Wednesday, June 22, 2016

Bed Bath & Beyond: A Good Example of a Bad Situation

Image result for bed bath & beyond
For a good case study of the challenges facing modern-day bricks-and-mortar retailers, investors need look no further than Bed Bath & Beyond Inc.

The company’s merchandise is largely commoditized, meaning the bulk of it is available on Amazon.com. Despite that, Bed Bath & Beyond was late to e-commerce and has recently been playing catch up, investing in upgrading its online presence, introducing mobile apps and rolling out a new point-of-sale system. Comparable sales from digital channels rose more than 25% in its fiscal fourth quarter ended in February.

But same-store sales at the retailer’s physical stores were flat.. . . more

Toys R' Us Still a Player Despite Brutal Competition From Amazon, Walmart

Although people cut back on buying apparel this spring at Macy's stores in the U.S., Gap stores overseas -- and most other retailers, it seemed -- apparently shoppers couldn't resist picking up an innovative new toy for little Johnny or Jenny.
 
Toy retailer Toys "R" Us saw first-quarter same-store sales, which are sales from stores open longer than a year, increase a respectable 0.9%. Domestic same-store sales rose 0.1%, improved from a 2.3% drop last year, fueled by demand for dolls and toys for pre-schoolers.. . . more

Ulta Loves Target, Expects Online Sales To Double In A Few Years

Ulta Beauty plans to stick with its mixed assortment of cosmetics, officials say. (Jovan Williams/IBD)Ulta Beauty Chief Executive Mary Dillon made clear Tuesday that while prestige brands are enjoying a period of growth, the specialty beauty retailer has no intention of straying from the high- and low-end assortment of cosmetics, skin care and hair care products that has made it so popular.

The company also touched on its real estate strategy, with Chief Financial Officer Scott Settersten telling investors that a "theoretical perfect co-tenant mix" largely includes off-pricers like TJX's Marshalls and T.J. Maxx and shoe seller DSW.. . . more

AmazonFresh grocery delivery launches in Boston

An Amazon truck made deliveries in Los Angeles, Calif.Online retailing giant Amazon.com, Inc. announced Tuesday that it has launched its on-demand grocery service in Boston.

AmazonFresh costs $299 a year, or $200 for people who already have an Amazon Prime membership. It offers groceries, prepared meals, beauty products, and household goods for same-day or next-day delivery.. . . more

Wegmans Brooklyn debut moving along

Progress is being made on the debut of Wegmans in the New York City market, The Real Deal reported last week.

According to the report, Steiner NYC, the developer behind the Navy Yard’s Steiner Studios, filed plans for the building with an address of 21 Flushing Avenue, according to an application recorded with the Department of Buildings.

The plans call for a supermarket on the first floor and mezzanine level, with light manufacturing space on floors two through five of the 248,489-sq.-ft. building. A roughly 100,000-sq.-ft. parking lot with 246 spaces is also in the works.. . . more

Former consumer electronics powerhouse charging up for store reboot

Circuit City is reportedly getting closer to a relaunch.
 
The new owner of the defunct consumer electronics chain is currently working with brokers from CBRE to open a 6,000-sq.-ft. to 9,000-sq.-ft. prototype store in Dallas, reported consumer electronics industry publication Twice.
   
The relaunched business will also include a dedicated e-commerce site, as well as a presence on digital marketplaces such as Amazon. . . . more

Modell's, Sports Direct considering joint bid for Sports Authority



Sports Direct International PLC, a U.K.-based sporting goods retailer, and New York-based Modell’s Sporting Goods are in talks regarding a potential joint effort to acquire some 200 Sports Authority stores, sources have told the Wall Street Journal.
 
Any bids for stores leased by Sports Authority, which filed for Chapter 11 bankruptcy protections in March, are due Thursday. The liquidation is already under way and is expected to be completed by the end of next month.. . . more

Tuesday, June 21, 2016

Friendly’s finalizes sale of ice cream business for $155M

The company that operates Friendly’s restaurants is Friendly’s no more.

The Massachusetts-based casual-dining chain said on Monday that it has finalized a deal to sell its retail ice cream and manufacturing business to Dallas-based Dean Foods company for $155 million in cash.. . . more

Uniqlo’s struggles cause fashion chain to close stores

Image result for uniqloThe fastest-growing retailers have hit the same speed bump that the rest of the industry slammed into last year.

Tokyo-based Uniqlo — a 1,700-store global chain with 43 US stores and big plans to grow its portfolio here — is the latest fast-fashion retailer to retrench amid slowing sales.. . . more

New Hannaford prototype marries convenience, innovation

Hannaford Supermarkets on Saturday unveiled a new prototype in Bedford, N.H., designed to meet the needs of an evolving consumer and stretch the possibilities inherent in its brand.

The 68,000-square-foot store debuts a suite of new features built around innovation and convenience, reflecting two years of planning and shopper research, as well as pilot tests of various departments in existing stores carried out over recent months, Mike Vail, president of Hannaford, told SN in an exclusive interview.. . . more

Luxury department store looking for a buyer

Embattled luxury retailer Neiman Marcus is casting around for a buyer, or investor, The Post has learned.

Struggling under a toxic combination of a staggering $5 billion debt load and flagging sales, Chief Executive Karen Katz traveled recently to China to meet with potential buyers, according to a source familiar with the situation.. . . more

CVS Pharmacy in 2,900-store healthy food commitment

CVS Pharmacy is upping its game on food.

The company on Tuesday unveiled plans to improve its convenient food offerings with healthier foods and beverages across more than 2,900 locations, up from an initial 500 pilot stores announced last year. Throughout the year, 100 stores each week are being enhanced with a carefully curated selection of national and niche better-for-you brands that make healthier eating on-the-go, convenient and affordable.. . . more

Wendy's, McDonald's say kiosk tests not tied to minimum wage battle

06222016_Honeygrow_Kiosks Amid nationwide calls for significantly higher wages for fast food workers, Wendy’s and McDonald’s are testing self-service ordering kiosks.

 “It’s not specifically tied to raising the minimum wage,” said Wendy’s spokesman Bob Bertini. “This is primarily driven by consumer demand. Customers, particularly young customers like to be in control. They’re used to doing iPhones and tablets so they like the convenience of using kiosks. And it does help to mitigate some costs.”. . . more

Monday, June 20, 2016

Strong Retail Sales Signal a Better Economic Outlook

This era of diminished expectations can only make us doubly grateful for the occasional blast of upbeat news.

The spring awakening in April’s retail sales didn’t go dormant in May. As reported last Tuesday, not only did May retail sales rise at a healthy rate, but key parts of April’s surge were also revised up. The back-to-back boost augurs well for economic growth in the April-June quarter.. . . more

Starbucks takes a seat…inside Outlook

The idea of Starbucks serving as a “third place” outside of home and work has been reinforced with a new add-in to Microsoft Outlook.
 
The Starbucks for Outlook add-in is currently available as a free download to U.S. users of the new Outlook.com, as well as several other iterations of the email platform. Once downloaded, users will have a “Meet at Starbucks” command available in their ribbon when creating a meeting request. They can then search for the nearest Starbucks store and add it as the location of the upcoming meeting.. . . more

Day of Reckoning Comes for U.S. Shopping Malls Laden With Debt

Image result for Detroit’s Lakeside MallSuburban Detroit’s Lakeside Mall, with mid-range stores such as Sears, Bath & Body Works and Kay Jewelers, is one of the hundreds of retail centers across the U.S. being buffeted by the rise of e-commerce. After a $144 million loan on the property came due this month, owner General Growth Properties Inc. didn’t make the payment.

The default by the second-biggest U.S. mall owner may be a harbinger of trouble nationwide as a wave of debt from the last decade’s borrowing binge comes due for shopping centers.. . . more

Nordstrom makes big e-commerce decision

The luxury retailer has decided to postpone the planned opening of a West Coast fulfillment center dedicated to fulfilling digital orders until 2020 or later.
 
For the past year, the cities of Visalia and Fresno, California, had both been in discussions with Nordstrom about serving as the site of the proposed center. However, the retailer sent the governments of both cities an identically worded letter signed by co-president Erik Nordstrom dated June 15, explaining why it has decided to put off opening the center for at least four years.. . . more

5 Trends That Are Radically Reshaping Shopper Marketing


Malls are lumbering, claustrophobic dinosaurs, while anchor stores like Macy's and Kohl's are shuttering hundreds of locations. Fresh Direct and Peapod make it easier and quicker to stock a cupboard than wading through the jam-packed neighborhood Kroger, and Amazon and eBay and Overstock sell, well, everything.

Who needs retail anymore?

In fact, 71 percent of U.S. consumers say they still prefer to buy from physical stores even if the same products are available online, according to a recent TimeTrade survey, which also found that 85 percent like to shop in stores because they say they want to "touch and feel" items before buying them.. . . more

Amazon to open another bookstore

Amazon is expanding its fledgling bricks-and-mortar bookstore format.
 
The Internet giant plans to open a third Amazon Books this fall, at Washington Square Mall, in Tigard, Oregon, just outside of Portland, The Oregonian reported.. . . more

Friday, June 17, 2016

Special Section Preview: 10-Year Historical Retail Category Report

The latest KeyPoints Retail Newsletter

In earlier Special Sections of our KeyPoint Report for Eastern Massachusetts we’ve explored changes in the Grocery and Restaurant categories. This year we’ve analyzed 10 years of data on occupancy changes in all retail tenant categories. Here’s a preview:

It’s clear that social values, shopping habits, and lifestyle choices of shoppers in this region have changed the retail real estate landscape. For example, Eastern MA residents have no excuse for not getting enough exercise, based on growth in Health & Fitness Services during the past decade. Regional shoppers certainly love their pets, too.. . . more

Here's exactly how much more you're paying to shop at Whole Foods

Whole Foods Whole Foods has been cutting prices to try and shed its "whole paycheck" image.

But it's still one of the most expensive places to buy food, according to Wedbush Securities analysts.

They compared prices at Whole Foods stores in half a dozen cities to those at various competing supermarkets to determine which stores were cheaper.

They found that Whole Foods is about 15% more expensive than other "conventional" supermarkets, such as Kroger, Wegmans, and Safeway.. . . more

Kroger profit rises 10%

The Kroger Co. topped Wall Street expectations with more than one result in the first quarter of fiscal 2016.

The grocery titan reported net earnings of $680 million, up 9.9% from $619 million the prior year period and ahead of Wall Street estimates. Reduced operating expenses helped Kroger produce solid profit growth despite a small decline in gross margin.

Total sales met expectations with 5% growth to $34.6 billion, from $33.1 billion. Same-store sales also beat Wall Street with a 2.4% increase excluding fuel.. . . more

Target hires former Bleacher Report exec for secret 'Goldfish' project

Target has has kept details of its Goldfish project under wraps as it hires engineers.Target Corp. has hired the former chief technology officer of sports news website Bleacher Report to play a leadership role at its top-secret "Goldfish" project.

Parnell's title will be vice president innovation engineering. Based in Target's office in Sunnyvale, Calif., he'll focus on building an engineering team to support Target's innovation efforts.. . . more

Let the bidding begin

Two private equity firms have thrown their hats in the arena to buy Cabela’s.
 
The firms, New York-based Apax Partners and San Francisco-based TPG Capital,  are each meeting Cabela’s management as part of an auction for the 82-store chain, the New York Post reported.
 
Bass Pro Shops is also interested in Cabela’s, and has partnered with Goldman Sachs Group’s private equity arm to make an offer for its rival, according to Reuters.. . . more

Are Retailers Prepared for New Lease Accounting Standards?

A retailer can accomplish plenty in two and a half years, but 61.2 percent of industry professionals say they are concerned about their readiness to meet updated lease accounting standards from the Financial Accounting Standards Board (FASB), which are set to go into effect in 2019, according to a recent study by consulting firm Deloitte.

The updated accounting rules, released in February, call for financial and accounting professionals to bring detailed information about their companies’ operating leases onto the balance sheet. All data related to leases on stores, distribution centers and equipment will be affected.. . . more

In The Graveyard Of American Malls, Bandier Is Reimagining The Brick-And-Mortar Store

<p>At the start of 2016, it opened its 10,000-square-foot store on Fifth Avenue. Only the ground floor contains racks of apparel and sneakers for sale.</p>America's malls have been dying for years. Of the nearly 1,200 enclosed malls in the U.S., one-third are doing so poorly that they aren't generating enough money to pay for the maintenance of the structures themselves. Part of this decline can be traced to the Internet. Now that consumers can easily buy products online, brick-and-mortar retail stores can't afford to simply serve as showcase rooms, only to see visitors buy the very products they offer from Amazon at lower prices. They need to offer exceptional in-person experiences to keep customers coming, buying in, and returning to their stores.

In the midst of this graveyard of malls, new retail concepts are emerging. In New York, for instance, there's been a rise in multi-use stores. At Molasses Books, you can leaf through coffee-table books while drinking a beer. At Community 54, you can play vintage video games while buying mens' streetwear. At Blind Barber, you can get a cocktail before you get a shave.
. . . more

Wal-Mart Stores Inc. Targets Increased Sales Of Up To $60 Billion By 2019

Image result for walmartRetail giant Wal-Mart Stores Inc. said Thursday it expects to add $45 billion to $60 billion of new sales over the next three years.

Chief Executive Officer Doug McMillon told delegates at the Consumer Goods Forum conference in the South African port city of Cape Town: “So sometimes people say Walmart is not really a growth company any more. I want to say: ‘Well, if we layer on $50 to $60 billion, would that count, in three years?”. . . more