Tesco returns to neglected retail basics 18 Nov 2016 The UK supermarket will plough most of its planned cost savings into shielding consumers from inflation, effectively continuing a price war. Yet Tesco also says it can double its operating margin. That hinges in part on a tricky strategy: persuading shoppers to buy pricier goods.
Target’s bull’s-eye will be hard to repeat 16 Nov 2016 After a rough summer, the $43 bln U.S. retailer notched an impressive jump in online sales and raised its 2016 profit forecast. Even so, Target needs more people in its stores over the holidays. Shopper habits are changing quickly and Amazon will keep flexing its muscles.
Amazon lends Morrisons scale, at a price 16 Nov 2016 The UK supermarket is extending its tie-up with Amazon, boosting its online sales. The deal isn't without risk for the grocer: Amazon is much bigger than it, and will have discretion over pricing. That's the price Morrisons pays for being slower than rivals to move online.
Alibaba digs itself deeper into a data hole 11 Nov 2016 The Chinese group wants the market to focus less on the sales handled by its websites and more on actual revenue. But it also boasts about doing $5 bln of business in the first hour of Singles' Day, the Chinese answer to Black Friday. The mixed message is confusing for investors.
Merger medicine fails to cure CVS Health 8 Nov 2016 The $80 bln drugstore chain warned that profit growth would slow down. Fewer customers and the loss of a couple big contracts were factors. Industry-wide pricing pressure adds to the challenge. Two big deals last year worth a combined $14 bln may be causing bad side effects.
M&S wisely turns to selective deglobalisation 8 Nov 2016 The UK clothing retailer will shut loss-making foreign stores, even in places like China where overall retail sales are still growing. It will keep stores where it has scale, or where the investment is done by others. The strategy sounds obvious. In retail it’s quite a novelty.
Richemont earns reprieve from negative watch 4 Nov 2016 The Cartier owner's first half was less alarming than it had warned. Shedding executives and stores should bring greater focus in an era of faltering watch sales. It all lends weight to a sum of the parts analysis that implies the Swiss luxury group is undervalued.
Whole Foods founder may have to break his own mold 3 Nov 2016 John Mackey is becoming sole boss, ending a rough six-year run for the $9 bln grocer under a co-CEO structure. Sales have been falling amid stiff competition. Starbucks and Apple proved an entrepreneur's zeal can revive a company, but Whole Foods could use radical rethinking.
Alibaba’s big data ambitions become an easier sell 2 Nov 2016 Cloud, media and things other than online retail now make up almost a fifth of the e-commerce giant's total revenue. Alibaba's shift from being a shopping platform to a data and content firm is still a work in progress, but boss Jack Ma's vision is looking increasingly plausible.
Chipotle’s latest activists may bring secret sauce 1 Nov 2016 Investors want the ailing burrito chain to split the chairman and CEO roles and appoint an independent to run the board. Freebies and a new burger chain failed to shake off the taint of its food-safety scandal. Overhauling Chipotle's governance may provide the right ingredient.
Amazon is trying to deliver everything to everyone 26 Oct 2016 The near $400 bln internet giant's efforts in gadget production, online video, shipping logistics and even bricks-and-mortar stores may smack of hubris. But there's a method to the ambition. Feedback loops mean it may be easier for Amazon to crack multiple markets at once.
Under Armour succumbs to all-powerful fads 25 Oct 2016 The $13 bln athletic-wear maker's shares tumbled after it warned of slowing U.S. growth and are now down 60 pct this year. Rivals from Lululemon to Nike to Gap give consumers a dizzying array of similar choices. Under Armour is learning the hard way about fashion's fickle ways.
Gucci’s owner develops taste for C-suite churn 25 Oct 2016 A fresh designer and CEO have worked magic at Gucci. Third-quarter sales at the label that makes the bulk of Kering’s operating profit grew 17 pct. Yet having hired four new chiefs and parted with two creative heads in 10 months, the French group risks overworking the formula.
Coach tie-up with Burberry is too fashion forward 21 Oct 2016 Shares in the $7.9 billion British label rose after a report the U.S. bagmaker might bid. The two could go together nicely. As befits a luxury brand, though, there’s no bargain here. Even with synergies, Coach would have to pay prices that would make a fashionista blush.
Philip Green is an advert for deferred knighthoods 20 Oct 2016 British MPs voted to strip the rag-trade billionaire of his title. Yet despite the collapse of retail chain BHS, Green hasn’t done anything the law didn’t allow. Such unpleasantries might be more easily avoided if knighthoods were treated more like executive bonuses.
Nestle rubs up against limit of consumer demand 20 Oct 2016 The coffee-to-chocolate maker cut its forecast as quarterly sales disappointed. Rivals face similar problems. With little volume growth, niche units like Nestle’s venture capital division will become more important, and pricing tussles with retailers more frequent.
Web-shy Germany has an edge in grocery wars 19 Oct 2016 Europe's three key food markets are challenged. Carrefour reported 0.1 pct nine-month sales growth in France, while profit margins have halved for UK grocers in five years. For now, the unique structure of Germany's grocery sector, and its qualms about online, provide a buffer.
Inflation shows up at wrong time for Mark Carney 18 Oct 2016 UK consumer prices are rising at their fastest pace in nearly two years. It should be a proud moment for the Bank of England chief, who has been struggling to achieve exactly this. Unfortunately, the pound’s fall is going to give him a bit too much of what he wanted.
Burberry shares priced a size too big 18 Oct 2016 The UK luxury label said sales in its home market grew over 30 percent as tourists cashed in on the weak pound. Demand in the U.S. is deteriorating, however. Burberry is tackling its problems head on, but there are few green shoots yet to justify a recent rally in the shares.
British retailers have leverage over Unilever 13 Oct 2016 The maker of Dove soap wants supermarkets like Tesco to pay more for its goods as the pound weakens. They can’t easily pass that cost on to shoppers. Grocers have two reasons to play tough: Unilever's 15 pct operating margin, and their access to the consumer.