Maybe your home is perfect just as it is or maybe you are one of the US home owners taking on renovations. Yet you would be in the minority during the first half of this year – at least according to the second quarter reports from Wal-Mart and Home Depot Inc.
Wal-Mart
Now no need to worry too much about Wal-Mart and Home Depot! Both businesses are doing ok for themselves. Home Depot's net income rose 7% and Wal-Mart saw a rise of 3.6% from their 2009 second quarter. Yet both companies had lowered their expectations. Trimming revenue forecast is not uncommon in this economy.
Saks
Even with its luxury line, Saks had to change the way they do business and brought in more 'full price selling' (fewer sales).
The CEO of Home Depot, Frank Blake, said that his company saw weakness in the "softer housing-related activity."
Home Depot
Home Depot saw a rise in sales for items under $50. This category accounts for 20% of Home Depot sales. People were buying a little paint, some hardware, inexpensive lighting, and other low-ticket home-related products. Sales of items over $900, however, were down 5% in the last quarter. Building materials, millwork, and some seasonal big-ticket items are not selling well at this time.
Obviously, air-conditioners and barbeques are popular at this time of year. Yet the CEO of Home Depot, Frank Blake, said that his company saw weakness in the "softer housing-related activities." On the bright side, Home Depot has noticed a growth in August sales compared to July. The company is hopeful that they can at least maintain the momentum of the second quarter for the remainder of the year.
Lowe's
Lowe's Companies, Inc. is quick to point out though that consumers are cautious – especially about larger purchases. Home buying had been encouraged to a degree with the Federal Home Buyers' Tax Credit. Now with that program's expiration, not as many people are dropping by to take home a new stove or oversized refrigerator. Other home owners seem to be content with their lot – unless it's that $20 spice rack or a similar item of similar price.
US
Of course, building and renovations were 'on the go' in some states more than other areas. Florida and California were busy but Portland and Seattle weren't as much into the home improvement scene. The home owners might be in the mood but major materials are costly and cost trumps the wish for a new guest room. When home owners are experiencing financial hardship, they are quite thankful for the roof over their head. The fabulous extension can wait for another day.
Canada
Canadian retailers might not see many new stoves fly off the shelves either in the coming days. Since August came in, home sales around Toronto have dropped by twenty nine percent. Across Canada, new home sales are down by slightly more – thirty per cent. Canadians have the usual worries about prices and the market.
Renovation Project
Back in February, renovation was in the works in Canada – at least for one Canadian game developer. When asked about the next big project – what game, what sport – he replied – "I need to finish renovating my bathroom." Home Depot would like that answer!
Are You Planning Home Renovations?