When you hear the words “home improvement,” many instantly think of Lowe’s. But recent developments have caused their customers and loyalists to start asking questions about the brand, including ‘Is Lowes going out of business?’
Recently, the brand decided to close several of its stores at once, which sprung a quick concern in the minds of its loyal customers.
Is Lowes going out of business really? What should you know about this new development about Lowe’s? Keep reading to see all that we’ve got for you in this post.
Table of Contents
A Quick Look at What Lowe’s Stands for
Before we show you all that you need to know about recent happenings behind the scenes of Lowe’s, let’s take a moment to see what the brand stands for. This will be really beneficial to people that are hearing about the company for the first time or not too familiar with it.
Lowe’s is an iconic name in the home improvement sector. The brand was created in 1946 as a small hardware store, which grew over the years to become a multinational home improvement company that we know today.
Known for its wide range of products, from gardening tools to home appliances, Lowe’s has always taken pride in its unique offering to homeowners and builders. There is hardly any home appliance you wouldn’t find at Lowe’s store.
Having operated for more than 75 years, Lowe’s has built its reputation on quality, service, and value. And now has stores all over the U.S. and even Canada. However, the company recently shutters all its stores in Canada and some areas in the U.S. The move not only caused concern in the minds of Lowe’s loyal customers but came with a touch of panic. Is Lowes going out of business?
Is Lowes Going Out of Business?
The direct answer is no. Even though the brand has been closing down multiple stores, Lowe’s is not shutting down entirely. Instead of calling it quit, Lowe’s sad they would rather call it optimizing their business operations.
In a significant move, Lowe’s signed a contract to transfer its Canadian business to a private equity firm, Sycamore Partners. This deal, worth $400 million in cash along with potential future payments based on performance, is set to close in early 2023.
While it may seem like a step back, Marvin R. Ellison, CEO of Lowe’s, stated that this decision is a strategic one, aiming to streamline the company’s business strategy. So, is Lowes going out of business? You can now see that the answer is simply no!
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Why is Lowe’s Closing Its Stores?
Now that we know that Lowe’s isn’t closing down entirely, then we should know why the brand has chosen to shutter many of its stores recently. Let’s talk about some motivations behind this decision.
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Strategic Reassessment
Lowe’s decision to close a segment of its stores stems from an overarching strategy to prioritize its most profitable locations. Like many businesses, Lowe’s aims to optimize its performance by focusing on outlets that bring the best returns while phasing out underperforming locations.
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Shift in Consumer Behavior
The COVID-19 pandemic saw a surge in home improvement sales as many people, confined to their homes, embarked on renovation projects. This spike was great for home improvement chains, but as the real estate market began to slow, and borrowing rates rose, people started looking at renovations differently, potentially affecting sales. And since sales have dropped drastically, Lowe’s had no choice than to close some of its stores to save the situation.
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Simplifying Business Strategy
Marvin R. Ellison, Lowe’s president and CEO, highlighted the sale of its Canadian stores as a crucial step in simplifying the company’s business model. Streamlining and focusing on key areas of business can often result in better efficiency and profitability in the long run.
List of Lowe’s Stores Closing
With the restructuring in progress, Lowe’s announced the closure of 51 stores in North America. Of these, 20 are located in the United States and 31 in Canada. Here’s a peek at some of the locations in the United States that are set to close:
- 1100 Bankhead Hwy SW, Graysville, Ala.
- 26501 Aliso Creek Rd., Aliso Viejo, Calif.
- 13300 Jamboree Rd., Irvine, Calif.
- 720 Dubuque Ave., South San Francisco, Calif.
- 750 Newhall Dr., San Jose, Calif.
- 48 Boston Post Rd., Orange, Conn.
- 1333 Schaefer Rd., Granite City, Ill.
- 7735 Grand Ave., Gurnee, Ill.
- 6221 US Hwy 6, Portage, Ind.
Who Bought Lowe’s?
The Sycamore Partners have acquired Lowe’s Canadian division. This private equity firm isn’t new to the retail industry and is known for its strategic investments. Under the new ownership, all Lowe’s stores in Canada will transition to “Rona” – a prominent Canadian hardware and home improvement store.
That means the next time you walk into your favorite Lowe’s store, the name might have changed to Rona. That the situation Canadian customers will likely be facing soon.
Lowe’s Not Alone; Other Retailers Closing
Lowe’s isn’t the only big-name facing challenges. Walmart has closed three of its tech hubs, Neiman Marcus announced layoffs, and Tuesday Morning is shutting stores. The retail industry, as a whole, has seen dramatic shifts with businesses needing to realign strategies and operations to stay profitable.
So is Lowes going out of business? No, they are simply restrategizing. Is Lowe’s the only retail brand doing this? Of course, the answer is also no!
FAQs
Did Lowes Get Bought Out?
No, Lowe’s has not been bought out. As of the recent reports released earlier this year about the company, Lowe’s remains an independent company and is publicly traded on the New York Stock Exchange under the ticker symbol “LOW.”
Did Walmart Buy Out Lowes?
No, Walmart has not bought out Lowe’s. Both Walmart and Lowes are separate entities and operate independently in their respective retail sectors.
Who Owns Most of Lowes?
Lowe’s is a publicly-traded company, so its ownership is dispersed among institutional investors, mutual funds, and individual shareholders. The largest shareholders typically include institutional investors who own over 50% of the company.
However, reports have it that The Vanguard Group, Inc. is the largest shareholder with 9.1% of shares outstanding.
Is Lowes Going Out of Business – Final Note
Is Lowe’s going out of business? While the company is going through transitions, it’s not saying goodbye. The decisions made, although tough, aim at ensuring the longevity and profitability of the brand.
As for the Canadian market, while the Lowe’s name might be changing to Rona, the commitment to quality and service remains steadfast. So, the next time you think of home improvements, remember, Lowe’s might have a different look in some places, but its heart remains unchanged.