Shop Talk

Retailers, consumers and prices

Check Out Line: Thank you, March


Check out the latest retailer to benefit from the earlier Easter and a mild March.

family dollar storeFamily Dollar’s profit in the quarter that ended in February came in higher than analysts’ anticipated, as the discounter extended hours at its stores and sold more private label goods, which carry better margins.

The retailer is already seeing other benefits this quarter.  Sales at stores open at least a year rose a whopping 11 percent in March, aided by Easter falling earlier in April this year than it did last year.  Some nicer weather also helped, it said.

Family Dollar’s third-quarter and full-year forecasts suggest profits could top analysts’ expectations throughout the remainder of fiscal 2010.

Check Out Line: Look for the (private) label


shop12Check out consumers’ continued taste for private label items.

In the past 12 months, private label’s unit and dollar share of the U.S. market have grown, according to a report by research firm Information Resources Inc. Unit share grew 1.2 points to 22.8 percent, while dollar share inched up 0.7 points to 17.6 percent.

“The popularity of private brands will continue as a result of several factors,” IRI Consulting and Innovation President Thom Blischok said in the statement. “These products offer a very strong value proposition based on quality as well as price. In addition, shoppers will continue their frugal shopping patterns long after the recession ends. And, retailers’ increasingly sophisticated private brand strategies will attract a larger and more diverse shopper base.”

Check Out Line: Frugality still in, but less so now


food1Check out the lower level of planned frugality among consumers.

While 52 percent of consumers making less than $35,000 plan to cut back on dining out, that is down from the 72 percent who had such plans last fall, according to a survey by Information Resources Inc.

IRI found most consumers plan to spend less on summer vacations, cook at home more and eat out less often.

Check Out Line: So, what’s the consumer up to these days?


pepsi.jpgCheck out the latest peeks into consumer behavior.
You know how when there is a huge news event, people stay home to watch it unfold on TV and order pizza?
Well, apparently that doesn’t happen when the major news event is a meltdown in the U.S. financial system.
Domino’s reported a dip in quarterly profit on Tuesday, with U.S. sales down 6.1 percent at restaurants open at least a year.
The credit crunch has also made it harder for the company to open new restaurants, overhaul existing ones and turn over poor performing franchisees, CEO David Brandon said.
Less pizza being sold also means less need to wash it down with Pepsi. PepsiCo missed Wall Street earnings expectations, hurt by disappointing U.S. soft drink sales.
Pepsi trades in brand names, like Cheetos and Tropicana. But brand names are coming under fire from thrifty shoppers seeking private-label products.
Just ask Supervalu. The grocery chain operator also posted lower profit as consumers traded down to lower-cost store brands.
So, to paraphrase John Belushi’s Greek diner owner, “No Coke! No Pepsi! Sam’s Choice.”
Also in the basket:
Thriftiness on special in aisle 5 (N.Y. Times)
Credit crunch raises pressure on U.S. textile industry (WWD, subscription only)
Cadbury cuts more jobs as Q3 sales rise 6 pct

(Reuters photo)