Fortune: Humbled Amazon turns to rival Alibaba for help in China by Scott Cendrowski at Fortune. “Yesterday, Chinese reporters discovered that Amazon had opened a store on rival Alibaba Group Holdings’ Tmall platform..Amazon didn’t publicize the news of its store on Alibaba’s site, maybe because it doesn’t make Amazon look very strong in the world’s largest e-commerce market.”Read more
Costco working to end use of human antibiotics in chicken by Nathan Layne at Reuters. “We are working towards, and working with our suppliers and the regulatory agencies… to see how we can get rid of shared-use antibiotics in animals,” Craig Wilson, vice president of food safety at the Issaquah, Washington-based retail giant, said in a phone interview.”Read more
WSJ: Apple Pay Stung by Low-Tech Fraudsters by Robin Sidel & Daisuke Wakabayashi. “Apple Inc.’s new mobile-payment system has been hit by a wave of fraudulent transactions using credit-card data stolen in recent breaches of big retailers, including Home Depot Inc. and Target Corp. , people familiar with the matter said.”Read more (Subscription)
Under Armour set to open on Michigan Avenue by Corilyn Shropshire at Chicago Tribune. “It is the largest store the company has opened, twice the size of its location in SoHo in New York, as Under Armour sets its sights on growing its direct-to-consumer business, which is about 30 percent of total sales, according to Chief Executive Officer Kevin Plank.”Read more
First Look: Inside Sephora’s New Innovation Lab by Evie Nagy at Fast Company. “The Innovation Lab itself is a converted warehouse near San Francisco’s Mission Bay district…the lab includes a full model of a Sephora store, including display windows.”Read more
Zillow says homes close to a Starbucks rise in value more quickly by Patrick May at Mercury News. “Between 1997 and 2014, homes within a quarter-mile of a Starbucks jumped by 96 percent, on average, compared with 65 percent for all homes in the United States.”Read more
Amazon Plans Store #2 at Purdue by Charlotte Tuggle at The Exponent. “After the initial success of the Amazon store that opened in the Krach Center in February, a second location is scheduled to open in the Purdue Memorial Union over the summer.”Read more
Dayton schedules meeting with Target CEO to discuss layoffs at KAUS 1480 AM. “Governor Mark Dayton says he’s scheduling a face-to-face meeting early next week with Target CEO Brian Cornell, after talking briefly by phone yesterday.”Read more
Made in the USA push gets boost from ports debacle by Krystina Gustafson at CNBC. “According to a new study by consulting firm BDO, although the cost of manufacturing remains lower in overseas regions such as Asia, 43 percent of retail chief financial officers said that North America provides the most attractive sourcing opportunities for 2015. That’s a substantial increase from last year, when only 30 percent of respondents chose North America.”Read more
Costco Q2 2015 Earnings Call Highlights
Richard Galanti, CFO
Excluding gas our reported 4% U.S. comp sales increase in Q2 would have been plus 8.
For our four week month of February…came in at plus one consisting of a plus two comp in the U.S.
Average transaction decrease of a little over minus 3%. But again taking gas out of that number the average transaction increase would have been plus.
Year-to-date shopping frequency is up a little over 5%.
Midwest, Southeast and Northeast regions were the strongest.
* Within Food and Sundries overall in the mid single-digits Candy, meat, daily, beer and wine were the relative standout.
* Electronics and consumer electronics was up in the mid single-digits.
* Within mid single-digit softlines comps domestics and apparel were standouts.
Costco Online, we continue to operate it into four countries, U.S., Canada, UK and Mexico….sales were up 23% in the quarter.
We’ll be at 28 net new units for the year or about 4.5% square footage growth.
Q: “Do you think you can get to a 1,000 (stores)?”
A: “Well we haven’t gone out that far as yet yes if we added 30 year for 10 years around a sense there so yes I think so but certainly not out of the relm.”
In this crazy world there are some items that we have online where we’ve agreed not to show the price unless you are a member.