Home Depot began business in 1979 with two stores in Atlanta, Georgia. At the end of January 1996, the company operated a total of 600 stores in more than 90 regional markets in 30 states, three provinces in Canada, and the District of Columbia. Home Depot is a "warehouse" store for the home improvement industry, and has changed the way that Americans purchase items in these categories. Its stock is sought after by investors seeking high returns and relative safety, and the company (similar to Wal-Mart), is viewed with dread by retailers in areas where it announces expansion. This research examines the company's strategy to this point, and considers what course the company may take in the future.
The average Home Depot store now approaches 105,000 square feet indoors with an additional 20,000-28,000 square feet of garden center and storage space attached to the store. Each store typically stocks between 40,000 and 50,000 stock keeping units (SKUs), including size and color variations. While the company's format stresses a broad range of merchandise offered at competitive prices, crucial hallmarks of the company's strategy are highly knowledgeable sales/service personnel and aggressive merchandising.
The majority of the company's customers are individual homeowners, many of whom have only limited knowledge and capability of completing do-it-yourself projects successfully. For those willing to attempt the projects, the company offers the counsel of its in-store personnel and a variety of "how-to" classes that are conducted in its stores. The company also targets buy-it-yourself customers, who purchase requisite materials but contract with others to install and/or complete the project. Home Depot has more than 2,000 installers who are authorized to provide services to its customers. Finally, the company has initiated programs to better serve and attract the professional customer by facilitating credit, by providing conve...