Business Analysis: Home Depot and Lowe's Companies Comparison Report

This report provides a comprehensive comparison between The Home Depot and Lowe's, two leading home improvement retailers in the U.S. It examines their strategic decision-making, leadership and communication styles, promotion policies, and management approaches. The report analyzes their company culture, performance, and responses to legal, social, and economic environments. A SWOT analysis is used to assess the strengths, weaknesses, opportunities, and threats for each company. Furthermore, the report assesses their operations strategy framework and the performance of their management teams, identifying the strong points of the managers. The analysis covers aspects such as supply chain modernization, marketing tactics, and responses to market dynamics. The report concludes by highlighting areas where improvements are needed for both companies to enhance their operations in the US and other countries.

Running Head: THE HOME DEPOT AND LOWE’S COMPANIES
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The Home Depot and Lowe’s Companies
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Comparison between Lowe’s and The Home Depot
Lowe’s and The Home Depot companies have been for a long time the famous of the
home improvement retailers in the US. Being the world’s best home improvement retailers, the
two companies share various similarities. Both are in competition for shared clients base across
the US, Mexico, and Canada. Also, they both allow clients to move flawlessly between offline
and online platforms
Strategic Decision Making Style
The Home Depot had experienced poor performance until when Robert Nardelli came up
with strategic decisions which made the company improve its financial and operation services.
Nardelli came up with a three-section strategy which is enhancing the core by increasing the
profitability of present and future stores in established markets; expand the business by providing
related services like tool rental and home introduction of The Home Depot products; and extend
the market, both physically and by supplying the new customer. Lowe's Company had also
experienced low sales leading to poor performance. Ellison shipped in and he decided to change
the supply chain approach. Ellison decided to close down 99 Orchard supply stores to enable the
company to focus on the main home improvement business (Russell & Taylor, 2016).
Leadership Style
The Home Depot adopted a leadership style of having a seasoned manager who has the
expertise required to drive the growth of the giant business. The manager would deal with the
current problems that are apparent either to investors or employees. Lowe's company adopted a

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new leadership team which would create an aggressive strategy to improve the store and remove
clutter thus reducing poor performance inventory.
Communication Style
Lowe's and The Home Depot Company use Facebook, mobile app, YouTube, Twitter,
and mobile site to communicate to customers and investors. They use an innovative strategy to
their timeline. However, the company does not communicate often as it posts once a week. Both
companies communicate with their customers in a conversational approach where they engage
their audience in their reply. Lowe's use Facebook to perfect its brand and The Home Depot's
use Twitter as a tool for customer service.
Promotion Policies
Both company all kinds of strategies for their marketing communications tactics to
enhance their business and products. The promotion policies used include; public relations, sales
promotions, advertising, direct selling, and personal selling. Advertising is the major promotion
tactic however other promotion activities have also major contributions (Pratt, 2011).
Companies Management Style
The Home Depot's administration has one major priority which is the continued
modernization of their supply chain. After relying much on the decentralized supply chain in
2007, The Home Depot began the modernization process of evolution where it embraced the
centralized network of distributing its centers. Similarly, Lowe’s has experienced an outstanding
growth history. It has already expanded its activities in Mexico, Canada, and the US. However,
like its competitors, it has not attained success in China. Perhaps as a result of logistical benefits,

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Lowe’s management is currently placing less focus on modernization of the supply chain.
(Harris, 2012). The Home Depot and Lowe’s management has four major functions which
include, planning, organizing, coordinating and controlling. Both the managerial bodies made the
two companies to be the leading home improvement retailers globally. The strong point of the
managers in the two companies was to identify the areas that were lagging behind. The managers
helped the companies in improving the supply chain of the retail business which eventually
resulted in performance improvement.
Company Culture and Performance
The two companies also have notable differences. The Home Depot's shops are
characterized by the black and orange color scheme with high shelves which are only accessed
through forklifts. Such industrial appearance depicts that the store is channeled towards
improving home professionals. On the other hand, Lowe’s store has a distinct appearance where
it has a white and blue color scheme and has more expounded floor display. Lowe’s has a
reputation for handling well its first-time customers. In spite of their different brands, both stores
refer to themselves as competitors of the same customers. Both retail companies operate in a
wide area for their activities and have over 2000 stores all over the US. Both companies operate
on the same market irrespective of their differences in supply-chain and branding strategies. At
the moment, Lowe’s runs its activities on a wider geographical area compared to that of The
Home Depot (Warren & Jones, 2019).
Legal, Social, and Economic Environment
The economic environment for both retailers has slightly improved. In comparison to
previous years, there is outstanding consumer confidence. It has also been supported by the

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Conference Board Consumer Confidence Index which demonstrated a slight improvement on the
same. The economic improvement of the two retailers has contributed to the decline in the
unemployment rate. It is evident in the US Bureau of Labor Statistics, which reported that
unemployment applications have declined since 2011(Cameron, 2011).
The Home Depot and Lowe’s retailers have improved the social-cultural environment of
the United States. In regard to these, the US has become a diversified society where current
research showed that New York is more diversified with a mixture of people from all over the
world. Thus, such diversity will compel these retail companies to expand their merchandise mix.
In addition, the co-founders of The Home Depot and Lowe’s stores have emphasized the strict
and unfair legal frameworks which are directed to retail businesses. For instance, unfair taxes,
Consumer Protection Act and other reforms are demolishing the businesses at the expense of
company performance.
Companies SWOT Tool
The Home Depot has the strength of being the largest home improvement retailer all over
the globe and it also has an efficient supply chain. Their brands increase customer's confidence
and their services are offered in an exclusive manner. On the other hand, Lowe’s has established
the presence and efficient merchandising. They also have strong distribution channels and
logistics which eventually enabled the company to have strong sales and marketing initiatives.
Both the retail companies have an opportunity for the growing demand for their brands
and increase relevance in other countries outside the US. Lowe's company has a weakness of
violating government regulations and being dependent on their manufacturers (Williams, 2009).
Similarly, The Home Depot has a weakness of already matured domestic market which hinders

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growth. Increased restrictions, rise in labor wages and grim appearance of the market have been
the threats of the two retailers as they operate their businesses.
Area of Improvements needed
For the two retail businesses to improve their operations in the US and other countries,
they need to adhere to the government regulations and policies concerning tax and consumer
protection. Such things would create a consumer's confidence and would also make their retail
activities legitimate all over the world. Besides,
Operations Strategy Framework
The Home Depot provides an update on the core programs under its strategic framework that
concentrates on creating value by linking the business end-to-end. Under this Operations
Strategy Framework, which Home Depot calls Interconnecting Retail, the Corporation continues
to be centered on productivity, product authority and customer experience. Lowe’s Companies,
Inc., on the other hand, incorporate their stakeholder values, mission, and vision into the
functional strategies, business level strategies, and corporate level strategies as a means to
ascertain sustainability.
Assesses how the overall management teams perform in terms of the four functions of
management.
Management team at the Home Depot is responsible for planning whereby it creates a
comprehensive action plan tailored to achieve some corporate goals. Some select team members
also determines how the Company should distribute resources and organize all workers
according to the strategy. The team members are generally leaders and they connect all

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employees on an interpersonal level. Managers in Home Depot create exceptional controlling
plans to develop the entire firm. Management team at Lowe’s Companies, Inc is responsible for
planning or mapping out a plan on to attain a certain goal. It also organizes groups and allocates
resource materials required to obtain the set goals. There is also a select team of HR practitioners
who conducts the staffing functions such as developing employees, training, recruiting, and
selecting. Some are left with the leading responsibilities such as communicating, encouraging,
guiding, and motivating.
Identifies and explains the strong points of the managers
Managers at the Home Depot have the ability to organize business activities and multi-task.
They are also good at delegating tasks effectively and efficiently. Most of them are confident
decision makers and are optimistic. At Lowe’s Companies, Inc managers are always flexible,
stay focused on the Company’s big picture. A majority of them lead by example and they pitch-
in to help other staff members.

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References
Cameron, S. (2011). Handbook on the economics of leisure. Northampton, Mass: Edward Elgar.
Harris, R. ( 2012). Building a market: the rise of the home improvement industry, 1914-1960.
Chicago: The University of Chicago Press.
Pratt, J. (2011). Financial accounting in an economic context. Hoboken, NJ: Wiley.
Russell, R. S., & Taylor, B. W. (2016). Operations and Supply Chain Management. New York:
Wiley.
Warren, C. S., & Jones, J. P. (2019). Corporate financial accounting. Boston, MA: Cengage.
Williams, C. (2009). Management. Mason, OH: South-Western Cengage Learning.