The Home Depot

April 26, 2018 Marketing

The Home Depot, Inc. (The Home Depot), based in Georgia, US, is a home improvement retailer. The Company operates The Home Depot stores, which are full-service, warehouse-style stores. The Home Depot stores sell an assortment of building materials, home improvement and lawn and garden products and provide a number of services. The Home Depot stores average approximately 104,000 square feet of enclosed space, with approximately 24,000 additional square feet of outside garden area.

The Home Depot stores serve three primary customer groups: do-it-yourself (D-I-Y) customers, do-it-for-me (D-I-F-M) customers and professional customers. As of January 29, 2012, the Company was operating 2,252 The Home Depot stores, which included 1,974 stores in the United States, including the Commonwealth of Puerto Rico and the territories of the United States, Virgin Islands and Guam, 180 stores in Canada, 91 stores in Mexico and 7 stores in China. The Company also offers over 300,000 products through its Website, homedepot. com.

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One of the co-founders (1978) of The Home Depot along side Bernard “Bearnie” Marcus who is an American pharmacist and retail entrepreneur and philanthropist, is NFL (Atlanta Falcons) team owner Arthur Blank. The Home Depot is the second largest retailer in the United States, behind Wal-Mart; and the third largest retailer in the world, behind Wal-Mart and French company Carrefour. Back in 2004 sales totaled up to $73. 1 billion. It was ranked #13 on the FORTUNE 500 list, The Home Depot also owns a chain of higher-end home decorating and appliance stores.

The continuous rebirth and the work to sustain culture that produces good products, employees, and customers has helped Home Depot maintain its competitive advantage and lead the retail building industry over the years. The company’s management put a lot of emphasis on taking care of its employees, encouraging an entrepreneurial spirit, treating each of all with respect, and being committed to the highest standards. I can attest to this 100% from experience, I’ve been there a whole now as an employee (non intern) and I must say the benefits with the compensation are wonderful.

No other job offers part-time benefits like The Home Depot, benefits such as medical, dental, vision, 401K, and stock options. I myself took advantage of them all, including the associate discounts they have to offer. My sprint cell phone bill is 25% cheaper through The Home Depot company associate discount site. Other discounts include hotel rooms at discounted prices, other electronics like laptops, TV’s and more. The Home Depot makes the community better! I think everyone should look to work for them at some point. SWOT ANALYSIS

Is an effective strategic planning tool that helps you identify and analyze your company’s Strengths, Weaknesses, Opportunities, and Threats. Strengths and Weaknesses are descriptors of the internal operations of your company, while Opportunities and Threats define the external factors that your company faces. Completing this analysis will help you focus on your company’s strengths and help you minimize and work on your company’s weaknesses. Strengths patents strong brand name or reputation among customers high quality products and services new unique products and services

location of company marketing and advertising strategies cost advantage (low costs) good customer service well trained staff “Home Depot’s diversified range of products and services and its wide network of stores enable it to improve sales and increase profitability. Its store inventory consists of almost 40,000 different kinds of building materials, home improvement supplies, appliances, and lawn and garden products. The products offered by the company mainly fall into four categories, namely plumbing, electrical and kitchen; hardware and seasonal; building materials,

lumber and millwork; and paint and flooring. In addition, the company offers a variety of installation services through pre-screened independent contractors. ” The Home Depot, Inc. – Financial and Strategic Analysis Review They’re always looking for ways to take care of its people-providing excellent wages and benefits, superior training, and advancement opportunities. This goes for employees and customers who can always expect exceptional customer service, which is the key to the company accomplishments. Weaknesses lack of patents weak brand name poor reputation poor quality products and services

undifferentiated products and services (not innovative and unique) location of company lack of marketing strategies cost disadvantage (high costs) poor customer service short-handed on staff Not all Home Depot’s strive for excellence! The same strengths The Home Depot has are always there weaknesses. Customer retention is seems to be a big deal in some HD stores. It seems that most of the do-it-yourselfers are not loyal to one particular building supply store, customers look for the following attributes and are willing to shop at different stores depending on their needs/wants.

Opportunities new customer preferences/tastes targeting a new market segment new technology loosening of regulations market led by a weak competitor Home Depot’s biggest opportunity comes from one of its threats, there competitor Lowes seeing as though the lead all competitors including Lowes. Being the only big retailer to offer a number of exclusive, high quality products such as Prego laminate flooring, Ralph Lauren paints, and Vigoro fertilizers gives Home Depot the competitive advantage.

Helping primarily the do-it-yourself customers, which make them an essentially recession-proof market. During a recession Home Depot can survive and even make money. Threats customer preferences change away from the company’s products and services new competitor substitute products developed new regulations taxation The biggest threats to Home Depot are its competitor Lowe’s, which are trying to emulate or even take steps further. Every strategy used by The Home Depot. Wholesale outlets can also affect Home Depot by offering lower prices to professional business customers.

Serving to the DIY industry can also be a threat because it is a very competitive industry and the profit margin is very low. So, if the DIY industry is not managed accurately, a company might end up selling it off , companies such as Kmart. Porter’s Five Forces Model (Home Depot) Bargaining Power of Customers at The Home Depot limits its bargaining power by putting everything a customer needs on the shelf. So the demand for different products or control of the price of the product is low.

They target three different customers which are do it yourself customers, buy it yourself customers, and professional contractors. Bargaining Power of Supplier at The Home Depot has about 12,000 suppliers in which it keeps good relationships with. Home Depot is very much in control of its bargaining power with it suppliers. Home Depot can buy in bulk from suppliers that they get the best discounts, in which then the suppliers don’t really make money. They eliminate the third party which are the distributing centers because they have control of its merchandising inventory.

Threat of New Entrants are There isn’t that much threat of new entrants because Home Depot and Lowe’s have so much advantage over any new entrant in this industry. Home Depot’s advantages is its brand name, a big variety of products, it’s big economies of scale, and its cost leadership quality. So for new entrants its very difficult because all the barriers they have to go through like how home depot and loew’s have influence over suppliers and distributors, their ability to be able to price cut on products, and their brand names.

Threat of Substitutes are that there really is not a true threat of substitutes for Home Depot in which it’s products are home improvement supplies. The reason why is because Home Depot has very low prices and many varieties of products and services. Rivalry One of Home Depot’s biggest rivals in this industry is Lowe’s in which both over very similar products and services. Lowe’s is the second largest competitor to Home Depot. Home Depot compete’s by buying and taking over stores to expand their company. Home Depot is not doing so well, sales are down and Lowe’s is becoming more and more profitable.

Lowe’s is its similar to Home Depot but are different in that Lowe’s target more of the women customers and Home depot target more men customers. “Home depot is using the Best Cost Provider Strategy that provides low prices and quality products to customers. Home Depot want to deliver supportable and profitable growth by extending business and expanding their markets. Home Depot has a saying which is “ You Can Do It. We can Help”, and it means as it creates customer closeness and a collaborative structure between its customers and employees, it can also provide a long-term competitive advantage. ”

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