Conclusion

We can work on our conclusion here. Home Depot, Inc. and Lowe's Companies, Inc. are both looking forward as they brace for the economic fallout of our present state of affairs. Each has a focus on maintaining their business edge and even allowing for growth during this period. Each company has strategic plans outlined in their annual reports and are following through with their investments in their human resources and the communities they serve.Home Depot is investing money in its workforce, maintaining the merit increases, adding training programs and working to re-develop a cultural focus on the associate, inverting the pyramid. Lowe's is not offering any pay increases, and is whittling away at salaries to keep their associates. Only time will tell which has the better policy overall. Right now Home Depot remains number one and Lowe's is solidly placed in the number two position. While both are bracing for the worst each is still able to show a profit.

The Home Depot uses a decentralized organizational structure in an effort to tailor each store's product mix to its own customer base. The Home Depot has a long tradition of empowering its sales associates to make decisions that will enhance customer service and sales. This decentralized structure is based on the philosophy that it is the sales associates on the floor that have the immediate customer contact and hear first hand what it is the customer wants. The founders of The Home Depot realized early on that such a decentralized scheme required a better than average retail sales clerk. The Home Depot made special efforts to hire experienced tradespeople (plumbers, electricians, carpenters, etc.) who had the necessary knowledge to boost sales through exceptional customer service and product knowledge. This required paying Home Depot sales associates more and the average retail wage but this strategy helped fuel the phenomenal growth of The Home Depot. By contrast, Lowe's has always followed the more traditional centralized retail structure and customer service approach.

Over the last thirty years Home Depot stock has been more coveted by investors than has Lowe's stock. This can be explained in part by the fact that The Home Depot was the first to successfully open a warehouse type home improvement store that offered low prices and relied high on volume to compensate for lower profit margins. This first mover advantage helped Home Depot to become the first national "brand" of home improvement stores. In order for their company to become a truly national "brand" the founders of The Home Depot were relentless in their quest for growth. They would enter a city's market in force opening enough stores in an area to dominate the local market. Once established they would move on to another city. In every market they entered they took on existing home improvement stores and their new store format and lower prices won over consumers. This growth strategy caught the imagination of investors. Lowe's, an older corporation saw Home Depot's success and saw an opportunity to become a competing national "brand". In order to do so Lowe's had to emulate the big stores and low prices of The Home Depot. While Lowe's has successfully become a national competitor for The Home Depot its stock has never had the same appeal as Home Depot's for investors. When examining the current state of the two companies it becomes apparent that there isn't much difference in their total equity yet the total market value of The Home Depot stock exceeds that of Lowe's. Lowe's also seems to to be in a better position regarding debts. Despite this, The Home Depot stock continues to be favored by investors with only a higher dividend to recommend it.

Both Lowe's and The Home Depot have old and active social responsibility programs. Both naturally contribute heavily to organizations that provide decent housing. They also both put much effort into environmental responsibility. These efforts include reducing and recycling their own waste as well as helping consumers do so. Sustainability is a key focus of both. Lowe's has a wood policy while The Home Depot has a labeling program to help consumers identify environmentally friendly products. Care of their own employees is a concern of both. The Home Depot is well know for its employee stock ownership plan. Lowe's has an employee relief fund. The Home Depot encourages its employees to volunteer their time locally while Lowe's is a big contributor to educational programs.