The other day I wrote about how Lowes and their Kobalt Tools house brand really disappointed me this holiday season. There were some great comments that got me thinking about Home Depot, Sears, and Lowes and how they all fared this holiday season.
My observations focus on Lowes because I am still in utter disbelief about how they ended the year.
I visited the local Home Depot the other day to scope out some of their post-Christmas deals. They seem to have sold certain things really well, and don’t seem to have too many displays full of unsold holiday tools.
There was a near-full display of Dewalt pliers sets, only 2 remaining “special buy” Dewalt 20V drill/driver kits, a near-full display of Rayovac camouflaged LED flashlights, and a bunch of other products.
Overall, I got the feeling that sales of holiday-special tools were not that strong at the local Home Depot. They seem to have experienced weaker tool sales than in recent years.
My local Home Depot also has dozens of inexpensive “clearanced” flashlights (Black & Decker?) still on display. It looks like they didn’t sell any in the 6 weeks or so since the products were first put on the floor.
Home Depot really didn’t give me much to talk about.
I have not been to a physical Sears store since November 2nd. At that time, half of their holiday tool displays were up already, and the others were a day or two away from being filled.
During my last visit to Sears I spotted a red-handled Leatherman Style CS keychain multi-tool with bonus LED Lenser keychain flashlight that I was interested in. I meant to go back, but I never got around to it.
I used to enjoy shopping at Sears during the holidays, but didn’t really feel compelled to head over there this season. This was half because I didn’t really need anything they carry, and half because the sales were not much different than the ones I took advantage of in past years’ holiday seasons.
We received a bunch of questions about Craftsman’s Bolt-On modular power tool line, and expect that these tools sold quite well in stores. I believe Sears typically sees strong Craftsman C3 cordless power tool sales during the holiday season as well.
Sears had some nice Black Friday weekend deals, with similar discounts that I took advantage of in the past, but there were three things I didn’t like. First, the sales flyer was a little vague. I found myself confused about which deals were doorbusters and which were valid throughout the weekend. Second, the flyer was poorly laid out. Why were there different ball bearing tool storage deals in mentioned in four separate locations? This made comparison very difficult.
Third, but perhaps most significantly, I didn’t like how some of the deals weren’t that good. Before Black Friday, the Craftsman C3 XCP heavy duty drill was on sale for $100. For Black Friday, it was $120 with $20 in future rewards points. Now, it’s on sale for $90.
Now, when you visit Sears.com, there’s a Member Alert: Check and your redeem your points before they expire!! warning.
I bet I’m not the only one who prefers instant savings compared to future rewards points.
Last year, after Sears announced millions of dollars in fourth quarter loses, their leadership said that they were working to make their Shop Your Way membership program a bigger part of the Sears shopping experience. Replacing instant discounts with reward points during the biggest shopping season of the year is a gamble, and I’m not sure it worked out for them.
I think Craftsman’s tool of the month program is a great idea, but Sears should have spent more time and money emphasizing it rather than talking about their Shop Your Way rewards program. I get that they’re linked, but some differentiation would be in everyone’s best interests.
One more gripe – where’s my Sears/Craftsman holiday tool flyer? They didn’t make one in 2012 or 2013. Okay, I get it, Sears keeps losing money and believes that the printing costs and mailing fees associated with the seasonal holiday tool flyer is an expense they could do without. That doesn’t explain why they couldn’t put together a nice digital version.
I honestly don’t even know where to begin in describing what I saw at Lowes. At all of my local Lowes stores, you would think it was before Thanksgiving and they had just set things up for the holidays.
I visited store number my local store. This store typically has a great selection of tools, clean displays, and great customer service. It’s one of two Lowes stores I prefer to visit instead of my closest one when I want to scout out the new tools of the season. The store is located in a very busy shopping area right next to a large mall, and is typically very busy.
As mentioned in my recent Lowes/Kobalt disappointment post, Lowes.com reports that the stores in my area have a LOT of unsold Kobalt holiday tools. From this, I estimated that around the country there are many hundreds of thousands of unsold Kobalt holiday tools.
Lowes.com reports that the my closest location has 267 Kobalt Hypercoil LED flashlights, 171 Kobalt Magnum Grip locking pliers, and 301 Triple Cut locking pliers still in stock and available for purchase. They also have 71 precision Double Drive sets and 51 stubby Double Drive sets still on display. These figures were collected on 1/1/2014.
The local store apparently still has 44 of last year’s Kobalt Double Drive holiday-special screwdriver set in stock, but these might have been left over from Father’s Day inventory.
Maybe Lowes.com is reporting inaccurate inventory numbers? It doesn’t look like that’s the case. Here is what the in-store displays looked like on December 31st, 2013:
The displays are all double-sided.
There was also a condensed endcap display featuring all of the new Kobalt tools at the front of the store, and it too was nearly full with unsold merchandise.
Deja vu? In this photo taken at my local Lowes on 12/30/2012, you can see many dozens of Kobalt Magnum Grip pliers sitting unsold in an endcap display. Why didn’t Lowes learn from this?
It’s not just the Kobalt Hypercoil, Magnum Grip, and Triple Cut products that seem to have sold poorly this year.
This is Kobalt Double Drive screwdriver display #1.
This is Kobalt Double Drive screwdriver display #2.
The bottom sections of both displays are untouched, meaning that if Lowes had just one display on the floor instead of two, they would still have unsold merchandise.
The Hammerhead Switch is a product we discovered on display at the local Lowes. It seems like an interesting product, but it’s the kind of thing that needs to be demonstrated to improve its appeal. It seems to me that this particular store had two displays that they consolidated after a few sales.
The local Lowes looks to have 18 of these off-brand rotary tool kits.
There are a bunch of unsold Kobalt 18V drill and drill + impact driver kits leftover. The drill kit was $79 during Lowes’ Black Friday sale and is currently discounted to $59.
There are at least 8 Kobalt compact sliding miter saws still in stock. These were also $79 on Black Friday, but are presently back to their regular price of $129.
There were nearly 30 of these 34pc combination wrench sets still on display. They were priced at $25, which is half of the Black Friday price of $50. The online price is a few bucks higher, at $29.
It also looks like Porter Cable cordless power tool sales were weaker than anticipated.
Even the stripped-down Porter Cable 20V Max impact driver kit, which comes with one battery and a slow-charger, didn’t really sell well. Either that or Lowes restocked the shelf really quickly.
I assume that Lowes made a deal to sell the economic version of the impact driver kit rather than the 20V Max drill/driver kit because they didn’t want Porter Cable sales to interfere too much with sales of their Kobalt 18V drill/driver kit.
Maybe a dozen Porter Cable oscillating tool kits were left on the sales floor as well. At least they were stacked neatly next to an endcap.
I don’t want to say that tool sales at Lowes seem to have been catastrophically weak, but I don’t know how else to describe what I’ve been seeing. This is now how things are supposed to look after Christmas.
I have not yet visited the local Sears, and to be honest I still don’t see any reason to. Past years’ experiences tell me that I will likely mostly see empty and half-empty holiday tool displays. Maybe the unsold merchandise will have already been moved back to pegs and shelves in the tool department. Most of Sears’ sale items are regularly stocked items.
I need to visit the local Home Depot to exchange a defective Milwaukee tape measure, but I expect for the situation to be the same as the other day. Maybe they’ll drop the prices further on the remaining holiday tools they can’t seem to sell. Some of what they can’t sell quickly will probably be moved into various aisles where they’ll gradually empty over time.
Don’t get me wrong, things could have been a lot better at the local Home Depot, but I did not notice any glaring issues of the type that would keep their leadership and investors up at night.
Lowes will probably keep their holiday tool displays right where they are, but eventually they’re going to have to clear out their seasonal areas. At that point, they’re going to have to be really creative in finding places to put their unsold tools, especially the Kobalt flagship products.
My wife asked if I’m happy about Lowes’ woes, but I’m not. I’m disappointed and frustrated that they chose to engage in deceptive pricing tactics while trying to move Kobalt holiday tools, but I am concerned that their poor sales will lead to lost jobs, closed stores, more gimmicky tool designs, or more extreme sales tactics.
It will be interesting to see the numbers all three retailers release in their fourth quarter and annual earnings reports in late February. In the fourth quarter of 2012, Sears lost less money than in 2011, Home Depot earned more than in the prior year, and Lowes earned less.