FINANCE

Amazon’s Bezos buys Washington Post

BY Dan Berthiaume

Seattle – Amazon.com founder and CEO Jeff Bezos is purchasing The Washington Post from media holdings firm The Washington Post. Co. for $250 million in cash. He is making the purchase privately and Amazon.com is not involved in the transaction. Bezos will reportedly take the currently public Washington Post private.

An article about the purchase in The Washington Post quoted Bezos as saying he was entering uncharted terrain that will require experimentation, but does not plan to change the paper’s core values or dedication to its readers.

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FINANCE

OfficeMax has down Q2; predicts tough road ahead

BY Dan Berthiaume

Naperville, Ill. – OfficeMax had a dismal second quarter of 2013, swinging to a big quarterly loss and experiencing declining total and same-store sales.

The office supply retailer reported a loss of $10 million, compared with a profit of $10.7 million in the year-ago period. Total sales dropped 4.3% to $1.53 billion, compared to $1.6 billion in the second quarter of the prior year. Same-store sales declined 3.6%. OfficeMax said the same-store sales dropped primarily due to decreased traffic and lower technology product category sales.

Based on the current environment, OfficeMax anticipates that total company sales for the third quarter and full fiscal year 2013 will be lower than the third quarter and full fiscal year 2012, including the projected unfavorable impact of foreign currency translation.

In two bright spots, OfficeMax.com reported double-digit year-over-year sales growth and the retailer said its upcoming merger with Office Depot is proceeding as planned. Ravi Saligram, president and CEO of OfficeMax, tried to stike a positive tone in his public comments.

"Sales declined in the second quarter, which impacted profitability compared to the prior year period,” said Saligram. “We continue to implement cost reduction measures to align our expenses with our revenue base and expect second-half profit performance to improve versus the first half. Further, we’re pleased to have received additional cash proceeds from our Boise investment in July, bolstering our strong balance sheet. In spite of secular challenges and an uneven economic recovery, we remain committed to restoring sales growth by evolving our business model to focus more on services, innovating new products and categories, growing our adjacencies, and building our omni-channel capabilities.”

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OPERATIONS

Amazon.com tops Temkin Web Experience Ratings

BY Dan Berthiaume

Waban, Mass. – Amazon.com was the top-ranked company across 19 industries in the 2013 Web Experience Ratings from Temkin Group. Amazon.com had a score of 77%, almost 21 percentage points higher than the retail industry average.

Other retailers in the top 10 included eBay, tied for fifth place at 70%, and QVC, tied for eighth place at 69%. Taco Bell and Kmart earned ratings that were at least 15 points below the retail industry average. Old Navy was the only retailer to have a double-digit score increase from last year.

According to Temkin Group, the ratings expose an overall poor state of web experiences. Only 6% of companies earned "strong" or "very strong" ratings, while 63% earned "weak" or "very weak" ratings. The research also shows that web experiences aren’t improving. More than half of the companies that were in the 2012 and 2013 ratings earned lower scores this year.

"The web is a key channel, but online experiences aren’t very good and are heading in the wrong direction," said Bruce Temkin, managing partner of Temkin Group.

The Temkin Web Experience Ratings are based on consumer feedback on companies with which Temkin Group survey respondents have recently interacted. Consumers are asked how much they trust those firms.

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