Posted by Dale Buss on May 16, 2013 07:01 PM
Old/new JCPenney CEO Mike Ullman keeps reaching backward into his pre-2012 bag of tricks for things that will revive the brand that he ran, then lost, and is now running again in the post-Ron Johnson era. But unfortunately, he hasn't yet been able to reach back to a time when the company still made money: Still smarting from the damage done during Johnson's tenure, JCPenney reported a worse-than-expected loss of nearly $350 million for the first quarter on Thursday afternoon.
Ullman had told investors to anticipate about a 16 percent drop in sales for the fiscal first quarter from a year ago, when Johnson was just putting his "reforms" into place. But the bottom line for the just-concluded period was much worse that analysts had expected, a loss amounting to $1.58 a share when the consensus forecast called for a loss of just 43 cents a share.
"Our objective is to put JC Penney back on a path to profitable growth," Ullman said in a press release, according to USA Today. "We are looking forward, not back, and undertaking initiatives to ensure that we have a successful future."Continue reading...
Posted by Dale Buss on May 14, 2013 02:49 PM
Maybe all that JCPenney really needed to turn things around was to get rid of Ron Johnson as CEO. A couple of weeks ago, the chain apologized for how the brand had behaved under him in 2012 and told consumers it was listening to their concerns. Now, it appears that JCPenney management believes the worst is over—and already is thanking customers for coming back.
It might be a bit premature for JCPenney to be running its new ad in which it claims, "Now, we're happy to say, you've come back to us. We're speechless, except for two little words. Thank you." After all, later this week the brand expects to report that fiscal first-quarter sales dropped by another 16 percent compared with a dismal 2012, a further decline beyond the $4.3 billion in sales that JCPenney lost for all of last year, as former CEO Johnson attempted to "transform" the brand.Continue reading...
Posted by Mark J. Miller on May 10, 2013 11:42 AM
Sears hasn’t had an easy time of it in recent years, but neither has its customers. The retailer has been trying out any way it can to create revenue and customer traffic, and its latest plan is a lease-to-own program.
The Associated Press reports that Sears tried out allowing customers to pay in installments for big purchases such as mattresses, home appliances, furniture and electronics in 10 stores last fall and is now introducing the option at all of its 900 locations, making it the first major retailer to have such a program.
Sears began offering layaway only a few years ago during the worst of the recession, but lease-to-own would provide a way to move inventory and bring in revenue simultaneously. For customers in a bind, the lease-to-own programs allows quick access to products, unlike layaway, which needs to be paid off before pick-up. Products need to be worth $280 or more and customers aren’t allowed to sign on unless they are at least 18, can show that they make $1,000 or more a month, and have a Social Security or tax ID number.Continue reading...
Posted by Mark J. Miller on April 19, 2013 03:46 PM
Gap has had rough times in recent years, with hundreds of store closures and executive swaps. But the clothing company is hedging a unique plan that it hopes will help it continue growing market share worldwide under the helm of its new, more focused Creative Director Rebekka Bay.
Glenn Murphy, the company’s chairman and CEO, rolled out the blueprint Thursday, noting that the brand aims to franchise Old Navy locations internationally, add Old Navy and Banana Republic stores to the brand’s presence in China and have a stronger push across all channels for all of its brands, including Athleta, Piperlime and Intermix, Mediapost reports.
"We see [the opportunity for global growth] particularly in some countries where in our category, you're talking about double-digit growth just to keep up with the market," an exec said during the call, according to Fool.com, which named China, Indonesia, Vietnam and Cambodia as a few of the countries in question. Old Navy is expected to be the first of the Gap brands that goes into Asian markets that it hasn’t entered just yet. Up to 85 stores are expected to be opened before year’s end and 10 of those will be outlets.Continue reading...
Posted by Barry Silverstein on April 17, 2013 05:50 PM
In an on again-off again economy, spotty consumer spending can wreak havoc on retailers.
The first quarter of 2013 proves the point. Jon Hatzius, chief economist for investment firm Goldman Sachs, said real consumer spending growth in Q1 was actually stronger than expected, but he cautions that "the March retail sales and the dip in consumer sentiment in early April suggest that consumption is entering the second quarter on a weak note," reports Business Insider. According to the monthly Consumer Reports Index, consumers' outlook has continued to decline since January.
Retailers are already feeling the slowdown. Target just warned that its earnings in Q1 would fall below expectations when it reports earnings on May 22. The retailer claimed that spring merchandise sales have been hurt by cold weather and despite its highly-anticitpated launch in Canada, retail outlets in the country have so far been a drag on earnings. In fact, UBS Securities analyst Jason DeRise called Target's expansion in Canada "risky," citing the fact that the retail chain will have little time for testing its format.Continue reading...
Posted by Mark J. Miller on April 4, 2013 03:35 PM
Apple has 400 stores of its own and partnerships with Best Buy, Walmart and Target to showcase its products, but its sales secret is out. One of its main competitors in the smartphone marketplace, Samsung, took a page from its playbook and announced Thursday that it will open mini-stores in 1,400 Best Buys nationwide by the end of June, according to the New York Times.
The Samsung Experience Shops will be stuffed with Samsung’s smartphones, tablets, cameras, laptops, televisions and accessories as well as offer service for Samsung products. That last part sounds a little bit like Apple’s Genius Bar, no? One big difference between the two Best Buy experiences is that Samsung will have its own checkout, Forbes reports, while those wanting to buy Apple gear will need to go through the main checkout like everybody else.Continue reading...
Posted by Sheila Shayon on March 28, 2013 03:25 PM
J.C. Penney recently resumed its marketing strategy of raising prices, then discounting them on its private brands which include St. John's Bay, jcp and Stafford and Arizona, which generate more than half of the company’s overall revenue.
"While our prices continue to represent a tremendous value every day, we now understand that customers are motivated by promotions and prefer to receive discounts through sales and coupons applied at the register," JCP spokeswoman Daphne Avila told Reuters.
That means an Arizona crewneck T-shirt with an "everyday" price of $5 now has a $6 pricetag to accommodate a better markdown and arrive at the same price. The move is an effort to reverse a 25 percent drop in fiscal year sales. The practice is common in retail and used by rivals Macy’s and Kohl's.
“The company said that it has now realized that coupons and sales attract more customers and that this is the market trend,” writes Nautilus Investment Strategies on the reversal of CEO Ron Johnson’s earlier "no sale" stance. “Market analysts feel that at this point no strategy change is going to change the fate of the company as a large number of customers have already gravitated towards other retailers such as Target and Macy’s.”Continue reading...
Posted by Dale Buss on March 28, 2013 02:28 PM
But wait—there's more! As in: There's more to the stories about Walmart planning to have lockers at its stores where online customers can pick up packages. It turns out that the chain may also want to turn its real-life locations into busy hubs for outgoing deliveries of goods by renting space and time in the vehicles of some of its customers.
Reuters reported that Walmart is considering such an initiative for same-day delivery to keep up with advances by Amazon and Google planned for that realm. The idea faces a lot of legal, regulatory and privacy obstacles, but it could be coming to a Walmart near you soon.
"I see a path to where [delivery] is crowd-sourced," Joel Anderson, chief executive of Walmart.com in the United States, told the news service. Another executive added: "This is at the brain-storming stage, but it's possible in a year or two."Continue reading...