Home Depot opens third direct-fulfillment center as next step in online distribution strategy
The Home Depot Inc. said today it has opened its third direct-fulfillment center to support its e-commerce ordering and delivery strategy, bringing to 3.6 million the amount of square feet of DC space to handle online sales and fulfillment.
The new location, in Troy Township, Ohio, near Toledo, has 1.6 million square feet, making it the largest of the three facilities. Home Depot's Locust Grove, Ga., location has 1.1 million square feet, and its Perris, Calif., center has 900,000 square feet. Both of those facilities opened last year. Home Depot has no near-term plans to build more large-scale centers of this type, said Stephen Holmes, a spokesman for the Atlanta-based home improvement giant.
With the third facility operational, Home Depot said it can now deliver 90 percent of all online orders within two days using ground parcel services. Online sales accounted for about 5 percent of the home improvement giant's $24.8 billion in revenue during its fiscal-2015 second quarter. That represents a 25 percent year-over-year increase, according to Holmes.
Holmes said most of the company's online orders are shipped directly from the fulfillment center to residences or business. However, some orders are shipped to stores for customer pickup, he added.
As part of what it calls its "interconnected" retail strategy, Home Depot is testing a delivery program to ship online orders from its stores to residences and job sites. The initiative will enable online users to order goods and specify a narrow time window for their deliveries. The product will then be pulled from store inventory, loaded on one of the company's vehicles, and delivered to the end customer.
Holmes said the three direct-fulfillment centers do not support the "Buy Online Deliver From Store" concept.
