from store to store because The Home Depot stores are always stocked with merchandise that is localized to match your area's specific market needs. We even offer a low price guarantee to beat anyone's advertised specials. And if for some reason you can't find it in the stores, we offer 250,000 other products that we can special order for you. Services Home Services Instead of doing it themselves, many customers choose to have qualified professionals complete home renovation projects for them. The Home Depot Home Services offers national installation services through pre-screened independent contractors for products ranging from floors to roofs, windows to water heaters, and kitchen cabinets to vinyl siding. Customers can call 1-800-HOMEDEPOT to schedule a free in-home consultation or learn more about the...
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...proposal is going to be on a strategic plan research for The Home Depot. The research will review where is the company headed with the organization’s future and what resources are needed to accomplish these plans. The strategy will provide step-by step directions for management goals and communicate with stakeholders the ongoing procedures. Researchers will benchmark the process to be able to measure the progress of the organization. The paper will illustrate the overview of Home Depot’s mission, vision, and value statements. These factors will give the strategic plan validation and what sources will be used to conduct an external and internal analysis. The analysis will allow The Home Depot to reach it’s set goal of being the biggest home improvement store in the world. * Mission, Vision, and Values Validation Home Depot’s mission, vision, and values are the focus in making the organization become the biggest home improvement retailer in the world. The plan decided will work for the organization’s mission and strategy necessary to achieved the productive goal. The achievement will be a success with an action plan developed by management. Home Depot’s mission is to be the number one home improvement retailer and offer customers the best products for fixing their home at the best prices in the market. The solution is set on products, quality, inventory, and the fairness of low prices. * Vision and Values The Home Depot’s vision and values guide the beliefs and actions...
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...External Environment Analysis Kristy Sanchez MGT/488 September-Sunday 11, 2011 Jeannette Guignard External Environment Analysis Introduction This essay is written in regards to the Home Depot and the evaluation of their external environment. The Home Depot is a highly successful retail industry that has expanded globally. The Home Depot has a wide variety of supplies and materials for all home improvement projects. They even have tools, equipment, and trucks that can be rented out to assist with any larger home improvement needs. The Home Depot has made a continuity plan to assist with protection of the customers, associates, and the industry if a crisis or disaster occurs. A continuity plan is basically the instructional list or procedures for the company in the event that a crisis or natural disaster occurs and how they will handle that event. This essay will look at how the external environment affects that plan. This essay will also look at the affects of the environment in three other areas as well, including general, industry, and competitor. Finally, it will look into the business ethics and see how they play a role when gathering information for competitor intelligence. The Home Depot has a continuity plan that they follow that can be found in their code of conduct and ethics manual. That continuity plan is as follows: “We are committed to taking all reasonable steps to minimize risks to our associates, customers, facilities, information assets and supply chains...
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