Why Are Lowes And Home Depot Next To Each Other?

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If you have ever asked this question: why are Lowe’s and Home Depot next to each other, this article will interest you. Not only are we going to tell you why Lowe’s and Home Depot are next to each other, we will also look at the key differences between the two stores.

But meanwhile, lets take a closer look at what Lowes and Home Depot is all about.

Lowes is a well-known chain of retail home improvement and appliance stores. They offer a wide range of products and services for home improvement and renovation projects. Lowes stores can be found in various locations across the United States and other countries, making it a convenient option for customers looking for home improvement supplies and solutions.

Home Depot is a prominent home improvement and construction supply retail chain. With numerous stores located across the United States and internationally, Home Depot provides a vast array of products and services catering to home improvement, construction, and renovation needs.

Whether you’re a DIY enthusiast or a professional contractor, Home Depot offers a wide selection of building materials, tools, appliances, and more to help customers complete their projects effectively.

Differences Between Lowes and Home Depot

Home Depot and Lowe’s exhibit distinct differences in their store layouts. Home Depot outlets sport an industrial look with an orange and black color scheme and towering shelves accessible only by forklifts, suggesting a focus on catering to home improvement professionals.

In contrast, Lowe’s stores adopt a blue-and-white color scheme and often showcase elaborate floor displays, themed products like patio sets, or seasonal decor items. The extensive product selection at these stores can be so impressive that customers are willing to travel long distances to shop there.

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Why are they Close to Each Other?

Why do these stores choose to be located in such close proximity to each other? Wouldn’t it make more sense for them to have a greater distance between them to establish their own distinct market areas?

The Central Place Theory provides insights into this phenomenon, suggesting that people are willing to travel further for higher-ordered goods, those bought less frequently, like cars, compared to lower-ordered goods purchased more often, such as breakfast items. Therefore, businesses selling higher-ordered goods tend to cluster together to attract customers who are willing to travel longer distances.

Successful business owners take various factors into account when deciding on their store locations, including the local customer base, transportation options, and, notably, the presence of competitors in the vicinity. It’s a strategic choice for many of these companies to set up shop near their rivals.

Moreover, Lowe’s aimed to replicate the success of Home Depot stores. As customers began to notice shortcomings in Home Depot’s format, particularly in terms of customer service, Lowe’s decided to emulate Home Depot’s model and build similar stores nearby.

By situating themselves near Home Depot locations, Lowe’s provides an alternative shopping option for customers who may have had a less-than-satisfactory experience at Home Depot, allowing them to easily switch to the next competitor.

Stats About Lowes And Home Depot

  • Home Depot has ~250 more stores than Lowe’s in the United States and has a higher concentration in California, New York, and Georgia. Lowe’s has a higher store concentration in North Carolina and Ohio.
  • Home Depot’s location advantage is largely a result of building more density in a given market versus opening in different markets than Lowe’s.
  • The brands have highly overlapping location strategies. The median distance from Lowe’s to the closest Home Depot is <2.5 miles.
  • Growth opportunities are unlikely to come from significant store count growth; we see higher opportunities in exploring alternate store formats to enable new market opportunities.

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In conclusion, the proximity of Lowe’s and Home Depot stores to each other is a result of strategic decision-making aimed at fostering competition, enhancing convenience for customers, optimizing supply chain logistics, and contributing to the economic development of the local community.

This deliberate coexistence benefits both retailers and shoppers, creating a win-win situation that has become a hallmark of the home improvement retail industry. So, when you see these two giants situated side by side, know that it’s a calculated business strategy that ultimately serves the interests of all stakeholders involved.


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