I am a Home Depot shareholder. I own it for its strong financial performance and growing dividend. However, after my experience last night I am seriously considering unloading my shares.

It was probably the worst shopping experience I have ever had.
I went in for one particular item that was featured in their weekly flyer. You would think that if it was in the flyer that had just come out the store would be prepared to sell it and make it relatively easy to find. 20 minutes later and 4 sales associates later the item was finally tracked down. I grabbed 6 of the items and headed to the check out. The 2 staffed lanes and the 2 self-checkout that were open (the other 3 were ‘down’) were about 10 people deep each. Already delayed with a wife waiting for me to pick up dinner I said to hell with it and left. I was fuming.

All the way home I thought about selling my shares. No matter how strong a performer a company has been, if this is the way they are running their stores now then I believe an investor must seriously think about holding on. Performance like this drives customers away. However, before I act I am going to visit the store a few more times to see if this is consistent. If it is, I will sell.

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18 Comments   |  

18 Comments

May 19, 2006, 9:03 pm

LOW might be a better bet – http://i4.tinypic.com/105bp8y.jpg . The market seems to have recognized these metrics – http://i4.tinypic.com/105ccp0.png

May 20, 2006, 8:10 am

If you are going to base your decision on how stores are run you should visit more than one Home Depot.

May 20, 2006, 12:50 pm

In addition to always having a terrible experience at Home Depot stores, their website HomeDepot.com is even worse. I recently had one of my worse online shopping experiences of all time with Home Depot. I tried to order a patio set and gas grill from the website since they were offering free shipping this spring for patio sets. After almost 4 weeks I got the patio set, but it was missing the unbrella and base. They also cancelled my grill order. Then I spend over 1 hour on the phone with them to correct the problem. Another month passes and I call them up. They inform me that no umbrellas or bases are available from their online store and maybe I could get it from one of their brick and mortar stores. I relent and agree to that if they can call up my local store and put it on reserve. The local store refused the online customer service reps request and indicated there were only two more in the store. I raced off to the store to get it, and none of the employees would help me find the items, so I had to climb up on one of their latters to get it myself! I should have falled and sued them.

The good news is that they double credited my account for the umbrella and base, so I ended up getting back an extra $200. I guess this is why Warren Buffett sold off his shares. I wonder how Lowe’s is doing. Hmm…

May 20, 2006, 12:54 pm

Should I Keep a Stock If the Shopping Experience Sux

This article asks the basic question of what to do if you discover a terrible customer experience with one of your stocks. Home Depot delivers terrible service to this blogger and myself. It’s had to want to be an owner when something like this happ…

GIV
May 21, 2006, 12:46 pm

I’m surprised that someone like you, who puts so much in depth and technical analysis into your investing decisions, would be swayed by a purely emotional ncident like this, but I guess sometimes we all have to trust our instincts.

May 21, 2006, 9:04 pm

That is a good point – probably why I did not immediately enter the sell order when I got home. However, my point is that if the shopping experience is so crappy, then how could the company succeed long-term? I consider using the services of the company I am buying as part of my research.

Anonymous
May 22, 2006, 9:08 am

I have had the same frustrating shopping experiences at the Home Depot on two different occasions. These visits were also to two different locations. Each visit took about 45 minutes of my time, 30 of which I was waiting for sales representatives to track down my item or direct me to somebody in the “department” my item was in. It was ridiculous how incompentent these employees were. The two experiences have convinced me never to shop there again or have anything to do with Home Depot.

Kay
May 22, 2006, 10:16 am

I’ve already left Home Depot, as a customer not a shareholder. A couple of weeks ago we bought an expensive grill and had the local store put it together for us. They did a terrible job. Took two additional follow-up trips to get the major assembly bugs fixed. The thing still has a minor issue and I’m very unhappy. When I pay as much as we did, I want it perfect. I wanted to return it and get our money back, but my husband just wanted to cook out, so the damn thing sits in our backyard mocking me. But I wrote both the local store and HQ in Atlanta, as well as the grill manufacturer, about my displeasure. And I’m a new Lowe’s customer, even though it’s a bit farther away.

Kay
May 22, 2006, 4:31 pm

Enjoyed your post. I specifically noted it my post announcing the PFC49.

LSD
May 22, 2006, 9:02 pm

One store does not reflect how the entire company is treating its customers.

BTW, stop investing into individual stocks and you won’t have such stupid dilemmas.

May 22, 2006, 10:05 pm

LSD – thanks for the comment but I am not sure how this is a stupid dilemma. If a fund invests in HD then I still have the same dilemma??

May 23, 2006, 4:26 am

[...] I recently had a terrible shopping experience at both Home Depot Online and at my local Home Depot (HD) store. I was a bit surprised at how bad my customer experience was. However, I’m not the only investor to have had a bad experience. The Dividend Guy also had a bad experience at Home Depot and shared his feelings on his blog, where he writes: “It was probably the worst shopping experience I have ever had. I went in for one particular item that was featured in their weekly flyer. You would think that if it was in the flyer that had just come out the store would be prepared to sell it and make it relatively easy to find. 20 minutes later and 4 sales associates later the item was finally tracked down. I grabbed 6 of the items and headed to the check out. The 2 staffed lanes and the 2 self-checkout that were open (the other 3 were ‘down’) were about 10 people deep each. Already delayed with a wife waiting for me to pick up dinner I said to hell with it and left. I was fuming.” [...]

Datapro01
May 23, 2006, 7:46 am

I’ve had bad experiences at a number of Home Depots in different states. There is one located on Sawmill Rd in Columbus Ohio that must hold some sort of record for poor customer service. That particular store is frequented by a number of local home builders who send their non-English speaking illegal aliens in to pich up huge lumber orders. These guys then take up both of the checkouts that are open. You would think the check out folks, managers, or somebody would do something about the long lines of frustrated customers that form up bhind these guys but no. Opening another register, or even acknowledging the situation might constitute customer service and we can’t have that. In addition the rudeness of several of their employees is only matched by their ignorance and incompetence. These experiences are most assuredly a reason to drop a stock. Especially when they are, as in HD’s case, widespread and typical.

May 23, 2006, 12:29 pm

I wouldn’t let one bad experience deter me from investing in their stock if I thought it was a good buy. Emotion is an evil thing when it affects your investment decisions. If that was typical experience and not just at one store then it might be something to consider. However, going through the experience you had would definately make me choose to shop elsewhere. Not buying a company’s products or services is probably the best way to show displeasure and/or make the business change their service.

James
May 25, 2006, 6:07 pm

Hi
I have also experienced poor service and assistance at the HD store here in Owen Sound. If you need assistance in a certain department, you have difficulty finding an “associate”, yet there is an abundance of “orange garbed” employees walking back and forth at the front of the store with their painted on smiles and rehearsed greetings. Meanwhile, if you ask them for assistance, the pat answer is ” there is an associate in that department”. As well, only 1 or 2 cash registers are open, and the “sheep, er customers” are duly lined up.
You may also want to check the comments etc. on the “Better Investing Forum” as well as the link to the New York Times article regarding the obscene executive compensation doled out even while the stock is in a downtrend.

May 26, 2006, 1:10 pm

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May 22, 2007, 3:00 am

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BDC
July 30, 2007, 9:39 pm

Home Depot is mostly geared toward the:
DO-IT-YOURSELFER…

Not the:
WHINY-WANNA-BE…

I used to work at HD, don’t like the politics there…so instead of WHINING – I quit! As far as HD’s status in the hardware industry, it doesn’t get any better…quit you’re crying and hire someone if you don’t like the service. ITS A HARDWARE STORE…not a restaurant!

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