In a continuation of its supply chain transformation project, Home Depot last year opened 20 new distribution centers, 18 of which are directed toward direct, flow-through operations, says Armstrong.

As of last spring, Home Depot's supply chain initiative had resulted in significant improvements in inventory turns and distribution costs, while supporting the company's double-digit growth, he says.

In the next phase of its transformation project, Home Depot will focus on synchronizing inventory information and management through demand planning and transportation all the way to the store shelf, he says. "We want to synchronize all those activities and leverage the network we are building so we can give our customers the right product at the right price and the right time through whatever channel they desire," he says.

Fulfillment of online sales continues to be a critical part of this process, Armstrong says, noting that the company is expanding its direct fulfillment footprint by adding three new facilities. "This allows us to ship products to our customers in the appropriate time line and lower the landed cost of products running through the network," he says.

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