Retail

Home Depot Invests $1.2B To Speed Up Deliveries

Home Depot

With eCommerce changing customer expectations, Home Depot is planning on investing $1.2 billion to facilitate quicker deliveries to homes and job sites. The company plans to bring 170 distribution centers online in an effort to reach 90 percent of the U.S. in a day – or even faster, The Wall Street Journal reported.

Those locations will include centers to facilitate same-day or next-day delivery of some products. And 100 local hubs will allow for the consolidation of bulky products, such as appliances and patio furniture, that will be delivered directly to consumers. The idea is to adapt its supply chain to an evolving retail landscape, and to offer plenty of shipping options.

“Sometimes they want [delivery] fast, and are willing to pay for that,” Home Depot’s Executive Vice President of Supply Chain and Product Mark Holifield told WSJ. “Sometimes they want it free, and they’re willing to wait for it. We need to have the right options there.”

And, even though the delivery service is still in a nascent stage, Home Depot Chairman, CEO and President Craig Menear said in a post-earnings conference call in May that customers are buying many different items through the service: Pros on job sites are also making use of it. He also noted that there was a lot of interest in the buy online and deliver from store option, although “it’s not taking a real pattern at this point.”

In terms of eCommerce, the company also rolled out a feature that allows consumers to buy installation services when they purchase products online in certain markets.

Overall, Menear said traffic growth for its online business was “healthy and our first quarter online sales grew approximately 20 percent from the first quarter of 2017.” In February, Home Depot’s CFO Carol Tomé revealed that the retailer saw a 21.5 percent growth in online sales last year, and that its online business now makes up almost 7 percent of its overall revenue.

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