Home Depot’s Business Model -Know More

With over 2300 stores around America, Home Depot is one of the largest home improvement retailing companies in the market. Innovations and creativity have seen to its success. Additionally, the innovations have so far led it to the top of the house improvement chain. Here is what to expect from Home Depot’s business model and strategy and of course how it also operates.

Home Depots Business Model

This article focuses on Home Depot’s current (2022) business model, strategies, and how a combination of their model and strategies can bring out the kind of success the retailer has achieved.

Home Depot’s business model

Home Depot model features a combination of services and products provision for home quality improvement like furniture, building materials, tools among other things that one may need to improve the quality of their homes.

The company has increased its online presence by acquiring online-based companies. The company’s adoption of eCommerce has also helped the company expand immensely.

Over the years, Home Depot has been able to establish itself as a strong clients base. This has been enforced by the company’s creative innovations.

Let us talk about how the Home Depot business model works

Home Depot model operates through more than a thousand stores, buying some of the online companies has helped make it easy for customers to order and make purchases online.

Being one of the most successful home improvement businesses in North America, its major focus is on how to be on top of its competitors by providing its customers with a huge variety of products using the most trained staff to deliver the best of best services. 

Currently, this home improvement giant provides its customers with more than a million products and services using its online platform and through its stores (more than 2300 stores) spread in Canada, Mexico, and United States. 

Home Depot major acquisitions

Originally, Home Depot is a retailer dealing brick and mortar, it boosts the sales of some of its products using the online platforms that it acquires, companies such as;

  1. Compact Power Equipment Inc

Specialized in equipment rental and other services was acquired by Home Depot in 2017. Through this acquisition, Home Depot stores spread across Canada and the United States have been receiving over a thousand equipment rentals from Compact Power Equipment. After this acquisition was done in 2017, Home Depot’s service provision and professionalism were surely strengthened.

  1. Company Store

This is an online-based textile product and home décor dealer. Company Store was commonly known for its dealership in the particular clothing line, quilts, home décor products, and sheets. 

  1. Internaline Brand.

 Interline Inc was a dealer of building products majoring in distribution and direct marketing of its products to consumers.

Having acquired this company, Home Depot was able to provide maintenance, repair to maintenance pros, hardware stores, contractors, and some of its customers residing in Puerto Rico, Canada, and the US. Home Depot’s maintenance and repair business sector not forgetting professional contractors boomed increasing the company’s sales and revenue.

The acquisition of this company increased Home Depot’s capabilities and networks of distribution. 

  1. Redbeacon.

Redbeacon is an online-based business offering home improvement services including online search directories of local business listings, screened and approved reviews, and ratings of home contractors. This platform provides customers with quotations and appointments bookings with local professionals. Hence this acquisition improved Home Depot’s online presence.

Let’s see about Home Depot’s business strategies

Like other big brands, Home Depot uses;

  • A combination of both cost leadership and broad differentiation strategies in its operations. This strategy has helped Home Depot to acquire more customers with very minimal costs on the products. 
  • The broad differentiation strategy is the major strategy that gives the company its competitive advantage over its mates! Home Depot can provide its customers with outstanding and quality products and services with broad differentiation.
  • Moreover, this strategy allows the company to provide a wide array of goods still maintaining high-quality services by the field experts. For more customers conversion the company employs a cost leadership strategy emphasizing everyday low prices.

Other strategies

Other strategies backing up Home Depot’s business model include; products development, market development, and market penetration.

Product development strategy. The company uses products strategies to push its products into the market promote its business products. With this strategy, the company has developed a culture of attracting new customers who are ever yearning to taste new products in the market. 

  • Market penetration strategy 

Home Depot applies this strategy to its advantage by devising new customers attraction techniques within the already existing markets. The company combines both leadership and market penetration strategies to provide customers with a variety of products at an affordable price.

  • Market development strategy

The profitability of Home Depot relies heavily on the successful execution of this strategy. The strategy aims at venturing into new market segments. Home Depot has, however, achieved this through the acquisition of online companies making it easy to establish its online presence. 

 Closing sentiments

Home Depot employs a retail business strategy to sell its home improvement supplies to its target clients. Additionally, the company uses online acquisitions to further its operations. 


Q: which business model does Home Depot use?

A: Home Depot uses the retail business model.

Q: What makes the Home Depot business application unique?

A: Home Depot applies a retail business model aiming at its prices and service to customers.

Home Depot’s Business Model -Know More

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