Lowe's follows money trail into city
September 9, 2002-- Home Textiles Today,
Since expanding the Lowe's format into more urban markets, "only recently has the metro market penetration significantly contributed to our total sales performance," Bob Tillman, chairman, president and ceo, told analysts at Goldman Sachs' Global Retailing conference last week.
The New York metropolitan stores include some of the "hottest locations" for the chain, he said, and the Boston stores are outperforming its expectations.
He added that the company wants a greater density of stores in high-income areas, and it's looking at all major markets, including Chicago, where Lowe's plans to add six to seven units in the suburbs. One advantage of a large market is "there is very little self-cannibalization … we can put a location three miles away from another one" — something that is harder to accomplish in a smaller market. Its research also shows that there is greater opportunity for the company in more upscale markets. "We're only going to build stores where we can make money."
The majority of Lowe's units, 765 out of a total of 806, are in its big-box format, "the real growth area." These stores have more than 85,000 square feet of selling space and are an average of four years old, said Robert Niblock, cfo and executive vp. Lowe's is on schedule to open 113 new stores this year and 127 stores next year, not including relocations.
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