Retail Giants Transform: The Rise of Professional Services
Amsterdam, donderdag, 3 juli 2025.
Major retail chains like Home Depot and Costco are redefining their business model by focusing on professional services and installation solutions. Instead of just selling products, these stores now offer comprehensive service packages for contractors and professionals. This strategic shift is driven by growing demand from ‘Pro customers’, with these retailers generating over $1 billion in additional annual revenue. By developing specialised installation programmes, improved supply systems, and targeted contractor networks, these big-box stores are creating a new value proposition that goes far beyond traditional product sales.
Strategic Shift to Pro Services
Major retail chains are transforming their business model by focusing on professional services. Home Depot reported that sales across all Pro cohorts grew in the 4th quarter of fiscal 2024, leading to over $1 billion in additional annual revenue across 17 US markets [1]. Lowe’s saw moderate growth in Pro sales in the 1st quarter of 2025, even as DIY demand softened [1].
Expansion of Services
Costco is actively investing in comprehensive installation solutions by collaborating with manufacturers and local installation partners. Their service offering includes flooring, blinds, kitchen cabinets, garage doors, HVAC systems, and generators [2]. The retailers are implementing advanced delivery and planning systems, and tracking customer satisfaction through metrics like VOC (Voice of the Customer) and LTR (Likely to Recommend) [2].
Contractor Network Strategy
Retailers are actively seeking reliable, high-performing contractors to meet consumer demand. Contractors who consistently perform, communicate strongly, and achieve high customer ratings will receive more business opportunities [3]. Entering the preferred contractor network of major retail chains can guarantee a stable project pipeline, but requires meeting strict expectations for timeliness, communication, and customer satisfaction [3].
Market Development
The shift towards professional services is supported by research data. The Home Improvement Research Institute (HIRI) discovered that in 2024, 44% of homeowners completed improvement projects, with 80% having at least one project completed by a professional [4].