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For investors, The Home Depot sets its priorities

BY Ken Clark

Atlanta-based The Home Depot heads into its 20102 investor and analyst conference today with a full slate of priorities.

The company pointed to four key strategic priorities:

• On creating an emotional connection with customers, putting customers first and simplifying the business;

• On its merchandising transformation and portfolio strategy, including innovation, assortment and value;

• On continuous operational improvement, incremental supply chain benefits and shareholder value built through higher returns on invested capital and total value returned to shareholders in the form of dividends and share repurchases; and

• On building a competitive platform across all commerce channels. 

“The Home Depot has a strong foundation of customer service, product authority and value creation,” said CEO Frank Blake in a press release. “We will continue to build on our strategic priorities as we look to 2015 and beyond.” 

The company still expects sales to be up approximately 4.6% for the year on a 53-week basis and diluted earnings per share to be up approximately 17%.

In 2011, The Home Depot had sales of $70.395 billion, up from $67.997 billion in 2010. Net earnings for the company were $3.883 billion, up 14%.

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Towers of CLT timber have green implications

BY HBSDealer Staff

An article in the New York Times explains the virtues of cross-laminated timber, or CLT, in building applications — including a nine-story tower.

One of several varieties of the larger category of engineered wood, CLT is used in one of the world’s tallest wood residential buildings, a nine-story building in London. In the United States, the idea has yet to take off.

The article quotes Pete McCrone of Whitefish, Mont.-based Innovative Timber Systems: “This is the way we ought to be building.”

CLT buildings offer a lower carbon footprint compared with steel or brick, according to its promoters.

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No clear winner in grills, patio furniture sales

BY Ken Clark

A market share analysis of outdoor living products by The Stevenson Co. shows that consumers pick and choose their retailers when it comes to outdoor power equipment, grills, mulch, and other lawn and garden merchandise.

The TraQline Quarterly report, the results of a survey that measures brand shares, retailer shares and consumer behavior trends, indicates that Walmart, Lowe’s and The Home Depot all vie for the top spot selling charcoal grills. While Walmart is the share leader for charcoal grill purchases at 23%, Lowe’s and The Home Depot follow closely behind at 20% and 19%, respectively. 

Other highlights from the report include:

• Compared with other retailers, more consumers choose to buy lawn and garden items from The Home Depot and Lowe’s.

• Consumers rely on Sears over any other retailer for purchasing lawn mowers, but Lowe’s, having eclipsed The Home Depot, is catching up.

• The Home Depot is the clear leader for bag mulch purchases, selling more than one-third of all mulch to U.S. consumers.

• Consumers showed no strong preference for patio furniture shopping, with "other outlets" combined leading the pack ahead of individual, larger retailers and big-box stores. 

"For many categories, Lowe’s, The Home Depot and Walmart compete with each other for the lawn and garden customer," said Eric Voyer, VP of The Stevenson Co. "From a trend perspective, we’re seeing an increase in the big-box home improvement stores’ ability to attract customers. To increase market share and remain viable, retailers and manufacturers must continually look at the factors that drive consumers’ purchasing habits and address these preferences in a meaningful way. Promotional activities and assortments play a huge role in winning the battle for the consumers."

Based in Louisville, Ky., The Stevenson Co. produces market intelligence for retailers and manufacturers selling in North America.

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