News
home depot

Home Depot to invest 3.3 billion pesos in e-commerce, physical stores

Coronavirus pandemic has fueled big increase in online sales

Reacting to a big uptick in traffic on its e-commerce site since the coronavirus pandemic began, Home Depot México is investing in its website with the aim of giving online customers essentially the same shopping options as they have in one of its brick-and-mortar stores.

The home improvements retailer will invest 3.3 billion pesos (US $160 million) this year on e-commerce strategies and two new physical stores.

The firm last made a big investment in 2019, strengthening the integration between its online and physical stores, allowing people to order online and pick up their purchases in a nearby store.

According to Home Depot president José Rodríguez Garza, that move paid off in a big way once the pandemic began last spring, sending Mexicans into their homes for many more hours a day.

“The investments we’ve made in the last number of years to better our capacity are now bearing fruit,” he said.

Company officials knew that things were changing last year when sales on the e-store began to spike. They saw the same number of orders in one day that they used to receive during the course of a week, according to Rodríguez.

“Our online business accelerated such that it achieved results [in 2020] that we planned for 2021,” he said.

Home Depot in the United States also seems to have benefitted from an increase in home improvement projects by customers with more time on their hands: the U.S. company recently reported that its revenue had increased 20% in its latest fiscal year and told the Wall Street Journal that consistent demand has continued during February.

Eager to meet the increased demand for e-commerce here, Home Depot México is expanding its distribution center in Atitalaquia, Hidalgo, to allow more inventory capacity. The company is also revamping its technology for greater efficiency and is mechanizing certain distribution activities.

However, it has clearly not ready to give up on brick-and-mortar sales: it is also considering opening at least three more stores in Mexico, including one in the city of Querétaro already in the works, Rodríguez said.

Sources: Expansión (sp), Wall Street Journal (en)

Reader forum

The forum is available to logged-in subscribers only.