Teresa Rivas explores the possibility of sustained retail sales in Barron's, writing: After the close of regular trading Wednesday, Costco Wholesale (ticker: COST) reported another month of double-digit comparable-sales growth. Comps climbed 14.5% in August, excluding fluctuations in gasoline and foreign exchange, while e-commerce sales soared more than 100%. That is par for the course for the discount retailer, which put up similarly strong same-store sales in June and again in July. While the company got a boost from panic-buying in March, flat April sales had some investors worried that … [Read more...]
Is the Consumer Spending Boom Destined to Turn to Bust?
Dick’s Sporting Goods reported a blowout quarter this week. Apparently, handing out a few thousand dollars to every household in America, while at the same time closing down every gym in the country, has created a boom in at-home fitness equipment. Dick’s fitness business is basically sold out. Golf clubs are also flying off the shelves as are boats, RVs, and fishing poles. It’s good to see consumers spending their windfalls, but are we simply looking at a one-time jolt to economic growth that will fizzle as the stimulus wears off? Has all the spending during COVID, simply pulled a few … [Read more...]
Food Companies Struggle to Keep up with Demand
Shifts in food supply and demand resulting from COVID-19 shutdowns have caused food companies to fall behind, creating shortages at stores. The Wall Street Journal reports: Grocers are having trouble staying stocked with goods from flour to soups as climbing coronavirus case numbers and continued lockdowns pressure production and bolster customer demand. Manufacturers including General Mills Inc., Campbell Soup Co. and Conagra Brands Inc. say they are pumping out food as fast as they can, but can’t replenish inventories. Popular items such as flour, canned soup, pasta and rice remain in … [Read more...]
Walgreens Fights Online Pharmacy Rivals with In-store Doctors Offices
Sharon Terlep explains the latest efforts by Walgreens to become a healthcare provider by adding doctors offices to its pharmacies. She writes in the WSJ: The largest U.S. drugstore chain by stores is pairing with primary-care provider VillageMD to open 500 to 700 clinics at Walgreens sites across the country over the next five years. Walgreens will pay VillageMD $1 billion in equity and debt over the next three years in exchange for a 30% stake in the Chicago-based startup by the end of that term. Walgreens and rival CVS Health Corp. are in a race to become go-to treatment centers, … [Read more...]
Multi-Channel is the Only Way Forward for Retailers
In retail, companies with strong e-commerce platforms fared much better than those lacking a strong online presence. Dick’s Sporting goods was one of the relative winners in brick and mortar retail. Dick’s made investments in its online platform pre-COVID that allowed the firm to roll out a curbside pick up a few days after the company closed all of its stores. Sales were still down 30% year-over-year in the quarter, but it could have been worse. Kohl’s reported sales down 45% for the quarter. The Coronavirus crisis should be a wakeup call to all brick and mortar retailers. Being able to … [Read more...]
Walmart Sales Soar as Americans Stock Up
As shutdown orders have closed other retailers without grocery stores attached, Walmart has been the only place open to many would-be shoppers. Walmart's sales have surged during the coronavirus shutdown. Sarah Nassauer writes in The Wall Street Journal: Walmart Inc. WMT +0.54% is reaping the rewards of being one of few retailers positioned to successfully navigate a global pandemic, reporting a surge in quarterly sales as consumers turned to its giant stores to stock up on food and household goods. The country’s largest retailer said U.S. comparable sales, those from stores and digital … [Read more...]
Coronavirus is Amazon’s Cleanup Crew
After Amazon set about decimating retail competitors across America, coronavirus has come along and helped it finish the job. Suzanne Kapner and Sarah Nassauer report in The Wall Street Journal: Amazon. AMZN 0.68% com hurt many retailers. Coronavirus will finish some of them off. Even as malls and stores begin to reopen, the Covid-19 pandemic has taken a toll on an industry already battered by the shift to online shopping. More than two million retail jobs disappeared in April as many stores closed. The damage will be clear Friday when the U.S. government reports what is expected to be one … [Read more...]
Established Brands Take Revenge on Startups
The coronavirus effect has halted a trend toward startup consumer companies that has been ongoing in the industry for years. Carol Ryan reports in The Wall Street Journal: Seeking comfort while sheltering at home, shoppers are reaching for Hershey Bars rather than gluten-free energy balls. That is bad news for challenger brands, whose healthy snacks were taking market share from global food companies until very recently. Discussing their latest quarterly results, executives at Nestlé, NSRGY -0.32% Kraft Heinz and Procter & Gamble PG -0.66% all said consumers are returning to … [Read more...]
Is Amazon Stealing from its Third-Party Sellers?
Dana Mattioli reports in the Wall Street Journal that Amazon may have lied to both its third-party sellers and Congress regarding its data policies. Mattioli's article alleges that Amazon used information from its independent sellers to enhance its own product lineup. She writes: Amazon.com Inc. employees have used data about independent sellers on the company’s platform to develop competing products, a practice at odds with the company’s stated policies. The online retailing giant has long asserted, including to Congress, that when it makes and sells its own products, it doesn’t use … [Read more...]
Walmart Prime?
Matthew Boyle reports at Bloomberg that Walmart is developing its own membership program to rival Amazon Prime. He writes: The world’s largest retailer is developing a paid membership program to challenge the internet giant’s Prime offering -- which has become the default online shopping option for millions around the globe. The service, called Walmart+, will expand on the retailer’s existing grocery-delivery subscription service, which it introduced last year. Chief Customer Officer Janey Whiteside will spearhead the service’s development and rollout. A Walmart spokeswoman confirmed the … [Read more...]
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