MOBILITY

Momentum 2016: The supply chain goes digital

BY CSA STAFF

The Momentum 2016 conference held by Manhattan Associates May 15-17 in Orlando, Florida offered attendees plenty of insightful sessions and interesting information about how omnichannel commerce is affecting the supply chain.

First, let’s review some data points shared by Brendan Witcher, principal analyst, e-business and channel strategy, Forrester Research:

By 2020, purchases made by mobile phone and tablet will represent 48% of all online sales.

During 2016, 49% of U.S. retail purchases, or $1.68 trillion of $3.4 trillion, will be influenced by or made online.

Seventy-five percent of consumers are more likely to visit a store if inventory is visible online.

Twenty-six percent of consumers, and 33% of millennial consumers, are less likely to visit a store if inventory is not visible online.

Fifty-three percent of consumers expect in-store online pickups to be ready in two hours or less.

Only 19% of consumers think store associates are the best source of product information.

There were also many notable quotes from numerous speakers throughout the conference. Here are some highlights.

“Bed Bath & Beyond has more than 1,000 stores. That means we have 1,000 warehouses and 1,000 returns centers.”

Alex Zelikovsky, VP, omnichannel solutions and supply chain technology, Bed Bath & Beyond

“Sales and conversion don’t reflect the value of most online and mobile touchpoints.”

Brendan Witcher, principal analyst, e-business and channel strategy, Forrester Research

“Supply chain is at the heart of retail. Merchants think they’re king, but they’re not.”

Rachel Mushahwar, head of global retail, hospitality and CPG enabling team for Internet of Things, Intel Corp.

“If I had to do an omnichannel rollout all over again, I would start with store fulfillment and do click and collect first.”

Joe Marotta, VP of supply chain and corporate systems, Michael Kors

“Transformation is more cultural than anything.”

Raj Govindarajan, senior manager, supply chain initiatives, Ulta Beauty

“A sale is a sale is a sale”

Uma Bhemisetty, VP, retail systems The Men’s Wearhouse

“The POS terminal business is terminal”

Eddie Capel, president and CEO, Manhattan Associates

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FINANCE

Lowe’s produces high Q1 profits

BY HBSDealer Staff

In a quarter of strong home improvement demand, Mooresville, North Carolina-based Lowe’s reported net earnings of $884 million for the quarter ended April 29, a 31.4% increase over the same quarter lat year.

Sales for the quarter increased 7.8% to $15.2 billion. Comp-store sales increased 7.3% overall, and increased 7.5% for the U.S. business.

"We executed well in the quarter, growing both transaction and average ticket to achieve comparable sales growth that exceeded our expectations," said Robert A. Niblock, Lowe's chairman, president and CEO. "We continued to focus on providing better omnichannel customer experiences, and saw strength in indoor as well as outdoor categories.”

At the end of the quarter, Lowe’s operated 1,860 home improvement and hardware stores in the U.S., Canada and Mexico.

Earlier this year, Lowe’s announced a deal to acquire Canadian home improvement giant RONA for $2.3 billion.

Lowe’s first-quarter results include an unrealized gain on a foreign currency hedge entered into in advance of the company's pending RONA acquisition, which increased pre-tax earnings for the first quarter by $160 million and diluted earnings per share by $0.11.

Lowe’s report follows by one day the earnings report of rival Home Depot. Lowe’s won by a slim margin the head-to-head comp-store comparison, as Home Depot’s comps were positive 6.5% overall, and positive 7.4% in the U.S.

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News

Home Depot builds Q1 profits, sales

BY CSA STAFF

Comp-store sales for the quarter were up 6.5% – with comps for the U.S. stores up 7.4%.

Net earnings for the three months ended May 1 were $1.8 billion, up 14.2% compared with net earnings of $1.6 billion in the same quarter last year.

"We were pleased with our stronger than expected start to the year, driven by solid execution and broad-based growth across the store," said Menear. He added that the quarter was marked by "week-to-week demand spikes caused by weather variability."

Also on Tuesday morning, the Atlanta-based retail giant raised its guidance. It now expects sales to grow 6.3% in fiscal 2016, and it expects comps to grow 4.9%.

At the end of the quarter, Home Depot operated 2,275 stores.

Other first-quarter data reported by the world's largest home improvement retailer:

• Number of customer transactions: 374.8 million, up 4.1%;

• Average ticket: $60.03, up 2.4%; and

• Sales per square foot: $376.73, up 6.5%.

The three data points above do not include results from the acquisition of Interline, completed in the third quarter of 2015.

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