Home Depot (The)

Moat components and weights we consider most relevant: cost advantage 35% (score 88), efficient scale 25% (82), switching costs 20% (76), intangible brand 15% (79), network effects 5% (52).

Weighted outcome is about 81. Cost advantage stems from vendor terms, private brands, and a national big‑and‑bulky delivery network tied to stores plus flatbed and market delivery operations.

Efficient scale is reinforced by thousands of stores across the U.S., Canada and Mexico, and now a large specialty distribution footprint following SRS and GMS. Switching costs are rising for Pros due to trade credit, delivery reliability, joblot quantities and a broader catalog across roofing, landscape, pool and now drywall and ceilings.

Brand equity remains strong in DIY and Pro segments. Network effects are not primary, though marketplace‑style product breadth and reviews online aid discovery.

Key evidence: online represented 15.1% of fiscal 2024 sales with dense store‑fulfilled logistics; SRS (closed June 18, 2024) added 760+ branches and 4,000+ trucks; GMS closed September 2025 under SRS, creating a 1,200+ location platform.

Risks to moat include Amazon price transparency, specialty distributor competition, and potential erosion if service quality or delivery reliability falter as footprint scales.