Home Depot 2006 Annual Report Download - page 13

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Products. A typical The Home Depot store stocks 35,000 to 45,000 products during the year, including
both national brand name and proprietary items. The following table shows the percentage of Net Sales
of each major product group (and related services) for each of the last three fiscal years:
Percentage of Net Sales for
Fiscal Year Ended
January 28, January 29, January 30,
Product Group 2007 2006 2005
Building materials, lumber and millwork 23.6% 24.2% 24.4%
Plumbing, electrical and kitchen 30.8 29.4 29.0
Hardware and seasonal 27.0 27.1 26.9
Paint, flooring and wall covering 18.6 19.3 19.7
Total 100.0% 100.0% 100.0%
To complement and enhance our product selection, we have formed strategic alliances and exclusive
relationships with selected suppliers to market products under a variety of well-recognized brand
names. During fiscal 2006, we offered a number of proprietary and exclusive brands across a wide
range of departments including, but not limited to, Behr Premium Pluspaint, Charmglowgas grills,
Hampton Baylighting, Mills Pridecabinets, Vigorolawn care products, Huskyhand tools,
RIDGIDand Ryobipower tools, Pegasusfaucets, Traffic Mastercarpet, Glacier Baybath
fixtures and Verandadecking products. We may consider additional strategic alliances and
relationships with other suppliers and will continue to assess opportunities to expand the range of
products available under brand names that are exclusive to The Home Depot.
In fiscal 2006, innovative and distinctive products continued to be a growth driver supporting our
merchandising strategy. The following successes helped differentiate The Home Depot in the
marketplace:
• Introduced the most comprehensive lineup of top brand lawn tractors and mowers available
nationwide, including Cub Cadet, Toro, John Deereand Honda;
• Launched an expanded outdoor living assortment, including Hampton Bay patio and Charmglow
grills;
• Launched an exclusive line-up of lithium-ion power tools from Milwaukee, RIDGID and
Makita; and
• Launched the LGSteamWasherand the MaytagEpicwasher and dryer.
We maintain a global sourcing merchandise program to source high-quality products directly from
manufacturers. Our product development merchants travel internationally to identify opportunities to
purchase items directly for our stores. Additionally, we have four sourcing offices located in Shanghai,
Shenzhen, Dalian, and Chengdu, China, as well as one office in Gurgaon, India. We also have a quality
assurance engineer located in Milan, Italy and we have product development merchants, as well as a
sourcing office, in Monterrey, Mexico. We currently source products from more than 800 factories in
approximately 35 countries.
Services. The Home Depot and EXPO Design Center stores offer a variety of installation services.
These services target D-I-F-M customers who select and purchase products and installation of those
products from us. These installation programs include products such as carpeting, flooring, cabinets,
countertops and water heaters. In addition, we provide professional installation of a number of
products sold through our in-home sales programs, such as generators and furnace and central air
systems.
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