HD sales - Trio & Rotozip

[durango dude]

Local HD has Dremel Trio kit piled up, priced for $79.

They also have Rotozips (previously $99) on sale for $49.

Still not quite a steal.

I noticed my local HD has been cutting back on tools a bit ---- their stock is getting thin, compared to what it was a couple of years ago.

I suspect durable goods aren't selling like they used to.

[toolman0701]

You are absolutely correct...and HD is leveraging their website for less commonly sold tools. That way, the vendor is responsible for warehousing and carrying the cost of inventory and HD makes profit/turns on something they never handled. As a company sales are down significantly (and not just at HD), so to make turns and have Wall Street happy, they are carrying less inventory, have less and less help available and are trimming costs wherever they think feasible. Once they trim the fat at store level you will see less and less deals available because they generally won't own the inventory on the website--so if it doesn't sell, they aren't out anything other than a few web pages.

[vaking]

I don't know much about trio but I have had rotozip for a long time. In my opinion - rotozip as originally intended (spiral saw) is a pretty useless tool. There was a time when I used it to cut openings in drywall or wood paneling to install electrical outlets, but today I will use a multi-tool from Harbor Freight for it rather than rotozip. Years ago I got myself a dremel plunge base which works well with rotozip. Combined together they became a good alternative to a small router, something like Bosch Colt. If you can get both rotozip and plunge base for something under $70 - it might make sense. If not - I would not buy rotozip today.

[woodturner]

I noticed my local HD has been cutting back on tools a bit ---- their stock is getting thin, compared to what it was a couple of years ago.

HD has been cutting back on tools in particular stores - the sander deals, etc. at the New Rochelle store are an example.

I've not seen any reduction in tools at my local HDs, and both items mentioned are full price at my local HDs. What HD had the prices you found?

FWIW, when I have ordered tools from the website, they have shipped from an HD warehouse, rather than a vendor warehouse. As far as I can tell, HD is still maintaining their own inventory for the web sales.

[greenacres2]

HD has been cutting back on tools in particular stores - the sander deals, etc. at the New Rochelle store are an example.

I've not seen any reduction in tools at my local HDs, and both items mentioned are full price at my local HDs. What HD had the prices you found?

FWIW, when I have ordered tools from the website, they have shipped from an HD warehouse, rather than a vendor warehouse. As far as I can tell, HD is still maintaining their own inventory for the web sales.

Could still be a significant reduction in owned inventory and costs...Let's say they had 1,000 stores with a display model drill press and an average of 3 for sale on the floor in each store--gotta own 4,000 drill presses to do that. Instead, they decide to have the display in half the stores, bring the floor inventory down to 1.5 per store, and keep 300 of something in a warehouse--only need to own 2,300 to do that. And, by cutting down on the display they reduce the markdowns needed for "shop-worn" merchandise. In the meantime, since it's more convenient, you buy your drill press online instead of the store. Instead of them trucking it, you pay the freight. Instead of a store clerk taking 20 minutes to get it to your truck, a picker puts it on a conveyor and the shipping clerk labels it in a combined 7 minutes. The warehouse space is in a less-traveled area, so the cost of real estate is lower, etc, etc.

You may get it from their warehouse, but the stock is as close to "just-in-time" as they can get it.

I'm making all of this up 'cuz i don't really have a clue--but it seems possible to me.

On to the original topic--$79 sounds like a good deal on the Dremel. Like vaking said, i'm using my vibra-tool more than i thought i would, almost to the point of a crutch at times.

earl

[durango dude]

Just reviewed an investor's presentation from HD - and they are guarding their profit margins by managing inventory movement more tightly (per Ted Decker).

My own store (Durango, CO) is certainly seeing less inventory. Although curiously, we now have a full-time Bosch representative (I assume paid for by Bosch). More of the inventory is being handled direct by the vendors.

HD will only open 2 new stores in the USA, in 2012 ----- and is assuming low single-digit growth in same-store sales (barely keeping up with cost, I'd imagine). The best way to sustain profits is to lower operating cost - which means lowering inventory turn-around time.

Looks like HD is about to centralize a lot of inventory functions in Indianapolis.
(great transportation hub)