Goodbye Home Depot Hello Small Fry Home Remodeling Firm

Everybody who’s little thinks it’s impossible to compete with the Big Box stores.

If price is the sole criteria, perhaps that’s true. But there are signs that the Big Boxes like Home Depot have become so big, they’ve created their own downfall.

The opportunity exists for small, responsive start up firms to do very well working by doing what Sam Walton said his stores could never do… provide serious customer service.

There’s plenty of room for home based contractors and home remodeling designers here… 

From Business Reform 

My parent had been living in the place they wanted to stay until death for about 40 years. We had been trying to get them into assisted care for years. But home was home. The house had not been properly cared for. We all made trips to Denver to try and help, but I’m the baby of the family and I’m 69. Bob had to have five by-passes last June. To make a very long story short, my stepfather had ignored water in the basement and mold was now living there. He made a dumb waiter to increase kitchen closet space and left 220 wiring exposed. There were numerous problems caused because of the age of the residents… there were things they just could not do. And the entire house needed to be updated if we were going to sell it for the going market price in that area of Denver.

After an initial meeting with a contractor who could not get it through his head that we did not want to build a new home, just update this one, Bob went to Home Depot. They explained they could replace the kitchen cabinets for about $3,500 and would be glad to do a layout design that would be based on exact measurements. They gave him a time schedule and he paid the fee – about $250 – for the design work.

Bob offered to put $30,000 in a deposit account with Home Depot so my handyman of six years, Myron, could buy whatever he needed to get the house painted, the floors finished, etc. No. They could not do that. Instead, they insisted Bob get a credit card with them.

Maybe that makes sense to you, but it sure did not make sense to me. When someone offers to pay you in advance for your products and work, take the money and let them draw against it. There will be no credit problems or unpaid items. We couldn’t use a credit card because my brother was a five hour drive to the west of Denver and Myron, who was doing the work, couldn’t sign his card (and no one expected him to use his own). Again, an inflexible policy by a big company was working to the company’s detriment.

As things worked out, it was a good thing the credit was extended and the deposit rejected.

Home Depot did not get to the house when they said to measure the kitchen for new tile and cabinets. The drawings – also late — did not accurately reflect the size of the room, the cabinet space available, and somehow the cost of the cabinets went from $3,500 to almost double the amount quoted.

Myron was living in my parents’ empty house as he worked. He coordinated what other workmen did – electricians, tilers, plumbers, etc. We were totally remodeling the entire house. During that process, he heard about four guys who had just started a new business and were very much in demand. The tile guy told him “Every time I do someone’s house, it seems these guys are doing the design, planning, and implementation. Everyone seems to be very happy with them.�?

Using computer software they had themselves designed, within forty minutes this small company had the total layout of the kitchen to be remodeled done. They were able to get the cabinets for $3,500. They saved my brother quite a bit of money in other areas of the house, too. Myron says it looks gorgeous!

Big companies – banks or home repair, in this example – just don’t seem to get it. They want customers to fit into their organizational structure, rather than adapting their businesses to fit customer needs. In the good old days, it was pounded into our heads: “The Customer is Always Right.�?

The problem in doing business with large companies is their inability to proactively adapt business policies to customer needs. Organizational structure requiring restrictive policies is a major problem for all big companies.

The bigger they are, the greater their inability to adapt business policies to customer needs.

As Adam Smith, the father of capitalism once said: When a company becomes so large it cannot react quickly to customer needs, such a company will eventually fail.

Goodbye, Home Depot.