Home Depot Expands Pro Market Footprint With $18 Billion SRS Deal
Home Depot is acquiring SRS, a distribution company for roof, landscaping and pool contractors.
The home improvement giant says the $18.2 billion deal, announced Thursday (March 28), will speed its growth with its professional customer base, and expand its total addressable market to approximately $1 trillion.
“SRS is an industry leader with a proven track record of profitable growth across verticals,” Home Depot Chair, President and CEO Ted Decker said in the announcement. “SRS’s ability to build leadership positions in each of its trade verticals while generating significant revenue growth is a testament to its strong vision, leadership, culture and execution.”
Decker noted that the SRS branch network, combined with Home Depot’s 2,000-plus stores and distribution centers, offers new fulfillment and service options for the retailer’s all-important pro customers.
SRS, meanwhile, has a sales force of more than 2,500 people and a network of upwards of 760 branches in 47 states, plus a fleet of 4,000 trucks.
Dan Tinker, president and CEO of SRS, said the deal “will enable us to better serve pros and continue growing in our large and highly fragmented market.”
Although Home Depot’s business is divided pretty much evenly between homeowners and DIY customers in one group and builders and contractors in the other, the company has said it views the pro segment as its more dependable driver for growth.
“The underpinning of this market segment is incredibly strong,” Chief Financial Officer Richard McPhail said during an earnings call last month.
As PYMNTS wrote at the time, larger professional shoppers with more complex spend make up a crucial way for Home Depot to boost sales, and the company has continually stressed its efforts to build a pro ecosystem that includes things like credit and financing products, digital capabilities, field support and rentals.
“In 2024, we will continue learning and building out new capabilities for the complex Pro,” Decker said last month. “We are expanding our assortments, fulfillment options, and our outside sales force and just recently began piloting trade credit options.
“In addition, we continue to work on new order management capabilities to better manage complex Pro orders,” he added. “For the complex Pro opportunity, this means that by the end of 2024, we will have 17 of our top pro markets equipped with new fulfillment options, localized product assortment, and expanded sales force and enhanced digital capabilities with trade credit and order management in pilot for development.”
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