Explain efforts was reason for poor financial performance

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The slowing economy in 2000 combined with Home Depot's aggressive expansion efforts was the reason for Home Depot's poor financial performance. Between June 1999 and May 2000, the FED had raised interest rates six times - or a total of 1.75 percentage points - in an effort to slow the economy and economists had been noticing some softening of overall consumer demand.

We see an average increase in sq. footage of 26% per year for period 1986 - 2000 while average sales growth fall from an average over the same time period of 31% to 19% in 2000. There was a drop in sales per square footage from $423 in 1999 to $415 in 2000 and a drop in weekly sales per store from $876,000 in 1999 to $826,000 in 2000.

Reference no: EM13159939

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