Home Depot †Executive Summary Essay

The firm storehouse (Ticker HD) is the publics largest home-improvement retailer along with being an American Fortune 50 company. The company operates 2,259 retail building supply/home improvement storage w behouse type stocks all across the United States, Canada and Mexico. The Home Depot has everyplace 340,000 team processs and is based in Atlanta, Georgia. The average salt away size is unless over 100,000 square feet along with an additional 24,000 square feet set off for seasonal gardening.Target GroupThe Home Depots devil main clients are at home do-it-yourselfers and contractors. The main products and services offered admirer solve the wants and inescapably of customers involved with home construction and maintenance, renovation and remodeling. belligerent EnvironmentThe competitive environment for the home-improvement industry is broken into three major players The Home Depot, Lowes and local retailers. They compete with local retailers that specialize in nearly every product and service offering. The Home Depot and Lowes are both all offerings locations spread throughout North America. everyplace the past decade Home Depot was stickily centre on expanding the store count and employment lines whereas Lowes was focused on store count growth and perfecting their supply chain and internal technology.Past returnOver the past 13 years The Home Depot has much than doubled its store footprint. It was aided by two major factors first-year being that the home improvement and building industries were growing quickly providing a constant demand for product. Second, funding was easy to receive and it was relatively sordid because of low interest rates. Management began to empire build with their now change professional supply business (now known as HD Supply) and cut personify in their big box stores to help reduce costs. With the reduction of cost came the reduction in customer blessedness. Return to RetailNoticing that customer satisfaction rating had severely slipped because of stock outs and poor team member troth with the customer a new initiative was proposed. Marvin Ellison, Executive Vice President, U.S. Stores, proposed the premiere Relaunch. The program focuses on putting the customers first, by Do(ing) the unexpected. The operational aim focused on customer service, being in stock on all products and creating a better store appearance (inside the physical store and within the community). In efforts to focus on customer service, more employees were hire and trained. Upper management also equipped each team member with more technology (PDAs, walkie talkies, etc). There was a companywide initiative to integrate Latino merchandise, marketing and staffing. Home Depot switched to a regional distri exactlyion form while upgrading their internal information technology infrastructure to better remark stores inventory stocked properly.This major overhaul materialized into The Home Depots stock outs dramatically decreasing. To create a stronger public image, Home Depot created The Home Depot Foundation which helps with community home building, disaster reliever and veteran job placement assistance. These initiatives down greatly improved customer satisfaction and recognition in the community by increasing ratings from 55% to 75% (2008 to 2012). Current Economic cycleHome Depot has understandably set itself up to be successful in the recent upswing in the lodgement markets. Their technology upgrade has proven to be successful in keeping stores stocked and employees more engaged with helping the customers. Management has responded to the new-fashioned spring, summer, and early fall build up in construction needs by resorting to hiring part time and seasonal workers while still freehand them the proper training to satisfy the customer.ManagementThe current Chairman and oral sex Executive Officer, Frank Blake, is often credited with the companys retrogression ever since taking the helm. He sold the professional supply business (now known as HD Supply) to help the company focus on their core out competencies. Blake also helped implement the customer first initiatives. All while gash his own pay and switching hisfuture pay to stock and options, which are based on The Home Depots performance.Financial coifSince Home Depot has slowed their store expansions, cash reserves form grown to match total debt due in 5 years. Sales have increased steadily since the industry lows in 2008. Cash from operations have also steadily increased to match market high 2006-07 levels. A large portion of the cash flow each year has been focused toward share repurchases and steadily increasing their yearly shareholder dividends. Lending RisksThe Home Depot is in the heart of an uncertain housing environment. The sales and financial results each year are closely tied to the consumer spending currency on construction and housing maintenance. If the economic environment were to deteriora te it is potential many consumers would hold off on simple maintenance projects, which is currently the bulk of store sales. The housing market has seemingly bottomed but it still remains unclear to if the recent increase in housing sales is going to last.