Who Owns Home Depot and Lowe’s?
Who Owns Home Depot and Lowe’s, however both company are American multinational home improvement retail corporation. Their shares are publicly available on the stock market.
Lowe’s is the second-largest hardware retailer in the United States and the world. Its headquarters are in North Wilkesboro, North Carolina, where its founder, Lucius Smith Lowe, grew up.
The company operates over 2,000 stores in the United States and Canada, having exited the Mexican market in mid-2019.
Lowe’s strategy, like that of other home improvement retailers, entails aggressive expansion.
The company gained a foothold in the United States through expansion and innovation. However, along the way, it fell behind The Home Depot and has never recovered.
The History of Lowe’s
Lucius Smith Lowe opened the first Lowe’s store, North Wilkesboro Hardware, in North Wilkesboro, North Carolina, in 1921.
When Lowe died in 1940, his daughter, Ruth Buchan, inherited the business and sold it to her brother, James Lowe, the following year. In 1943, James partnered with his brother-in-law Carl Buchan.
Buchan anticipated the dramatic increase in construction following World War II, and the store he managed specialized in hardware and building materials.
The product mix had previously included notions, dry goods, horse tack, snuff, produce, and groceries. In 1949, the company purchased a second location in Sparta, North Carolina.
Buchan became the sole owner of Lowe’s in 1952, and the company was renamed Lowe’s North Wilkesboro Hardware. Jim Lowe founded the Lowes Foods grocery store chain in 1954.
By 1955, Buchan had quickly expanded the company by opening stores in Asheville, Charlotte, and Durham, North Carolina. Buchan had opened a total of six stores by the end of 1955.
Buchan died of a heart attack in 1960, at the age of 44. His five-man executive team, which included Robert Strickland and Leonard Herring, took Lowe’s Companies Inc. public in 1961.
Lowe’s had 21 stores and reported $32 million in annual revenue by 1962. In 1979, Lowe’s began trading on the New York Stock Exchange.
Lowe’s struggled in the 1980s due to market conditions and increased competition from The Home Depot, a new big-box store chain.
Lowe’s resisted the mega-store format for a time, partly because its management believed that the smaller towns where Lowe’s mostly operated would not support large stores. To survive, Lowe’s eventually adopted the big-box format.
The Home Depot
Home Depot is a multinational American home improvement retailer that sells tools, construction products, appliances, and services such as fuel and transportation rentals.
The largest home improvement retailer in the United States is Home Depot. The company had 490,600 employees and more than $151 billion in revenue in 2021.
The company is based in Cobb County, Georgia, and has an Atlanta mailing address.
You may want to read more about Home Depot and Lowe’s check the link below to know more about them.
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Ownership History
Bernard Marcus, Arthur Blank, Ron Brill, Pat Farrah, and Ken Langone co-founded The Home Depot in 1978.
The Home Depot’s pitch was to build home-improvement superstores that were larger than any of their competitors’. Ken Langone, an investment banker, assisted Marcus and Blank in obtaining the necessary capital.
On June 22, 1979, the first two stores opened in metro Atlanta (in Doraville and on Memorial Drive in Decatur, both near I-285) built in spaces leased from J. C. Penney that were originally Treasure Island “hypermarket” (discount department and grocery) stores.
The Home Depot went public on the NASDAQ on September 22, 1981, raising $4.093 million. On April 19, 1984, The Home Depot was admitted to the New York Stock Exchange.
On January 2, 2007, the Home Depot and Robert Nardelli mutually agreed to end Nardelli’s six-year tenure as CEO.
Nardelli resigned amid complaints about his heavy-handed management style, as well as whether his pay package of $123.7 million (excluding stock option grants) over the previous five years was excessive, given the stock’s poor performance compared to competitor Lowe’s.
His $210 million severance package was criticized because when the stock fell, his pay increased.
Frank Blake, his successor, previously served as the company’s vice chairman of the board and executive vice president.
Blake agreed to a much more conservative compensation package than Nardelli, which is heavily reliant on the company’s success.
Despite being Nardelli’s longtime deputy at GE and Home Depot, Blake was said to lack Nardelli’s toughness and preferred to make decisions by consensus.
Indeed, Blake criticized many of Nardelli’s strategies, and it has been reported that the two men have not spoken since Nardelli left Home Depot.
Largest Shareholder of Home Depot and Lowe’s
The Vanguard Group, Inc. is a registered investment advisor based in Malvern, Pennsylvania, that manages approximately $7 trillion in global assets as of January 13, 2021.
It is the world’s largest provider of mutual funds and the world’s second-largest provider of exchange-traded funds (ETFs), trailing only BlackRock’s iShares.
Vanguard provides brokerage services, educational account services, financial planning, asset management, and trust services in addition to mutual funds and ETFs.
Several Vanguard mutual funds are at the top of the list of US mutual funds in terms of assets under management.
Along with BlackRock and State Street, Vanguard is considered to be one of the Big Three index fund managers that dominate corporate America.
The Vanguard Group, Inc. provides investment management and advisory services.
The Company offers its services to equity investment and fixed income group, investment pooled vehicles, mutual funds, and separate account institutional clients. The Vanguard Group serves customers worldwide.
Are Lowes and Home Depot Related?
Many people assume that Lowe’s and Home Depot are one and the same, but this isn’t true.
Lowes and Home Depot are similar in terms of the products and services they both provide, but they are not related in terms of ownership and other relevant information based on history and operations.
And though Home Depot is the larger of the two by a significant margin and Lowe’s is still rebuilding itself after a fallow period, each is to be admired for its retailing expertise.
Home Depot stores are orange and black in color, with tall shelves that can only be reached by forklifts. Lowe’s stores are blue and white in color, with elaborate floor displays and themed products.
Home Depot’s strategy is to increase distribution centers to increase profitability, whereas Lowe’s strategy is to strengthen its bottom line by closing underperforming stores.
When compared to Lowe’s, Home Depot generates more revenue and sales. Home Depot had 132.11 billion US dollars in sales in 2020, while Lowe’s had 89.6 billion US dollars.
Home Depot has had international success with stores in Canada and Mexico, whereas Lowe’s has had little success with its international ventures, having been forced to close the majority of them.
Home Depot leads in contractor services, while Lowe’s has the edge in DIY services thanks to its focus on staff assistance for amateurs.
Home Depot and Lowe’s are the two largest home improvement retailers, and while they share many similarities, they are not the same.
You may want to read more about Home Depot and Lowe’s check the link below to know more about them.
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Why are Lowes and Home Depot Close to Each Other?
The Central Place Theory teaches us that people are willing to travel farther to consume higher ordered goods, which is why firms that sell these goods co-locate.
One of the central ideas of Central Place Theory is that goods have a hierarchy – an order, where higher ordered goods are those purchased infrequently, such as cars, and lower ordered goods are those purchased more frequently.
In this case, people are willing to travel farther from their homes to buy a car than to buy breakfast, so rival car dealerships should locate next to each other to take advantage of potential customers who travel long distances to shop.
Skilled business owners carefully consider where they will locate their operations. They consider the local customer base, transportation options, and, yes, competitors’ locations.
Many of these companies are making a deliberate decision to locate near their competitors.
Furthermore, the goal of Lowe’s was to replicate Home Depot stores. People began to notice flaws in Home Depot’s format. Customer service was beginning to deteriorate, at least in comparison to the early years.
Lowe’s would never be able to compete with Home Depot, so they needed to do something. So they imitated Home Depot and built stores similar to them near them.
When people can’t find something at Home Depot, they have an IMMEDIATE way to express their frustration by moving on to the next competitor. Lowe’s is built near Home Depots so that people who dislike Home Depot have a store nearby.
What Does Home Depot do that Lowes Doesn’t?
In this sector, both companies perform similar operations, but one is superior to the other and has a greater advantage.
1. Professional Service
Home Depot is significantly more popular with professional contractors than Lowe’s. Professional contractors generate 40% of Home Depot’s revenue but only 30% of Lowe’s.
What’s interesting is that only 3% of Home Depot’s customers are professionals.
Remodelers, general contractors, handymen, property managers, building service contractors, and specialty tradesmen such as installers are among these professionals.
Home Depot’s lead in professional services seems intentional in its branding and store organization.
Home Depot has tall shelves, the highest of which can only be reached by forklift. At Home Depot, you’re likely to come across products that lack signage and tags.
In contrast, Lowe’s employs a blue-and-white color scheme. Lowe’s stores frequently have more elaborate floor displays or themed products like patio sets. Lowe’s products are less likely to be missing tags or labels.
2. Online Experience and E-commerce
If there’s one area where Home Depot is outperforming Lowe’s, it’s in e-commerce and online shopping.
Home Depot ranks fifth in the 2020 Top 1000 Report, which ranks the top online retailers in the United States based on web sales. Lowe’s, on the other hand, is ranked 22nd.
Home Depot began its online transformation years before Lowe’s. Lowe’s admitted in 2019 that it was operating on a ten-year-old platform!
In fact, the Lowe’s website crashed during the 2018 Black Friday sales. Ouch!
3. Truck Rental
Truck rentals are available at Home Depot and Lowe’s stores on a first come, first served basis. The majority of the time, the cheapest option is to rent a truck from a local rental company.
4. Tool Rental Selection
In terms of tool rentals, Home Depot clearly outperforms Lowe’s.
Lowe’s rents tools in 20 different categories as of January 2021. Home Depot, on the other hand, rents tools from over 40 different categories.
For example, you can rent a 5-ton excavator from Home Depot. You can’t from Lowe’s!
You may want to read more about Home Depot and Lowe’s check the link below to know more about them.
- Where is the largest Home Depot in the US?
- Who is Home Depot’s largest competitor?
- Why Do They Call It Home Depot?
Who Came First Home Depot or Lowes?
Lowe’s was founded in 1921, and Home Depot was founded in 1978. However, the newer store was the first to expand.
The Home Depot was co-founded by Bernard Marcus, Arthur Blank, Ron Brill, Pat Farrah, and Ken Langone in 1978 while the first Lowe’s store, North Wilkesboro Hardware, opened in North Wilkesboro, North Carolina, in 1921 by Lucius Smith Lowe.
After Lowe died in 1940, the business was inherited by his daughter, Ruth Buchan, who sold the company to her brother, James Lowe, that same year. James took on his brother-in-law Carl Buchan as a partner in 1943
Basically, because Home Depot expanded its store presence before Lowe’s, it was given first right of refusal on location.
Lowe’s has many “secondary real-estate locations” that aren’t ideal in terms of population flow or traffic patterns, Lowe’s expansion in terms of new store openings followed Home Depot’s.
In 1952, Buchan became the sole owner of Lowe’s, and the company was incorporated as Lowe’s North Wilkesboro Hardware.
Lowe’s has since grown nationally, operating more than 2,355 locations in the United States, Canada, and Mexico.
Who is More Expensive Lowe’s or Home Depot?
Every day, both retailers compete on price. When all costs are considered, shopping at Lowe’s vs. Home Depot is essentially the same.
Because Lowe’s and Home Depot stores compete on price, it is common to find similar popular items priced within pennies of each other.
Less popular items (such as plumbing, electrical, and HVAC) have the greatest price disparity.
When comparing Home Depot vs Lowe’s we discovers that both provide good home improvement resources for the average consumer as well as professionals.
At the end of the day, whether Lowe’s or Home Depot is the best place to shop depends on what you’re looking for and how your local store is stocked, staffed, and managed.
Home Depot and Lowe’s compete aggressively for consumer dollars. We compared the cost of 38 commonly purchased Lowe’s and Home Depot products that were the same or very similar at both stores.
Building materials (such as lumber and drywall) were among them, as were ceramic floor tile, wood flooring, blinds, mulch, paint, appliances, and basic tools.
Both big box stores also have a variety of other departments, such as hardware, plumbing, electrical, lighting, and so on.
Lowe’s had the lowest prices on 11 items on our list, including four types of interior paint ($4 less per gallon for house brand paint in flat, eggshell, or semi-gloss finish), engineered hardwood flooring (a $2.37 per square foot difference), and bagged mulch (more than 30 percent savings).
Home Depot bested Lowe’s on 9 products, including basic ceramic floor tile (73 cents vs. 99 cents a square foot), sheets of drywall (5 percent less), and a few tools, such as a cordless drill (15 percent cheaper).
The cost of the remaining 18 products was essentially the same at both stores (less than a 1 percent difference).
Of course, which store has the best prices varies by location and is subject to change.
The regular (non-sale) prices we compared on appliances were nearly identical, but depending on the day, one store could drastically undercut the other.
However, based on our analysis, both stores’ prices vary depending on the product and location, but Home Depot is more expensive than Lowe’s because of the high value in services that they provide to customers that Lowe’s does not.
You may want to read more about Home Depot and Lowe’s check the link below to know more about them.
CSN Team.