Lessons Learned From Restaurants, Retail and Renovation
I was raised in Tampa, Florida, where my parents ran an Italian butcher and deli shop. So, my work ethic started at a young age. I swept the floors and helped out where I could. Sometimes, it meant staying up late to get the job done.
I got my first paying job at age 12 at the local mall, managing a kiosk where I sold software. This is the job that taught me about sales and customer service. I had to ask customers what they were looking for and try to identify their problems and needs. I then had to try to match them with the right software solution for their need. As I took on different roles in my career, I did hold close that asking questions is the first step to offering good customer service.
I worked at that kiosk until my brother recruited me to join him at a Checkers Drive-In Restaurant when I was 15. There I learned the world of fast food management. By the time I was 18, I had worked my way up from the grill to managing the restaurant. I was one of the youngest managers in the company. But, I learned how to manage a team with many different backgrounds and experience.
As I moved into my college years, I wanted to try my hand at retail. I got a job managing a mall-based toy store. That was a hard business. Two key things made it hard.
First, you turned 75% of your inventory in one day (Black Friday) and you had to replenish it overnight to be ready for the next day.
Second, the whole staff was seasonal, so you had to hire and train more than 40 people in less than a month, only to let them go a little more than a month later.
My Home Depot adventure began in October 1999. Initially a manager-in-training candidate, I spent my first two years learning the company culture and our store environment in the garden and hardware departments. As college graduation neared, I chose to pursue a career at the Store Support Center. I went on to spend six years in finance supporting the Home Services Division of Home Depot.
In 2006, consumers had access to large credit limits and home improvement loans. These financing vehicles allowed them to complete large “do-it-for-me projects.” Home Depot began expanding its services offerings into many new product lines, and I left the finance group to focus on Outdoor Living Installation Services. There, I led an initiative to convert parking lot space into an Outdoor Living vignette with sheds, decks, pavers, outdoor kitchens and water features.
In addition to setting up the space and creating a selling center, I convinced the leadership team to invest in an associate to staff the area and generate sales. Just like building a small business, but with access to investment, I had to convince the leadership team to give me a little startup capital.
Besides selling the internal Home Depot team, I also needed to get vendors to participate. Vendors were on board with supplying product, but I had to figure out the labor side to create the selling space. So, I led by example and laid pavers for the first three selling centers. But, just as the program was ramping up, the bottom fell out of the market and people’s access to credit dried up. Due to reduced demand, Home Depot exited the Outdoor Living Installation Services business.
At about the same time, Wells Fargo mortgage consultants started sending people into our stores to get support for a 203K Renovation Loan product. Although Home Depot Home Services offered more than 25 unique programs through our stores, none were designed to be a flexible general contracting program. Recognizing an emerging market segment, Home Depot invested in a small team to put together a network of contractors that could focus on completing a full range of repairs. We started with a list of our best Pro customers. Within four months, we went from a pilot program to a nationwide 203K Renovation Loan rollout.
Alongside our growing 203K Renovation Program, a foreclosure crisis was emerging across the country. As the crisis deepened, Wells Fargo began accumulating more and more of their own properties, many of them in severely distressed conditions. Properties that weren’t repaired would not sell, so a huge backlog of distressed assets formed. Premiere Asset Services (PAS), a division of Wells Fargo that maintains and manages assets for Wells Fargo and other clients, was introduced to Home Depot, and we became a direct repair vendor.
As economic conditions continued to decline, foreclosures plagued the country. We expanded our business by taking on additional clients, which allowed us to build out our team and expand our service provider network. As a recession-combating line of business for the Home Depot, we became a landing place for associates who would have been displaced from other lines of business. In addition, we were able to provide opportunities for our best Pro customers and keep them working. By creating value for our clients and stabilizing neighborhoods, we helped create future Home Depot customers. We made it our team goal to create more business for Home Depot and its customers, so we could save more Home Depot employees who would otherwise be displaced.
Another key initiative for The Home Depot is supporting our veterans. The capabilities we developed during the foreclosure crisis provided a unique opportunity to partner with several banks and military donation funds to provide housing for wounded veterans and their families. To date, Home Depot has rehabbed more than 600 military donation homes and has pledged to donate $500 million to veterans by 2025. Although I didn’t serve, both my uncles served in the Army and my father served in the National Guard. As we grew our Renovation Services Team, I looked for folks with military experience to support us in leadership roles.
As the market continued to evolve, investors turned their eyes toward real estate. Large REITs started to form in the single-family rental space. They had several key areas of need: rehab contractors, access to quality products, control over the product going into their homes and tools to support scoping repairs. We quickly mobilized and again grew our team to support them in their key market areas with local construction coordination and supervision. We helped establish local pricing templates for product and labor that later became the backbone of a proprietary project-scoping tool known as RenoWalk.
Similar to when I ran a software kiosk at the local mall, our team prides itself on being solution-oriented, thinking outside the box and being exceptionally entrepreneurial. We continue to evolve with an ever- present focus on solving customers problems. Currently, we support the investor community in all shapes and sizes. Being entrepreneurial, we help investors grow their portfolios into new markets. We have found that one of the biggest reasons investors are cautious about investing outside their home markets is managing the rehab remotely. It takes time to build up a portfolio big enough to support an in-house management team. In recent years, the country has experienced historically low default rates and foreclosure inventory, making it difficult for investors to find value in the market. While many repair contractors retreated from this industry, Home Depot continued to expand its customer base, offerings, service provider network and field capabilities.
