RETAIL NEWS FLASH August 01, 2014
Table of Contents Sales & Marketing ................................................................................................................. 3 Finance ................................................................................................................................. 7 Technology .......................................................................................................................... 10 Strategic Initiatives .............................................................................................................. 13 eCommerce & Online Retail ................................................................................................. 15 Expansion to New Markets .................................................................................................. 19
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Sales & Marketing Marks & Spencer poaches Tesco internet chief information officer July 25, 2014 | Retail Week http://www.retail-week.com/multichannel/online-retail/marks-and-spencer-poaches-tescointernet-chief-information-officer/5062585.article Dawson replaces Darrell Stein in the role at M&S and will report to the chief finance officer. The finance position is being filled on an interim basis by Paul Friston, former director of financial control, following M&S finance boss Alan Stewart’s surprise move to Tesco where chief executive Phil Clarke has been replaced by Unilever man Dave Lewis. In an internal announcement, M&S chief executive Marc Bolland said: “Carl has a wealth of IT experience from the retail industry and joins us from Tesco. Prior to this, Carl has held chief information officer positions at both Shop Direct and Thomas Cook. His start date will be announced in due course.” Until Dawson joins, Clifford Cohen, at present M&S’s head of business solutions at M&S.com, will be interim director in the tech role. Bolland said: “Clifford has extensive M&S experience and played a critical role in the successful launch of the new M&S.com platform.” M&S is in the midst of technological and digital change as it overhauls its systems to adapt for the shift to ecommerce and the resulting demands on distribution, ordering and fulfilment systems. M&S is refocusing as part of its efforts to become an international multichannel business.
Shop Direct brings in more sales by bringing usability testing in house July 23, 2014 | Internet Retailer http://www.internetretailer.com/2014/07/23/shop-direct-brings-more-sales-bringing-testinghouse The U.K. web-only retailer pays $170,000 for an onsite lab where it recruits consumers to navigate its web sites as employees watch. Two months later, the lab has already helped boost conversions. United Kingdom-based retailer Shop Direct takes usability testing seriously. So seriously, it’s invested $170,000 to develop its own on-site testing facility where it recruits consumers to visit and navigate its e-commerce sites while employees observe and look for ways to make the sites easier to shop and navigate.
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The retailer, which operates full department store sites including Very.co.uk and Littlewoods.com, had been using usability testing labs though outside vendors for around five years, conducting tests with facilities throughout the U.K., says Jonathan Wall, e-commerce director for the web only retailer. For each of those tests, Shop Direct, No. 7 in the Internet Retailer Europe 500 shelled out around $6,000 for the external agency to run the test and recruit the particular demographic of consumers Shop Direct wanted to analyze. The problem with using outside facilities, Wall says, is that it was tough to get top executives and stakeholders to attend the testing sessions, which were often conducted in London or Manchester, U.K. Shop Direct is based in Liverpool, U.K. which is approximately 45 minutes from Manchester and nearly four hours from London. Without seeing consumers interacting with its e-commerce sites firsthand, it was difficult to convince top management to invest in web site or company changes, Wall says.
Office Depot names a new head of North American retail July 22, 2014 | Internet Retailer http://www.internetretailer.com/2014/07/22/office-depot-names-new-head-north-americanretail Office Depot Inc. has named a former CVS pharmacy executive as the office supply retailer’s new president of North America. In his new role at Office Depot, No. 9 in the 2014 Internet Retailer Top 500, Mark Cosby will be in charge of the North American e-commerce operation in addition to stores, contract sales, merchandising, marketing, real estate and supply chain. He will report to CEO Roland Smith. Prior to joining Office Depot, Cosby served as president of pharmacy of retail pharmacy chain and health care services provider CVS/Caremark (No. 103). At CVS, Cosby oversaw a $65 billion retail business, including 7,600 retail stores, 19 distribution centers, retail merchandising, supply chain, marketing, real estate and store pharmacy operations. Cosby also has served as president of Macy’s Inc. (No. 8), president of stores at Sears, Roebuck & Company (now Sears Holdings Corp., No. 5) and chief operating officer and chief development officer at Yum Brands Inc. As the president of Office Depot North America, Cosby will receive a compensation package that includes an $850,000 annual salary, a one-time signing bonus of $500,000, a $1,200 monthly vehicle stipend, stock and other performance-based bonus compensation, according an Office Depot regulatory filing with the U.S. Securities and Exchange Commission.
Amazon and eBay grow their B2B online sales July 22, 2014 | Internet Retailer http://www.internetretailer.com/2014/07/22/amazon-and-ebay-grow-their-b2b-online-sales The growth rate of sales of business and industrial products on Amazon and eBay rival that of those sites’ retail sales, one marketplace expert says.
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With more than 2.25 million products, Amazon.com Inc.’s AmazonSupply.com has emerged as the biggest competitor in the eyes of many business-to-business e-commerce sellers. But along with its rival eBay.com, B2B sales—the product category referred to as Business & Industrial, or B&I—are also giving Amazon’s and eBay’s own online retail sales stiff competition as the source of the top growth rate in sales, says Scot Wingo, CEO of ChannelAdvisor Corp., which helps online companies sell through Amazon, eBay and other e-marketplaces. EBay Inc. no longer breaks out B&I growth rates, but in the fourth quarter of last year it noted that B&I sales were growing at an annual clip of 17%, compared with 12% overall for eBay.com, Wingo says. Although Amazon hasn’t broken out similar numbers, he figures that total B2B sales at AmazonSupply.com and Amazon.com are growing at rate the same or higher than Amazon.com’s overall sales. “My educated guess would be, with Amazon growing overall in the mid-20’s, B2B there is growing in the 25% to 35% range,” he says. EBay and Amazon did not immediately return calls for comment. For 2013, Amazon reported revenue of $74.45 billion, up 21.9% from $61.09 billion in 2012. Its 2013 web sales, including commissions from retailers that sell through the Amazon marketplace but excluding revenue from Amazon Web Services and other units not directly related to retail sales, were estimated by Internet Retailer at $67.86 billion, up 20.3% from $56.41 billion in 2012. EBay reported the gross merchandise value of goods sold on its global marketplaces in 2013 of $76.50 billion, up 12.9% from $67.76 billion a year earlier.
Amazon delivers nearly a third of orders for marketplace sellers July 14, 2014 | Internet Retailer http://www.internetretailer.com/2014/07/14/amazon-delivers-nearly-third-orders-marketplacesellers ChannelAdvisor says its clients are increasingly turning to Amazon’s fulfillment program to handle the warehousing and delivery of their products. Sales by outside merchants on Amazon.com Inc.’s marketplace were up 34.4% in June 2014 compared with June 2013, according to ChannelAdvisor. The company produces monthly reports that compare its merchant clients’ sales through various online shopping portals and marketing channels, including Amazon.com, eBay Inc., Google search and Google Shopping. ChannelAdvisor has added two new data points to its monthly report in response to requests for information about the Fulfillment by Amazon program, a service that lets merchants store inventory at Amazon warehouses with Amazon handling delivery to the customer. The new “Percent FBA” measures the percentage of Amazon gross merchandise volume of ChannelAdvisor clients that was fulfilled with Fulfillment by Amazon. For June 2014, 31.8% of Amazon gross merchandise volume was shipped through the Fulfillment by Amazon program, up from 28.7% in June 2013. The second new data point, “FBA non Amazon,” measures the percentage of gross merchandise value shipped through the Fulfillment by Amazon program that was not sold through Amazon’s Marketplace. These are sales from a merchant’s own site or other marketplaces that Amazon fulfills. In June 2014, that was 1.8%, up from 0.9% in June 2013.
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Last month, ChannelAdvisor began tracking its clients’ sales on web marketplaces other than Amazon and eBay—including those of Sears, Newegg and Rakuten Shopping—and combines them in the report. In June 2014, sales on those marketplaces increased 51.5% compared with June 2013. Although that’s solid growth, ChannelAdvisor notes it’s a decrease from the 78.3% year-over-year growth seen in May. A deeper dive into eBay’s numbers reveals eBay’s fixed-price division is experiencing steady growth—18.4% in June—but its auctions have been declining since October 2013. In June, auctions were down 19.0% over the previous year. Overall, sales on eBay increased 12.3% from June 2013— up, too, from last month’s year-over-year increase of 11.5%. Google Product Listing Ads and paid search channels are generating increased sales for ChannelAdvisor clients. Revenue from paid search ads on Google grew 20.4% in June compared with an 11.7% year-over-year growth rate in May. Year-over-year growth on Google Product Listing Ads was 6.4% compared to the previous year—up from just 0.4% year-over-year growth in May. Conversion rates on Google search ads increased 6.0% in June compared with the previous year, and customers spent on average 7.0% more in June 2014 than June 2013—up to $137.02 from $128.06. That is the highest average order value ChannelAdvisor has measured for sales originating with Google search ads. Conversion rates for Google Product Listing Ads on Google were up 10.5% in June 2014 compared to the previous year. Customers spent in June an average of $98.23—an 8.7% decrease from June 2013.
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Finance CARREFOUR H1 confirms ongoing turnaround July 31, 2014 | Planet Retail http://www.planetretail.net/NewsAndInsight/Article/89615 Carrefour posted net sales up 4.3% at constant exchange rates to EUR35.9 billion (USD49.64 billion) for the period starting 1 January to 30 June. This represented its highest increase in five years, according to the retailer. But more than top line growth, recurring operating income is a key indicator to evaluate CEO Plassat’s effort to bring the second-largest global retailer back on track. The 13.8% hike seems to show he is doing a good job, with France up 6.9% and a substantial improvement in other European countries, soaring 19.3% overall. It is understood that Spain and Belgium were the main drivers, while profitability remains under pressure in Italy due to heightened commercial investments. Emerging markets posted a similar increase at 19.2%, lifted by strong performances in Brazil and Argentina. Overall, Carrefour net income soared 16.7% to EUR274 million (USD378.87 million) over the period. The reinvigorated retailer continues to invest massively in store refurbishments and has resumed expansion to a level in line with previously announced commitments of EUR818 million (USD1.13 billion). As key indicators seem one by one to be returning to positive figures, the management appears confident in their strategy, which could now intensify going forward. Yesterday evening, Carrefour announced an exclusive agreement for the purchase of a further nine shopping centres in France and Spain for EUR1.1 billion (USD1.52 billion).
Sales surge for NEXT in Q2 July 29, 2014 | Planet Retail http://www.planetretail.net/NewsAndInsight/Article/89581 UK apparel giant Next has once again over-delivered on very high expectations. One of the best-run retailers in the UK saw overall sales grow 10.7% in the 26 weeks to 26 July. Next Retail - the storebased business - saw sales rise 6.4% while Next Directory - the catalogue/online business - grew 16.2%. But as one of the leading exponents of multi-channel retailing, the dividing line between the two businesses is increasingly blurring. New space (which it stressed was profitable) contributed 2.4% to overall growth. The stellar sales performance in the first half also prompted the company to upgrade its full-year forecasts. The guidance range of full-year sales growth is now 7-10%, against 5.5-9.5% previously. Profit guidance (before tax) was also upgraded by GBP25 million (USD42 million) to GBP775-815 million (USD1.3-1.4 billion). True to form, even this guidance was touched with a note of conservatism, in recognition of tougher comparables in the second half of last year.
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STARBUCKS Q3 revenues up by 11% July 25, 2014 | Planet Retail http://www.planetretail.net/NewsAndInsight/Article/89550 Starbucks has reported third-quarter results for the period ended 29 June. The company reported an 11% increase in revenue to USD4.2 billion from USD3.7 billion last year. Net revenue for the Americas increased 10% to USD3.05 billion. Revenue was also up 13% to USD323.5 million in EMEA and showed a rise of 23% to USD287.6 million in the China/Asia-Pacific region. Net revenues for the Channel Development segment rose 13% to USD375.3 million, primarily driven by increased sales of premium single-serve products and higher sales volumes of packaged coffee in the US. The Other segment saw net revenues increase 3% to USD109.6 million, primarily driven by increased sales in the emerging businesses. Starbucks reported strong global comparable sales of 6%. America's comparable sales increased 6% while US increased 7%, 3% EMEA (Europe, Middle East & Africa) and 7% CAP (China/Asia-Pacific). During the quarter Starbucks opened 344 net new stores including 149 in the Americas, 37 in EMEA and 160 in CAP. The company’s operating income also grew significantly by 25% to USD769 million from USD615.2 million last year. Howard Schultz, President & CEO, said:” Our Q3 results give us confidence in our ability to deliver on our full-year fiscal 2014 targets and support the strong 2015 revenue and profit growth targets we introduced today, despite continued challenging economic and consumer headwinds in many of the global markets in which we operate.” In 2015, Starbucks plans to open 1,600 net new restaurants across the globe and grow revenue by at least 10%.
SUPERVALU reports solid Q1 results July 25, 2014 | Planet Retail http://www.planetretail.net/NewsAndInsight/Article/89554 US retailer Supervalu net sales for its first quarter ended 14 June were flat, dropping 0.1% to USD5.23 billion. Net earnings totalled USD43 million. Comparable store sales were up 0.6% for Retail Food and up 5.6% for the Save-A-Lot discount chain. Identical store sales for corporately-operated stores within the Save-A-Lot network were up 7.2 %. Retail Food net sales rose 0.6% to USD1.4 billion, while Save-A-Lot net sales were up 6.5% to USD1.35 billion. Independent business sales slipped 2.6% to USD2.40 billion. Net income for the quarter fell 49.4% to USD43 million, which included USD2 million in after tax charges, costs for employee severance and debt financing activities following the sale in March of five retail banners (Albertsons, Acme, Jewel-Osco, Shaw’s and Star Market).
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Sam Duncan, President & CEO, said: “Our top priority is driving top line sales, which I believe we will do. The momentum we generated in the fourth quarter carried forward into this new fiscal year, and first-quarter results reflect the investments we are making to position the company for future success” Supervalu’s independent business segment added 47 new stores during the quarter. The retailer is on track to complete more than 40 store remodels this year and is working on what optimum store sets for 20 of the 40 locations to better allocate space across departments and categories and create more appropriate adjacencies.
AMAZON sales up, profits down in Q2 July 25, 2014 | Planet Retail http://www.planetretail.net/NewsAndInsight/Article/89547 Amazon has announced that net sales for the second quarter ended 30 June 2014 rose 23% to USD19.34 billion. In North America, sales rose 26% to USD12 billion while international sales were up 18%. The retailer reported an operating loss of USD15 million during the quarter, compared with operating income of USD79 million in the same period last year. "We continue working hard on making the Amazon customer experience better and better," said Jeff Bezos, CEO of Amazon.com. "We've recently introduced Sunday delivery coverage to 25% of the U.S. population, launched European cross-border two-day delivery for Prime, launched Prime Music with over one million songs, created three original kids TV series, added world-class parental controls to Fire TV with FreeTime, and launched Kindle Unlimited, an eBook subscription service.” He continued: “For our AWS customers we launched Amazon Zocalo, T2 instances, an SSD-backed EBS volume, Amazon Cognito, Amazon Mobile Analytics, and the AWS Mobile SDK, and we substantially reduced prices." Looking ahead to Q3, the retailer expects net sales to be between USD19.7 billion and USD21.5 billion, or to grow between 15% and 26% compared with the third quarter last year. The company expects to report an operating loss of between USD10 million and USD410 million, compared to USD25 million in the third quarter of 2013.
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Technology Walmart buys social shopping app Luvocracy July 29, 2014 | Fierce Retail http://www.fierceretail.com/story/walmart-buys-social-shopping-app-luvocracy/2014-07-29 WalmartLabs, Walmart's technology division, has made another acquisition, and this time it's social shopping site and app, Luvocracy. Luvocracy is among a host of similar sites that lets users upload and share images. Ben Galbraith, VP of global products at Walmart.com equated the user experience to that of flipping through a catalog, back when there were catalogs. "In the retail business, we thrive on these moments—on finding products we think our customers will love and introducing them to each other," Galbraith said. "Whether in pages, pixels, or aisles, facilitating such moments is at the very core of what we at Walmart do. Founded three years ago, Luvocracy was one of the first companies to enable the entire social shopping experience—from discovery to commerce—to occur within the four walls of its app." Walmart is busy building omnichannel capabilities. It already allows shoppers to order online and ship to stores, and there's even a test of in-store kiosks that lets shoppers order online from a Walmart supercenter and have the items transferred to a nearby Neighborhood Market for pickup (the very first such order included at least one canoe). When it comes to mobile investment, Walmart has been busy. The retailer's Walmart to Go test in Denver lets shoppers order online or from a mobile device and pick up groceries at a designated, freestanding location—without leaving their car.
Target app uses image recognition to speed mobile purchases July 23, 2014 | Retail Customer Experience http://www.retailcustomerexperience.com/news/target-app-uses-image-recognition-to-speedmobile-purchases/ Earlier this week, Target unveiled its new iOS app "In a Snap," which lets users scan images of products in an advertisement and either purchase them or save them for later. he retailer said the app is the work of its recently announced Rapid Accelerated Development tech team. It currently works with ads featured in the latest issues of Real Simple, Architectural Digest and Domino, as well as its back-to-school catalog and in-store signage in a new Target Express store in Minneapolis.
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Starbucks to test mobile ordering app July 21, 2014 | Fierce Retail http://www.fierceretail.com/story/starbucks-test-mobile-ordering-app/2014-07-21 Starbucks will test out an app that allows customers to place orders for pickup. According to the company's Chief Digital Officer, Adam Brotman, the retailer is determined to eventually roll out the technology nationwide. More than 14 percent of all Starbucks purchases in the United States are paid through the company's app, reported Re/code. Therefore, the ability to order through mobile will be an extension of the company's existing app capabilities. Americans are using apps to order, pick up, and have services and products delivered more and more frequently, especially in the food and beverage industry, where companies such as GrubHub, Topingo and Square allow consumers a variety of order and delivery-pickup options. Current purchases made at Starbucks with credit or debit cards run through Square's payment platforms, but the transactions using the Starbucks app do not. Brotman believes the new app will make current customers more loyal by giving them another alternative to waiting in long lines during busy hours. Of course there's the remaining risk of a hot beverage sitting out too long and getting cold. Therefore, the company is testing different beverages to gauge how long it takes for them to cool to keep services satisfactory. "We're trying to get things down to a science," said Brotman, who is working with a team of employees from different store divisions to perfect the process. "It's the most cross-functional team I've ever worked on and the most important project I've ever worked on," Brotman said.
Apple and IBM's partnership means big things for retail July 17, 2014 | Fierce Retail http://www.fierceretail.com/retailit/story/apple-and-ibms-partnership-means-big-thingsretail/2014-07-17 Apple (NASDAQ:APPL) and IBM (NYSE:IBM) announced an exclusive deal that will introduce new business apps to the iPhone and iPad. The enterprise-specific apps for Apple's iOS will be aimed at companies in the retail, healthcare and transportation industries, among others. The two companies intend to redefine the way work gets done and set the bar for mobile business solutions. Tools will include security, analytics and device management.
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"IPhone and iPad are the best mobile devices in the world and have transformed the way people work with over 98 percent of the Fortune 500 and over 92 percent of the Global 500 using iOS devices in their business today," said Tim Cook, Apple's CEO. "For the first time ever we're putting IBM's renowned big data analytics at iOS users' fingertips, which opens up a large market opportunity for Apple. This is a radical step for enterprise and something that only Apple and IBM can deliver." It is also a meaningful partnership for retailers. The ease of Apple's iOS combined with IBM's data and analytics capabilities should help simplify big data for merchants. "Mobility—combined with the phenomena of data and cloud—is transforming business and our industry in historic ways, allowing people to re-imagine work, industries and professions," said Ginni Rometty, IBM president and CEO. "This alliance with Apple will build on our momentum in bringing these innovations to our clients globally, and leverages IBM's leadership in analytics, cloud, software and services. We are delighted to be teaming with Apple, whose innovations have transformed our lives in ways we take for granted, but can't imagine living without. Our alliance will bring the same kind of transformation to the way people work, industries operate and companies perform."
Mayday! Mayday! Amazon tablet users love the Mayday support option July 16, 2014 | Internet Retailer http://www.internetretailer.com/2014/06/16/mayday-amazon-tablet-users-love-maydaysupport-option 75% of contacts from users of the Amazon Fire HDX tablet now come through the device’s unique Mayday button, which quickly connects the tablet user with Amazon support agents via onscreen video. Amazon.com Inc. years ago made the giant leap forward in mobile commerce with its patented 1Click Checkout. A customer goes through a one-time device registration process, linking her smartphone or tablet with her Amazon account, and from then on all she needs to do to complete a mobile purchase is press the Buy Now button. Truly one touch. Eight months ago, Amazon.com debuted another one-touch mobile leap forward, the Mayday button on its Fire HDX tablet. When an HDX user needs help, she just presses the appropriately titled Mayday button and within seconds an Amazon support agent appears onscreen, ready to help. The service is available for free 24/7/365. Amazon.com, No. 2 in the 2014 Internet Retailer Mobile 500, reveals that the Mayday button is now the most popular way for Fire HDX customers to contact customer service, and that the average time it takes for a customer service agent to respond is 9.75 seconds.
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Strategic Initiatives Albertsons finalizes $9 billion Safeway purchase July 28, 2014 | Fierce Retail http://www.fierceretail.com/story/albertsons-finalizes-9-billion-safeway-purchase/2014-07-28 Albertsons' board of directors officially approved the acquisition of Safeway for $9.2 billion. The agreement would make the retailer the second largest supermarket chain in the United States. Safeway's outstanding 96 percent of shares voted in favor of the merger at last week's meeting in Pleasanton, California, the company's headquarters, reported the Los Angeles Daily Mail. The deal is still pending a review by the Federal Trade Commission, which will probably require both supermarket chains to divest some stores for competitive reasons. The deal will create a network of more than 2,000 stores, 27 distribution facilities and 20 manufacturing plants managed by more than 250,000 employees. Safeway currently operates 1,330 stores and Albertsons has more than 600. The merger would make the supermarket chain slightly smaller than Kroger, the largest grocery retailer in the United States. "Albertsons is a very important, major player in Southern California, and you might see an overlap there with Vons," Robert Reynolds, a Moraga-based retail analyst, told the Los Angeles Daily Mail. The acquisition was voted on and approved by Safeway's board of directors in March. The news came just days after Safeway announced it was looking for a buyer and rumors that Kroger had an interest in the purchase.
Dollar Tree, Inc. to Acquire Family Dollar Stores, Inc. to Create North America’s Leading Discount Retailer July 28, 2014 | Family Dollar http://investor.familydollar.com/investors-relations/news-releases/Press-ReleaseDetails/2014/Dollar-Tree-Inc-to-Acquire-Family-Dollar-Stores-Inc-to-Create-North-AmericasLeading-Discount-Retailer/default.aspx Dollar Tree, Inc. (NASDAQ:DLTR), the nation's leading operator of discount variety stores selling everything for $1 or less, and Family Dollar Stores, Inc. (NYSE:FDO), a leading national discount retailer offering name brands and quality, private brand merchandise, today announced that they have entered into a definitive merger agreement under which Dollar Tree will acquire Family Dollar in a cash and stock transaction. The value of the consideration is $74.50 per share, a 22.8% premium over Family Dollar’s closing price as of July 25, 2014.
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The transaction, which has been unanimously approved by the Boards of Directors of both companies, is expected to close by early 2015, at which time the Family Dollar shareholders will receive $59.60 in cash and $14.90 equivalent in Dollar Tree shares, subject to the collar described below. At closing, Family Dollar shareholders will own no less than 12.7% and no more than 15.1% of the outstanding common stock of Dollar Tree. Howard R. Levine and Trian Fund Management, L.P. and funds managed by it, which collectively own approximately 16% of the outstanding stock of Family Dollar, have entered into voting agreements in support of the merger. “This is a transformational opportunity,” stated Bob Sasser, Dollar Tree’s Chief Executive Officer. “With the acquisition of Family Dollar Stores, Dollar Tree will become a leading discount retailer in North America, with over 13,000 stores in 48 states and five Canadian Provinces, sales of over $18 billion, and more than 145,000 associates on our team. We will continue to operate under the Dollar Tree, Deals, and Dollar Tree Canada brands, and when this transaction is complete, we will operate under the Family Dollar brand as well. Throughout our history, we have strived continuously to evolve and improve our business. This acquisition, which enhances our footprint and diversifies our company, will enable us to build on that progression, and importantly, positions Dollar Tree for accelerated growth. By offering both fixed-price and multi-price point formats and an even broader, more compelling merchandise assortment, we will be able to provide even greater value and choice to a wider array of customers. Dollar Tree has a long record of consistent, profitable growth, strong financial performance, prudent capital management, and outstanding total shareholder returns. The acquisition of Family Dollar is consistent with our vision to be the leader in value retailing.” Sasser added, “This acquisition will extend our reach to lower-income customers and strengthen and diversify our store footprint. We plan to leverage best practices across both organizations to deliver significant synergies, while we accelerate and augment Family Dollar’s recently introduced strategic initiatives. Combined, our growth potential is enhanced with improved opportunities to increase the productivity of the stores and to open more stores across multiple banners.” “I have long admired the Family Dollar brand and its key position in the minds of the consumer,” said Sasser. “We are excited about the prospects for the combined company and the many opportunities that it will create for our associates, vendors, business partners, and shareholders. Howard Levine, CEO of Family Dollar, will remain with the company and report directly to me. Upon closing, Howard will become a member of the Dollar Tree Board of Directors. We are excited to welcome the Family Dollar team to Dollar Tree, and we look forward to working together to deliver increased value to the consumer and to our shareholders.”
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eCommerce & Online Retail Online retailer Zulily to open call center in Columbus July 30, 2014 | Toledo Blade www.toledoblade.com/Retail/2014/07/30/(copy)-46.html#gfyYdfoSokP4iec1.99\ An online retailer is opening a call center in central Ohio and bringing about 900 new jobs. Seattle-based Zulily — offering daily deals for women, children, and infants — will have a temporary office in suburban Columbus while it looks for a permanent facility. The hiring will be done over the next three years. The Ohio Tax Credit Authority approved a 75 percent, 12-year income-tax credit that will save the company about $6.2 million assuming it meets its hiring obligations.
Distributor United Stationers steps up its focus on online services July 29, 2014 | Internet Retailer http://www.internetretailer.com/2014/07/29/distributor-united-stationers-sharpens-its-onlinefocus The company’s second quarter sales rose about 20% to companies that sell online to other businesses. United Stationers Inc., a distributor of office and industrial supplies to businesses, is focusing more on e-commerce to generate revenue. The company’s net sales for the second quarter rose a modest 3.6% year over year, to $1.320 billion from $1.274 billion. That included $8.2 million in Q2 online sales gained from the May acquisition of online tools merchant CPO Commerce, No. 256 in the Internet Retailer Top 500, which ranks companies on their annual web sales. Much of the United Stationers’ increase in total sales, however, comes from sales to client resellers that sell through their own e-commerce sites. Sales to those companies increased about 20% year over year in Q2, though United Stationers doesn’t break out the amount of sales to those resellers. “Our sales to online *reseller+ customers accelerated, growing nearly 20% during the second quarter, which is a good indication that our strategy is on target,” president and CEO Paul Cody Phipps said during a conference call with stock analysts last week. Indeed, a key part of the company’s growth strategy, Phipps said, is “winning the shift to online” sales among resellers. Another part of that strategy is providing another increasing revenue stream: providing e-commerce technology and fulfillment services to its clients that sell online. “We make others run well online,” adds vice president of marketing Diane Hund. Hund notes that United Stationers provides both e-commerce technology and warehousing and fulfillment services to some resellers, while providing only warehousing and fulfillment to others.
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Future Group launching another e-commerce platform; FutureBazaar? July 24, 2014 | Medianama http://www.medianama.com/2014/07/223-future-group-e-commerce/ Kishore Biyani’s Future Group is planning to launch an e-commerce platform in October, reports Business Standard. Biyani said they are currently running an e-commerce pilot in Akola, Amravati and Bhilwara and they would be launching it in a phased manner starting with the electronics category in October and followed by sports. While the focus will be predominantly on non-perishable products, the company plans to also sell perishable products like fruits, vegetables and meat in select cities. Europe-based Hybris Technology is apparently developing the portal. It’s currently not clear whether this will be a B2B e-commerce venture or a B2C e-commerce venture, although there are indications that this will possibly be a B2B venture. Biyani mentions that Hong Kong firm Li & Fung will be taking care of supply chain management for the e-commerce venture. Note that Li & Fung already has a joint venture with the Future Group for a wholesale cash-and-carry business. It had also invested $30 million for a 26% stake in Future Group’s logistics venture Future Supply Chains back in 2009. Earlier this month, Walmart India had also launched its B2B e-commerce store Best Price Modern Wholesale for the registered members of Best Price Modern Wholesale stores in Hyderabad and Lucknow.
Crocs exiting 75 to 100 stores July 23, 2014 | Fierce Retail http://www.fierceretail.com/story/crocs-exiting-75-100-stores/2014-07-23 Clog-maker Crocs (NASDAQ:CROX) announced it would attempt to sell or convert 75 to 100 stores and lay off about 180 of its 5,000 employees as it suffers from overexpansion. As many as 70 jobs will be cut from the company's Niwot, Colorado headquarters, reported the Wall Street Journal. The brand will also cut back the number of styles it sells by 30 to 40 percent, in addition to categories such as boots and dress shoes. The retailer will shift its focus to sandals, loafers and casual shoes. After hitting it big in 2002 with sandals, Crocs wanted to diversify, but some of the styles were "too big a reach for the brand," Andrew Rees, president of Crocs, told the Wall Street Journal. So now the company must shrink to improve profitability. Profits fell 44 percent to $19.7 million in the second quarter, but revenue increased 3.6 percent to $376.9 million. The retailer expects the new plan will save Crocs $4 million in 2014 and $10 million in 2015. Rees hopes to convert to third-party operators for the 75 to 100 stores so the company can continue to operate as Crocs without the expensive ownership of excess parts. He also plans to open a new global commerce center with 75 employees in Boston later this year, reported Sports One Source. The new office will house key merchandising, marketing and retail functions. He believes the new
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location will be more attractive for executives than Colorado. Blackstone invested $200 million in Crocs in January 2014 with hopes of turning profits around.
A snacks manufacturer rolls out a new web and social media strategy July 22, 2014 | Internet Retailer http://www.internetretailer.com/2014/07/22/snacks-manufacturer-launches-new-e-commercestrategy The new site for John Wm. Macy’s CheeseSticks consolidates three former sites for its blog, recipe content and e-commerce sales, and renders content on mobile devices as well as desktop computers. John Wm. Macy’s CheeseSticks, a manufacturer of cheesy breadsticks and crackers, launched a new e-commerce site this month that combines direct sales to consumers, links to distributors, a geolocation tool to nearby stores that carry the brand, image-heavy content for products and recipes, and links to social media. "We wanted a cleaner, more beautiful site with better navigation, greater interactivity with consumers and an easier online shopping experience," says Tim Macy, vice president. "In a nutshell, we wanted visitors to have more fun. This called for a complete rebuild, which led us to a new web host and developer, new software and a new e-commerce solution." The site serves wholesale as well as consumer customers, with client retailers able to click into a section on distributors to directly place bulk orders on some distributors’ web sites. Other distributors only list their phone and fax numbers for taking orders. The company, based in Elmwood Park, NJ, retained Adpartner Inc., its long-time creative agency, for the site design and Web Instinct, its new web-hosting partner, to develop the site. The new site, Cheesesticks.com, is built on the Shopify e-commerce platform and uses the open-source Concrete5 content management system. Open-source technology provides access to the software source code for modifying software features and functionality. The new site features additional content, such as weekly stories related to dining, entertainment and lifestyle, and a new section for recipe content, including more photography and written features that suggesting pairings of John Wm. Macy’s “gourmet snack products” with wine and desserts. The home page of Cheesesticks.com now also includes links to Twitter as well as other social media sites, including Facebook, Google+, Pinterest and YouTube.com, where visitors can click into videos of John Wm. Macy’s products and manufacturing operations. To better connect site visitors with the manufacturer’s retail partners, Cheesesticks.com now features a Where to Buy page that uses geo-location software from Donde.io to connect site visitors with information on nearby merchants that carry John Wm. Macy’s products.
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Facebook experimenting with 'buy' button July 18, 2014 | Fierce CMO http://www.fiercecmo.com/story/facebook-experimenting-buy-button/2014-07-18 In a move to encourage more e-commerce on its platform, Facebook announced it is testing a "buy" button. The company said the button is designed to help businesses drive sales through Facebook in News Feeds and on Pages. "With this feature, people on desktop or mobile can click the 'Buy' call-to-action button on ads and Page posts to purchase a product directly from a business, without leaving Facebook," the company said in a blog post. Facebook said the test is currently limited to small and midsize businesses in the U.S. While the benefits are obvious for e-commerce B2B marketers, others can leverage a buy button as well. According to a recent IDG study, 93 percent of consumers purchase business-related products via the Internet using a laptop or desktop. In addition, 50 percent of these executives have purchased IT products for business using their smartphone, with 13 percent reporting making a purchase from $1,000 to $4,999. Facebook said privacy was considered while building the product and that payment would be safe and secure. "None of the credit or debit card information people share with Facebook when completing a transaction will be shared with other advertisers, and people can select whether or not they'd like to save payment information for future purchases," the company said. Cost reduction initiatives
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Expansion to New Markets Amazon to invest $2 bln more in India as e-commerce race heats up July 30, 2014 | Reuters http://in.reuters.com/article/2014/07/30/amazon-com-india-idINKBN0FZ0DX20140730 Amazon.com Inc on Wednesday said it will invest a further $2 billion in India just a day after the country's largest e-tailer Flipkart attracted $1 billion of fresh funds, raising the stakes in a nascent but fast-growing e-commerce sector. Amazon, which opened its Indian website in June last year, has drawn up the battle lines by slashing prices, launching same-day delivery, adding new product categories and embarking on a high-voltage advertisement campaign. Amazon and Flipkart are joined in India's $13 billion e-commerce sector by marketplace Snapdeal, fashion e-tailer Jabong, and U.S. auctioneer eBay Inc. "With this additional investment of $2 billion, our team can continue to think big, innovate, and raise the bar for customers in India," Chief Executive Jeff Bezos said in a statement. "At current scale and growth rates, India is on track to be our fastest country ever to a billion dollars in gross sales." Amazon had not previously disclosed Indian investment plans. But on Monday, the U.S. company said it will raise its presence in the country by opening five more warehouses, almost doubling storage capacity to half a million square feet. "It's all about who builds up scale faster and remains relevant for the next few decades," said Harminder Sahani, managing director of retail consultancy Wazir Advisors. Amazon makes its money in India by charging third-party suppliers to use its website to sell 17 million different products including books, electronics and clothing. The government is considering allowing foreign retailers to sell directly to customers. It recently took a step in that direction by allowing retailers to sell online products manufactured in India. Indian e-commerce is expanding at a compound annual growth rate of 34 percent, according to a joint report by consultants Digital– Commerce, the Internet Mobile Association of India and the Indian Market Research Bureau. That rate, however, is slower than in some other emerging nations such as China. Of the $13 billion market, travel services account for about 70 percent, according to consultancy Technopak. The type of goods sold through Amazon made up $1.6 billion of the total last year, according to researcher Forrester, and Technopak expects that figure to swell to $76 billion by 2021.
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AMAZON India ramps up Fulfilment July 29, 2014 | Planet Retail http://www.planetretail.net/NewsAndInsight/Article/89595 Amazon plans to open five new fulfillment centers (FCs) in India. The facilities, located in Delhi, Chennai, Jaipur, Ahmedabad and Tauru, will be operational from next month and will enable Amazon to widen its customer reach, allowing small and medium-sized businesses to adopt a national platform using Fulfillment by Amazon. The new FCs will complement Amazon’s two existing units on the outskirts of Mumbai and Bangalore, and will nearly double its total storage capacity to over half a million square feet. "The launch of the five new fulfillment centers is part of our continued investment in providing reliable delivery and enabling sellers to achieve nationwide scale." said Amit Agarwal, Vice President & Country Manager, Amazon India, in a statement.
WILLIAMS-SONOMA goes to the Philippines July 25, 2014 | Planet Retail www.planetretail.net/NewsAndInsight/Article/89561 In partnership with Store Specialists, Williams-Sonoma has opened its very first outlets in South-East Asia in the Philippines. The Pottery Barn and Pottery Barn Kids stores are located at Central Square, Bonifacio High Street, the premier retail destination in the capital Manila. Both stores also feature a Design Studio, where trained professionals provide assistance to shoppers with their home furnishing ideas. The move to the Philippines is in line with the home furnishing retailer’s strategy of international expansion. In addition to its domestic US market, the company also operates retail stores in Canada, Puerto Rico, Australia, and the UK. The retailer is also present in the Middle East, where it operates via franchise. Later this year, the retailer will open eight additional stores in Australia and further West Elm outlets in the UK. The retailer is currently focusing on global expansion programmes based on subsidiaries, rather than franchising, according to Bob Bogan, Vice President, International Systems.
First TargetExpress opens in Minnesota July 23, 2014 | Fierce Retail http://www.fierceretail.com/story/first-targetexpress-opens-minnesota/2014-07-23 TargetExpress opened its doors today in Dinkytown, Minnesota, unveiling the retailer's first test of a smaller, urban store. Target announced in January that it would open its smallest format ever near its home market of Minneapolis. The 20,000 sq.-ft. space is near the University of Minnesota and is about the sixth of the size of a traditional location. The store sells roughly 15 percent of the typical merchandise found at a normal Target.
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"We're testing things on an ongoing basis," Kamau Witherspoon, senior director of store operations, told the Star Tribune. "This is just our latest innovation." Target is increasingly eyeing opportunities to reach shoppers in urban areas. At the moment, about 11 percent of Target stores are in urban areas. While it may not have all the items traditionally found in a Target--no furniture or apparel--it does include a pharmacy, socks and underwear and a full-size beauty department with a beauty concierge. The food department also includes a lot of grab-and-go meals and beverages. In 2012, Target began testing a middle-of-the-road concept, an 80,000 to 100,000 sq.-ft. store called CityTarget. There are now eight CityTargets in cities such as Chicago, San Francisco and Portland, Oregon.
Walmart invests $103 million in Indian wholesale July 22, 2014 | Fierce Retail http://www.fierceretail.com/story/walmart-invests-103-million-indian-wholesale/2014-07-22 Walmart has invested $103 million in its Indian operations with the goal of expanding the number of wholesale stores as well as its online presence. Walmart intends to establish 50 more wholesale stores in India in the next five years, reported Chain Store Age. It currently has 20 locations in India. The investment will be used to meet working capital and capital expenditure requirements. The funding will also offer 24-hour customer service for local retailers, who Walmart serves through local Indian wholesale stores. "The equity infusion is to fund the working capital and capex requirements of our cash-and-carry business in India," Rajneesh Kumar, VP for corporate affairs at Walmart India, wrote in an email, according to MarketWatch. Walmart piloted an e-commerce site for retailers in the cities of Hyderabad and Lucknow last month. A full rollout in India is planned for early 2015.
Amazon shows the big opportunity in Latin America e-commerce July 21, 2014 | Internet Retailer http://www.internetretailer.com/2014/07/21/amazon-shows-big-opportunity-latin-america-ecommerce Latin America remains the world’s second fastest-growing e-commerce market behind China, according to data in Internet Retailer’s newly published 2014 Latin America 500. And the fastestgrowing merchants aren’t just promising start-ups. Latin America also is attracting big web merchants like Amazon.com, which grew sales in the region 142% in 2013.
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Even though e-commerce is 15 years year old in countries such as Brazil, there’s still plenty of room for web sales growth in Latin America. And the retailers growing the fastest online are a combination of newly launched online retailers and companies from outside the region, including Amazon.com Inc., according to an analysis of data from Internet Retailer’s newly published 2014 Latin America 500. Overall the collective web sales of the 500 merchants ranked in the Latin America 500 grew 23% in 2013 to $17.94 billion. To put that number into context, Latin America is now the second fastestgrowing international e-commerce market behind China, where the retailers ranked in Internet Retailer’s 2014 China 500 grew combined 2013 web sales 65% to $73.58 billion. Latin America’s top e-retailers grew faster than e-commerce in the U.S., where online retailing grew 17% to $263.3 billion in 2013 and the U.S. retailers ranked in the 2014 Top 500 Guide grew 16% to $161.95 billion. The Latin America 500 also grew faster than the merchants ranked in the 2014 Europe 500, which increased their combined web sales 17% to $155.23 billion last year.
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