Solved by verified expert:Purpose of Assignment Students will have the opportunity to analyze and critique other team members’ submissions from the previous week’s assignment. The team feedback will allow all team members to improve their Week 2 assignments in preparation for their final strategic plan. Assignment Steps Discuss drafts of your Business Model and Strategic Plan, Part I Individual assignment from Week 2 with all team members.Choose two or three team member’s drafts and review as a team this week. You will review a different team member’s drafts each week. By Week 5, all team members’ papers should have been reviewed at least once.Propose detailed feedback and critical analysis team members can incorporate into their drafts.Prepare a maximum 700-word synopsis summarizing what the team has learned from the review and discussion. Please make sure to include specific recommendations for each of the submitted papers.
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Strategic plant Part I: New Product or Service
Hugo Soto
Monday January 29th, 2018
David Akerman
A company’s mission and vision statements are vital when it comes to the success of a
company; a company needs to have an obtainable mission, values, and goals which must also
work hand in hand with all the other tenets of business. All companies are looking to obtain the
perfect visualization for their intended audience of what it intends to achieve while it exists and
the ethics or values that will guide the organization thru their actions. With the ever-growing
aspects of other competitors, every company must continue to innovative their ways to meet the
ever changing customer demands and to gain competitive advantage. The following paper will
discuss how innovation is vital to Home Depot’s values, mission, and vision as well as its
business model. I will talk about the company’s current Mission and Vision statements and then
about the introduction of a new service designated to obtain and create customer loyalty over
other companies.
Mission and Vision Statement
Home Depot is a major American corporation established in the 1978 is not the leading
home improvement retail store chain in the United States in terms of revenue. “Home Depot’s
vision statement, based on the founders’ original purpose, is to provide “one-stop shopping for
the do-it-yourselfer.” In addition, Home Depot’s founders added that the firm’s vision statement
is also “to create a company that would keep alive the values that were important to us. Values
like respect among all people, excellent customer service and giving back to communities and
society.” The vision statement demonstrates that the company’s main goal is to be a one-stop
shopping place as well as company that targets customers that are “do-it-yourselfers”. (Home
Depot, 2015)
New Business Division
Home Depot’s vision statement is directed to the do-it yourself customers and what better
way to obtain this goal then to build a new division whose main goal is exactly that. What I
propose is to establish a new Machine Shop service in several Home Depot locations where not
only does the customer can purchase the material, rent the tools but also rent a workout space.
How many times have you seen customers come back to the store because they forget to buy
material or a piece or then do not have the tools to do the work or do not have a place to do the
work themselves and end up paying for the service of others. The Home Depot Do-It-Yourself
Shop will allow customer to not only to obtain all the necessary tools, be more productive since
the work can be done there and Home Depot will be able to engage their customers even more as
they will be there in case of questions (since Home Depot already offers expert advice at most
locations). The basic idea is to select a number of Home Depot locations (after doing market
research) and expand their property size by adding enough square footage to build individual
“storage units” type of buildings that can be rented hourly to customers based on individual
projects and equipment needed.
SWOTT analysis
In the following SWOTT analysis I will attempt to demonstrate Home Depot’s Strengths,
Weaknesses, Opportunities, Threats and Trend that could impact the company in the future. The
new business division has a promising growth prospect in this emerging market where the
company will attempt to establish themselves as the dominating home improvement store.
Home Depot Strengths – Internal Strategic Factors
Home Depot’s strengths are directly related to the success of the company where the
main strengths are their High Quality service, the company’s strong brand image, the close
relationship they have with suppliers and the company’s leadership and also for being Ecofriendly. Home Depot already has the ability to provide expert advice to customers as they have
carpenters and plumbers on their staff so having the customer work on the premises would
strengthen the customer’s relationships. Home Depot uses a supply chain approach that’s
supported by a close relationship with suppliers which in turn guarantees cost-effective and
economies of scale. Another Strength is their level of productivity. “Home Depot aims at
maximizing revenue per square foot. This is evident when one looks at the metric in international
stores — where Home Depot made ~$297 in average revenue per square foot, also Home
Depot’s mastery of productivity enhancement is also evident from their continued modernization
of the supply chain, which, after starting as late as 2007 has already reached over 18 centers, as
opposed to competitors” (Home Depot, 2015). Another company strength is their diversification
as Home Depot’s business has strength in terms of product portfolio, and operational areas.
Home Depot’s business extends across a network of about 2,269 stores across the U.S., Canada,
and Mexico. “The company has Eco Options Program for customers who are looking for ecofriendly solutions. They currently have around over 9000 products in this category. The products
sold under this category have energy stars on them to indicate the amount of power saved.”
(Hitesh Bhasin, Marketing 91, 2018)
Home Depot Weaknesses – Internal Strategic Factors
Home Depot’s weaknesses are directly relate to the nature of the business as it is
imitable, their focus and dependence on the U.S. market and their limited supply chain. “One of
the biggest drawbacks for Home Depot’s business is its high dependence on macroeconomic
factors. With ~90% of stores located in the U.S., Home Depot’s success is highly correlated with
the performance of the U.S. economy”. (Trefis Team, 2015). This trend can be seen if you take a
look at the company’s performance during times of recession. One suggestion would be for
Home Depot to diversify their operations across other countries to balance against risks with
particular U.S. markets. Home Depot’s business strategy is relatively easy to imitate by
competitors, with the company’s high quality of human resources being what separates them
from the rest. Home Depot limitations on the supply chain makes it another weakness as some
brands are not available on their stores which creates fear with suppliers as they tend to avoid
doing business with the competition for fear of losing their business.
Opportunities for Home Depot
If we look back the weaknesses, we can determine that there is a need to look at new
markets and reduce the company’s reliability in the U.S. market. New Sales is another
opportunity as the latest home improvement research indicated that the market is expected to be
valued at $332.2 billion this being an increase of 27.5% from 2014. Another opportunity is the
buying power of the rising Hispanic population in the U.S. as it is expected to become 119
million in 2060 from 55 million in 2014 as well as counting the millennials that form a new hose
buying trend.
Threats for Home Depot
The threats that Home Depot faces are related to the economy and their competitors.
“Increased Regulations on Credit Cards and how the US has changed the credit card policy to
ensure they do not fall into another debt trap as this decreases the purchasing power of the
customers and can hamper the balance sheet of Home Depot. The labor cost in the US is on an
increase and this will reduce the profits of Home Depot”. (Hitesh Bhasin, Marketing 91, 2018)
Trends for Home Depot
Some of the trends that Home Depot can benefit from is the increase or changes in the
expected number of first time buyers and home improvements also known as “fixer-uppers”. The
Harvard Joint Center for Housing Studies predicts “that millennials will form 23 million new
households over the next 10 years as they marry and have children (yes, they are marrying and
having children at rates similar to previous generations at the same age)”. The Joint Center also
forecasts “that the share of homeowners under the age of 35 will grow from 31 percent today to
35 percent in 2017”. (Brad Hunter, Home Improvements, 2017). The generation known as
millennials are interested in building equity so it is believe that many will buy homes for the first
time and do their own work to fix them up.
Conclusion
After looking at the results from the SWOTT analysis, it would be best to Home Depot to
focus on a global growth and expansion. I know that this doesn’t apply to the new venture
suggested on the new service but since we are looking for the improvement of the business, then
we can say that the company could expand on new regions, especially where high-growth
markets are expected to grow in the identified country. Another suggestion based on the results
of the SWOT analysis, Home Depot could benefit from expanding its business to minimize risk
exposure in the home improvement retail market. This branching out can be done in the form of
launching the new business division of “Do-It-Yourself machine shops” and acquisitions of
properties or locations equipped with extra lot size and establish Home Depot’s new venture and
differentiate from the rest of retailers.
References
Lucas, J. R. (1998). Anatomy of a vision statement. Management Review, 87(2), 22
Hill, T., & Westbrook, R. (1997). SWOT analysis: it’s time for a product recall. Long Range
Planning, 30(1), 46-52
https://www.forbes.com/sites/greatspeculations/2015/10/06/home-depot-strengths-weaknessesopportunities-and-threats/#2f2c85af6fac
https://www.marketing91.com/swot-analysis-home-depot/#Opportunities-in-the-SWOTAnalysis-of-Home-Depot
https://www.homeadvisor.com/r/2017-home-improvement-trends/
Strategic plant Part I: New Product or Service
Hugo Soto
A company’s mission and vision statements are vital when it comes to the success of a
company; a company needs to have an obtainable mission, values, and goals which must also
work hand in hand with all the other tenets of business. All companies are looking to obtain the
perfect visualization for their intended audience of what it intends to achieve while it exists and
the ethics or values that will guide the organization thru their actions. With the ever-growing
aspects of other competitors, every company must continue to innovative their ways to meet the
ever changing customer demands and to gain competitive advantage. The following paper will
discuss how innovation is vital to Home Depot’s values, mission, and vision as well as its
business model. I will talk about the company’s current Mission and Vision statements and then
about the introduction of a new service designated to obtain and create customer loyalty over
other companies.
Mission and Vision Statement
Home Depot is a major American corporation established in the 1978 is not the leading
home improvement retail store chain in the United States in terms of revenue. “Home Depot’s
vision statement, based on the founders’ original purpose, is to provide “one-stop shopping for
the do-it-yourselfer.” In addition, Home Depot’s founders added that the firm’s vision statement
is also “to create a company that would keep alive the values that were important to us. Values
like respect among all people, excellent customer service and giving back to communities and
society.” The vision statement demonstrates that the company’s main goal is to be a one-stop
shopping place as well as company that targets customers that are “do-it-yourselfers”. (Home
Depot, 2015)
New Business Division
Home Depot’s vision statement is directed to the do-it yourself customers and what better
way to obtain this goal then to build a new division whose main goal is exactly that. What I
propose is to establish a new Machine Shop service in several Home Depot locations where not
only does the customer can purchase the material, rent the tools but also rent a workout space.
How many times have you seen customers come back to the store because they forget to buy
material or a piece or then do not have the tools to do the work or do not have a place to do the
work themselves and end up paying for the service of others. The Home Depot Do-It-Yourself
Shop will allow customer to not only to obtain all the necessary tools, be more productive since
the work can be done there and Home Depot will be able to engage their customers even more as
they will be there in case of questions (since Home Depot already offers expert advice at most
locations). The basic idea is to select a number of Home Depot locations (after doing market
research) and expand their property size by adding enough square footage to build individual
“storage units” type of buildings that can be rented hourly to customers based on individual
projects and equipment needed.
SWOTT analysis
In the following SWOTT analysis I will attempt to demonstrate Home Depot’s Strengths,
Weaknesses, Opportunities, Threats and Trend that could impact the company in the future. The
new business division has a promising growth prospect in this emerging market where the
company will attempt to establish themselves as the dominating home improvement store.
Home Depot Strengths – Internal Strategic Factors
Home Depot’s strengths are directly related to the success of the company where the
main strengths are their High Quality service, the company’s strong brand image, the close
relationship they have with suppliers and the company’s leadership and also for being Ecofriendly. Home Depot already has the ability to provide expert advice to customers as they have
carpenters and plumbers on their staff so having the customer work on the premises would
strengthen the customer’s relationships. Home Depot uses a supply chain approach that’s
supported by a close relationship with suppliers which in turn guarantees cost-effective and
economies of scale. Another Strength is their level of productivity. “Home Depot aims at
maximizing revenue per square foot. This is evident when one looks at the metric in international
stores — where Home Depot made ~$297 in average revenue per square foot, also Home
Depot’s mastery of productivity enhancement is also evident from their continued modernization
of the supply chain, which, after starting as late as 2007 has already reached over 18 centers, as
opposed to competitors” (Home Depot, 2015). Another company strength is their diversification
as Home Depot’s business has strength in terms of product portfolio, and operational areas.
Home Depot’s business extends across a network of about 2,269 stores across the U.S., Canada,
and Mexico. “The company has Eco Options Program for customers who are looking for ecofriendly solutions. They currently have around over 9000 products in this category. The products
sold under this category have energy stars on them to indicate the amount of power saved.”
(Hitesh Bhasin, Marketing 91, 2018)
Home Depot Weaknesses – Internal Strategic Factors
Home Depot’s weaknesses are directly relate to the nature of the business as it is
imitable, their focus and dependence on the U.S. market and their limited supply chain. “One of
the biggest drawbacks for Home Depot’s business is its high dependence on macroeconomic
factors. With ~90% of stores located in the U.S., Home Depot’s success is highly correlated with
the performance of the U.S. economy”. (Trefis Team, 2015). This trend can be seen if you take a
look at the company’s performance during times of recession. One suggestion would be for
Home Depot to diversify their operations across other countries to balance against risks with
particular U.S. markets. Home Depot’s business strategy is relatively easy to imitate by
competitors, with the company’s high quality of human resources being what separates them
from the rest. Home Depot limitations on the supply chain makes it another weakness as some
brands are not available on their stores which creates fear with suppliers as they tend to avoid
doing business with the competition for fear of losing their business.
Opportunities for Home Depot
If we look back the weaknesses, we can determine that there is a need to look at new
markets and reduce the company’s reliability in the U.S. market. New Sales is another
opportunity as the latest home improvement research indicated that the market is expected to be
valued at $332.2 billion this being an increase of 27.5% from 2014. Another opportunity is the
buying power of the rising Hispanic population in the U.S. as it is expected to become 119
million in 2060 from 55 million in 2014 as well as counting the millennials that form a new hose
buying trend.
Threats for Home Depot
The threats that Home Depot faces are related to the economy and their competitors.
“Increased Regulations on Credit Cards and how the US has changed the credit card policy to
ensure they do not fall into another debt trap as this decreases the purchasing power of the
customers and can hamper the balance sheet of Home Depot. The labor cost in the US is on an
increase and this will reduce the profits of Home Depot”. (Hitesh Bhasin, Marketing 91, 2018)
Trends for Home Depot
Some of the trends that Home Depot can benefit from is the increase or changes in the
expected number of first time buyers and home improvements also known as “fixer-uppers”. The
Harvard Joint Center for Housing Studies predicts “that millennials will form 23 million new
households over the next 10 years as they marry and have children (yes, they are marrying and
having children at rates similar to previous generations at the same age)”. The Joint Center also
forecasts “that the share of homeowners under the age of 35 will grow from 31 percent today to
35 percent in 2017”. (Brad Hunter, Home Improvements, 2017). The generation known as
millennials are interested in building equity so it is believe that many will buy homes for the first
time and do their own work to fix them up.
Conclusion
After looking at the results from the SWOTT analysis, it would be best to Home Depot to
focus on a global growth and expansion. I know that this doesn’t apply to the new venture
suggested on the new service but since we are looking for the improvement of the business, then
we can say that the company could expand on new regions, especially where high-growth
markets are expected to grow in the identified country. Another suggestion based on the results
of the SWOT analysis, Home Depot could benefit from expanding its business to minimize risk
exposure in the home improvement retail market. This branching out can be done in the form of
launching the new business division of “Do-It-Yourself machine shops” and acquisitions of
properties or locations equipped with extra lot size and establish Home Depot’s new venture and
differentiate from the rest of retailers.
References
Lucas, J. R. (1998). Anatomy of a vision statement. Management Review, 87(2), 22
Hill, T., & Westbrook, R. (1997). SWOT analysis: it’s time for a product recall. Long Range
Planning, 30(1), 46-52
https://www.forbes.com/sites/greatspeculations/2015/10/06/home-depot-strengths-weaknessesopportunities-and-threats/#2f2c85af6fac
https://www.marketing91.com/swot-analysis-home-depot/#Opportunities-in-the-SWOTAnalysis-of-Home-Depot
https://www.homeadvisor.com/r/2017-home-improvement-trends/
Strategic plant Part I: New Product or Service
Hugo Soto
A company’s mission and vision statements are vital when it comes to the success of a
company; a company needs to have an obtainable mission, values, and goals which must also
work hand in hand with all the other tenets of business. All companies are looking to obtain the
perfect visualization for their intended audience of what it intends to achieve while it exists and
the …
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