Strategic Analysis of Home Depot

Topics: Customer service, Sales, Strategic management, Retailing, Home improvement / Pages: 15 (3580 words) / Published: Apr 9th, 2012
A Strategic Analysis of Home Depot
GM599

A Strategic Analysis of Home Depot
Introduction
The Home Depot (NYSE: HD) is a home improvement, construction products and services retailer operating over 2,000 big-box stores in the United States and abroad. The Home Depot was founded in 1978 by Bernie Marcus and Arthur Blank with the vision of one-stop shopping for do-it-yourself (DIY) customers, installation services for do-it-for-me (DIFM) customers and competitive products for the professional market. Their DIFM installation programs include products such as carpeting, flooring, cabinets, countertops, and water heaters. In addition, the company provides installation of various professional products like generators and HVAC systems.
The Home Depot developed strategic product alliances directly with industry-leading manufacturers to deliver the most exclusive assortments to customers. Through a combination of national brands and proprietary products The Home Depot exclusively carries several major brands, including: BEHR Paint, G.E., Martha Stewart Living and Thomasville, which sets the standard for the do-it-yourselfer and the professional contractor.
The Home Depot revolutionized the home improvement industry by bringing the know-how and the tools to the consumer and by saving them money. According to the founders, the customer has a bill of rights at The Home Depot, and this entitles the customer to the right assortment, quantities and price, along with trained associates on the sales floor who are there to help customers (The Home Depot, 2011). Their philosophy of customer service – “whatever it takes” – means cultivating a relationship with customers rather than merely completing a transaction. The founders initially viewed the structure of the company as an inverted pyramid, with stores and customers at the top and senior management on the bottom. They demanded that associates take risks to succeed, saying, “It is your business, your division, your



References: About True Value. (n.d.). Retrieved Jun 1, 2011 from http://truevaluecompany.com/about_true_value/default.asp Carlo, A Home Depot (HD). (n.d.). Retrieved May 18, 2011 from http://www.wikinvest.com/stock/Home_Depot_(HD) Isidore, C Kotler, P., & Keller, K. L. (2009). Marketing Management (13 ed.). Upper Saddle River, New Jersey: Prentice Hall. Lowe 's Companies, Inc. 2010 financial review. (n.d.). Retrieved June 1, 2011 from http://www.lowes.com/AboutLowes/AnnualReports/annual_report_10/financials.html The Home Depot Thompson, Jr., A. A., Strickland III, A. J., & Gamble, J. E. (2008). Crafting and executing strategy (16th ed.). New York, New York: McGraw-Hill. Table1 Home Depot Income Statements for years ending Jan 1 2009-2011 (The Home Depot, 2011)

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