The Home Depot Reveals $500M Cost-Savings Initiative — Retail Bum

Following significant investments in its supply chain in recent years, The Home Depot is now reducing its surplus warehouse capacity due to a decline in sales compared to the peak levels observed during the pandemic.

The idea behind reducing warehouse capacity is part of the company’s effort to actively find cost savings in its downstream supply chain, which involves direct customer deliveries, according to Executive Vice President of Supply Chain and Product Development John Deaton.

To support its cost-cutting effort, the company plans to enhance its forecasting and labor management processes and utilize technology and robotics.

Deaton highlighted that The Home Depot has already enhanced productivity in its upstream network, which involves transporting products from distribution centers and fulfillment centers to stores. This improvement was achieved with the implementation of additional automation and mechanization measures.

Despite the cost-cutting measures, the company expects its previous investments in its supply chain to continue yielding long-term benefits for the company.

One such initiative was implemented in 2017 when the company set out to achieve next-day or same-day delivery to approximately 90% of the population…