Dive Brief:
- After announcing plans to invest $1.2 billion in its supply chain and stand up 170 new distribution locations, Home Depot is "now live with a number of these pilot facilities," CEO Craig Menear said on the company's most recent earnings call. A spokesperson was unable to provide the exact number of new locations.
- "We'd look to fiscal 2019 as a year to take what we have learned in pilot," Menear said. "We expect to complete by 2022."
- This investment is part of the company's plan to achieve same-day delivery nationwide. The retailer said it is currently able to reach 70% of the U.S. population with same-day delivery.
Dive Insight:
New distribution facilities are not the only change Home Depot has made in how it plans to get goods to consumers. It is also installing pickup lockers in stores to allow customers to select what they want online and pick it up in the store. The company has installed these lockers at about 1,000 locations and expects to install more in 2019, Menear said.
The lockers help with the growing number of customers who want to take advantage of BOPIS. "Approximately 50% of our online U.S. orders are picked up in our stores, a testament to the power of our interconnected retail strategy," Menear told analysts.
The addition of the lockers is about helping to further accommodate these customers' needs, Ann-Marie Campbell, the executive vice president of U.S. Stores, said during a 2017 investor conference.
"The lockers give our customers the ability to walk into our stores, pick up their product, right?" Campbell said. "So it's not just about the front end in infrastructure it's also about capabilities and driving a high level of convenience for the customer as well."
Despite distribution and locker investments, fourth quarter sales for the retailer were lower than expected and executives are placing the blame on the weather. "Wet weather delays projects and this was evidenced in our sales performance in the quarter," Menear said.
