Walmart is teaming with home services startup Handy to offer installation and assembly of TVs and furniture available in more than 2,000 stores, said the companies Monday in a joint announcement. Walmart shoppers can buy the Handy services during in-store checkout, they said. Handy services are available for purchase in 25 Walmart stores in the Atlanta area and will be rolled out to 2,000 more Walmarts nationally next month, they said. We asked the Handy website what it would cost to mount a 45-inch or larger TV on a brick or concrete wall. We were quoted an estimate of $383, including $80 for the cost of the basic service, $60 for sending “an additional pro” to do the job, and other services such as removing the old TV from the wall. Handy also charges a $3 “trust and support fee” to cover the cost of insurance, customer support and other company expenses.
Traditional and online retailing are increasingly intertwined as customers “shop across touchpoints” and the industry uses both platforms to reach them, said a Wednesday study from the National Retail Federation and Forrester. Products ordered online are increasingly picked up in-store or shipped from a nearby store, and digital technology used at brick-and-mortar locations lets retailers help customers find what they want or make the sale "even if the product is out of stock,” said Mark Mathews, NRF vice president-research development. Of companies surveyed this year, 32 percent were purely online retailers and 57 percent were multichannel operations, including brick-and-mortar retailers also selling online. Some 43 percent of physical store retailers expect a net increase in the number of outlets they operate by year-end vs. last year, while 16 percent expected a reduction, it said. Retailers also are testing new store formats such as pop-up stores (24 percent) and opening new warehouses or distribution centers (12 percent). Some 12 percent of retailers said they are using technology to enable store staff to help customers. Seventy percent of retailers surveyed said online conversion rates increased in the past year, while 62 percent said repeat customers were up and 57 percent said average order values had increased. Sales from desktop PCs are double those from mobile browsers, but the latter are growing 36 percent per year vs. 8 percent for desktop sales. Mobile app sales are growing 16 percent year on year, and 89 percent of retailers plan to boost investments in mobile initiatives.
Same-store sales in Target’s Q4 ended Feb. 3 grew 3.6 percent over the 2016 quarter, with 1.8 percentage points comp improvements from stores and e-commerce, the company reported Tuesday. That compares with a 3.3 percent drop in same-store sales in Q4 2016 and an increase of 1.8 percent for e-commerce. Revenue in Q4 2017 rose 10 percent to $22.8 billion, reflecting the additional shopping week in the 2017 holiday season. The retailer had growth across all five core categories, said CEO Brian Cornell on an investor webcast. Store traffic rose 3.2 percent, which Cornell said reflected “healthy increases” in stores and digital channels. Target plans to spend more than $7 billion over the next two years on "reimagining" stores and "modernizing every part of the business," he said. E-commerce sales were up 29 percent vs. 34 percent in Q4 2016, the company said. Stores generated 91.8 percent of revenue in Q4 vs. 8.2 percent for digital channels. Segment earnings before interest expense and income taxes were $1.2 billion in Q4, down 14.3 percent, and EBIT margin rate was 5.1 percent, compared with 6.5 percent. The Q4 gross margin rate slipped from 26.6 percent to 26.2 percent, reflecting “pressure from digital fulfillment costs,” it said. Selling, general and administrative expenses grew a percentage point to 18.5 percent, driven by higher compensation costs. Target announced Tuesday it will raise minimum hourly wages to $12 per hour this spring, after an increase to $11 last fall, as part of a plan to reach $15 by 2020. Shares closed 4.5 percent lower Tuesday at $71.79.
Barnes & Noble revenue sank 5.3 percent to $1.2 billion in Q3, ended Jan. 27, said the company Thursday. Comp store sales fell 5.8 percent. The retailer had a loss of $63.5 million vs. profit of $70 million. Nook sales dropped to $30.9 million in the holiday quarter from $38.4 million. CEO Demos Parneros underscored the company’s commitment to books and away from nonbook categories, on a Thursday earnings call. Declines in gifts, music and DVDs accounted for nearly half of the overall comp sales decrease, said Chief Financial Officer Allen Lindstrom. The company projects a mid-single-digit decline in same-store sales for the fiscal year. Shares were off 3.3 percent Thursday to close at $4.35 after reaching a 52-week low of $4.10.
Barnes & Noble will incur a FY 2018 Q3 charge of $11 million for severance costs for store layoffs, it said in an 8-K SEC filing Tuesday. Annual cost savings from the layoffs, to be completed by the end of February, are projected at $40 million, said the retailer. “Given our sales decline this holiday, we’re adjusting staffing so that it meets the needs of our existing business and our customers,” the company said. The filing referenced “the elimination of certain store positions” in favor of a new model that “will allow stores to adjust staff up or down based on the needs of the business,” it said. It didn’t give the number of positions being eliminated. The company employed about 11,000 full-time and 15,000 part-time staffers on April 29, said June's annual report. Shares closed down Tuesday 2.2 percent to $4.50.
Holiday sales breezed past forecasts in November and December, rising 5.5 percent over the 2016 period to reach $691.9 billion on “growing wages, stronger employment and higher confidence,” said the National Retail Federation Friday. Holiday retail sales volume includes $138.4 billion in online and other non-store sales -- up 11.5 percent over the year-ago period -- and excludes restaurants, car dealers and gas stations. NRF had forecast that non-store sales, including e-commerce, would grow 11-15 percent to between $137.7 billion and $142.6 billion, it said. Overall results exceeded NRF forecasts of $678.7 billion-$682 billion. Results were better "than anything we could have hoped for, especially given the misleading headlines of the past year,” said NRF CEO Matthew Shay, calling the 2017 holiday season a “starting point.” With tax cuts “putting more money into consumers’ pockets, we are confident that retailers will have a very good year ahead,” Shay said: “Retail has proven once again that it is the most nimble industry in the economy, able to transform and reinvent itself to meet always-changing consumer demands.” Retail looks different than it did 10 years ago, he said, "and it certainly won’t look the same in another 10 years.”
Traditional brick-and-mortar retailers continued to get hammered over the holiday season, despite an overall increase in consumer retail spending. Barnes & Noble reported Thursday holiday sales for the nine-week period ended Dec. 30 fell 6.4 percent. Comparable stores sales at BN fell 6.4 percent, while online sales decreased 4.5 percent, it said. Declines in BN’s gift, music and DVD categories accounted for nearly half of the comp sales decline; the company didn’t break out figures for Nook hardware and software. BN's stock closed Friday at $5.60, down 13.9 percent. Sears said it will shutter 64 Kmart and 39 Sears stores in March and April, with liquidation sales to begin Friday. Mastercard SpendingPulse reported last month holiday sales grew 4.9 percent in 2017 through Christmas, setting a new record for dollars spent. Online shopping saw year-on-year gains of 18.1 percent, it said.
Forecasts for big retail sales gains on Cyber Monday and the week that followed “turned out to be more virtual than reality,” said NPD Thursday in its weekly “holiday shopping bag” report. There was a “slight uptick” in overall U.S. holiday spending compared with the Thanksgiving week declines but “not to the degree that many early reports indicated,” said NPD. Cumulative retail sales for the first five weeks of the holiday selling season were up 2 percent from a year earlier “across the key general merchandise categories” that NPD tracks at the point of sale, it said. Consumer tech products occupied three of the top five “performing categories” for Cyber Monday week, with home automation first, stereo headphones second and LCD TVs fourth, said NPD. “Leading segments are struggling to make up for aggressive promotions that counteract positive product movement in others,” said NPD. “The final weeks of this holiday season will be critical as delivery deadlines approach and consumers are driven back to the stores to complete their shopping.”
Retail performance at Conn’s “remains strong,” despite the impact of Hurricane Harvey on stores in southeast Texas, said CEO Norm Miller on a Thursday earnings call. Harvey made landfall Aug. 24 near Rockport, Texas, as a Category 4 storm. Conn’s estimates it lost about 100 selling days from Harvey, he said. About 30 percent of Conn’s customer credit accounts “portfolio” is based in markets the storm “impacted,” said Miller. “However, we believe only a portion of these accounts were directly impacted by the storm.” The requirement that all in-house credit customers have property insurance “helped insulate the company’s net exposure to credit losses” from the storm, he said. Of those customers who were hard hit, many “may have experienced a temporary reduction in wages, job lost and shift in priorities,” he said. Banks and other financial companies “offered various degrees of financial relief to their customers,” such as “automatic payment holidays,” he said. Conn’s took a “disciplined” approach, such as by offering credit “due-date extensions” with no penalty, and “sought to show appropriate compassion to impacted customers, while staying very focused on our credit performance,” he said. “We believe that these concessions provided affected customers with necessary flexibility during this challenging time and minimized our exposure to credit losses from the hurricane.”
Walmart’s refresh of its legal name from Wal-Mart Stores to Walmart Inc., represents “how customers are shopping us today and how they’ll increasingly shop us in the future,” said the company in a Wednesday blog post. The world’s largest retailer said all of its customers already refer to the company as Walmart, but the official change “is a way of better reflecting our company’s path to win the future of retail.” It cited the varied ways in which customers can shop: stores, websites, apps, by voice “and whatever comes next.” The change spins Walmart back to its roots: when Sam Walton opened the first store in 1962, the sign read: “Walmart.”