Home Depot and Lowe’s are in a race against time and each other
Home improvement retailing rivals Home Depot and Lowe’s have a need for speed. Each company has announced this month that they are taking steps to outpace the other when it comes to the delivery and pickup of online orders made by their respective professional and do-it-yourself customers.
Home Depot revealed earlier this month that it plans to open three new distribution centers in Georgia over the next 18 months to meet growing demand. The largest of the new facilities will be a 657,600-square-foot DC to speed inventory replenishment at stores. A new “flatbed” center will offer same- and next-day deliveries of bulk and oversized orders, including direct service to job sites for the retailer’s professional building trade customers.
“Retail has changed more in the past four years than in our company’s 40-year history. Customers expect to shop whenever, wherever and however they want — whether they’re buying a hammer or a pallet of pavers,” said Stephanie Smith, senior vice president of supply chain development and delivery at Home Depot, in a statement.
The three new warehouses are part of a $1.2 billion multiyear investment announced by Home Depot in 2017. The goal was to add 150 new warehouses nationwide to help expand Home Depot’s same-day and next-day delivery capabilities to 90 percent of the U.S. population.
Earlier this week, Lowe’s announced it will open its second direct fulfillment center in October in Mira Loma, CA. Lowe’s said the new facility combined with the first center, which opened in Nashville in 2018, will enable it to provide its two-day delivery program to almost 100 percent of its customers across the country.
The Mira Loma DC is part of a bigger effort at Lowe’s. The home improvement retailer said it plans to open 50 cross dock delivery terminals, seven bulk distribution centers and four e-commerce fulfillment centers over the next 18 months. The goal is to enable more same- and next-day service to customers. Lowe’s announced in 2018 that it would spend $1.7 billion over five years to upgrade its supply chain.
“Opening these new facilities will allow our stores to operate more efficiently through improved flow management and inventory visibility and improve the customer experience with more predictable deliveries, better in-stock rates and faster fulfillment options,” Don Frieson, Lowe’s EVP of supply chain, said in a statement.
Home Depot (+7.5 percent) and Lowe’s (+12.3 percent) reported first-quarter same-store sales gains in May.
- The Home Depot Opening Three New Distribution Centers in Georgia – The Home Depot
- Lowe’s Expands Supply Chain Network, Announces Opening of Second Direct Fulfillment Center – Lowe’s Companies, Inc.
- Lowe’s and Home Depot get a boost as customers stay-at-home – RetailWire
DISCUSSION QUESTIONS: Has the coronavirus pandemic created a paradigm shift in how consumers and professional customers purchase from home improvement retailers? How important will speed relative to both delivery and pickup be for home improvement retailing success going forward?