Home Depot Transformation Electric business checking: Closed seven stores a day

Original title: Day close seven stores Home Depot transformation Electric Business Checking

Yi Shi

[An industry analyst said, "It is really late to do e-commerce, the traditional industry to integrate supply chain resources, and familiar with the internet," water ", need a long-term process. ” ]

Continuous loss of performance, shrinking scale, frequent change of personnel ... Home Depot, the country's second-largest retail giant and the world's largest home building materials retailer, finally failed to survive the winter in the Chinese market.

14th, Home Depot announced the closure of Tianjin, Xian and Zhengzhou, respectively, seven home building materials retail stores. In this regard, Home Depot to the "First financial daily," said the company in China will continue to have 170 employees, the company will also provide the affected staff severance compensation and re-employment support services. They will serve as a global sourcing business, a new business model team and a professional retail store in Shanghai and Shenzhen, established in 2002.

Home Depot is called the "new business model", which includes offline and online business. Offline refers to the continued operation of the recently opened in Tianjin, two professional retail stores, online is the majority of home supermarkets generally try the electric business model, "the company is with a number of China's leading E-commerce website to discuss cooperation matters." "said a spokesman for Home Depot.

For Home Depot China is transforming the electric business model, the industry generally believe that in the current environment is not easy.

Where's the disease?

A home PO Tianjin supplier told our correspondent, September 13 5 o'clock he suddenly received a Home Depot news, the previous week, he also as usual delivery, Home Depot did not mention this matter, so that their hands are now the value of a hundred thousand of yuan and hundreds of thousands of yuan of different materials.

It is reported that the closing of the shop affected about 850 employees. A home Po Xian store employees told reporters, Home Depot Xian, the client said, may be provided to employees of the compensation scheme for 2N (n is economic compensation). N covers money that may not be settled by the employee. Additional payment is not covered by the amount of money, can be explained to the company, the company will be dealt with in a timely manner.

The development of Home Depot in China is almost a copy of the "American Supermarket model" (ie do-it-yourself DIY), a home building materials industry veteran of the reporter analysis: "This is obviously not applicable in China, because of the high cost of human resources, decoration for DIY and enjoy the fun, the domestic just the opposite, consumer habits please decorate team, Prefer in the building materials market this traditional mode of "Amoy", because the price is more flexible. "For example," A network of sockets in the outside to buy less than 10 yuan, but at home to treasure, hundred homes, the same thing is more than 70 yuan. ”

In addition, Home Depot in the process of localization of talent reserves also have bottlenecks. A former world person told reporters that the top changes in Home Depot have never been quiet, especially in the management team, the former home world Kibaki majority. Localization of professional talent is seriously scarce, middle and ordinary staff turnover is also very frequent.

And with the use of store mode and since the establishment of the main shopping industry in China local enterprises Red Star United States Kai-Lung, incredibly the home compared to the Home Depot also encountered a property leasing management problems. Before, Jinan shop closed, to a certain extent, is caused by the contradictions of the property.

Of course, the real estate market is a drag can not be overlooked a major reason. China Building Materials Circulation Association at the same time disclosed data show that the national scale of building materials home sales volume of 553.9 billion yuan in January-June, the year-on-year decline of 7.7%, for the first time in five years decline.

Association president Meng said, at present, the major building materials Home store rental rate began to decline, new building materials Home store investment also encountered difficulties. And a few years ago, all the stores have blind expansion of the phenomenon, prone to more than 300,000 square meters of volume, resulting in increased supply pressure manufacturers, the industry vicious competition.

Brokeback to survive

In fact, the traditional home building materials stores to enter the electrical business has become a common consensus in the industry.

Including the Red Star of the United States, Kai Lung, Golden Seahorse and so have tried. However, Huaqiang North online vice President Shangxiang said to reporters: "Now only do E-commerce is a bit late, the traditional industry to integrate supply chain resources, as well as familiar with the internet" water ", need a long-term process. ”

Another electric business person said: "If it is to ensure that online traffic is based on lower-priced goods, it may not be happy for suppliers that emphasise brand value and premium space." ”

At the same time, the home industry has its special industry attributes, user experience is the most important, and the electrical business model can not solve this fundamental problem. If the line of the professional shop is not enough, it is difficult to carry out the effective online interaction.

However, this attempt to home to the treasure, it is also a broken arm to survive. After entering China, Home Depot has been dismal performance, some stores annual sales of less than 100 million yuan, the annual loss of tens of millions of dollars.

In the United States and other land, Home Depot has always been a bright performance. In the first quarter of this year, Home Depot net earnings increased from $812 million trillion to $1.04 billion a year earlier. Global same-store sales grew 5.8%, with sales in the US growing 6.1%.

Home Depot said to reporters that the closing work is expected to enable the company in the third quarter of 2012 to bear about 160 million U.S. dollars in after-tax costs, or diluted after the cost of about 0.1 dollars per share. This will mainly include the loss of goodwill and other assets impairment, the termination of the lease contract, employee turnover compensation and other related work costs. The earnings per share of the 2012 fiscal year after dilution is expected to increase by 19% to $2.95 in the case of a $0.1 diluted cost per share, excluding the entry.