To follow is a brief review of retail news from around the world:
May 19 – Alibaba Delivers Yet Another Year of Powerful Growth
China’s vast ranks of consumers are finding ways to spend more money online — and that’s good news for Alibaba. The Alibaba Group, the Chinese e-commerce giant that a few years ago led the biggest share listing in the history of the American stock market, on Thursday posted strong profit growth and better-than-expected sales growth for the three months that ended in March. The surge came as Chinese government statistics showed an increase in online retail sales as well as stronger overall economic growth. Robust online activity has helped others as well, with Tencent Holdings, a major rival to Alibaba, reporting a strong rise in profit and JD.com, another rival, posting its first profit. For more reading, see New York Times.
May 19 – Walmart’s Online Sales Soar
Walmart reported comparable-store sales growth for the 11th straight quarter in Q1 2017, but, even more importantly, the company grew its US e-commerce sales and gross merchandise volume (GMV) by an incredible 63% and 69% year-over-year (YoY), respectively. That digital growth helped the company increase revenue by 1.4% YoY to $117.5 billion for the quarter. Although Walmart has acquired a string of startups in recent months, company executives said most of the online sales growth came through Walmart.com. The acquisitions may have contributed to that growth, though, since Walmart has been listing some merchandise from its newly acquired brands on the flagship site. This could be attracting new customers to Walmart.com, as most of the acquired companies appeal to younger and higher-income consumers than the retailer has traditionally drawn. Taken from Business Insider.
May 17 – TJX Is Dinged by Department Store Crash
TJX Co is getting a little taste of the rest of the retail industry’s pain. But it should remain an island of relative safety over the long run. Shares of the owner of T.J. Maxx and Marshall’s fell 3.7% on Tuesday after it reported lighter-than-expected first-quarter sales. Same-store sales still climbed 1%, but it was the first time TJX hasn’t beaten its guidance since the third quarter of 2014. The company also said earnings in the second quarter would be lower than Wall Street had been forecasting because of foreign currency effects and wage increases. It raised its full-year guidance. For further reading, see Wall Street Journal.
May 16 – India: Star Bazaar to Increase Store Count to 200 in 3 Years
Multi-format grocery retail chain Star Bazaar, a Tata-Tesco initiative, plans to take its store count to over 65 stores by the end of this year, and 200 stores by 2020, a senior company executive said today. “We plan to scale up to over 65 stores by the end of this year, and touch 200 stores in three years,” Jamshed Daboo, managing director of Trent Hypermarket, that operates Star Bazaar, told reporters here. The new stores will be Star Market, which is more a mid-size format at an average size of 7,500 sq ft, Daboo said. Besides the entire range of grocery and some kitchen items, the new stores will feature live counters for meats and fish, he said. Read more at India Times.
May 15 – Walmart China Shoppers can now shop Sam’s Club USA
Wal-Mart is letting online customers in China order from its Sam’s Club stores in the U.S. for the first time to cater to China’s increasingly affluent, well-traveled shoppers. It’s Wal-Mart’s latest attempt to boost growth in China since it sold its online business in the country to JD, China’s No. 2 e-commerce site, in June 2016. The U.S. retailer has a 12 percent stake in JD and hopes working with the homegrown company will boost its performance in China. Getting China right is key to bolstering Wal-Mart’s global online business. About 200 products from Sam’s Clubs stores will initially be available for Sam’s Club customers in China to order online via JD’s website, expanding to 700 this year, says Rebecca Lui, a Wal-Mart spokeswoman. The company is focusing on personal care, baby supplies and nutritional supplies that are mostly not available in China. Products for sale include Aveeno moisturizers and Waterpik Ultra and Cordless Plus Water Flossers. See ABC News for additional reading.
May 12 – Canadian Tire Posts Strong Q1 Results
Canadian Tire Corporation, Limited today released first quarter results for the period ended April 1, 2017. Retail segment revenue increased 8.5% in the first quarter compared to last year. For more detail, see Canadian Newswire.
May 12 – Robinsons Retail (Philippines) Grows Margin in Q1
Robinsons Retail posted a 26.9% year-on-year growth in first quarter net profit to PHP996 million, driven by higher sales from its expanding store network coupled with improved margins and cost-saving measures. Excluding interest income on available-for-sale investments, unrealized foreign exchange gains or losses and equity earnings from affiliate, RRHI said core net profit had grown by 21% year-on-year to PHP842 million in the first quarter. Taken from Planet Retail.
May 11 – Brazilian Variety Retailer Lojas Americanas Endures Tough First Quarter Trading
Retailer Lojas Americanas significantly increased first-quarter losses compared to the same period last year, weighed down by calendar effects, with Easter in 2017 falling to the second quarter (April), unlike in 2016, when it fell in March. The company’s consolidated net loss jumped to R $ 132.9 million from January to March, compared to a negative result of R $ 23.9 million in the same period last year. For more (in Spanish), see El Globo.
May 9 – JD.com (China) Turns Profitable for the First Time
JD.com, China’s second largest ecommerce platform has achieved its first profitable quarter since going public two years ago, helped by Chinese consumers using mobile to shop. JD.com’s net profits made an unexpected turn, rising to CNY239m (US$35m) compared with a loss of CNY910m (US$132m) in the first quarter of last year. Gross merchandise volume increased 42% in the March quarter compared to a year ago, while annual active customer accounts grew 40% to 236.5 million in the year to March. Taken from Retail Analysis.
May 2 – Matahari budgets for 10% revenue-boosting expansion
Indonesian department store operator Matahari Putra Prima plans to invest up to IDR600 billion (USD45 million) this year to open new stores and revamp outlets. The company has been under pressure to turn around its business after a 17% loss in profit last year amid flat sales and increased costs. Excerpt from Planet Retail.
May 2 – Walmart to open 50 new stores in India soon; 10 of them in Telangana
Global retail giant Walmart will set up 50 new stores across India over the next three to four years, a top company official said on Saturday. The new stores would include 10 in Telangana, for which the US retailer signed a Memorandum of Understanding (MoU) with the state government. It will invest $10 to $12 million in each store, which would create direct and indirect employment for 2,000 people. Walmart currently has 21 stores in India, including one in Hyderabad. For more reading, see Business Standard.
May 2 – Woolworths (Australia) Continues Strong Turnaround in Q3
Australia’s leading retailer Woolworths has reported strong quarterly results surging ahead of its main competitor Coles. Total third-quarter sales increased by 3.7% to AU$13.81bn (US$10.39bn) from AU$13.32bn (USD$10.02bn), previous year. Sales at its department store BIG W, on the other hand, fell by 8.6% in the third quarter with LFL sales declining by 8.2%. The company has completed a strategic review of BIG W and is in process of implementing the plan. Woolworths’ CEO Brad Banducci said, “BIG W is a work in progress and its turnaround will be a multi-year journey”. See Retail Analysis for additional details.
May 1 – SM (Philippines) Chairman Henry Sy Sr Steps Down
SM chairman Henry Sy Sr has stepped down as chairman of SM Investments Corporation (SM), accepting a new role of chairman emeritus, in recognition of his role as the founder of the company. The company’s board announced the move as part of a series of key organizational changes it says will support the company’s next phase of growth. The chairmanship has been taken over by Jose T. Sio, who has been SM’s CFO for 26 years and was highly instrumental in supporting the growth of SM and its subsidiaries. “He instilled strict financial discipline across all businesses that later helped the company achieve optimal results even as the whole group maintained a sound and stable financial position,” SM said in a statement. Henry Sy Sr, a multi-awarded entrepreneur and philanthropist, opened the first ShoeMart store in 1958, a business now simply known as SM, and fostered it to become one of the largest holding companies in the Philippines. For more, go to Inside Retail.
The International Business Council is a special interest group of IHA members, dedicated to helping its membership market and sell their products internationally by sharing information, providing networking opportunities and offering programs to assist, support, and educate. Membership is free to all regular, IHA members – visit the IBC website to learn more.
The Global Retail Intelligence Report provide a brief review of retail news from around the world, useful when evaluating foreign market opportunities.