Lowe’s is closing 51 stores in the US and Canada
In another sign of the times for retail, Lowe’s is closing 51 North American stores.
The home improvement chain said Monday that locations are underperforming and the decision will help the hardware chain focus on its most profitable stores and “improve the overall health of its store portfolio.”
Lowe’s (LOW) is shutting down 20 stores in the US and 31 in Canada. The company said that a “majority” of the shuttered stores are within 10 miles of another Lowe’s location.
The stores will be closed before Feb. 1, 2019. The company will try to find jobs at nearby stores for its employees affected by the closings.
“The store closures are a necessary step in our strategic reassessment as we focus on building a stronger business,” said CEO Marvin R. Ellison.
Lowe’s is struggling to keep up with its larger rival Home Depot. Last year, Home Depot’s revenue hit more than $100 million, while Lowe’s sales were below $70 million.
Lowe’s stock price has also lagged behind its rival, leading to pressure from activist investors.
Earlier this year, Lowe’s gave the reins to a home improvement veteran to turn around the company. Ellison was a top executive Home Depot for more than a decade, and most recently served as JCPenney’s CEO.
Ellison has already made some big strategic decisions, including closing all of its Orchard Supply Hardware stores and slashing inventory at its Lowe’s stores.
He believes targeting professional home builders and construction companies with higher-quality tools and equipment, additional discounts, and better customer service will improve Lowe’s. Sales to home building pros make up around 45% of Home Depot’s sales, but only around 30% of Lowe’s sales, according to analysts at Wedbush Securities.