EDITORIAL

The battle moyes to the countryslde

Hone Depot's r€cent aclmowledgement that it plans to open strores in rural markets has significant implications for small town independents who have always felt their isolation protected them ftmr Oe Big Boxes. No more.

Wal-Mart proved big stores could work in small towns; McDonald's likewise discovered a Umit€d population base was no bar to fast food success.

Depot seems !o aglee. They've hired two WalMart officials and re developing a "rural maket pfototype," according to oompany spokesman Lonnie Fogel. No other details were available at press time, but speculation has been b'risk.

Some feel the home improvement giant needs to convince Wdl Street that its stock is still a gmd buy after a recent price slump following disappointing earnings. Without slock appreciation, obsenrers hold that stock owning employees will lack the commitment that has powered Depot to industry leadership. Visions of riches frwt stock profits have driven many employees to 0olerate long hours and sometimes stressful working cmditions. Expansim out of metro martets could be seen by manegement as a way to bolster and lift the pnce of Home Depot stock.

More San one smrll chain and several ind€p€ndents have told us that they will survive and prosper even if the Big Boxes invade their economic islands. Some believe personal service, relationships and small lown lomlty win carry the day fr them. Others just hoot at this, pointing out the death of thousands of local businesses trying to cmpete with tbe likes of Wd-Mfrt and McDonald's.

Some conjecue that rural Home Depots will be fr smaller than existing units in lrge markets. Others say such an assumption is wrong becels€ of the bulky nature of many of the pnodttcs carrie4 such as lumber and plywood.

We suspect rural units will be close in size to curent metro stof€s. smdl town wal-Mara are large, so there's no intrinsic reason to believe Home Depot would seriously downsize barring exceptional ciromstanc€s.

When they will open outside the cities is anyone's guess 31 this poinL But it seems certain they will invade Small Town America It is no death sentenoe for the smalls. The best of them have proven many times that Life with Depot can be both profitable and exciting.