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Retail Industry Trends |
HenryTo
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 Posted: Wed Oct 31, 2007 4:58 pm Post subject: Retail Industry Trends |
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Retailiers already bracing for the worst. The $64 billion question is, as always, how bad will this get and how much of this has already been factored into retail stocks?
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Retail Holiday Season May Be Modest
Tuesday October 30, 5:15 pm ET
By Betsy Vereckey, AP Business Writer
Sluggish US Economy May Weigh on Holiday Sales for National Retailers
NEW YORK (AP) -- U.S. retailers are bracing for a difficult holiday season, some industry watchers say, as higher gas prices and a sluggish housing market are expected to continue crimping consumer spending.
At a conference on Tuesday hosted by the Retail Marketing Society, a membership-based organization focused on the retail industry, some industry executives said holiday sales may be sluggish.
"This holiday season will be somewhat Grinch-like," said Carl Steidtmann, chief economist at Deloitte Research.
Steidtmann said retailers are preparing for the worst, especially given tightening credit and problems in the housing market. Steidtmann said it will be at least 18 months to two years before the housing market bottoms.
Merrill Lynch analyst Jaime Sheinheit said higher energy costs will weigh on consumer spending, noting that retailers have had trouble getting customers in the door. However, it's hard to tell whether the sluggish traffic is related to softening consumer spending or warm weather, Sheinheit said.
"Cold weather may spark shopping," she said.
In the luxury sector, Sheinheit said handbag maker Coach Inc. has warned of sluggish traffic in its U.S. stores. The company recently issued a fiscal second-quarter same-store sales outlook it called "conservative." Same-store sales are sales at stores open at least a year, and the industry metric is considered a key barometer of a retailer's health.
David Wolfe, creative director at Doneger Group, a buying office, said Coach has reached its saturation point with aspirational customers, who may not have the money to spend on these handbags but still want quality at a price.
Meanwhile, wealthy customers may help other luxury retailers this season, like Tiffany & Co., as spending patterns among the affluent tend to stay the same, regardless of changes in the economy.
Sectors that might fare better include teen retailers, Sheinheit said, noting that the income of their main customer, teenagers, usually stays the same. Companies in this sector include American Eagle Outfitters Inc. and Abercrombie & Fitch Co.
One company that may emerge stronger, Sheinheit said, is AnnTaylor Stores Corp., which has leaner inventory and a new product assortment at its lower-priced Loft division. In August, the company said it increased markdowns to reduce inventory heading into fall seasons at both its Ann Taylor and Loft stores.
"There is a lot of opportunity for Loft to improve margins this holiday season," Sheinheit said. "As always, what it comes down to is having the right product."
Last edited by HenryTo on Wed Jul 16, 2008 8:40 am; edited 2 times in total |
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HenryTo
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| Posted: Fri Mar 12, 2010 11:17 am Post subject: |
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Morningstar's latest notes on Aeropostale (ARO) and why its robust same-store sales growth won't last in 2010:
| Quote: | | After reviewing Aeropostale's ARO fourth-quarter results, we are maintaining our fair value estimate. The firm posted an impressive 9% increase in quarterly comparable-store sales, outperforming competitors like American Eagle AEO and Abercrombie & Fitch ANF, which delivered 5% growth and a 13% decline in same-store sales, respectively. In our view, Aeropostale's ability to gain share amid the tough consumer spending environment was largely attributable to its value proposition and successful marketing campaigns. However, this trend will probably reverse in fiscal 2010 as teens trade back up to premium brands fol lowing improvements in the economy. In our view, the firm will have to fight hard to retain its newfound customers, especially given recent pricing reductions at American Eagle and Abercrombie. As a result, we project Aeropostale's same-store sales growth will decelerate to the low single digits in 2010, relative to the 10.0% delivered in 2009. The quarterly operating margin expanded significantly to 19.9% from 16.4%, mainly because of better merchandise margins and leverage gained from spreading store operating expenses over a larger revenue base. This was partially offset by higher incentive compensation, advertising expense and travel costs during the quarter. While we anticipate that Aeropostale will continue to benefit from cost savings through supply-chain efficiencies and updated product-allocation systems in the near term, higher marketing expense and increased competition in teen retail will probably weigh on margins. Therefore, we estimate that the operating margin in 2010 will be slightly below the 17.2% posted in the prior year. |
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rffrydr
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| Posted: Mon Mar 01, 2010 10:37 am Post subject: |
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Cheaper on Amazon? Amazing. Instant gratification will greatly water-down this tech trick. Speaking of which, how do you like that 20% combined tax on your cell bill every month. New York the worst with its 16%; Cali in there at 13%....Nevada a cool 1% 
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HenryTo
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| Posted: Sat Feb 27, 2010 10:59 am Post subject: |
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| Quote: | In the end, though, stores may not have much control over the way consumers use mobile technology.
Some shoppers are already outwitting retailers, using mobile applications like RedLaser to compare prices in a physical store to those on the Web. (Such applications scan product bar codes through a cellphone’s camera.)
Ben Aldern, 20, of Berkeley, Calif., went to Target recently to shop for headphones. “I was ready to spend whatever I needed,” he said, but on a hunch, he fired up RedLaser — and found the same model for less at Amazon, the online merchant. |
The barcode technology is pretty neat (I've been using this on my cell phone). Just wait till they could search and compares prices at other physical locations. |
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rffrydr
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rffrydr
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| Posted: Mon Feb 22, 2010 9:14 pm Post subject: |
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Sham Gad
Where Are My Two Pennies??
2/22/2010 5:20 PM EST
| Quote: | | Nordstrom shares are off after hours after the company reported an overall excellent quarter and year. Yet EPS was 77 cents versus 79 cent estimates. I guess the value guy in me finds it hard to justify such changes in value over a couple of pennies. Nevertheless, JWN is certainly not cheap at these prices, BUT it's operational performance speaks volumes of the relativel resiliency of luxury goods versus ordinary goods during periods of economic weakness. Going forward in the retail sector we could see a major decoupling in the relative performance between "luxury" brands and everyone else trying to not get killed by Wal-Mart...more tomorrow on this in my weekly commentary. |
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rffrydr
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| Posted: Sun Feb 21, 2010 10:08 am Post subject: |
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Our dirty little secret of retail goes farther to explaining our retail rebound than The Madman's mortgage free-up spending:
| Quote: | | But it showed that affluent consumers -- households that make more than $100,000 a year -- have much more confidence in the economy than the rest of the population does, and that confidence has risen dramatically from its 12-month lows. There's been a nice improvement among households earning between $75,000 and $99,999, too, although both groups' sentiment remains in negative territory. |
| Quote: | | Still, the affluent have a disproportionate impact. Households earning more than $100,000 a year represented nearly half of all consumer spending before the recession, according to Mark Zandi of Moody's Economy.com. That percentage dropped to 45%, but as this group steps up its participation, it could give the economy a shot in the arm. |
http://www.marketwatch.com/story/affluent-consumers-spend-again-cautiously-2010-02-21?siteid=rss&rss=1
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HenryTo
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| Posted: Mon Feb 15, 2010 11:11 am Post subject: |
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OfficeMax looks for new CEO. Following is courtesy of Retailing Today:
| Quote: | THE NEWS | SEARCH IS ON FOR OFFICEMAX CEO
NAPERVILLE, Ill. - Sam Duncan plans to step down as chairman and CEO of OfficeMax, and the company's board has one year to find a replacement, as Duncan indicated his retirement will become effective Feb. 28, 2011. Duncan served as CEO for the past five years and said it was a privilege to lead the great company.
"I am proud of our accomplishments and the initiatives we have put in place and I have great confidence in the company's future," said Duncan, adding, "I thank our associates for their passion, innovation and dedication."
THE FIX Duncan remembered for leading turnaround effort
The accomplishments of a CEO are often difficult to judge for the simple reason that it can take several years before an executive's incompetence is revealed on those occasions when they are handed the reins of a well-run company positioned in a growing market. Conversely, a highly skilled executive's abilities tend to be concealed when they are asked to assume leadership of a floundering organization. Duncan falls into the latter camp. He became CEO at a difficult time in the company's history when OfficeMax, long a distant third player to Staples and Office Depot, was falling even further behind in the office products space. During his tenure, OfficeMax managed to not only maintain its independence, but execute a noteworthy turnaround effort, improve profitability and weather the recent economic downtown in better shape than Office Depot. Not a bad effort considering this time five years ago there were concerns about the long-term viability of OfficeMax. |
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rffrydr
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| Posted: Wed Feb 03, 2010 9:45 pm Post subject: |
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The short fall in WAG’s January sales highlights unease over
the consumer sector. The most bullish surprise could come from chain store sales. The ICSC has talked about a
gain of 1%, while bottom up analysts are much more bullish.
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rffrydr
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rffrydr
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| Posted: Wed Jan 27, 2010 6:13 pm Post subject: |
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If you're interested in getting back in the (overpriced) retail game consider KIMCO REIT--well leveraged to retail and all equitied-up. Costco is one of their primary tenants. 
Too bad the preferreds are all bought up. One good thing about REIT structures unlike, say, banks, shareholder interest is built in--by law.
http://www.nytimes.com/2010/01/27/business/27pay.html?ref=business
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HenryTo
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rffrydr
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| Posted: Thu Jan 14, 2010 8:33 am Post subject: |
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Calorie postings at Dunkin' Donuts sends business Starbucks way--ironic with the new panini line coming on--despite founder's move away from prepared food.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aOfo2oSh2k9s
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rffrydr
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rffrydr
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rffrydr
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| Posted: Tue Nov 24, 2009 12:26 pm Post subject: |
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| Quote: | Jim Cramer
The skinny on retail
11/24/2009 12:43 PM EST
I think that people are just much more savvy about looking for the stores and making the splash. It is like any democratized activity, people have figured out how to shop and the retailers are being proactive. However, as someone who has been around retail all my life, i want to reiterate that what matters is inventory and inventory is NOT deep and the stores are going to make a lot of money on the holiday. Macy's has lowered the bar so much it might be ready to do its creep up into the next quarter.... |
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