Financial Analysis Home Depot Essay

Home Depot’s retail strategy is one of reasons for its fast growth and continued leadership in the home improvement retailer industry. Its focus on speed, efficiency, and quality has made it one of the largest retailers in the world. Home Depot focuses on being a leader in “product authority.” Walmart and Costco are leaders

The Home Depot (Ticker: HD) is the world’s largest home-improvement retailer along with being an American Fortune 50 company. The company operates 2,259 retail building supply/home improvement “warehouse” type stores all across the United States, Canada and Mexico. The Home Depot has over 340,000 team members and is based in Atlanta, Georgia. The average store size is just over 100,000 square feet along with an additional 24,000 square feet set aside for seasonal gardening.

The Home Depot mission statement reads as follows: “The Home Depot is in the home improvement business and our goal is to provide the highest level of service, the broadest selection of products and the most competitive prices. We are a values-driven company and our eight values include the following: excellent customer service, taking care of our people, giving back, doing the “right” things, creating shareholder value, respect for all people, entrepreneurial spirit, and building strong relationships.”

Home Depot is the fastest growing retailer in the U.S. by some accounts. It has a fascinating history of innovation and entrepreneurship. The company had some difficulties in the mid-2000s that some attribute to cultural clashes. However, during this period the company was able to take full advantage of the housing boom. Yet when the bubble burst, Home Depot was forced to claim substantial losses. Despite these loses Home Depot has weathered the storm fairly well and is in prime position to take advantage of an economic recovery; if it ever comes.

I believe that Home Depot has done an excellent job at reaching its goals in the past ten years. They have been able to expand their market by aggressively opening several store locations and using a clustering strategy. In doing this they have become a market leader and they have also been able to keep their SG&A expenses down by eliminating redundant expenses by spreading them out between stores close in proximity to each other. Home Depot is facing a few problems in order to continue reaching its stated goal(s) of becoming a global leader and expanding their existing market. There are a few established business that are in direct competition with Home Depot such as Lowe's, their number one competitor, and other companies such as Eagle Hardware & Garden of Seattle, who has been preparing for the intense competition

If we look at Home Depot's business segments and the statistics on new home sales, we can see where the challenge is. According to the Commerce Department, sales of new homes grew by 6.6% in the month, setting the annual pace for 2010 to 307,000 total units sold. Although, there was an increase in September, this annual pace is the worst on new home sales since 1963, even when mortgage rates are at an all time low. This signifies why there would be disappointment from Home Depot. It is quite obvious that they will continue to struggle, at least through the 4th quarter of this year due to an industry dependent upon a strong real estate market.

* Focus on continual growth and improvement while providing a reasonable return to our investors.

Home Depot was founded in 1978 by Bernie Marcus and Arthur Blank. These founders envisioned providing one-stop shopping for the “do-it-yourselfer,” and this vision became a reality after working with investment banker Ken Lagone and merchandising expert, Pat Farrah. The first two stores were opened on June 22, 1979, in Atlanta, GA. These first stores were approximately 60,000 square feet in size each, and stocked 25,000 products, which made the stores drastically larger than any competitor or hardware store at that time. In addition to offering more products than competitors, store associates were also expected to offer the best customer service in the industry. Associates at

Organizational overviewBeginning in 1978, The Home Depot was founded by Bernie Marcus and Arthur Blank. , the founders' vision of one-stop shopping for the do-it-yourselfer came to fruition with the help of investment banker Ken Langone and merchandising guru Pat Farrah. The first two Home Depot stores opened on June 22,

Home Depot is the world's largest home improvement retailer operating in 45 states, Canada, Chili and Puerto Rico. Home Depot stores aim to serve both do-it-yourselfers and professional contractors with home improvement superstores carrying between 40,000 and 50,000 different products. Home Depot has also been listed as one of Fortune's most admired specialty retailers for the past six years. In order for companies to succeed in the competitive current marketplace they must consider not only the bottom line and their investors but also their impacts on the community, their employees, and their customers. Home Depot was founded on the idea that treating employees well is an important responsibility. Home Depot believes employees that are

J reflects department store chain. This industry is a retail business; therefore, there is a large amount of inventories. This industry also has high accounts receivable because usually customers pay with credit cards which are billed at the end of the month. However, sometimes, customers forget to pay their bills on time, and the bills are brought to next month. Therefore, the collection period is approximately 2 months.

Home Depot 's target market is individual homeowners/small contractors. Even though the traditional ideology is that cost leadership and product differentiation business strategies are mutually exclusive, Home Depot was successful at using a combination strategy. First, Home Depot optimized the cost leadership strategy by offering low and competitive prices to its customers by emphasizing higher sales volumes with lower margins, while instituting a high inventory turnover. Home Depot successfully offered a warehouse product strategy to the individual consumer for the first time. Previously, this type of price discounting was only available to professional contractors who earned product price

The Home Depot Inc. was founded in 1978 and is the world’s largest home improvement retailer and the second largest retailer in the United States. The sales for the fiscal year 2000 were $45.7 billion, compared to $38.4 billion in fiscal 1999. As of January 2001, the company was operating 1,134 retail stores in forty-seven states, six Canadian provinces, Puerto Rico, Chile and Argentina.

Home Depot (TheHomeDepot, n.d.) began as a two store operation in Atlanta, GA in 1979. The concept was the brainchild of Bernie Marcus and Arthur Blank, with inspiration from investment banker Ken Langone and well know merchandising expert Pat Farrah. They envisioned a one stop, do it yourself store that carried most of the products needed to do common home care projects.

The Company operates retail stores and call centers, and conducts online retail operations. Home Depot is considered a service based business. Home depot depends on people and the client experience and it also targets different markets in general.