Doing It for You : HomeBase Hopes to Build New Name in Installations
HomeBase Inc., which hammered its way into the hearts of homeowners as a discount do-it-yourself store, now plans to drill into the market for professional home installations as well.
The 87-store home improvement chain hopes to fill the gap left when Sears, Roebuck & Co. dropped much of its at-home installation services. Those included jobs that are typically too complicated for homeowners, such as installing roofing, garage doors or chain-link fences.
“What this gives HomeBase is a true differentiation from any other home center,” said the company’s president, William Patterson, who until November was group vice president for product installation at Sears.
Because of Sears’ decision, HomeBase also has an opportunity to hire a legion of workers already trained in installations. HomeBase has contracted with more than 120 former Sears sales representatives who call on customers at their homes. It also has hired some Sears senior and middle managers who ran the installation operation and has signed up many of the independent contractors who actually installed Sears products.
The business was worth about $1.3 billion a year for Sears, which decided to get out of some lines of the business to concentrate on its retail sales.
Patterson said he hopes that with advertising, time and a little luck, his company might be able to pick up 20% of Sears’ former home installation business in Illinois, Ohio, Oklahoma and the western states in which HomeBase operates.
HomeBase, like other home improvement chains, has offered installation on a limited basis in the past. Now, though, the company plans to market the service extensively and offer a toll-free telephone number for ordering. HomeBase sales representatives will call on customers at their homes, where they can estimate costs and write orders. Then the company will have its contract installers come out and do the work.
Customer get home service backed by a chain they know and are spared the trouble of choosing among contractors, Patterson said. And HomeBase, with its low-cost structure, hopes to cut Sears’ prices on the same installations by as much as 15%, he said.
Margo McGlade, an analyst for the brokerage PaineWebber in New York, said HomeBase’s idea sounds reasonable. “I think the concept of these installed sales is very big,” McGlade said. “It seems to me like something HomeBase probably should be” doing.
The service will also be a boon to the independent contractors who were left in the lurch when Sears pulled out.
“I’m real excited,” said Kathy Trout, a vice president of AAnchor Overhead Door in Garden Grove. “They’ll offer the best pricing and the highest quality in both the retrofit market and the construction trade. . . . It’s a great opportunity for everyone to benefit--the contractor, the management team and the consumer.”
She said Sears accounted for 35% of her company’s annual sales of $2 million in garage doors and related products. That work was important, she said, because “it identified us with a national company and gave us a lot of credibility.”
For Lucky Installations in Santa Fe Springs, which bills itself as the Southland’s largest installer of seamless rain gutters, the relationship with HomeBase is “going to be a major shot in the arm,” Vice President Frank Lemmo said.
The pullout of Sears “created a tremendous vacuum for homeowners,” said Lemmo, whose company worked with Sears for 22 years. The link with HomeBase will be “an excellent opportunity” to regain some of that business.
Gordon Jones, a Sears spokesman in Hoffman Estates, Ill., said the retailing giant will continue to do some at-home installation of appliances such as garage door openers and dishwashers that customers buy in the company’s retail stores. Some other lines, such as roofing or fencing, may be installed through the licensing of independent contractors, he said, but will not involve Sears personnel.
He would not comment on HomeBase’s decision to pick up where Sears left off.
HomeBase Inc.
Headquarters: Fullerton
President: William Patterson
Stores: 87 in California, Washington, Nevada, Arizona, New Mexico, Texas, Idaho, Oregon, Colorado, Oklahoma, Utah, Illinois and Ohio
Facts and figures:
* One of two major chains owned by Waban Inc., based in Natick, Mass.
* HomeBase recorded sales of $1.6 billion for the fiscal year ended Jan. 30, up 16% over the previous year. Operating income last year was $44.9 million, up 13%.
Source: HomeBase Inc.
