Based on this intensive growth strategy, a strategic objective is to offer products at affordable prices. Home Depot’s cost leadership generic strategy supports this intensive growth strategy. To enhance its product selection, the company has developed strategic alliances and exclusive relationships with suppliers to market a variety of well-known brand names (Home Depot Product Authority, LLC, 2016). Lowe’s competitive business level strategy is a low-cost provider. Lowe’s is able to keep costs low through by purchasing in large quantities from suppliers, buying directly from manufacturers, using technology to control costs, and setting up distribution centers to service area stores.
Bernie Marcus and Arthur Blank dreamed up The Home Depot from a coffee shop in Los Angeles in 1978. They pictured a superstore that would offer a huge variety of merchandise at great prices and with a highly trained staff. With help, Marcus and Blank opened the first two Home Depot stores in Atlanta the following year. The warehouse had more items than any other hardware store. Home Depot started off structured differently than it is today (“Home Depot Product Authority,” 2016).
However with few exceptions, The Home Depot outperforms Lowe’s considerably. Lowe’s did outperform The Home Depot in revenue growth this most recent quarter, but this is just a snapshot when in reality both The Home Depot and Lowe’s have been experiencing very similar growth for years. Next is Earnings/Share, The Home Depot is earns over two times more than Lowe’s for one dollar of share price. Key differences can be found in profit margins, debt vs equity, and return on equity. The Home Depot has a considerably higher profit margin when compared to the margin of Lowe’s, and is much better at turning invested capital into equity.
Hill, C. W. L., Jones, G. R., & Schilling, M. A. (2015). Strategic management: An integrated approach. Stamford, CT: Cengage Learning. "Home Depot seeks strategies for surviving 2009. " Hardware Retailing, Apr. 2009, p. 19.
Across the United States, Mexico, and Canada these two giants have industrialized characteristic strategic priorities, and brand images. Despite the strategic differences, Home Depot and Lowe’s both share one major objective. The fact of customer-based increasingly active online, both companies being committed to allowing their customers to move perfectly online and offline channels. For example, a customer may order online and have the item shipped to their nearest store, or may even identify the item in store and have it arranged so it could be shipped to their worksite. (Home Depot Vs.
This allowed for more products to be developed and
This drastically increased profits and business opportunities
The atmosphere of any setting is continuously fluctuating in both obvious and vague ways. A hardware store such as Home Depot is a prominent example of this fluctuation. Home Depot has been providing hardware products for both home and business improvement needs since 1978. Home Depot sells products that fall under categories such as: paint, lumber, electrical, plumbing, garden, and more. The diversity among the customer population is wide ranging, from the different ethnicities, nationalities, and gender shopping on any given day.
In the early 21st century, the economy was soaring causing people to use their money to have bigger and better homes, cars, and spending more money on discretionary items. Ideally, the job market was flourishing with people making more money than they have in years. Logically, this caused stores like Lowe’s, and Home Depot to sell more home building products than in previous years.
Since the company was founded as a corner store, the company’s business plan has always emphasized on expect more, pay less brand promise that sets it apart from its chief rival, Walmart. Although, Walmart is known for its low prices and offers a large selection to its customers; it’s customer service is often found to be nonexistent. This
Home Depot current marketing strategy consist of a strategic plan in four different areas of the business. Home depot expects to follow changing trends and implement strategies that would allow them to sustain competitive advantage, in the retail home improvement industry. The areas of concentration are prices, products, promotions and the place where products would be distributed (Panmore.com, 2017). Home depots marketing strategy is to offer for a more innovative experience that target customers (Panmore.com, 2017). Home depot offers customers a host of home improvement household brands.
Business continued to grow.
There eight core values still stands as a elements of their success today. I personally feel that Home Depot would not have stood the test of time if they did not have transformational leaders like Marcus, Blank, Blake and now Menear to motivate the company to achieve their highest level of performance. Many leaders are competent but few qualify as remarkable as those individual. Home Depot is a highly diverse business that is highly committed and decided to its customers. The leadership at Home Depot started with the inverted pyramid, customer and store associated at top and senior level management at the bottom.
The store Home Depot is the world’s largest home improvement retail store, “founded in 1978 by Bernie Marcus and Arthur Blank, and they opened their first two Home Depot stores in June 22, 1979 in Atlanta Georgia”. The stores were both “60,000 square feet, which stocked about 25,000 products which was much more than any other hardware store at that time”. Today “Home Depot has more than 2,200 stores in the U.S., Canada, and Mexico”, ninety distribution facilities, three online contact centers, and “105,000 square feet of indoor retail space that offer more than one million products” (The Home Depot, 2017). Home Depot’s main source of revenue is brick and mortar stores, it has branched out to interconnected business and online sales. Home Depot
The extreme success of this business was only made possible as a result of
