“Wall Street pours cold water on Target’s weather excuses” by Thomas Lee at Star-Tribune. ““Weather does not even make up [a quarter] of their sales decline,” said Robin Lewis, CEO of the Robin Report, a retail strategy newsletter. The Minneapolis-based retailer said sales at stores open for at least a year dropped 0.6 percent while overall sales were nearly flat at $16.6 billion. Specifically, Target executives said cold weather that persisted into spring especially hurt seasonal goods like clothing, lawn, patio, and sporting goods.” Read more: http://www.startribune.com/business/208585721.html
Lowe’s Q1 Negative Comps: Blame the Ongoing Category Resets as Much as the Weather…
Heard Yesterday on the Lowe’s Q1 Earnings Call:
* The month of March was particularly soft, with a roughly 10% comp decline, but April improved significantly, resulting in positive comps of approximately 10%.
* Comps for indoor products were positive approximately 3%, while comps for outdoor products declined approximately 7%.
* Pro services business outperformed the company average.
* We continued to apply a particular focus on building stronger relationships with our largest Pro customers, both in-store and to our field based Pro services team.
* At the end of the first quarter we had completed resets representing over half of our business.
* Examples of resets completed in the first quarter include seasonal products by planters, patio furniture and grills, and year around products like kitchen cabinets and garage door openers.
* We expect to finish the initial round of resets in 2013…the financial benefit of value improvement is greatest once we have reached stabilization. That is, when we are past clearance and selling only new assortments.
* We completed the reset of over 80 categories in Q1 and that reset process brought us to over 50% of the categories. But with the weather impacts and a slow sales environment, many of those categories that are seasonally oriented did not reach stabilization. And therefore moved through their clearance inventory so we could appreciate the margin gains from the new sets.
* There is — we still have from a reset standpoint, half of our categories to go. So there is about 100 and half left…As we move into summer they will be more hard line focused and probably more focused in some of the areas of plumbing, fashion electrical, some in millwork that I am aware of. But it is spread across the store.
* We still have a lot of disruption going on as we go through the reset process, the transition of the lines, those type of things and selling through existing inventory.
“CEO says Lowe’s will add employee hours after cutting too deeply” by Ely Portillo at Charlotte Observer. ““I think we just pulled hours back too far as we went through (the recession),” Niblock said. “We didn’t have enough coverage.” He said the cuts are now hampering the company as the housing market recovers. Niblock’s comments came as Lowe’s, the nation’s second-largest home improvement retailer, reported lackluster results Wednesday for the first quarte.” Read more: http://www.charlotteobserver.com/2013/05/22/4056110/lowes-1q-profit-rises-but-results.html
“Wal-Mart Hires Former Bush Aide as Chief Image Maker” by Stephanie Clifford at NY Times. “The company, the nation’s largest retailer, announced on Wednesday that Dan Bartlett, an adviser to President George W. Bush, would be its new executive vice president for corporate affairs, starting in late June. The vague-sounding role in fact has a wide mandate, overseeing corporate communications, government relations, sustainability and the Wal-Mart Foundation. It is in essence Wal-Mart’s chief image maker.” Read more: http://www.nytimes.com/2013/05/23/business/wal-mart-hires-a-new-chief-image-maker.html?_r=0
“How Amazon’s Rising Headwaters Could Threaten Google” by Derek Brown at Read Write. “I actually think there’s one final aspect to Amazon’s business with which Google cannot (yet) directly compete, and which may prove to be the difference-maker in this faux-ish battle: Data. With 17+ years of history and hundreds of millions of transactions across almost every category of goods, Amazon now has massive quantities of data about the actual buying habits of tens, if not hundreds, of millions of consumers around the globe. Not just what people are searching for (Google, though Amazon.com actually has it too).” Read more: http://readwrite.com/2013/05/20/how-amazons-rising-headwaters-could-threaten-google
“Wal-Mart Puts Its Faith in Big Data for Mobile Strategy” by Cadie Thompson at CNBC. “”Our mobile strategy is as simple as it is audacious. We want to make mobile tools that become indispensable for our customers while shopping in our stores and online,” said Gibu Thomas, global head of Wal-Mart’s mobile division, on Wednesday at the CTIA Wireless conference in Las Vegas. “Our goal is to create shopping tools that become second nature to the customer, providing assistance with every part of the retail experience from pre-store planning to in-store shopping and decision making to checking out.” Read more: http://www.cnbc.com/id/100759264
“Kroger executive gives insight into Memphis market” by Andy Ashby at Memphis Business Journal. “Among the improvements to new Kroger stores is the “cue vision” seen at the new Poplar Plaza location. This measures shopping patterns in a store. “We’ll know how many people we have at produce at any given time,” Tim Brown said. This lets store management know when people will get to the checkout area so they can open registers as needed.” Read more: http://www.bizjournals.com/memphis/blog/morning_call/2013/05/kroger-executive-gives-insight-into.html