Home-Depot Inc. (NYSE:HD) will need an army of PR consultants to restore its tattered public image among investors and the public. I say "army" because one PR agency alone can't take on that Herculean task.
Former CEO Robert Nardelli set new standards for boorish behavior toward investors at the chain's last annual meeting. Investors are outraged at his arrogance and now are trying to stop the company from paying him a $210 million golden parachute.
Critics argue that Nardelli was overpayed, especially when factoring in the poor performance of its stock. House Financial Services Chairman Rep. Barney Frank said Nardelli's severance package was "further confirmation of the need to deal with a pattern of CEO pay that appears to be out of control," Reuters said.
Home Depot is in a pickle with regards to Nardelli's pay. It's also found away to turn off consumers as well. I haven't set foot in my local Home Depot in years because the experience of shopping in Lowe's Companies Inc. (NYSE:LOW) is so much more pleasant. The Lowe's is about 20 miles further from my house than the Home Depot.
In the coming weeks, PR firm after PR firm will be pitching their services to Home Depot. There will be a reputation-building advertising campaign in the spirt of what Wal-Mart Stores Inc. (NYSE:WMT) is doing. Executives will probably hit the road to New York and Boston and listen to shareholders yell at them. Then the public will move onto the next scandal.
--Jonathan Berr is editor of http://www.desperateinvestors.com.











Reader Comments (Page 1 of 1)
1-11-2007 @ 11:12AM
lee bonin said...
Nardeli came on the scene[from General Electric who didn't want him]walking around Home Deot with his orange apron on like he was going to change the world,and Home Depot has been going downhill since,and stock holders taking the hit.When is the pilfering going to stop ?
1-11-2007 @ 3:51PM
Gene Reed said...
I'm a Home Depot employee at store #1702 Pearl City, Hawaii. I have been with Home Depot 10 Years this June 2, 2007. The company changed when Bob came on board. The employees need a voice, we need to be heard. We can change the company. We the employees are unhappy with the company. I was talking with Brian at Business Week about a interview. No help. If you know someone call me or e-mail me. Just go into the HD stock and check out the chat at the bottom. We need to be heard. Thank you for your time.
1-11-2007 @ 9:53PM
Rajesh said...
Well, that is a blaring example of what is going on at the top levels. Are the directors so stupid to agree to such packages in the first place? It's not Nardelli who is the culprit but the directors who approved such pay package.
Common sense is not so common. Definitely not in the top brass!
1-11-2007 @ 3:46PM
Richard Schons said...
I worked for Home Depot for three years and I noticed that every six months the ememployees received a cutback in one area or another. I was one of my store's top producers and I got squeezed out without a thank you. Nardelli's one of it's biggest losers and gets 210 million. Go figure!
1-11-2007 @ 3:54PM
jerry smith said...
I also used to spend substantial sums each month at Home Depot. I've switched to Lowes for their better service.
Plan to vote no on all directors at next meeting.
They have final responsibility.
1-11-2007 @ 4:43PM
Emmett Gomez said...
I'm a General Contractor in Arizona and I now frequent Lowe's because of there service. Additionally, Home Depot has cut back personnel in the mornings of many stores and that is when either I or my employees pick up materials. I will live to see Home Depot take a beating in the stock market. Also, I sold my stock in Home Depot because of performance over the last five years.
Emmett
1-11-2007 @ 10:45PM
KRISTIN PEREZ said...
As a 20 year HD employee, it was obvious early on that we were in for a long term problem. Nardelli's announcement that he was going to 'improve' customer service by lowering the number of full time(read: expert) employees and hiring more part time employees was a big red flag that he was going for the short term fix to line his pockets and that in the long term HD would really lose a lot of customers. So how come the 'idiots' that work at the store level can figure that out but all of these highly paid bean counters with there BAs and MBAs can't?
1-12-2007 @ 7:16AM
Ron Cada said...
I'm a long-time customer who purchased a small item so I could vent my dislike on the "opinion" website. I love the store, the people who work in it but said I would not return "unless and until the Board rescinds the ridiculous parachute". Menards is available and Lowe's is building in Lincoln, NE, but I am sad to not be able to donate the profit to the CEO of the day......
1-12-2007 @ 7:16AM
Walter said...
I am one of those part time "idiots" and believe me tenure is not a measure of compotence. As far as executive compensation there is no question Nardelli's seems excessive and while it is true the stock is soft at the present time, which is true of most DIY companies right now, you have to look at where HD was six years ago and where it is today when it comes to revenue, growth,profitability, etc.
1-13-2007 @ 9:45AM
robyn said...
i worked for home depot when the original founders we still the main power. it was a GREAT company to work for. i took a couple of years off work then returned to home depot. i could see the difference in the company and the MANAGEMENT when i returned. i knew the difference was the founders, that honestly cared about their business, had retired. i don't blame them for retiring, they worked hard all their lives for this. it's sad to see that THIS management doesn't care nearly as much for it's customers or employees as the original one did. maybe now a new c.e.o. that does care, will be appointed. finding a good company to work for these days sure is hard.
1-16-2007 @ 8:30AM
Bob Cooper said...
Lot's of negative sentiment toward HD here. Unfortunately as a shareholder I'm afraid most of it is true. Service is down, but I still shop there. It seems to me that prices and selection are better than LOW. That is not a scientific assessment, but it seems that way to me.
I believe HD may be a good buy now in anticipation of a great recovery.
1-20-2007 @ 11:49AM
RICHARD LEE said...
It's very true that Home Depot has gone down in customer service by cutting experienced & knowledgeable associates. As employee of eight years, I have seen mangement & Dh's take a toll in inexperienced & stupidity and too many wanna be. No crue in retail business, but cheap labor & low pay & heavy responsibilities. No pay to match their daily tasks. Most of them have no business in selling environment. We paid millions of dollars to thieves who stole from store yet management is afraid to say no to refunds. Yet, CEOs' are stealing from our retirements, bonuses, other incentives every day. BOb Nardelli & his board members should be canned, vote out the old regime. Join Ney. Ken and other crooket CEOs in jail for backdating the stocks on our expense. Vote fat "NO" to your proxies that they spent thousands of dollar preparing, money wasted for fancy nonsense packages. All HD have same complaints from associates, thanks for waking up America. BOB you should be ashamed of your greed.
1-21-2007 @ 9:40PM
BOB Matthews said...
As a employee of 9 years at the HD... When it comes to home improvement needs, we have to places to go, HD or Lowes, and everyday I hear Customers scream and complaine on a daily bases, Lowes has the same prod/prices,that means HD has to provide good customer service, and with unhappy employees HD will loose thier customers, wake up Atlanta, you need to respect your employees just like your customers, with out your employees hard work you would not make the money, if you dont have happy employees, you will never be ablr to keep your customer happy.
1-23-2007 @ 7:30PM
Rich Schollenberg said...
I refuse to shop at HD. If their BOD can reward incompetent CEO's with a salary that exceeds in one day what an employee makes in a year and a severance package that is way out of line, they don't need my business. It is time the American Public stops the rape of wages, prices and investors money to benefit a select few.
1-24-2007 @ 8:26PM
Junior said...
What's everyone complaining about? We, the American public, have created these gigantic slush boxes (read: Wal Mart, Home Depot, Lowe's, etc.) and we support them more and more everyday. Wake up people, spend your hard earned money with your neghborhood mom and pop retailers and teach these "big box bozos" a lesson. If you don't, stop complaining about their ridiculous schemes to fleece the population of our money. These big box retailers make their money off the backs of hard working, mostly part time people and line their own pockets with the "sweat" that these people have generated for them. Boycott Now or ShutUP!!!!