Shop Talk

Retailers, consumers and prices

Check Out Line: Tussle over toys as holiday season nears


sears1Check out the latest news on the fight for a piece of toy market.

U.S. retailer Sears plans to launch 85 toy shops in select markets next month as it angles for a bigger bite of the holiday sales pie, a senior executive told Reuters. Specialty retailer Toys R Us previously announced plans to open about 600 temporary stores and 10 FAO Schwarz “pop-up” stores this year. 

The move from the operator of Sears department stores and the Kmart discount chain comes as competition heats up in the toy market ahead of the crucial selling season.

“We have a very aggressive plan for growing our toy business,” Julia Fitzgerald, chief marketing officer for Sears’ toy business said in an interview ahead of an event marking the launch of Kmart’s top toy picks for the holidays.

The decision came after many customers showed interest to shop for toys in convenient locations such as malls, during a pilot program in 20 department stores last year. 

Check Out Line: Consumers spending again?


GERMANY/Check Out home-related retailers Sears Holdings and Williams-Sonoma reporting better-than-expected quarterly results. Does this mean consumers are feathering their nests again?

Somewhat, according to Barclays analyst Michael Lasser, who said Williams-Sonoma’s results were “an indication that upper-income consumers are spending a bit more, which is not surprising given the rally in the stock market and the stabilization in the housing market.”

How about some lipstick to go with that lawn mower?


shld1Sears, the low-priced retailer known for its selection of Craftsman tools and kitchen appliances, is jumping on the beauty bandwagon.

The retailer is debuting beauty departments  — called Sears Beauty — in 13 mall locations in Chicago, Los Angeles and New York.

Some retailers hope for Christmas magic


Santa’s not getting any rest this year.

After U.S. retailers posted the longest running decline in same-store sales in nearly a decade, Sears, Kmart and Toys R Us announced Christmas-themed sales for the month of July.  While actual sale dates and locations vary among the three chains, the event has drawn a lot of attention from news media, which had the once-in-a-year joy of headlining a story with “Christmas in July.”

Not to be outdone, Disney has sent a train to 36 states around the country to promote its new animated film “A Christmas Carol,” slated for release this November.  Yes, November.

Check Out Line: What’s in a name?


Check out the “What you talkin’ ’bout Willis Tower.” 

As of today, the Sears Tower will be no more, at least in the minds of the executives at the British insurance broker that now has the naming rights for the building.
On Thursday, the signs on the erstwhile Sears Tower will read Willis Tower instead, changing the name of what was once the tallest building in the world.
Sears the retailer left the tower for a new headquarters in 1991. But the Sears Tower, once the world’s tallest building, arguably remained more prominent than the retailer, which has lost ground to retailers like Home Depot and Wal-Mart.
“To Chicagoans this is not just a commercial building. It is a monument to who we are and the kind of city we live in,” Chicago History Museum curator John Russick said.
So while the signs say “Willis Tower,” the lips in Chicago are likely to keep saying “Sears Tower” for a long, long time.
Also in the basket:
CIT talks fall apart, bankruptcy looms
Electrolux cautious despite Q2 profit
Kellwood options limited if it doesn’t repay debt

Check Out Line: Buying basics buoys big chains


Check out the ten largest U.S. retailers.

The National Retail Federation’s STORES magazine is out with its annual ranking of the top 100 retailers.

wal-mart-meat-shoppersThe list shows that U.S. consumers have been focused on bargains and basic necessities, such as food and medicine.  Wal-Mart tops the lineup, followed by Kroger and CostcoHome Depot fell from No. 2 in 2007 to the fourth spot in 2008 as many shoppers decided to cut back on costly home-improvement projects.

Check Out Line: Sears surprise


USA/Check out the surprising profit at Sears.
Yes, that’s right – Sears. The department store operator that also owns Kmart. The holding company controlled by hedge fund manager Edward Lampert that was supposed to be a real estate play, before the real estate market tanked.
Well, Sears surprised analysts with a first-quarter profit. Margins improved and Kmart same-store sales only fell 2.1 percent, less than the 3.7 percent decline posted by rival discounter Target. (Though that was helped by Kmart including a footwear business that it had leased in the past.)
So the stock is trading at about $60 Friday. Is that too pricey?
Credit Suisse analyst Gary Balter thinks it is.
“The stock is not cheap even if one assumes that results can be sustained, and the continued loss of market share should gradually catch up to margins,” Balter said in a research note.
Still, given the sentiment on Sears’ retail operations just a year or so ago, Balter does give Lampert props for improving performance and driving improved margins through better inventory management and sourcing.
“The investment question for the name should no longer be will Sears make it, a line of thinking that we have not subscribed to due to strong cash flow and quality balance sheet, but what is the proper value for stock?” Balter wrote.
For some investors, just thinking in those terms is a positive sign for Sears.
Also in the basket:
LED pumps life into flat-screen TV market
Gap, Aeropostale, PacSun top expectations
Axe body products puts its brand on Hamptons club scene (N.Y. Times)
Recession turns malls into ghost towns (Wall Street Journal)

(Reuters photo)

For Father’s Day, suit shows greener side of Sears


Sears Covington Perfect suitHey guys, this isn’t your pop’s polyester.

Just in time for Father’s Day shopping, Sears will roll out a line of men’s suits made of the first high-tech fabric that blends wool with polyester spun from recycled plastic soda bottles.

The suit separates, sold under Sears’ Covington Perfect brand, will be on racks in about 500 U.S. Sears stores in May.  Price: $175 for the jacket and $75 for the pants, according to Tim Danser, vice president of marketing for Bagir Group Ltd., the Israeli manufacturer that tailors the garments for Sears’ private label.

Check Out Line: Happy over Sears


searsCheck out Sears results

Sears Holdings beat Wall Street expectations when it reported earnings this morning, helped by cost cuts, and the market sang its praises by sending shares up 8 percent. The streamlining isn’t over either, as the company controlled by Eddie Lampert announced plans to shutter another 24 stores.

We’re wondering about the exuberance of the market’s response, since the results still show marked same-store sales declines for the company’s Kmart and Sears, Roebuck stores and questions remain about whether the company can pull off a real turnaround in the future.

Appliances get Black Friday boost


The beaten-down appliance sector got a shot in the arm on Black Friday as many consumers bought new washers for their laundry rooms, one spot survey shows.

Appliance sales, especially of washing machines and dryers, were up significantly over Thanksgiving weekend as shoppers responded to discounts, said David MacGregor, an analyst with Longbow Research.