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Pro-Business Sales – likely a key advantage for Home Depot over Lowe's

08.18.15

This past Tuesday Home Depot revealed it experienced a record number of transactions in the last three months. On average, shoppers spent more than at any point since 2006 and sales at stores open for a year or more jumped 5.8% from the previous year. Home Depot’s rival Lowe’s struggled to capitalize on the long expansion in housing prices.

One of the key reasons Home Depot continues to outperform Lowe's is the significant business from professional builders and DIFM contractors. Ducker’s ongoing research and consulting projects with contractors and builders indicates continued share shift to big box outlets relative to other professional distribution locations for fill in project needs and various rough building materials (lumber, roofing, siding, paint etc.)

Additionally, professional contractors and the growing DIFM movement are seeing greater service and attention through services and loyalty programs by Home Depot. Location advantages, pro-oriented stores and now specialized programs have allowed Home Depot (and Lowe's to a lesser extent) to tap into the multi-billion dollar pro segment.

While not often discussed, another key segment that is driving pro-business at big box stores is the growing expenditures for MRO (maintenance/repair) for multifamily facilities. High rental rates, growth in multi-family and population migration for jobs all lead to greater spending by facility management at multifamily locations thus giving Home Depot the advantage in sales.

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