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Home Depot Base Case

By Larry Dignan  |  Posted 2003-06-16 Email Print this article Print
 
 
 
 
 
 

Will a Home Depot technology overhaul fend off Lowe's?


Home Depot Base Case

Headquarters: 2455 Paces Ferry Road, Atlanta, GA 30339

Phone: (770) 433-8211

Business: Home improvement retailer focused on do-it-yourself customers and contractors. Company also offers installation services.

Chief Information Officer: Robert DeRodes

Financials in 2002: $58.25 billion in revenue, $3.66 billion in net income, net profit margin 6.3%.

Challenge: Update inventory tracking systems for the sales floor and behind the scenes. Remodel stores to better compete with rival Lowe's Home Improvement. Centralize operations to improve efficiency.

Baseline Goals:

  • Grow sales at existing stores by 1% a year, while opening new stores nearby.
  • Install automated checkout systems in 800 stores.
  • Keep at least 99% of products on shelves all the time.
  • Maintain sales per store at $40 million a year or better, stemming three-year slide.

    HOME DEPOT

    Net Income Per Year: $3.66 billion

    Operating Profit Per Store: $3.8 million

    Average Customer Purchase: $51.29

    Inventory Turns Per Year: 5.1


    LOWE'S

    Net Income Per Year: $1.47 billion

    Operating Profit Per Store: $2.76 million

    Average Customer Purchase: $58.26

    Inventory Turns Per Year: 4.5

    SOURCE: CIBC WORLD MARKETS



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    Business Editor
    ldignan@ziffdavisenterprise.com
    Larry formerly served as the East Coast news editor and Finance Editor at CNET News.com. Prior to that, he was editor of Ziff Davis Inter@ctive Investor, which was, according to Barron's, a Top-10 financial site in the late 1990s. Larry has covered the technology and financial services industry since 1995, publishing articles in WallStreetWeek.com, Inter@ctive Week, The New York Times, and Financial Planning magazine. He's a graduate of the Columbia School of Journalism.
     
     
     
     
     
     
     
     
     
     
     

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