A Good Start
Both Lowe’s and The Home Depot released their first quarter earnings this week and both retailers are off to a really good start in 2016.
Lowe’s reported that its sales for comparable stores in the United States increased 7.5 percent over last year, while The Home Depot said its comp sales for the first quarter were up 7.4 percent.
The Home Depot reported sales of $22.8 billion for the first quarter and Lowe’s said its sales increased to $15.2 billion from $14.1 billion in the first quarter of 2015.
“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 omni-channel customer experiences, and saw strength in indoor as well as outdoor categories.”
Craig Menear, Depot’s chairman, CEO and president said, “We were pleased with our stronger than expected start to the year, driven by solid execution and broad-based growth across the store.”
He said the first quarter performance could, in part, be attributed to the company’s associates and their dedication to customer service “in a quarter marked by week-to-week demand spikes caused by weather variability.”
According to analysts, both home improvement retailers are benefiting from the fact that consumers are investing more money in their existing homes, patios and yards as the housing market continues its recovery and home prices continue to rise.
It will be interesting to see how Lowe’s and The Home Depot perform in the second quarter. This quarter is really the crunch time in the garden centers for both companies so I am curious to find out how lawn and garden sales (as well as a cooperative Mother Nature) will impact the numbers for this quarter.
Whole Foods to Add More 365 Stores
Whole Foods will open its first 365 store this month in Los Angeles, followed by two additional stores later this summer in Oregon and Washington. And now the company has announced it plans to open six more of its smaller, more streamlined 365 stores. Whole Foods has signed leases to open the new stores in Decatur, Georgia; North Hollywood and Long Beach, California; Bloomington, Indiana; and Akron and Toledo, Ohio. The company could add as many as 10 new stores by the end of 2017.
Wal-Mart Introduces E-Commerce Subscription Program
In an effort to compete with Amazon.com’s Prime service, Wal-Mart will begin offering a new e-commerce subscription program. Wal-Mart’s ShippingPass program will offer two-day delivery to consumers and is highly discounting the service’s introductory price to entice new customers. While still in its pilot phase, subscribers to the program will receive free delivery of more than 1 million products. Wal-Mart will use “a unique fulfillment network” made up of its stores and distribution centers to help deliver the online orders.
Lowe’s Gets the OK to Buy Canadian Retailer
Last week, Lowe’s Inc. received approval from Canadian regulators to purchase the Rona chain stores in Canada. The No. 2 home improvement retailer announced its plans to acquire its Canadian rival back in February. The deal is expected to close some time this month. Lowe’s currently has more than 40 stores in Canada. With the Rona acquisition, it will add 500 corporate and independent stores and nine distribution centers.
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