Competitor Analysis: Home Depot
Competitor Analysis
Home Depot competitors are primarily in the home improvement and hardware retail industry, but also compete in the building materials retail and distribution, consumer electronics and appliances retail, and convenience stores and truck stops sectors. Some of Home Depot’s main competitors include: Lowe’s, True Value, and Ace Hardware. Now, these competitors are the main competition of Home Depot and all three stores carry about 75% if not more of what Home Depot sells. Keep in mind, that there are also smaller companies, often family-owned lumberyards or hardware stores that compete with Home Depot and the other large chain stores. However, Home Depot’s biggest competition is Lowe’s. “Home Depot and Lowe’s are home improvement retailers with very different value propositions. Home Depot has very austere, functional stores that are designed to appeal to the contractor or homeowners on the basis of function and price” (Aaker, 7).
This industry is mainly driven by residential real estate construction and renovation. Large chains such as Home Depot, Lowe’s, True Value, and Ace Hardware are able to expand recently because of their focus on the home improvement market, with contractor sales as a sideline (Hoover.com). This is where the family-owned stores are able to successfully compete against these large chain stores because they effectively cater to the small and mid-sized contractors who believe that price is less important than the other services that these small stores can offer. High customer concentration is the value proposition that the small, family owned stores offer opposed to these large box stores that have limited customer concentration. The large chain box stores’ value proposition is low-cost. Yes, low-cost is what consumers are looking for in most cases however, many small to mid-size contractors and even do-it-yourselfers are interested in the value proposition of differentiation. They want the knowledge that the workers can
Home Depot competitors are primarily in the home improvement and hardware retail industry, but also compete in the building materials retail and distribution, consumer electronics and appliances retail, and convenience stores and truck stops sectors. Some of Home Depot’s main competitors include: Lowe’s, True Value, and Ace Hardware. Now, these competitors are the main competition of Home Depot and all three stores carry about 75% if not more of what Home Depot sells. Keep in mind, that there are also smaller companies, often family-owned lumberyards or hardware stores that compete with Home Depot and the other large chain stores. However, Home Depot’s biggest competition is Lowe’s. “Home Depot and Lowe’s are home improvement retailers with very different value propositions. Home Depot has very austere, functional stores that are designed to appeal to the contractor or homeowners on the basis of function and price” (Aaker, 7).
This industry is mainly driven by residential real estate construction and renovation. Large chains such as Home Depot, Lowe’s, True Value, and Ace Hardware are able to expand recently because of their focus on the home improvement market, with contractor sales as a sideline (Hoover.com). This is where the family-owned stores are able to successfully compete against these large chain stores because they effectively cater to the small and mid-sized contractors who believe that price is less important than the other services that these small stores can offer. High customer concentration is the value proposition that the small, family owned stores offer opposed to these large box stores that have limited customer concentration. The large chain box stores’ value proposition is low-cost. Yes, low-cost is what consumers are looking for in most cases however, many small to mid-size contractors and even do-it-yourselfers are interested in the value proposition of differentiation. They want the knowledge that the workers can