A new report from CNBC highlights how big-box home improvement retailers Home Depot and Lowe’s are increasingly focusing on capturing sales from pro customers.
During the pandemic, both companies saw sales rise sharply as more customers invested in home improvement projects. However, CNBC notes that as COVID-19 cases fall in the U.S. and homeowners shift their spending to activities they were unable to accomplish during the pandemic like travel and dining, both big boxes see new sales potential by focusing on pro sales.
The report notes roughly 45 percent of Home Depot’s total sales came from pro customers and 20-25 percent of Lowe’s sales came from pros.
“In talking to the pro, they all have very strong books of business,” Home Depot president and chief operating officer Ted Decker said. “They all have backlogs.”
One of the key ways both companies are trying to court pros is by ensuring they have in-stock inventory, even as supply chains feel the strain.
So far, Home Depot’s $1.2 billion supply chain investment has created flatbed distribution centers in Dallas, Baltimore, Miami and Newark, New Jersey, with three more planned to open before the end of the year. These facilities are designed to hold more product and deliver directly to job sites to streamline delivery for pros.
Lowe’s is also seeing pro potential. First-quarter sales for contractors and builders grew by more than 30 percent compared to 2020. Capturing more pro sales has long been a focus of Lowe’s CEO Marvin Ellison. In July, Lowe’s announced a partnership with home improvement website HomeAdvisor to supply pros with direct project leads.
A few months later, Lowe’s announced enhancements to its own supply chain, including plans to open 50 cross dock delivery terminals and seven bulk distribution centers.
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