Lowe’s CEO: Charlotte’s rapid growth is a boom for home improvement retailers
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Lowe's in South End. Photo: Katie Peralta Soloff/Axios Charlotte
The kind of growth Charlotte is experiencing — we’ve jumped 20% in population since 2020 — is fueling an incredible run for the home improvement industry and retailers like Lowe’s, the Mooresville-based company’s CEO Marvin Ellison told reporters Wednesday.
As people move here, they’re buying homes and spending a lot of money sprucing them up.
What he’s saying: “Charlotte is a microcosm of what we’re seeing in other cities around the country,” Ellison said, adding that Charlotte ranks at the top of the list of “family-friendly” destinations to which families are moving.
- “That puts enormous stress on the housing market,” he said. “However, that is a net benefit for Lowe’s.”
What’s more, America’s homes are aging. Nationally, there are more homes 40 years old or older than any time since World War II, Ellison said. Those older homes often require much more work.
- Two-thirds of sales at Lowe’s stem from repairs and maintenance, Ellison said.
- Customers here have been investing in areas such as kitchens, flooring, countertops and bathrooms.
Why it matters: The pandemic has provided a boost to home improvement retailers as stuck-at-home Americans embarked on all sorts of home projects. Homes have turned into offices, schools and places of entertainment for all of us — and people see home-improvement spending as an investment, not an expense, Ellison said.
“We believe fundamentally coming out of the pandemic — or as we still live through the pandemic — that we are always going to feel differently about our home. We think that’s a permanent shift, that the home has just taken on a whole new meaning to all of us, me included,” Ellison said.
The Charlotte region, Ellison added, ranks near the top of the 15 geographic regions Lowe’s tracks in terms of financial performance.
“That’s in part because our customers are continuing to invest in their homes and we have seen a resurgence in the growth in the millennial homeowner and property owner, and that is part of the growth that we’re seeing in Charlotte,” Ellison said.
Ellison’s comments came hours after Lowe’s reported its earnings for the second quarter, a three-month period during which the economy started opening back up and Americans started spending more on things like travel and dining out.
- The company reported earnings of $3 billion and revenue of $27.6 billion, both figures that topped Wall Street estimates, as CNBC noted.
- Lowe’s reported 21% growth in its important pro business, which Ellison has said is a key segment to expand as Lowe’s works to catch up to rival Home Depot.
- Comparable sales, a key retail metric that measures sales at stores open at least one year, decreased 1.6% in the second quarter from a year ago.
Ellison calls last year’s sales at Lowe’s “an anomaly.” Customers spent way more than usual on items like cleaning supplies, lumber and masks.
“We are very aware there are some uncertain times out there. Even so, we’re positive on the outlook for home improvement and housing,” Ellison said.