Home Depot has shut down five of its 12 stores in China, according to a report in the Chinese media, but has no intention of withdrawing from the market.
The Comtex News Network reported on Jan. 26 that the first store shuttered by the Atlanta retailer was in Qingdao in June 2009; since then four others, including the Beijing location, have been closed.
However, Home Depot’s stores in Tianjin, Xi'an and Zhengzhou are all doing well, the article said. “People close to the matter” told the news service that some of the underperforming stores have suffered losses of more than CNY $10 million (US$1.5 million) annually.
In the Home Depot’s annual investors and analyst meeting on Dec. 13, president and CEO Frank Blake described the company retail presence in China as “problematic, as we concentrate our geographic presence to a few key cities.” When asked about the number of stores in China, Blake gave no exact count, but said that the company has no immediate growth plans.
“China has been a journey,” Blake added. “I don't think we're alone in having it take some time to figure out how to build a profitable business model. We've said from the start that we're not there to drive square-footage growth. We're there to figure out a profitable business model and then move.”