Arthur J. Villasanta – Fourth Estate Contributor
Mooresville, NC, United States (4E) – Lowe’s Companies, Inc., the second largest hardware chain in the United States and the world, will close 51 of what it says are underperforming stores in the U.S. and Canada.
Lowe’s operates some 3,400 home improvement and hardware stores, and employs over 310,000 people in both countries. It said the decision to shut down these stores will help it focus on its most profitable ones
Lowe’s will shutter 20 stores in the U.S. and 31 in Canada. It said a majority of the shuttered stores are within 10 miles of another Lowe’s location. These stores will be closed before Feb. 1, 2019. The company will try to find jobs at nearby stores for its employees affected by the closings.
“The store closures are a necessary step in our strategic reassessment as we focus on building a stronger business,” said CEO Marvin Ellison, who was hired to turn around Lowe’s sagging fortunes.
Lowe’s is struggling to compete against Home Depot, the largest hardware chain in the USA. Lowe’s revenues in 2017 came in at $70 million compared to Home Depot’s $100 million, Its stock price is also weaker than Home Depot’s, leading to pressure from activist investors.
Earlier this year, Lowe’s hired Ellison, a home improvement veteran, to turn the company around. Ellison was a top executive at Home Depot for more than a decade. He was previously CEO of department store chain JCPenney.
Ellison’s plan to restore revenues and profitability has included closing all of Lowe’s Orchard Supply Hardware stores and slashing inventory at its Lowe’s stores.
He believes he can boost Lowe’s sales by targeting professional home builders and construction companies with higher-quality tools and equipment; more discounts, and better customer service.
Sales to home building pros comprise 30% of Lowe’s sales compared to 45% of Home Depot’s sales.
Article – All Rights Reserved.
Provided by FeedSyndicate