Atlanta, GA, July 8--Home Depot Inc. is banking on becoming the "handyman" for homeowners and professional builders, a role that will help open up a $500 billion industry to the world's largest home improvement retailer, the Financial Times reported on its Web site.
Robert Nardelli, chief executive, says the goal was to move beyond the original "do-it-yourself" market to become a "home aggregator"--both the supplier of goods and provider of services for every aspect of improving one's home, the FT reported.
In that role, Nardelli says, Home Depot, with sales of roughly $53 billion, represents a mere 10% of the industry.
Analysts have warned that Home Depot--with over 1,500 stores--is close to saturating the U.S. market. In some areas one store is cannibalizing the sales of another, though Home Depot says that is an intentional strategy to keep competition out. Its biggest rival is Lowe's Cos., which is about half the size.
Home Depot has already begun its transformation, now offering homeowners carpet installation services, for instance, or taking charge of flooring installation for professional builders.
"The mass builders love the credibility and financial strength we bring versus the Mom and Pop stores," said Nardelli in an interview.
"Once you get in position, you can take it from carpeting to cabinets to counter tops to lighting. You work up the food chain," he said.
There were other potential fast-expanding areas not traditionally associated with Home Depot, including installing water treatment systems for homes or at home power generation, said Nardelli.
"Remember we were on the edge of an energy crisis," said Nardelli. "Some people want to ensure that they never lose power... (so) some of them are going to want home generation. And to me, that fits into home improvement."
Sales in stores open at least a year fell much less than expected in the first quarter. Comparable sales "are running better in the second quarter than when we exited the first quarter," said Nardelli.
