The Home Depot, Inc. has invested significantly in modernizing its supply chain to enhance efficiency, speed, and operational resilience as part of its strategy to reduce reliance on non-U.S. product sourcing. Over 50% of Home Depot’s products are sourced domestically, but half of its imports face tariffs between 10% and 30%. The company aims to ensure that no single non-U.S. country accounts for more than 10% of total purchases within the next year. This diversification is essential for navigating a complex trade landscape characterized by rising tariffs, particularly on imports from China.
In the first quarter of fiscal 2025, Home Depot’s supply chain productivity helped mitigate gross margin declines amid ongoing macroeconomic uncertainties. The company’s “One Home Depot” investment plan focuses on supply chain expansion and technology integrative efforts, aimed at reinforcing distribution centers and enhancing delivery capabilities. Despite facing a year-to-date stock decline of 6.2%, Home Depot has maintained a forward price-to-earnings ratio of 23.14, compared to the industry average of 20.38.
Home Depot competes with Lowe’s Companies, Inc. and Amazon.com, Inc., both of which are enhancing their supply chain capabilities to improve efficiency and customer experience. Lowe’s focuses on inventory flow and operational efficiency while Amazon prioritizes speed and automation in its supply operations, thereby constantly evolving to meet customer demands.
