Home Depot's CEO says company is seeing benefits from US housing-market recovery as purchases from professional contractors have begun to rise; company to focus on growing its online business instead of expanding overseas
Wendy Lisney
NEW YORK
,
October 12, 2012
(Thomson Reuters)
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The U.S. housing market is starting to thaw, but it could be two years before a full-blown recovery takes hold, Home Depot Inc
"It's starting to recover, but we're a long way away from true recovery," Blake, 63, told Reuters in a wide-ranging interview that touched on his views of the so-called Fiscal Cliff to why he sees the internet as Home Depot's next frontier. "This housing market's been very, very bad and it's going to take some time to recover," Blake said. "The way we look at it is there's going to be a period of a workout, a fine period of one to two years and then you're going to get a more robust recovery," Blake said. While California and Florida, states slammed by the housing downturn, show signs of improvement, Blake urged investors not to read too much into the recent signs of recovery. One way to tell the difference is whether or not consumers will again look at a home improvement as a cost they can recoup when they sell their home. TAKING THE ONLINE ROUTE Last month, Blake decided to close all seven of Home Depot's big box stores in China after a failed expansion attempt there. He said he views online business as the next area of expansion, rather than new geographic markets. The retailer, which bought California-based Red Beacon earlier this year, is interested in making more acquisitions in Silicon Valley to boost its online business and other related capabilities, Blake said. FISCAL CLIFF "We don't see that in consumer behavior," Blake said. "You never want to get too deep into a bet on the rationality of Washington," Blake replied.
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