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1
Part I
Item 1 - Business
General Information
Lowe’s Companies, Inc. and subsidiaries (the Company or Lowe’s) is a Fortune® 100 company and the world’s second largest
home improvement retailer. As of January 31, 2014, Lowe's operated 1,832 home improvement and hardware stores in the
United States, Canada and Mexico representing approximately 200 million square feet of retail selling space.
Our home improvement stores were comprised of 1,717 stores located across 50 U.S. states, 35 stores in Canada and eight
stores in Mexico. In addition, in August 2013, the Company acquired the majority of the assets of Orchard Supply Hardware
(Orchard), a neighborhood hardware and backyard store focused on paint, repair and the backyard (Orchard stores), primarily
located in densely populated markets in California. Orchard stores average approximately 36,000 square feet of retail selling
space, and generally serve similar customers as the Lowe's home improvement store. As of the acquisition date, Orchard
represented less than 2% of the Company's consolidated net sales. As of January 31, 2014, the Company operated 72 Orchard
stores located in the U.S.
Lowe’s was incorporated in North Carolina in 1952 and has been publicly held since 1961. The Company’s common stock is
listed on the New York Stock Exchange - ticker symbol “LOW”.
See Item 6, “Selected Financial Data”, of this Annual Report on Form 10-K, for historical revenues, profits and identifiable
assets. For additional information about the Company’s performance and financial condition, see also Item 7, “Management’s
Discussion and Analysis of Financial Condition and Results of Operations”, of this Annual Report on Form 10-K.
Our Promise
We strive to be customers’ first choice for home improvement. Customers expect that we will not only sell the products they
need and want, but also deliver a full solution. Our goal is to make the process of home improvement as seamless and simple
as possible, while ensuring we remain relevant to our customers. We have several initiatives designed to deliver seamless and
simple experiences, which include evolving our sales culture across all selling channels, upgrading and continuously enhancing
our information technology infrastructure, and allowing access to customers’ project and product status at all relevant touch
points.
Customers, Market and Competition
Our Customers
We serve homeowners, renters and professional customers (Pro customer). Individual homeowners and renters, which
represent our retail customers, complete a wide array of projects and vary along the spectrum of do-it-yourself (DIY) and do-it-
for-me (DIFM). The Pro customer consists of two broad categories: construction trades; and maintenance, repair & operations.
Our Market
We are among the many businesses, including home centers, paint stores, hardware stores, lumber yards and garden centers,
whose revenues are included in the Building Material and Garden Equipment and Supplies Dealers Subsector (444) of the
Retail Trade Sector of the North American Industry Classification System (NAICS), the standard used by Federal statistical
agencies in classifying business establishments for the purpose of collecting, analyzing, and publishing statistical data related to
the U.S. business economy. The total annual revenue reported for businesses included in NAICS 444 in 2013 was $312 billion,
which represented an increase of 6.0% from the total amount reported in 2012. The total annual revenue reported for
businesses included in NAICS 444 in 2012 was $294 billion, which represented an increase of 5.4% over the amount reported
for 2011.
NAICS 444 represents less than half of what we consider the total market for our products and services. The broader market in
which Lowe’s operates includes home-related sales through a variety of companies beyond those in NAICS 444. These consist
of other companies in the retail sector, including mass retailers, home furnishings stores, and online retailers, as well as
wholesalers that provide home-related products and services to homeowners, businesses, and the government. Based on our
analysis of the most recent comprehensive data available, we estimate the size of the U.S. home improvement market at $637
billion in 2013, comprised of $481 billion of product sales and $156 billion of installed labor sales.