Home Depot 2010 Annual Report Download - page 10

Credit Services. We offer private label credit products in our stores through a third-party credit provider to
professional, D-I-Y and D-I-F-M customers. In fiscal 2010, approximately 2.5 million new The Home Depot
private label credit accounts were opened, and the total number of The Home Depot active account holders was
approximately 10 million. Private label credit card sales accounted for approximately 22% of store sales in fiscal
2010. In fiscal 2010, we also launched a home improvement loan program for D-I-F-M customers and introduced
PayPal as a payment option for our online customers.
Logistics. We continued our supply chain transformation in fiscal 2010 to ensure product availability for
customers, effective use of our investment in inventory and optimal total supply chain costs. Across our supply
chain operations in the U.S., we continued the restructuring of our distribution center network to meet the
changing needs of our business, including our general distribution center space rationalization initiatives and the
completion of the Rapid Deployment Center (“RDC”) roll out in the U.S. RDCs allow for aggregation of store
product needs to a single purchase order, and then rapid allocation and deployment of inventory to individual
stores upon arrival at the center. This process allows improved transportation, simplified order processing at
suppliers and last minute reallocation from the time that product needs at stores are determined to actual
replenishment.
As a result of the changes to our distribution network, in fiscal 2010 we added 2.9 million net square feet of
distribution center space, primarily for new RDCs. At the end of fiscal 2010, we operated 30 bulk distribution
centers and 34 conventional distribution centers in the U.S., Canada and Mexico. Additionally in fiscal 2010, we
opened seven new RDCs in the U.S., bringing our total number of RDCs to 19. We now serve all of our U.S.
stores from RDCs, with approximately 42% of our costs of sales on an annualized basis for those stores serviced
through the RDCs. We remain committed to leveraging our supply chain capabilities to fully utilize and optimize
our improved logistics network.
Associates. At the end of fiscal 2010, we employed approximately 321,000 associates, of whom approximately
19,000 were salaried, with the remainder compensated on an hourly or temporary basis. Approximately 59% of
our associates are employed on a full-time basis. We believe that our employee relations are very good. To attract
and retain qualified personnel, we seek to maintain competitive salary and wage levels in each market we serve.
Intellectual Property. Our business has one of the most recognized brands in North America. As a result, we
believe that The Home Depot®trademark has significant value and is an important factor in the marketing of our
products, e-commerce, stores and business. We have registered or applied for registration of trademarks, service
marks, copyrights and internet domain names, both domestically and internationally, for use in our business. We
also maintain patent portfolios relating to some of our products and services and seek to patent or otherwise
protect innovations we incorporate into our products or business operations.
Quality Assurance Program. We have both quality assurance and engineering resources that are dedicated to
overseeing the quality of all of our products, whether they are directly imported, locally- or globally-sourced or
proprietary branded products. Through these programs, we have established criteria for supplier and product
performance that are designed to ensure that our products comply with federal, state and local safety, quality and
performance standards and to allow us to measure and track the timeliness of shipments. We also have a Supplier
Social and Environmental Responsibility Program designed to ensure that our suppliers adhere to the highest
standards of social and environmental responsibility.
Environmental, Health & Safety (“EH&S”). We are committed to maintaining a safe environment for our
customers and associates and protecting the environment of the communities in which we do business. Our
EH&S function in the field is directed by trained associates focused primarily on the execution of the EH&S
programs. Additionally, we have a Store Support Center-based team of dedicated EH&S professionals who
evaluate, develop, implement and enforce policies, processes and programs on a Company-wide basis.
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