The first place people, in general, look at when planning to do a household project is a reliable Home Depot warehouse. The company catering to both construction professionals and do-it-yourself budding craftsmen, is the largest home center retailer and second largest US retailer next to Wal-Mart. There are 478 warehouse stores across 19 states, on US southwestern, southeastern, northeastern regions as well as on the West Coast. A warehouse stocks and sells no less than 40, 000 items ranging from building materials, plumbing supplies, wall and floor covers, paint, electrical supplies, and more-even tools and supplies for gardening and landscaping. But how did it become as the way we know it today?
The first outlets were established in Atlanta, Georgia by Bernard Marcus, Ronald Brill, and Arthur Blank. Marcus and his associates build their business with the concept of marking down price to increase sales while decreasing sales cost. During that time, other retailer that operates with the same concept hired low-paid warehouse workers lacking some skills as a way to minimize sales cost. Also at that time, most of the construction supplies’ customers are those dealing with do-it-yourself work and those people don’t actually have technical expertise.
Marcus and his associates recognized that problem and reckoned that addressing customers’ needs is vital to the company’s growth. As such, they formulated two ways to solve the problems.
First is to ensure that their warehouse can store no less than 25, 000 different items surpassing that of their competitors by a wide margin. The normal capacity of their competitor’s warehouse is up to 10, 000 items.
Second is to deploy sales staffs that are trained regarding home improvement projects to be able to help the consumers with their own projects. Marcus and his associates intended the knowledgeable sales staffers in every warehouse store to educate the consumers. Marcus and his partners believed if they can make the consumers more confident to venture into more house improvement projects, they can make the customers go back to Home Depot for necessary supplies and for additional tips from the staff.
Both professionals in the trade and people dedicated do-it-yourself projects made the Home Depot team of sales staff that are mostly full-time employees; only about 10% of Home Depot’s sales staff are part-timers. Each store had a licensed electrician and plumber, whenever possible.
Customers were encouraged to phone-in the nearest outlet if ever they encounter problems or have some queries while doing a repair or home improvement project. Scheduled in-store instructional workshops for customers were also held; at some occasions, the company even invited local contractors as speakers or teachers.
Marcus and his teams’ approach paid off and Home Depot reached its $ 1B mark in 1986 with 50 retail outlets. As natural, they also encountered some fallbacks. Home Depot, however, manages to get back up just like they did after the Bowater problem. And it may not be without pitfalls, but still Home Depot continues to prosper.