While we are not TECHNICALLY in a recession (A friend pointed out that the definition of recession requires 2 quarters in a row of declining GDP) we are definitely in economic doldrums.
We have had four quarters of definitely sub par growth as a nation, the housing bubble has definitely burst, and more and more companies are looking to trim any fat they can.
Economically unstable areas already hit hard by the economic down turn now have even more bad news headed their way. One of the staples of these areas has always been self reliance, and the entry of big box home improvement stores into unstable areas has been a boon to these areas in terms of jobs and the ability to find cheap materials to do their projects. This is about to change for the worse. Especially for states east of the Mississippi.
On Thursday May 1, 2008 The Home Depot announced that it will be closing 15 under performing stores. This bold move by the retailer to trim fat from its list of stores is not the only move that the company is making. The Home Depot also announced that it will be removing 50 stores from its new store pipeline as well.
That means that not only can DIYers east of the Mississippi look forward to losing 15 current home improvement warehouses, but they can also bet that the 50 stores getting trimmed are not stores planned for bustling metropolises. Most likely these are stores that were planned for areas that the company, during happier economic times, was willing to take a risk on in the hope that they would pay off. Now that the economy has, if not fallen into a recession, taken a turn for the worse, the company is no longer willing to bet so heavily on possible money makers when the risk to an already shaky bottom line is so great.
While this will adversely affect some people's ability to reach the retailer's door, it is good news for those of us who are going to still have a Home Depot store in their neighborhood. By trimming poorly performing stores now and by not opening stores that were going to be a risk, the home improvement giant is definitely taking steps to insure that it will be around for years to come by taking the minor hits now to insure its long term financial health. A failing Home Depot would not be a good thing for any DIYers in the 4 countries in which it operates.
So while we mourn the loss of a DIY resource in some areas, we can breathe a sigh of relief for the future of the world's largest home improvement retailer because love the chain or hate it, it does provide a haven for DIYers, and the chain does help make sure that prices for us DIYers are as low as possible.