DayBreaker

Barnes & Noble sees smaller stores, more books in its future

BY Marianne Wilson

In the wake of a wider quarterly loss than expected and a continuing sales slide, Barnes & Noble plans to a greater emphasis on what brought it the party in the first place: books.

Barnes & Noble’s sales in the second quarter fell 7.9% to $791.1 million. Same-store sales decreased 6.3%. But book sales are on the rise, the company said.

“Book sales continued to strengthen, and we saw improved traffic and conversion trends,” said Demos Parneros, CEO of Barnes & Noble. “As a result of the improving trends, we will continue to place a greater emphasis on books, while further narrowing our non-book assortment.”

Barnes & Noble has added more toys and games to its assortment. But its efforts have been met with falling sales. Its e-book business has also stalled.

Along with a renewed focus on books, the retailer is looking is smaller stores. Barnes & Noble stores average approximately 26,000 sq. ft. But its new store, in Plano, Texas, is less than half that, about 10,000 sq.ft.

“Our goal is to get smaller,” Parneros told analysts on the chain’s quarterly call. “We want to have smaller stores that are more efficient.”

The struggling retailer posted a consolidated second quarter net loss of $30.1 million, or $0.41 per share, compared to a loss of $20.4 million, or $0.29 per share, in the year-ago period. Analysts had expected a loss of 26 cents per share with approximately half of this decline attributable to last year’s release of Harry Potter and The Cursed Child, the company said, with the balance primarily due to non-book categories. It was Barnes & Noble’s 14th straight quarter of revenue decline.

“Comparable sales improved throughout the second quarter and into November,” For fiscal 2018, the company expects comparable sales to decline in the low single digits and full year consolidated EBITDA to be approximately $180 million. It expects comparable store sales to be approximately flat for the balance of the fiscal year. Additionally, it plans to reduce costs by $40 million for the full fiscal year.

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Earns Kohls
DayBreaker

Analyst: Kohl’s leads department stores over holiday weekend

BY Marianne Wilson

Roughly 65% of consumers made a purchase (online/store) this year over the Thanksgiving holiday weekend, with 15% incremental uplift versus last year and a weighted average spend of $420.

“In terms of winners by retail sub-sector, we were able to analyze responses by both in-store traffic and digital results and, when combined, winners include Walmart, Kohl’s, Amazon and Dollar Tree,” said Gordon Haskett Research Advisors analyst Chuck Grom.

In a note, Haskett said that, after surveying consumers, “we walked away from the start to the holiday shopping season more bullish than we had anticipated.” He added that approximately 53% of consumers stated they spent more or much more than last year – “much higher than we had expected,” with apparel the top category (66% hit rate) followed by consumer electronics (54%), toys (41%), and home décor (37%).

According to Gordon Haskett’s survey data, Kohl’s (55.6%) led all department stores in Black Friday weekend, both online and in store, with J.C. Penney (54%) close on its heels. Moving down the list of highest traffic in descending order: Macy’s (52.2%); Sears (45.0%); Nordstrom (39.9%); Dillard’s (35.5%); Bloomingdales (35.3%); Saks Fifth Avenue (32.5%); and Neiman Marcus (32.3%).

“Interestingly, on average, the group drew 24.8% online traffic, slightly less than the 28.3% in-store traffic,” Grom said.

The leaders in digital traffic among the department stores were J.C. Penney (32.3%), followed by Kohl’s and Macy’s at 30.1% each. Rounding out the group were: Sears (29.1%); Nordstrom (26.3%); Bloomingdales (26.3%); Neiman Marcus (17.5%); Saks Fifth Avenue (17.3%) and Dillard’s (14.2%).

Other finding from Gordon Haskett (based on its survey data) include:
* Walmart garnered more consumer traffic than Target when we measured online, in-store and total traffic. Approximately 76.5% of respondents said they made a purchase at Walmart, on Walmart.com. or both, versus 61.6% at Target.

* Walmart (when combined with Jet.com) is not only a powerhouse among discount retailers, but in close competition with Amazon when measuring online traffic only. To this end, approximately 57% of respondents indicated they made a purchase from Walmart.com (or Jet.com), about 12 percentage points below Amazon. While we admit, the gap is still wide, it’s important to note that the next most often cited online retailer on Black Friday Weekend was Target.com at roughly 35%.

*Stores remain the most popular means to shop on Black Friday Weekend, with 48.2% respondents doing more of their shopping in-store versus online, 14.9% split evenly between the two channels, and 36.9% tilted more towards online.

•Apparel was the most purchased category with 66.3% of respondents purchasing at least one apparel item, followed by electronics (54.0%), and toys (40.8%). Also, 15.7% of respondents purchased an iPhone this weekend.

*In the extreme value category, Dollar Tree (46.6%) and Dollar General (46.0%) were the winners.

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DayBreaker

Happy Thanksgiving from Chain Store Age

BY CSA STAFF

The offices of Chain Store Age will be closed Thursday and Friday for Thanksgiving. DayBreaker will not be published on Thursday. We wish you a wonderful holiday!

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