The Home Depot described its third quarter earnings report as something the company is “very proud” to announce, following strong gains and an increase in sales of more than 8 percent over the same period last year.
In addition to a boost in sales from hurricane relief in Texas, Florida, and Puerto Rico, the DIY is very happy with its process with pro customers, which say a significant gain over a year ago. “Big-ticket sales in the third quarter or transactions over $900, which represent approximately 22% of our U.S. sales, were up 12.1%,” Edward Decker, Vice President of Merchandising said during an earnings conference call.
“The increase in big-ticket sales was driven in part by strength in appliances, vinyl plank flooring, special order carpet, and several pro-heavy categories.”
Decker went on to say there is strong growth in a number of categories bought by the pro customer, including wire. “Sales to our professional customers grew double digits in the quarter, with similar growth rates in both our high-spend and low-spend pros,” Decker added. “Pro-heavy categories such as lumber, wire, insulation, gypsum and hand tools, all had double-digit growth during the quarter.”
The Home Depot is also seeing some positive results from their work to put sales people on the street to sell to contractors. “We have made some enhancements to our Pro MyView system in the store which gives our PASAs, or pro account sales associates, a better view into their customers and better insights on where to reach for category expansion and how to get a better engagement with our customers,” William Lennie, Executive Vice President of Outside Sales and Service said.
Lennie added that Home Depot is doing two things to keep its pro customers happy. “(The first is) pro MRO, which gives the pro customers shopping in our stores access to the Interline catalog and we’re seeing that engagement in those sales ramp week-over-week in a nice fashion right on target to where we would expect them to be. Key categories for engagement with the pros are running in plumbing, electrical, HVAC, and hardware,” Lennie added. “And then the second initiative is our ProPurchase card which I would really describe as a pro access card. It gives the Interline customers access to shop our stores and with the swipe card have their purchases billed back onto their accounts.”
Home Depot executives did not get into details on how their online offerings to the pro customer fared in the third quarter, but offered a little insight that they were seeing positive results. “And so that means we have to continue to invest in the (online) experience and at our Investor Conference on December 6, we will lay out our investing plans,” Carol Tome, Chief Financial Officer explained.
If there was one negative in the Home Depot results, it came from lighting, where the DIY reported price competition drove revenue down for the third quarter.
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