Home Depot $1.2B Supply Chain Spend Will Blanket U.S. with One-Day Delivery

Home Depot plans to spend $1.2 billion to upgrade its supply chain and fulfillment network between now and 2023, adding 170 distribution facilities to reach 90% of the U.S. population in a day or less, an executive said at a recent supply chain conference.

Among the new facilities will be dozens of fulfillment centers for next-day or same-day delivery of popular products, as well as 100 local hubs for consolidating orders of larger items like appliances and patio furniture, according to a report in the Wall Street Journal.

Other experiments in supply chain and fulfillment overhaul by Home Depot include the use of cars and vans locally for smaller orders and pickup lockers at some stores, the Journal reported.

Home Depot’s ecommerce sales grew 21% in 2017, making up 6.7% of its $100.9 billion in revenue. Store pickup accounts for about 45% of online orders. You can read the rest of the story here.

MCM Musings: All of this investment and activity by Home Depot is a hedge against competition from the likes of Amazon. Its Prime subscription program, now exceeding 100 million members, is quickly making a minimum two days’ delivery time the new table stakes for retailers scrambling to keep up.  These moves will put even more distance between the category leader, lauded for its omnichannel innovation, and followers like Lowe’s and the True Value chain.