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Home Depot CEO: Internet biggest challenge

Housing market getting better

Home Depot CEO Frank Blake spoke to the Roswell Rotary Club Jan. 24 about the company and how he sees its future. JONATHAN COPSEY. (click for larger version)

JONATHAN COPSEY. (click for larger version)
January 27, 2013
ROSWELL, Ga. – The future looks good for Atlanta-based The Home Depot, said Chief Executive Officer Frank Blake, but there are significant challenges to keep it that way.

Blake spoke Jan. 24 to members of the Roswell Rotary Club about his company and how he saw the coming years.

In his six years as CEO, Blake has turned a lagging home supply chain into a profitable, nimble retail giant even in the midst of the worst housing crisis the country has ever seen. He attributes his success to four key areas – taking care of employees, restructuring the supply chain, investing in customer service and investing in IT.

The Home Depot employs roughly 20,000 people in the Atlanta area alone. They are expanding their footprint by adding a call center in Kennesaw.

For a home supply store, the housing slump of the past few years has been catastrophic. Blake is proud of the fact his company has emerged from it stronger than ever.

"As a country, we've been through an amazingly difficult time in the housing market," he said. "For housing, it's been worse than it was during the Great Depression. We're proud of the fact that, with the housing demand in 2011, we grew profitably."

The centers of the housing crisis – Florida, Arizona and California – are improving, albeit slowly. And that means more people buying goods in the stores.

"While it may not come roaring back, at least we're in a healing mode."

The most significant challenge facing the company, he said, was the threat of losing sales to Internet companies.

"Retail is a detail-oriented business," he said. "You need the right amount of product in the right store at the right price."

Technology coupled with a slick supply chain can take advantage of demand in a way that previous years could not. The trick is competing with companies that skip the store and deliver straight to the customer.

From mom-and-pop stores, to the early 1900s' Woolworth's and Sears, to big box stores such as Walmart, retail has grown bigger and bigger. Now, he said, online sales have the capacity to kill retailers if they do not find a way to adapt and draw customers away from their computers.

"The Internet will have an enormous impact on the brick-and-mortar retailers," he said. "A third of all retailers will be wiped out because of dot-com competition."

Part of the reason for this is the lack of an online sales tax. Retailers such as Amazon have traditionally been able to sell goods without adding state sales tax because they are not physically located within the state. For those states that have changed that, online retailers have been slow to adopt it.

Georgia's online sales tax went into effect at the beginning of the year, and Amazon has yet to implement it.

"We are concerned about a level playing field," he said.

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  1. report print email
    declining Home Depot services
    January 28, 2013 | 12:18 PM

    I`m sadden to say that over the resent years I`ve become very disappointed with your higher prices, and now CHARGING to make a payment online.

    That is the straw that broke the camels back. I will to continue to make payments at the local store or via mail I will be going back to the local hardware and lumber yard. thank you for many years of service, D.Rogers

    Doug Rogers acct.6035322013146685
  2. report print email
    Declining Home Depot Services
    January 30, 2013 | 04:16 PM

    Hi Doug,

    We are extremely sorry for any inconveniences you may have experienced and would like to help. We've attempted to look into your issue, but your account# is invalid. Please email me at so that I may provide the correct account# to our credit specialists for further assistance.

    Thanks kindly,

    Robert G
    Home Depot Customer Care
    Social Media Team

  3. report print email
    LG Washer and Dryer
    January 30, 2013 | 08:42 PM

    I purchased my second LG washer and dryer in 2007. The first set was bad within the first month, but it took Home Depot almost six months to finally replace the faulty dryer. Now I have a replacement, but have the same problem with the dryer that I had the first time, a faulty drum. I have had this set in storage for over two years as I had one in my vacation home already. Since moving I have been using the new set and it takes over an hour to get my clothes dry and its just me in the house, very small loads and its making the annoying loud thumping sound again. Its a cracked drum. LG has had this problem and know about it, but neither LG or Home Depot will help or repair or replace this defective dryer. I paid over $2000 for the set, and even paid an additional 300 for an extended warranty. Of course now that I have it up and running the agreement has run out and both LG and Home Depot do nothing. I am so unhappy with both these companies. I remodled my home from top to bottom and used Home Depot for the majority of the expenses. I will not use them any longer, I will go to their competator and when and if I am in the store I will discourage anyone from shopping there as they will not help their customers and obviously do not value their customers. I have fought this for two years and have gotten no where. Do not purchase LG products, expecially the appliances and Do not shop at Home Depot, they do not stand behind the products they sell.

    Debbie Charles
    Fircrest, WA
  4. report print email
    We'd like to like
    February 01, 2013 | 07:51 AM

    Hi Debbie, we'd like help you with your washer and dryer and restore your faith in The Home Depot. Please email me your contact information and the store location where the washer and dryer were purchased to We will work to take care of this for you. Thank you!

    Home Depot Customer Care
    Social Media Team

    Home Depot Customer Care
  5. report print email
    new replacement windows
    February 17, 2013 | 10:27 AM

    Wanted new windows for sound reduction of farm/pick up truck traffic. Salesman hyped the sound and safety They were installed in Oct. 2012. No sound reduction. Did research. Spoke with Cardinal glass rep and he verified that the sound and safety windows decrease high frequency noises, not low ones such as traffic. And, the new windows have a significant draft. Installation team came out Feb 15 2013 to insulate windows with fiberglass batting. This was not done initially. They insulated just the sides of the windows. Problem still exists. I just get a runaround from people with no knowledge of the product they sold me. I want a partial refund because 1. there is no sound reduction and 2. how can my windows be energy efficient with a substantial draft? I will be pursuing this matter beyond this comment section.

    Deborah Blair
    Callahan, FL
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