The large number of responses we received to my story Home Depot management should stock shelves & help some customers tells me I touched an important subject in the minds of our readers. Almost all the comments supported my contention that the first step toward improvement of The Home Depot (NYSE: HD) must come from management creating a deeper dialog with employees, customers and shareholders. This means management must roll up their sleeves and get personally involved with customers and staff.
Not surprisingly Home Depot executive management had nothing to say and no comments were received from Home Depot, not even a public relations person. It would have been spectacular if there was a dialog. I have been a supporter of giving management time and have viewed the stock as a value proposition this year. I might change my mind if Home Depot does not radically improve the level of dialog. If any Home Depot Executives read this I hope they will add their voice. I think I will send this post to Home Depot and see what happens.
Meanwhile Home Depot also announced the sale of its HD supply to private equity group for $10.3 billion as well as a $22.5 billion Increase in its share buyback plan. This jump started the stock for a day or two, and maybe the reduction in the number of shares will have the desired effect in raising shareholder value, but if you get the cash from borrowing or by selling assets the value may be dubious since each share is part of a smaller company. Prettier picture, less substance.
Earlier in the week Home Depot's chief financial officer, Carol Tome, said in an interview this week that the world's largest home improvement store chain is doing more than just buying back stock to improve shareholder value. It's also reinvesting and has plans to improve its supply chain, store environment, employee morale and customer service. The return on investment from these actions is critical to the long term value of the company. It does make it seem they are aware of the points of dissatisfaction and perhaps are reading what you all have to say!
The following excerpts from the comments we received cover most of the sentiment expressed and I invite additional comments that might add further to the discussion. The most important thing that is missing, partially because managements views are absent, is how Home Depot can implement corrective action with diminishing capital?
Customers:
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John Katica: This suggestion is right on the money....literally. Anytime any business puts customer service below #1 on their formula for success plan, they're destined for problems. Management should definitely teach by "on the floor" example. Put on an orange smock over a tee shirt and levis and show your staff you care. Perspiration will improve the bottom line more than another report.
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haveittodayray: "Lowes is still the growth company for the future of Home Improvement, they will continue to take market share and a greater slice of the pie awasy from Home Depot."
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TEE: "My local HD is a pig pen! I feel dirty just shopping there, whether I buy or not."
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Schatzie Caldwell: "HD had a sale for Thanksgiving so we waited in line at 5:AM and the sale items were still in their boxes not cut open and salesperson stood there and refused to help we, each one of us that were there for the drills, picked up an entire box of 6 battery operated drills and took them to the cash register. There is no need to tell you other customers were furious. WE bought ours and never went back to that store."
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K: "Amen - they need to put their heads down and get to work. They cannot manage what they do not understand and with their recent push to hire from outside they need to change their management philosophy so that their outside hires can get a taste of the business."
Employees:
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Marlys: "I'm the wife of a HD employee. I have to live with my husband's schedule. The lack of HD's ability to give someone a regular schedule means you cannot plan and always have to trade days or bother the scheduler because you have doctor's appointment. This is ridiculous along with their pay schedule. My husband does his best for the client and will bend over backwards in the name of customer service. He sometimes brings his work home with him because he's so frustrated over store policy and the limitations that management puts on their ability to provide what the customer needs."
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John: "I think that a lot of the problems at HD are caused because of low salary and inexperience help...Just as others have stated you can't expect a pro to work for what the store is willing to pay....I work at a store where there are times you have one associate for three or four departments...It doesn't matter if you know anything about the departments that you cver, just get over there and do it..If you say that you are not comfotable in the department , because you are not skilled , you are told,LEARN IT... "
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Elie M: I think the pionts are valid, and there is alot of things that we are working on to improve. As you may guess i am a current employee of THD. More than an employee i am a manager for the Totowa,NJ store. For those of you folks that believe that we do not take your comments or concerns seriously, your sadly mistaken. I challenge you folks to gear your comments to your local store managers; contrary to your beliefs, many of us are "down in the treches" to make sure service and safety are priorities.
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Skidoo: "-Frank Blake has been in position for less than a year, give him a break people, you aren't going to see changes overnight.
-During his time in the company though, there have been more changes for the good in that one year than I have seen in my 3.5 years with the company.
-Yes, he is consulting the founders Arthur & Bernie. Arthur & Bernie's take on the Nardelli regime: "What the hell did you do to my stores?"
It seems to me that The Home Depot is suffering from ailments that remind me of a losing sports team. When the team is winning all is forgiven and when it's losing, the locker room gets nasty, the seats are not filled, and everything is put under a magnifying glass. In particular things like Ex-CEO's Bob Nardelli's pay and severance package resemble the outlandishness of doubling ticket prices for an unwatchable losing team.
All this said customers must recognize that management is struggling to find the dollars to make the kind of improvements we would all like to see. Home Depot has very large fixed costs in their "physical plant" (buildings) employee costs, and everything else. When things get tight, be it at your home or The Home Depot, things can become ragged around the edges. You decide to re-stripe the parking lot every four years, instead of every three; you decide to extend roof repair cycles, and slow down or reduce employee costs and more. While Nardelli was the poster boy for many of the companies ills, his ridiculous compensation is only a drop in a very large bucket.
From my perspective as an architect I would be addressing energy consumption as a major line item, but they may have been doing this all along and not made it known. Maybe a more dramatic approach is needed. It's your turn now...what do you think? Lets talk about financially viable solutions. In the original story I asked management to come back down to earth. Now I am extending the conversation to put customers and employees in management's role. Where would you find the money for the corrective action you would implement? We have heard the problems, what are the potential solutions?
Those of you who are new to BloggingStocks can check out my other stories and read Chasing Value or Serious Money to find more potential opportunities and verify my track record as well.
Sheldon Liber is the CEO of a small private investment company and the vice president for design and research at an architecture & planning firm. Check out his other posts for BloggingStocks here.
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Reader Comments (Page 2 of 2)
6-24-2007 @ 9:34PM
DepotGal said...
First I would like to say that I have been with the Depot for 3.25yrs, started out pt as a lead generator, and currently run the special services desk. I resent the fact that you think that college kids who work at the Depot just don't care. I worked full time through college and stayed with the Depot afterward. Would I agree that they have terrible promotional opportunities, yes, and that is what causes your college students to leave. HD can't seem to figure out how to retain it's talent. Here you have a pool of fresh college grads who KNOW about your business, and you do nothing about it. You let them leave. This is the least of HD's problems, as everyone who has posted has legitimate complaints. But answer me this... do you think that it is easy being the associate who knows that there is no help in any of the departments, calling around to all the people on the floor to see who is on that can mix paint, or cut carpet, or make a key, cut wire, sell you a tractor, operate a forklift to load up your truck with lumber, oh and answer the phones and take returns while they're at it? We get customers who walk into our stores with a chip on their shoulder the size of Texas, because of one bad experience five months ago in a different store. Not all Home Depots are alike! Try a different store, we're our biggest competitor. And don't walk into every Depot thinking they are all the same and that the help sucks just because you had one terrible experience. We are all human. It is time for some mutual respect.
6-25-2007 @ 12:02PM
Al said...
I live in the Washington DC area in Northren Virginia (Vienna) and we have 2 Home Depots within 3 miles of each other and Neither one of them are worth a dime. NO customer service and when you do get customer service over half of the employees know VERY little WHEN you can even get someone to help you. The check out lines with cashiers is only 2! and the rest our self service. I over pay enough for this stuff as it is, why should I have to check myself out too! God I wish we would have a LOWES in this area, Home Depot needs some SERIOUS competition!
6-25-2007 @ 10:40AM
jim said...
As a spouse of a FORMER HD Asst. Mgr. I have been a first hand observer of the treatment of the long term employees of HD. With 5 years as a Asst Mgr and 11 years with HD my wife was fired by a ninty day wonder with no retail exp. who was moved in by Nar-dilly With never a write up in 10 years she was given a 90 day termination notice, which she completed. One year later she was fired with no notice for the 2005 write up. Could it be because she turned 65 2 months prior, or because another store managers wife, 26 years old was promoted and transfered to the store my wife worked in I am glad she no longer works for HD But The new hires in management have no retail exp. and fine a way to force out or fire anyone with more knowledge then them.. It sures smell funny.. Thanks for letting me vent
6-25-2007 @ 10:43AM
Sheldon L said...
Stay tuned JB, I will posting more on the subject.
6-25-2007 @ 12:06PM
Rob H. said...
There's a Home Depot location only 5 minutes from my house, yet I drive a good 30 minutes to the nearest Lowe's more often than not because I know there is a higher level of service. Example of an issue I've encountered at Home Depot: I insulated my attic last winter and ran out of insulation with a crew of 6 waiting for me buy more. I had been told the night before that it would be stocked by 5 AM. I went by at 6. There were several workers standing around gossiping, but none of them were willing to step away from their all important gossip session to help me chase down insulation (not stocked of course). I finally found it stacked on one of the racks high off the floor. I asked at least 8 people for help and was told someone would be right over. After a 30 minute wait I climbed up and threw down the bails myself. Several employees walked by to the break room next door while I was tossing bails and a couple of other customers had to dodge the bails as they came down. No employee offered assistance or even took a second glance. Obviously they have no training in lawsuit prevention nor customer service...
I did complain to management, but they were entirely indifferent and suggested I shop elsewhere. I do shop elsewhere now and encourage others to do the same.
6-25-2007 @ 10:58AM
Terry said...
The HD's that are closest to my home are horrible. Once I waited nearly 42 minutes for a manager to show up and get the price of an item that had none. When the salesman told him on the walkie talkie toy that there was one smaller next to it for a certain amount, he comes out and doubles the price of the one I was asking about, based on the price of one that was totally different and 1/4 smaller. You might wonder why I waited so long? Actually, after the first 10 minutes, I started to go into shock at how long it was taking for anyone to give me an answer, so I was waiting to also complain about that. By 30 minutes in my blood was boiling and I could not even think straight. When the manager finally came out of his "meeting" 42 minutes later. He tollk one look at me and said, with not one ounce of apology for having me wait so long, "Yep, that's the price I am putting on this, the tag must have fallen off.", then nonchalantly walked away.
I was furious! I find the employees at the Crismon store in Mesa Arizona and on Power Road also in Mesa to be very racist. But the managers remind me of something out of a bad mafia movie, where the employees follow you out to the parking lot calling you "boy" asking to double check your receipt to see if you have paid for everything in your wagon.
Horrible horrible horrible at Home Depot! Above all else, HD needs to train their management and staff in cultural diversity because when I enter and am the first in line to be helped by an employee, I except not to be put off while white men and women ask questions, even interrupting my being helped. I had an employee in the middle of helping me, get asked a question by a white male in the same isle and he went off with him without completing helping me. I took my green money elsewhere and do not shop there anymore but I wanted you to know my experience with HD. By the way, it was not that he had ADHD or ADD, he just played into the belief that my request was not as pressing as the white person and walked off with them telling me, hold on a second.
I wish more people would respond by not buying there when these things occur. I may pay a little more elsewhere, but guess what, I get served and treated with respect and common curtesy.
Terry in the East Valley of Arizona
6-25-2007 @ 7:34PM
Jerry Bluhm said...
You can get some trash talk from almost any companies' employees and from customers as well, but right now things are not good. HD and Lowe's build their company by making each employee an associate in the company who shared in the wealth. Employee owners they are called. A few years ago both companies trully had employee owners. The companies really did put the employee first. Executives are always saying put the customer first and you will have a great company provided you have enough merchandise at the right price and at the right time to satisfy the customer. The REAL TRUTH is companies that really treat their employees as associates and allow them to share in the profits of the company to the point that the employee really feels ownership, then and only then will you see great customer service. You can have all the training programs in the world and I do think time should be spend on training, but without proper treatment of the employee customer service will never be where it could be. The way a company treats its employees will always be reflected in how the majority of employees will treat the customer and their jobs. Companies begin to really increase sales and profits and value to the investors and then they do a 90 degree turn and begin to take from their employees. When an employee feels he or she has little to loose he or she will feel they have little to give. It is a very simple formula that keeps the great companies great. It is sad that there are very few companies that became great but turned away from what made them great. Is it greed, or is it the few just refused to share with the masses.
6-26-2007 @ 7:37AM
Meesh said...
I have been an HD employee for a year now working as a cashier. They never have enough help and when they hire people they never last because they hire the dumbest of the dumb and pay the new ones crap. And here I am a part timer who is one of the most reliable in the front end and they cut my hours instead of the dummies who are $100 short on their registers. Go figure.
6-26-2007 @ 1:54PM
SIR said...
I CANNOT BELIEVE THAT SO MANY PEOPLE ARE ACTUALLY SAYING THE SAME THINGS THAT I HAVE FELT FOR THE LAST 5 TO 6 YEARS,(EVER SINCE NARDELLI). TRUST ME , I WAS EMPLOYEE FOR OVER 16 YEARS AT HD AND THAT "PIG" TOTALY DESTROYED EVERYTHING THAT BERNIE AND ARTHUR STOOD FOR. I WILL NEVER,NOR WILL ANY OF MY FRIENDS OR NEIGHBORS SHOP AT HD EVER AGAIN. I WAS FIRED FOLLOWING HEART SURGERY BECAUSE I """"COULDN'T WORK TO 100% OF MY CAPACITY"""". THAT'S EXACTLY WHAT I WAS TOLD BY HUMAN RECOURSES, EVEN WITH A NOTE FROM MY DOCTOR. THERE IS NOTHING GOOD ABOUT THE WAY THIS CO. TREATS IT'S EMPLOYEES AT ALL. THEY HAVE TAKEN AWAY EVERY PERK THAT EMPLOYEES USED TO LOOK FORWARD TO. I HAVE WORKED IN 4 DIFFERENT STORES IN 2 DIFFERENT STATES, AND BELIEVE ME , THEY ARE ALL THE SAME. I HAVE GOTTEN RID OF ALL OF MY HD STOCK AFTER 16+ YEARS AND INVESTED IN OTHER STOCKS, (BEST THING I EVER DID). THIS CO. WILL NEVER RECOVER FROM THE DAMAGE DONE. I DON'T CARE WHAT THEY TELL THE PUBLIC, NOTHING HAS CHANGED AND NEVER WILL. SINCE I'VE BEEN OUT OF HD THE ENTIRE OUTDOOR GARDEN DEPT. HAS EITHER BEEN FIRED OR QUIT,SOME EMPLOYEES WERE THERE FOR AT LEAST 5 TO 6 YEARS, WHAT DOES THAT TELL YOU. THERE IS ABSOLUTLEY NO REGARD FOR CUSTOMER SERVICE OR EMPLOYEE MORALE FROM MANAGEMENT AT HD. THE ONLY THING THAT THEY CONSTANTLY HARRASS THE EMPLOYEES ABOUT IS MAKING "PLAN" SO THEY CAN MAKE BONUS. LOWES IS THE PLACE TO SHOP & INVEST IN, THEY'RE NOT PERFECT BUT THEY CARE AND SHOW IT.
6-26-2007 @ 8:48PM
s said...
I worked at the THD store 4158 hilltown that sore is screwed up never enough people there to help customers RTVs were at a high 50k and they (mangers)sitt in the office never to be seen only two worked there butts off to help and make life better for both customer and workers. i worked there as a cashier my skills and training were more then what they put me in. a customer one day came throught the line with a cart load of copper wire showed a recipt and i looked at it and it did not match up wrong store wrong product i told him to wait(company police dont hold people that is lps job called manger and it tok then a while to answere and come out by that time the guy left and hey im not stoping someone with what i got paid over some wire about 800 dollars worth they said (manger)ok did you get his plate # i said no he had no plate on the car and i said look at the tapes they never did well thats messed up no wounder thd is losing no back up of the works plus crapy hours = bad service i left and found a real job real money and ps they pay the women with exp less then the men i had no register exp i bilt them hmm messed up or what
6-27-2007 @ 8:23PM
Edie said...
My last trip to Home Depot was fruitless I had a list of about 6 items I needed, I couldn't find hardly any of the items I went in for and the items I did find had a very limited selection. I am really fed up with the constent fork-lifts riding allover the place and shutting isles down. Stock at night. Hire a Night crew!!! Or if someone purchases something that is up high...keep 1 or 2 at floor level. Sorry I am not a warehouse shopper, Wise-up
and run your business like a normal business. The self checkouts in the stores only put people out of a job, I never use them even if I am in a hurry, I do see alot of Men using them I hope you are not Union workers, regardless think of how you would like some one automating your job???...That's All
6-30-2007 @ 7:15PM
claudio di gangi said...
I shop at home depot and Everytime i ask for Help :I getit:! People are friendly and willing to help. The home dopot is in montville n.j.
6-29-2007 @ 4:14PM
Jay said...
Hello all,I have shopped at H-D here in Oralndo 2 stores (East Colonial & now Lee Rd)& Hemstead,NY Oh & I have applied to these stores also..I do have good cust. serv. skills after working with the public 20+ yrs. Most of the time it is hard to find help & when you do you better be nice..I love to go to the store & know what I'm there for& find it myself.When I first moved to this house I thought wow I could walk to H-D cool..Where is all the help I do understand prices need to be kept down but what about the bigwigs crazy salaries..Try getting a key cut that could be an experiance in it's self.
6-29-2007 @ 6:02PM
Lorraine said...
My son worked at Home Depot from around 1995 to 2002 and last worked at a HD Expo Store. When he started working there the employees were trained by management and there was always help to be had on the floor. They need to correct this problem but I have had many unpleasant experiences in all types of other stores. For instance: A Walmart finally opened about 5 miles from where I lived and I was so thrilled before it opened because I do a lot of shopping there. I live in a neighborhood with houses in the range of $250,000 to $500,000 The first time I went in there I was shocked to see that there was only 1 white employee working there and the rest were all black and hispanic as were the customers. I am not prejudiced if the persons do their jobs but I encountered the finger pointing "it's over there"; "I don't know if we have that" (doesn't bother to check); hispanics talking to each other in spanish and no thank yous at the register. Lowe's is more balanced as to race but I can never find anyone to help me; people in the garden shop don't know anything about plants, and at the return counter when I was returning a "sick" plant the girl asked me why I killed it. I'm also disgusted with KMart, Sears and other smaller stores, so you see, it is not just HD but many stores. The thing is, people don't take pride i n working for a company and a lot has to do with the way they are treated.
6-30-2007 @ 8:48AM
Pat Frintzilas said...
I have a HD right up the road. The store is unorganized and confusing. Last week my husband and I were there to pick up one item. There were no cashiers and two self serve registers. There was one nasty and angry employee who was not helping people with the self serve registers. I was dumbfounded and amazed there was no manager to be found. We will be going to the Lowes a few miles from us from now on. With the cost of gas, I have given HD many chances!!
6-30-2007 @ 9:26PM
Sarah McCarthy said...
I know exactly what happened to the Home Depot. I worked there for 13 years,when it was under the original owners it was the best place to work and buy things from. There were very few essential rules,the customers came first, the employees were treated like family,we had to learn about the products through classes,we were taught how to help the customers with their projects and then along came Nardelli who tried to make the full timers cut their hours so they didn't have to pay for our benefits,for those of us who were working there and couldn't afford to lose their medical benefits and made better salaries then new and younger employees the company either made them go part time or fired them whether they had a legitimate reason or not. I know that for a fact from personal experience.It happened to me. I took them to court but after 4 years an appellate judge decided to dismiss the case and sealed it, I had witnesses both customers and employees who were going to testify,but this judge was either to busy or lazy to read the transcripts, or in my opinion bought off to shut the case down. Like I said that's MY opinion. Now customers get poorer service by people who don't get the training and know the merchandise like they use too.It truly is a shame for everyone, but its all Home Depot's fault, and Bob Nardelli. Sincerely, Sarah McCarthy
7-01-2007 @ 4:04PM
Christine said...
I worked at THD for 10 1/2 years, and had seen the way the human resource manager would laugh at the employees with the managers, the store manager would redicule the ASM's right on the sales floor. I had put my blood, sweat, and tears into several different Home Depot locations while helping out several more in that district, and management was never greatful. THD is filled with hungriest of sharks that would eat you up and spit you out after they are done with you. Once you stand up to mgmt, they find a way to get rid of you.
7-09-2007 @ 3:02PM
John said...
I won't shop in Home Depot (at least not
until my anger subsides).
I agree with post 35 that people are willing
to help, but willingness is useless - they
don't know much more about item location than
a newcomer. I am tired of being sent to one
end of this huge store by one employee, then
being sent back by another, etc.
So, it takes at least 30 minutes to find
each item and that is only if you know exactly
what you want. But if I don't know exactly
what will fit my need - then it may take
a whole weekend.
But this is not why I am angry.
After spending 45 minutes and picking two
items (they were related, therefore it took
45 minutes instead of 60), I found that they
have most registers closed. I was told
that they only have register #1 (that's where
the heavy stuff is sold).
While waiting 15 minutes in a long line
of contractors with carts full of cement,
plywood, etc, I made the following simple
calculations: $210 million CEO Bonus divided by
2,150 stores further divided by $9/hr cashier
salary amounts to about 5 cahier-years.
That is if they had caught this CEO-thief in
time and take away stolen money,
they could have opened 5 additional
registers and kept them for a year or
one register for 5 years.
So I realized that this thief simply stole
my time and caused anger and stress.
Since the line to register #1
didn't move a bit, I simply threw my items
to a closed register and walked away.
I hope never be back.
P.S. Please, double check my math.
7-11-2007 @ 10:14PM
Leon said...
I used to work for Home Depot. The morale is terrible because corporate refuses to adequately staff the stores. Why don't they understand that sales would increase dramatically if they put more employees in the store to wait on customers. Most people despise the self-check, they want a real person to take their real money and thank them for it. The products are generally good but if no one is there to get them down from the overheads, ou may as well not have them at all!
8-10-2007 @ 8:54AM
becka said...
I am a home depot employee, and since i been working there (1 year), the moral of follow co-workers has gone down hill, due to managment. if managment dont care or recognize good customer service why should the employees care, which is wrong , because i do care. employees that do care are not being recognized. I think that managment should have to work on the floor and with the customers, so they know what we go through in a days time. to all you hd customers i apoligize for the bad service you are getting. the next time u go to a hd store and see a manager standing there get them to help you, see what the response is.