The Home Depot (THD) expects to offer pros delivery service in virtually all its markets by this spring as it beefs up its outside sales and online capabilities thanks to last year's acquisition of the home repair and maintenance products firm Interline, the big box's vice president of pro business says.
"A year ago, I'd have said delivery is not a competitive advantage for us," J.T. Rieves told ProSales. But delivery service first tested two years ago in Las Vegas and one year back in New Orleans is now available in every U.S. market, he said. The plan calls for delivery promises to be phased in: First offering same-day service and a four-hour window, and eventually service within a two-hour window. In addition, "hotshot couriers" continue to be offered at 500 THD stores nationwide, he said.
Rieves noted during the Jan. 11 interview that when he used to meet with customers, their No. 1 complaint was delivery. "Now, If I take you to a place like Las Vegas, it's not on the list," he said.
Just 4% of THD's customers account for roughly 40% of its $88.5 billion in annual sales. This group is Rieves' focus, and historically it has focused on maintenance crews, painters, repairmen, and small remodelers more than on the kinds of builders that LBM operations serve. Very few get products delivered currently, he said. In fact, even as the delivery service gets ramped up, THD continues to promote a service it calls BOPUS--Buy Online, Pick Up in Store. Given THD's ubiquity and hours, that system saves time for remodelers and small builders as well as maintenance and repair crews.
"If I can get the average pro to come three more times a year, that's a billion dollars" in revenue, he noted.
THD's efforts to rev up its delivery capabilities got turbocharged in 2015 when it bought Interline Brands for $1.63 billion and merged it into Rieves' operation. The VP mentioned four things Interline brought to THD that dealers should note:
- Interline's 700 outside sales reps will more than triple the 200-member OSR team that the Home Depot had been using to sell to pros.
- Interline has 900 trucks, thus making it easier to THD to deliver goods to a job site. One of Interline's claims to fame was speed of delivery, Rieves said, and its pricing was based in part on how fast it could deliver goods.
- Products that Interline had sold via catalog and the web will be available for order at the Pro desk inside THD stores; heating and ventilation systems is one example.
- Interline's web offerings are being merged into THD's online system.
THD also plans to continue the 60-day payment terms on house accounts that it implemented last year. But for the most part, Rieves said, his focus is on getting Interline's staff fully merged into the THD family.
"The question I get most," he said, "is 'When do I get an orange apron?'"
