Home Improvement

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In Home Depot's most significant move since Robert Nardelli's departure in January, the nation's largest home improvement retailer has announced the sale of its Home Depot Supply Unit to a trio of private equity firms for $10 billion. The unit, which sells supply infrastructure to contractors and municipal systems, was created in 2000 to offset downturns in the housing market. Although it accounted for 80 percent of the company's sales growth last year, according to the Times, its profit margins never reached the level of the retail side and the expected savings from buying bulk materials did not come as quickly as predicted.

In the April issue we polled six entrepreneurs on what they would do to reinvigorate the brand. One of the main refrains was to "reconnect with customers" and "focus on what employees know." These ideas were echoed in the reasons Home Depot has offered for why it decided to sell the unit: to spend more money and resources on customer service, improve staff morale, and boost sales at its current 2,100 retail locations. Does this sound like a good plan for dusting off those orange aprons? If you were Frank Blake, what would you do?

Last updated: Jun 19, 2007




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