So far, 2008 hasn't been a banner year for Home Depot.
In January, the Atlanta-based home improvement retailer laid off 500 people from corporate headquarters.
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In February, it announced its first ever year-over-year sales decline.
In April, it announced the net loss of 970 jobs after reorganizing its human resources staff.
And Thursday, it announced 15 stores will close, affecting 1,300 employees. Home Depot is also shelving 50 planned new stores.
The 15 stores that will close are mostly in the Northeast and Midwest. None are in Atlanta.
"Closing a store is always a difficult decision because it affects both our people and our communities," Home Depot Chief Executive Frank Blake said in a memo to employees obtained by The Atlanta Journal-Constitution. "At the same time, the stores we're closing weren't meeting our expected returns and weren't projected to anytime soon."
He told employees that after reviewing all 1,970 U.S. stores, no others are being closed.
The closings show the company is reeling from the "perfect storm" of higher gas prices, higher food and health care costs and the real estate bubble bursting, said Wayne Hood, managing director of BMO Capital Markets, an equity research firm.
Wall Street seemed to approve Home Depot's fixes.
"The stock is up 5 percent today, and the market is up 1.5 percent," noted Hood, who is based in Atlanta.
Home Depot's shares closed at $29.87, up $1.07.
The bad news for Home Depot (and rival Lowe's), Hood said, is that the U.S. market is saturated with stores and the housing market is flooded with inventory, leaving little opportunity for growth. Store closings and layoffs "are not atypical to see when you have a weak economy," he said.
Home Depot will record a $586 million pretax charge related to the closings and the 50 shelved stores. Home Depot didn't publicly revise its earnings forecast for fiscal 2008 to reflect the charge.
But in the memo to staff, Blake said: "We will record a write-off to our first-quarter earnings. While this will reduce our earnings per share for the year, it does not mean that we're losing money or that the company is in any sort of financial trouble."
Home Depot said earnings from continuing operations are expected to decline between 19 percent and 24 percent, for earnings per share of $1.73 to $1.84.
By slowing new store growth, Home Depot will cut capital spending by $1 billion over the next three years. The money will be freed up to improve existing stores and possibly for share repurchases. Home Depot still expects to build 36 U.S. stores this year.
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Comments
By Monica
Dec 2, 2008 5:24 PM | Link to this
... Okay people.
First of all, i agree with the persons post who said that HELLO - The Home Depot is an at will employer, and if you hated/complained about your job that much, then you should have quit. If you stayed that long, obviously you've stayed for a reason.
I have been an employee of the home depot for nearly four years. I started when i was a mere 18 years old, and have been there ever since. I admit - i've had my fair share of everyones complaints - crazy hours, awful managers, hardly any recognition, rediculous paperwork, attendence policies that might not make sense.... What does this sound like? The majority of ANY retail job. And problems of many other jobs. there will always be some of these problems anywhere you go. You either go to work everyday and deal with it, and make your money and go home... throw a fit and complain and make everyone else's life miserable.. or quit and move on. In all reality, there are many times when i thought i wanted to quit. But i love my job. i love helping people. Im very knowledgable in my department.. for those of you who say that there is poor employee training -- you are not assertive enough. i took it upon myself to reasearch, talk, ask questions (other associates, customers, my vendors, etc) and that is how i gained my knowledge. Don't be lazy - just like they say, a teacher can only do so much, you have to WANT to learn. And yeah, their managers are overworked, but the majority of the managers i've experienced in the past 4 years love their job and are doing it for a reason. And if not, they've quit. The hours are crazy, but thats because the business demands it - we are the 3rd (just dropped from 2nd) largest retailer in the world for a reason. and look at your market research - it is proven that The Home Depot - AS WELL AS LOWES - does extremely better with their sales when built within a certain amount of miles from each other... same concept as Walgreens/CVS, ANY major gas stations, target/wal-mart, etc. Thats how the market works. And building "within 6 miles of each other" is a saturation theory. has worked for twenty years for them, so obviously they were doing something right.
Anyway, i have just found out that if you go to work, are chipper and happy (im a naturally happy person - but of course i have my bad days), do your job, talk to your customers, and go home... your life will be easy and you will NOT have any problems. I kind of feel like its associates like some of the people that have posted (i said SOME) on here that complain and dont offer the best customer service they can, that are the cause for "such crappy customer service" and the reason the company struggles.
And like i said.. i admit there is some awful management, even in my store, but it is the decision of the associates to overlook it and handle it the best way they can, instead of throwing a fit over it.
But what do i konw... I am just a college student working there because they pay 50% of my tuition books and fees, and will be gone when i graduate (:
Did i mention they have great benefits? anyone who has not looked at what The Home Depot actually DOES for their employees (NOT just full time, i have never been full time.. they pay for a percentage of my phone bill every month, what i just stated above, plus Employee stock purchasing, profit sharing, bonuses, sick/vacation time, ETC!!!) instead of just complaining about it might double check. I would recommend this job to anyone who is in college, who needs a part time job, or is an older retiree.
Besides all the ups and downs, i love this company, and it is the only job i have had as a teenager and throughout my adulthood (up until i graduate, like i said). I love my job - for what it is, to get me through college - and i love the majority of the people i work with.
k.
By Monica
Dec 2, 2008 5:23 PM | Link to this
... Okay people.
First of all, i agree with the persons post who said that HELLO - The Home Depot is an at will employer, and if you hated/complained about your job that much, then you should have quit. If you stayed that long, obviously you've stayed for a reason.
I have been an employee of the home depot for nearly four years. I started when i was a mere 18 years old, and have been there ever since. I admit - i've had my fair share of everyones complaints - crazy hours, awful managers, hardly any recognition, rediculous paperwork, attendence policies that might not make sense.... What does this sound like? The majority of ANY retail job. And problems of many other jobs. there will always be some of these problems anywhere you go. You either go to work everyday and deal with it, and make your money and go home... throw a fit and complain and make everyone else's life miserable.. or quit and move on. In all reality, there are many times when i thought i wanted to quit. But i love my job. i love helping people. Im very knowledgable in my department.. for those of you who say that there is poor employee training -- you are not assertive enough. i took it upon myself to reasearch, talk, ask questions (other associates, customers, my vendors, etc) and that is how i gained my knowledge. Don't be lazy - just like they say, a teacher can only do so much, you have to WANT to learn. And yeah, their managers are overworked, but the majority of the managers i've experienced in the past 4 years love their job and are doing it for a reason. And if not, they've quit. The hours are crazy, but thats because the business demands it - we are the 3rd (just dropped from 2nd) largest retailer in the world for a reason. and look at your market research - it is proven that The Home Depot - AS WELL AS LOWES - does extremely better with their sales when built within a certain amount of miles from each other... same concept as Walgreens/CVS, ANY major gas stations, target/wal-mart, etc. Thats how the market works. And building "within 6 miles of each other" is a saturation theory. has worked for twenty years for them, so obviously they were doing something right.
Anyway, i have just found out that if you go to work, are chipper and happy (im a naturally happy person - but of course i have my bad days), do your job, talk to your customers, and go home... your life will be easy and you will NOT have any problems. I kind of feel like its associates like some of the people that have posted (i said SOME) on here that complain and dont offer the best customer service they can, that are the cause for "such crappy customer service" and the reason the company struggles.
And like i said.. i admit there is some awful management, even in my store, but it is the decision of the associates to overlook it and handle it the best way they can, instead of throwing a fit over it.
But what do i konw... I am just a college student working there because they pay 50% of my tuition books and fees, and will be gone when i graduate (:
Did i mention they have great benefits? anyone who has not looked at what The Home Depot actually DOES for their employees (NOT just full time, i have never been full time.. they pay for a percentage of my phone bill every month, what i just stated above, plus Employee stock purchasing, profit sharing, bonuses, sick/vacation time, ETC!!!) instead of just complaining about it might double check. I would recommend this job to anyone who is in college, who needs a part time job, or is an older retiree.
Besides all the ups and downs, i love this company, and it is the only job i have had as a teenager and throughout my adulthood (up until i graduate, like i said). I love my job - for what it is, to get me through college - and i love the majority of the people i work with.
k.
By Peter V. Brun
Nov 3, 2008 11:26 PM | Link to this
When is Home Depot going to realize that the economy is going south.
Change your hours.
Stop building stores within 6 miles of each other.
Stop building near Lowe's stores.
Wake up Home Depot.
PVB
By current manager
Aug 9, 2008 12:33 PM | Link to this
Dear current Home Depot associates. If you are not happy with your job, and truly do not enjoy coming to work, remember one thing....The Home Depot is an At Will Employer. That means that you can call your boss any day of the week and voluntarily resign. If you are not happy with yourself, you will not be happy with customers. Take action and respectfully move on.
By Danny boy
Jul 9, 2008 3:03 PM | Link to this
I'm sending this email because I believe all that I have read to be factual. Per the conversation with one of my children there has been a high turn over rate with no discrminatory age. My child started less than 90dys ago and haven't been late nor missed any days. They have been told that they will be dismissed after the 90dy probation period without any type of explanation or even a 30dy review for growth for positive change. I'm leavitt at this point because my child has been very responsible with the actions of being a team member with this organization. I cant believe that they have posted a mission statement that they dont obey by. Principles are the number one thing that should make all the employers to be productive happy citizen.
By Dean
May 20, 2008 9:32 AM | Link to this
I am a former employee of the Expo Design Ctr branch of Home Depot. I am sad to say that after 3 years of service, my experience is not very different from that of others on here. I can sum it up as :
1. Rude management,
2. Stupid Attendance policy and point system
3. Lack of training for Associates (those online classes do not help. What we need are paid Home Depot instructors dedicating time by coming to the store and answering real associate questions on a regular basis
4. "Associate is always wrong" mentality,
5. Understaffing putting excessive stress on existing employees and customers
6. Poor inventory. We're always out of merchandise.
7. Lack of recognition for merit.
8. Ovewhelming weekly paperwork for management.
9. Cheap profit sharing policy
10. COMPLETELY OUTDATED computer system that slows you down. Trying to set up a Mesure and Installation in some depts is like writing a 2 page HTML code from scratch.
I could go on and on but are they really reading this? i do not think so.
By Depot Escapee
May 18, 2008 7:52 PM | Link to this
What a horrible, dying compan Home Depot is. I am so glad as a senior manager I escaped this sinking ship, They treat ther people like crap and before I left we were told at a high level meeting the management turnover was 56%. No company can survive when they drive out that many good people. They expect managers to accept being constantly being demeaned, not to think, have no home life, and to be automatons. I doubled my salary after leaving and every person I interviewed with had a Depot horror story. Home Depot knows its srtores are dirty, understaffed and that associates are untrained. That came out in countless customer surveys, yet this GE dickhead Blake continues to do nothing. Sold my stock at $43 before escaping and it's now at $28. How sad a goldmine has been turned into a deteriorating manure factory! I'm sure they're even out of stock of that.
By k.
May 5, 2008 12:56 PM | Link to this
Wow..it seems like most people are in agreement that the Depot is a pretty bad place to work. I worked there for 13 years...DO NOT ASK ME WHY I STAYED THAT LONG? Actually it was only the money. I woke up every day dreading to go to work. The management was cluless, rude, and carried on political ********. If you wer not friends with someone on management staff that would help you out if needed, you were screwed. The hours were ridiculous and if more people complained I am sure there could be a law suit or two out there for overworking with barely any hours between shifts. The management work those long hours yes...only getting paid for 40...yes...but believ eme they are making up for it in other ways....if you worked there you know all the merchandise that goes out those doors unpaid with mamgement acknowledgement...it is pretty scary...oh believe me they are getting reimbursed in other ways.....no one is going to work that many hours, be treated like crap for free...13 years ago when I started there the stores were a pleasure....the employees were all trained and knowledgeable....and it was a caring company....Bernie & Arthur were genuinely good guys, they even came to my store a few times...I am sure they are dissapointed....the compant got to big for its britches and we all became just a number....98% of wmployees are misreable and it shows with their customer service....Its a sad story but not surprising...
By JOJO
May 5, 2008 11:00 AM | Link to this
I worked at the store 3 years before i left for a better job due to unqualified and rude managers. unfortunately for me, my wife also works for Home Depot but in another store as a manager.The minimum hours a Manager is supposed to work is 55 hours a week, even though they are only paid for 40 hrs a week! this is actual fact! Home Depot over works its management staff all the time and to make matters worse they have asked all managers to work 6 days a week bringing the minimum hours to 66 hours a week but only gets paid for only 40!
The point am trying to put across is that The Home Depot has an Unhappy management staff! who are always sad and very very tired and frustrated! they are always seen taking their anger and frustrations on associates and that really kills the morale in the stores leading to poor customer service!
In one month alone 4 managers in one district had to quit their jobs because they could not take the toll any longer.I have also asked my wife to quit and look for a part time job or stay home after working 5 years as a manager.
Share holders should look into this poor management from the coperate level to check that the Home Depot does not lose any more value of its stocks, by giving the management staff a break!! to ensure quality customer service and may be, just maybe it wont have to close any more stores!
By Jesse
May 5, 2008 9:20 AM | Link to this
I have worked for home depot for two years and i have watched as it has declined but you still have stores out there that do very well and a management team that knows what they are doing. You can't blame the political team in office right now for HD's decline because then you have to blame them for everything that you have done in support of that with out knowing you have. Dave you are and idiot because when you lose your job house kids die of starvation who are you going to blame...bush no beacause you didnt vote for him you liberal p^%$y. think before you speak and learn that blame falls upon all and just individuals
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