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Going Green

BY Marianne Wilson

There is no getting around it: Green is everywhere these days (including at

Indeed, the green movement has permeated the retail industry to the extent that there is a new phrase being tossed around: green IQ. It’s a catchall for how savvy a retailer is when it comes to sustainability. Retailers with high green IQs have no trouble when it comes to discussing such matters as carbon footprints, greenhouse-gas emissions, renewable energy and LEED (if you don’t know what that last one is, your green IQ is definitely under par).

A new survey from RSR Research, “What Can Green Do For You?,” sponsored by DigiPOS Store Solutions and IBM, reveals the extent of the green revolution in retail. An impressive 44% of the respondents said that green practices are now a strategic initiative in their company.

The survey found that the most valid near-term opportunities for retailers to enhance their bottom line via sustainability exist in three areas: within the supply chain, in stores, and in packaging improvements and reductions.

Sixty percent of respondents identified soaring oil and transportation costs as the No. 1 cost-related reason to become more environmentally conscious. Packaging/material costs (54%) and energy consumption at the store level (53%) weren’t far behind.

As to the green technologies retailers are most willing to invest in, those that reduce store-based energy costs ranked highest (47%), followed by technologies that limit supply chain energy costs (22%). That’s not surprising. The American Gas Association predicts a 4.5% annual increase in energy prices for the next four to eight years. That type of year-to-year jump can be damaging to a retailer’s bottom line, particularly at a time when consumers are cutting back on spending.

The report (available for download at www.retailsystemsresearch.com ) contains a number of recommendations for retailers, including:

*Store up: Mitigate the amount of energy consumed in the store and the supply chain. As the report notes, reduced consumption makes good sense for ethical and bottom-line reasons. It urges that retailers conduct a simple energy profile of their existing facilities as a first step;

*Announce your initiatives: Retailers should spread the word by branding and labeling every green device, tool and initiative they make; and

*Package better: Requiring the lowest amount of tech infrastructure, efforts to minimize packaging materials not only reduce the amount of landfill created, but also significantly minimize carbon emissions. At the same time, reduced packaging offers one of the best short-term opportunities for cost-reduction across the chain.

Finally, the survey notes the single greatest driving factor in adopting environmentally responsible factors: a proactive corporate culture. Like so many other things, green has to start at the top.

It’s not too late to register for Chain Store Age’s inaugural Green 4 Retail (G4R) Conference, June 18-19, at the Hilton O’Hare in Chicago. The agenda will explore real-life solutions and cutting-edge strategies with regard to sustainability in retail design, construction and facilities management. For information, visit  www.greenforretail.com.

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Michaels comps down for the quarter

BY CSA STAFF

IRVING, Texas Michaels Stores reported that total sales for the quarter were $847 million, a 1% increase from fiscal 2007 first quarter sales of $839 million. Same-store sales for the comparable 13-week period decreased 2.9%.

Ceo, Brian Cornell, said, “While our overall comps for the first quarter declined 2.9%, we were very encouraged with the sales of our kids and specialty craft categories, scrapbooking and frame and art supplies. Sales in April showed a reversal of trend with same-store sales up 3.1% on a strong increase in transactions. This positive sales and transaction performance gives us confidence that our new marketing and merchandising programs are connecting with our Michaels customers.”

For fiscal 2008, the company expects same-store sales growth  to be approximately flat given the current economic environment.

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Kirkland’s 1Q sales up 2.1%

BY CSA STAFF

JACKSON, Tenn. Kirkland’s reported that net sales for the first quarter ended May 3 increased 2.1% to $84.1 million from $82.3 million for the first quarter ended May 5, 2007. Comparable-store sales for the first quarter of fiscal 2008 increased 4.3% compared with an 18.8% comparable-stores sales decrease in the first quarter of fiscal 2007.

The company reported a net loss of $2.6 million, or 13 cents per diluted share, for the 13-week period ended May 3, 2008, compared with a net loss of $7.5 million, or 38 cents per diluted share, in the 13-week period ended May 5, 2007.

Robert Alderson, Kirkland’s president and ceo, said, “The first quarter results reflect strong merchandising execution and the benefits of aggressive financial initiatives that have reduced our operating costs, improved cash flow and strengthened our liquidity. During the quarter, we experienced improved customer conversions as shoppers have reacted very favorably to our merchandise mix. The positive comparable-store sales and trimming of unproductive stores led to leveraging of occupancy and distribution costs. Combined with an improvement in merchandise margin and a year-over-year reduction in operating costs of almost $5 million, we were able to post a significant improvement in our pre-tax results.

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