Improve service, Home Depot shareholders say

By Karen Jacobs

ATLANTA, May 22 (Reuters) - Home Depot Inc (HD.N) shareholders told the company's chief executive on Thursday the world's largest home improvement retailer had a long way to go in improving customer service.

At the company's annual meeting in Atlanta, investors complained that efforts to improve the shopping environment have not fully trickled down to all stores. Finding goods on the shelf and helpful workers who make eye contact with customers is difficult, they said.

"I want you to know how badly we need more aprons on the floor," said Gary Patton, a 16-year Home Depot employee from South Carolina. "I just long for the days back in the beginning when we were the destination store. Now we're just one of the other stores."

Shareholder Ken Kaplan said he hoped a move to boost the bottom line would not keep the retailer from spending money to attract knowledgeable workers.

"Pay what it takes to get the ones who defected, the good ones, back from (rival) Lowe's (LOW.N)," Kaplan said.

After the meeting, Kaplan said the company's falling share price was leading shareholders to speak out. Home Depot's stock has fallen about 30 percent in the past year as the slumping U.S. housing market hurt earnings.

"It's an apparently different landscape out there," Kaplan said. "There's been a significant slowdown."

At the meeting, shareholders elected 10 board members. Four board members, including company co-founder Kenneth Langone, retired from the board.

"There's no dramatic fanfare" over a new strategy, Home Depot Chairman and Chief Executive Frank Blake said at the meeting. He said the retailer would continue to focus on top priorities that include boosting sales with contractors, improving product availability and training staff.

This year, Home Depot is scaling back new-store growth and hiring licensed plumbers and electricians in the hope of lifting sales and earnings when the U.S. economy and housing market improve. The company reported a 66 percent drop in first quarter profit earlier this week.

Blake said that, although per-share profit could fall as much as 24 percent this year, residential housing would eventually reverse its slowdown.

Despite the shareholder complaints, lead company director Bonnie Hill said Blake, who took over Home Depot's top job when Robert Nardelli resigned under fire in early 2007, was "doing a fabulous job."

"Our associates really love him," Hill added.

Home Depot's shares were up 15 cents at $27.08 in midday trading on the New York Stock Exchange. (Editing by Andre Grenon)