Ecommerce sales sizzle as assortments expand
Walmart said sales of its Global eCommerce business unit grew by 40% during the third quarter as it increased investments, expanded assortments and included results from a Chinese acquisition.
The sales growth of the global ecommerce business was in sharp contrast to the low single digit sales gains of Walmart’s U.S. stores and Sam’s Club divisions and was driven by several key factors. Third quarter sales reflected the acquisition of Chinese Internet retailer Yihaodian and a dramatic expansion of the Walmart.com product offering which more than doubled to five million products. Without the impact of Yihaodian global ecommerce sales grew roughly 20%.
“We’re investing in fulfillment centers, like the facility recently opened in Fort Worth, Texas, to be closer to our customers and to expedite the delivery of their merchandise,” said Wal-Mart Stores, Inc., president and CEO Mike Duke. “We are accelerating the integration of e-commerce with our business segments. I’m really excited about the fantastic growth opportunities that lie ahead of us, as Walmart serves millions of additional customers through our e-commerce sites in 10 countries.”
The heightened level of ecommerce activity this year was originally projected to represent an investment of nine cents a share, according to EVP and treasurer Jeff Davis, but increased expenditures cause the company to boost the figure by a penny.
“Each of our formats is rapidly converging with our digital platforms through the continued development of programs like ship from store, Scan & Go, lockers and more,” said Walmart U.S. president and CEO Bill Simon. “We’re focused on innovative ways to serve the customer, like the grocery delivery test which we recently expanded to Denver. To complement these programs, we’re expanding our endless aisle, giving our customers the ability to shop anytime and anywhere.”
Nordstrom third quarter consistent with full-year outlook
Nordstrom’s third quarter results were consistent with its full-year outlook. Strong direct sales growth and improving trends in the Rack mitigated softer sales trends in full-line stores.
The company’s Anniversary Sale, which is historically its largest sale event of the year, fell in the second quarter this year, rather than in the second and third quarters as it did last year. The estimated impact of this event shift increased earnings per diluted share in the second quarter but reduced them in this quarter by approximately $0.06.
Total third-quarter same-store sales increased 0.1% and net sales totaled $2.8 billion, a 2.9% increase compared with the same period in fiscal 2012.
Nordstrom same-store sales including the full-line and direct businesses decreased 0.7%, compared with last year’s same-store sales increase of 11.2%. Top-performing merchandise categories included cosmetics, women’s apparel, and women’s shoes. Momentum continued in women’s apparel, outperforming the Nordstrom average on a year-to-date basis.
Full-line same-store sales decreased 4.2% compared with last year’s same-store sales increase of 8.1%. The Southwest and Southern California regions were the top-performing geographic areas.
Direct net sales increased 23% in the third quarter, on top of last year’s increase of 38%, driven by expanded merchandise selection and ongoing technology investments to enhance the online experience.
Nordstrom Rack net sales increased $95 million, or 16%, compared with the same period in fiscal 2012, reflecting 20 store openings since the third quarter of fiscal 2012. Nordstrom Rack same-store sales increased 3.7% on top of last year’s same-store sales increase of 8.1%.
HauteLook net sales increased by 22% in the third quarter.
Nordstrom plans to open four new Rack stores and relocate one Rack store during the remainder of fiscal 2013.
Stan Sheetz inducted into Convenience Retailer Hall of Fame
Chairman of Sheetz Convenience Restaurants, Stan Sheetz, has been inducted into the Convenience Store News Hall of Fame in recognition of his accomplishments in the convenience retail industry. The reception and dinner was recently held at the Hershey Country Club in Hershey, Pa.
Sheetz received honors for his contributions to U.S. and international business, and his transformation of the company founded by his father Bob Sheetz, from a convenience store into a chain of more than 460 "convenience restaurants."
"My father’s vision was to open 100 convenience stores and then he retired," Stan said, "The only way to predict the future is to create the future, and that’s what we’re trying to do."
Sheetz served as president and CEO of Sheetz from 1995 until this year. He retired from the position on Oct. 1 and was succeeded by his cousin Joe Sheetz. Under his leadership the company grew from 195 stores to a chain of 466, with annual revenues of $6.6 billion.
Stan is the second member of the Sheetz family to be inducted into the CSNews Hall of Fame, following his uncle Steve, who became a Hall of Famer in 1995.
During his acceptance speech, he recalled how he was drafted into the company by his father and company founder Bob Sheetz. He said the Hall of Fame Award really belongs to his dad because he stepped aside and allowed his son and other family members to take the business to new heights.
Launched in 1987 with the induction of Chester Cadieux of QuikTrip Corp., the CSNews Hall of Fame has recognized convenience store industry pioneers and innovators from retailer and supplier companies of all sizes.