Ace Hardware, Home Depot, and Lowe’s Boast Outstanding Quarters
The Home Depot, Lowe’s and Ace Hardware all posted outstanding first quarters of 2021, as shoppers still clamor to make home improvements.
Home Depot’s comparable sales were up 31%, Ace Hardware’s jumped 30% and Lowe’s were up 26%.
“The strong demand that we’ve seen for more than a year now has continued,” said Richard McPhail, EVP and CFO, The Home Depot. “During the first two weeks of May, on a two-year stacked basis, we’ve seen comps in the U.S. above 30%. Housing remains strong, homeowners balance sheets are healthy and our customers continue to tell us that they are planning on spending of variety -- on a variety of home improvement projects.”
Same-store sales growth, 51 new stores, a 220% increase in its digital business, and increased retail inventory depth drove the best first quarter in Ace Hardware’s history. Ace Hardware reported record first quarter 2021 revenues of $2.0 billion, an increase of 42%, from the first quarter of 2020, yet John Venhuizen, president & CEO noted “elevated demand, limited supply, and a ridiculously disrupted global supply chain continue to create a difficult environment operationally.”
“This remains a very difficult environment to operate retail stores in,” Lowe’s EVP, stores, Joe McFarland also noted.
McFarland claimed Lowe’s focus on perpetual productivity improvement continued to yield results during the quarter as the retailer leverages store payroll by using technology to reduce tasking hours, improve customer service, and increase sales productivity. Lowe’s rolled out digital signs in appliances and lumber to cut down on associate tasking labor. The signs also support better product margin performance, as Lowe’s can more rapidly implement price changes in line with the market.
“We're also leveraging an improved freight flow app, creating a fully digital process that gives our associates better line of sight to when products will arrive at our stores,” he noted.
Lowe’s developed the mobile app in-house, which helped store associates to prioritize the incoming merchandise so they can quickly and efficiently position the product on the sales floor. In the quarter, the retailer also completed the rollout of buy-online-pickup-in-store (BOPIS) lockers to 100% of U.S. stores in April.
Home Depot saw both ticket and transactions up double digits in the quarter, and saw strong double-digit growth from both Pro and DIY customers.
“We continue to rollout new capabilities, such as mixed cart selling from store that remove friction for both our customers and associates,” said Craig Menear.
The mix cart feature enables associates to more efficiently and effectively serve the total project needs for a customer, as products from both the website and store can be added to a single transaction.
“We also continue to drive interconnected enhancements in other areas of the business to solve customer pain points,” he continued. In tool rental, Home Depot will soon rollout its rent online pilot chain wide, enabling rent-online-pickup-in-store capabilities for all 1,300 plus tool rental locations in the U.S. and Canada.
“This will enhance the experience for our busy Pro and DIY customers and complement additional investments we’re making to expand our rental footprint and increase our assortment and delivery capabilities,” he said.
For Ace Hardware, increases were seen across all departments with outdoor power equipment, grilling, power tools and paint showing the largest gains.