Assignment:
The Home Depot
Home Depot was established in 1979 by Arthur Blank and Bernie Marcus in Atlanta, Gerogia. Home Depot revolutionized home improvement industry in the United States of America very quickly. By 1990s, Home Depot had almost 35000 different well known products under its roof.
The first IPO of Home Depot was held on 1981 and was listed on the New York Stock Exchange 3 years later under the tag HD. By 1986, Home Depot reached the sale of 1 billion dollars and soon it became one of the fastest growing home improvement retailer and reached 20 billion dollars sales by 1997 these sales increased to 20 billion dollars. Annual sales in growth at this time was 119% of the Home Depot. The success of the company can be imagined by noting that its 100th store was opened in 1989.
The Home Depot is considered to be one of the largest retailer of home improvement products that was established in 1979. The company kept on selling large volume of goods at a lower price. The company used warehouses as the mean of their selling points and revolutionized the market of the United States of America. It is also considered to be the only company that successfully brought off the union of low prices and high service.
The operating and financial performance of the company since the time of its establishment has been extraordinary. The earnings and stock price of the company continue to rise and by the end of the decade the company established itself as the largest home improvement retailer in the country and was still planning to increase its stores.
Home Depot was a fast growing company in the industry of home improvement products and was not drastically affected by economic variations. There were many competitors in the company but Home Depot occupied the largest market share among then by becoming the largest and competent retailer of this industry. There were several growth initiatives taken by the company to increase the earnings of the company. Few of the tactics used by the company were as follows
1- Reaching out professional customers
2- Changing store formats
3- Adding more products to product line
4- Generating and developing internet business
5- Taking risk
As the business expanded, the company also expanded to different countries such as Canada, Mexico, Argentina, Chile and Puerto Rico. In 1994, the company expanded to Canada which was its first international expansion. In 2001, Home Depot expanded to Mexico and later on expanded to other international markets.
By 2002, when a study on large publically traded was conducted, Home Depot was ranked first in the Quality of Earnings by Merrill Lynch. The company reported that by 2001, it had approximately 280,000 people working under it throughout the world. It was also cited by the Fortune Magazine as America's Most Admired Specialty Retailer and was included in the ten best boards in the US by Business Week. The company continued its international expansion which helped the company to buy directly from the manufacturers and also helped the company to increase its purchasing power.