MADDOG'S LAIR
  • Blog
  • About
  • Contact

While Walmart and many other brick and mortar businesses are taking note of Amazon . . . 

5/13/2016

Comments

 
Retail Slump Shows Amazon Effect

. . . others are not. Retail is accelerating towards a new paradigm, there is no rest for the weary here.

Read more below the fold.
The old line stores overlook Amazon, Walmart, and the others at their peril.

"Department stores are in a funk and executives at some of the country’s biggest chains are struggling to explain why consumers aren’t spending more time and money in their stores.

But analysts have a familiar culprit: Amazon.com Inc."

There are no protected markets any longer. Amazon, Walmart, and many more are changing their business models slightly to creep into ever more diverse markets. 

"Analysts, however, argue that Amazon, which has made an aggressive push into apparel and fashion, is starting to take significant market share from traditional department stores. In a research note Thursday, Morgan Stanley analysts estimated that Amazon already accounts for about 7% of the overall U.S. apparel market and will reach 19% by 2020. By their estimates, the online superstore is already selling more apparel than all U.S. retailers but the biggest, Wal-Mart Stores Inc."

This is not limited to Amazon, and the bloodletting will only worsen with time. These are moribund businesses mostly because the model is old, and stodgy. In addition, we saw a huge amount of low cost capital and debt enter the system over the past decade or so, and the "mall" model has become saturated. So much so, that it has depressed the productivity numbers in the US economy. This model needs a serious correction, and it will likely take a 15-20% reduction to create the necessary level of correction. 

The stores which see this and act early will likely remain successful, the ones who wait may not. The new model also requires these old brick and mortar "mall" stores to increasingly expand online sales, and begin to, or expand competition in the low cost/fast shipping market. Amazon may have created this market, but others like Walmart are now beginning to hammer it home. This is now a necessity, not a luxury in retail. 

"For the first quarter ended April 30, Kohl’s reported a profit of $17 million, down from $127 million a year earlier. Sales fell 3.7% to $3.97 billion, while sales at Kohl’s stores open for at least a year declined 3.9%.

Nordstrom’s earnings for the same period were $46 million, compared with $128 million a year earlier. Total sales rose 2.5% to $3.2 billion, but sales excluding newly opened or closed stores fell 1.7%.

As traditional retailers have struggled, chains that sell name brands at discount prices have been gaining share. Sales at Nordstrom Rack stores, the company’s off-price chain, open for at least a year rose 4.6% in the period, but much of that growth came from orders placed online.

Ralph Lauren Corp., which sells much of its clothes at department stores, reported Thursday that its profit plunged 67% in its latest quarter and revenue fell 1% to $1.9 billion."

The race is always to the swift. But it appears that these runners missed the starting gun.
Comments
comments powered by Disqus

    Author

    Maddog

      Blog Subscription

    Subscribe to Blog

    Archives

    August 2020
    July 2020
    June 2020
    May 2020
    April 2020
    March 2020
    February 2020
    January 2020
    December 2019
    November 2019
    October 2019
    September 2019
    August 2019
    July 2019
    June 2019
    May 2019
    April 2019
    March 2019
    February 2019
    January 2019
    December 2018
    November 2018
    October 2018
    September 2018
    August 2018
    July 2018
    June 2018
    May 2018
    April 2018
    March 2018
    February 2018
    January 2018
    December 2017
    November 2017
    October 2017
    September 2017
    August 2017
    July 2017
    June 2017
    May 2017
    April 2017
    March 2017
    February 2017
    January 2017
    December 2016
    November 2016
    October 2016
    September 2016
    August 2016
    July 2016
    June 2016
    May 2016
    April 2016
    March 2016
    February 2016

    Categories

    All
    1000-ways-to-die
    Abortion
    Amazon
    America
    Antisemitism
    Anti-semitism
    Bible
    Blogging
    Blue-model
    Book-links
    Booze
    Bus
    Cancer
    Children
    China
    China-ccp
    China-gdp
    China-ghost-cities
    China-ponzi
    Climate-change
    Coast-guardrescue-swimmer
    Cold-war
    Concealed-carry
    Constitution
    Cool-stuff
    Corruption
    Creative-destruction
    Crime
    Crisis-change
    Dead-guy-vote
    Dead-pool
    Death-of-the-pc
    Declaration-of-independence
    Deflation
    Democrat
    Demographic-decline
    Diet
    Earth-hour
    Ecommerce
    E-commerce
    Economic-change
    Economy
    Education
    End-of-history
    Energy
    Environmentalism
    Epa
    Eric-barker
    Europe
    Executive-outcomes
    F35
    Faith
    Family
    Fascists
    Financial-irresponsibility
    Financial-times
    Firearms
    First-world-problems
    Fitness
    Flight-to-security
    Food
    Fourth-turning
    Free-eye-exam
    French
    Funny
    Gdp
    Gdp-usa-vs-britain
    Gdp-usa-vs-germany
    Gdp-usa-vs-sweden
    Generational-theft
    Global-warming
    Government-incompetence
    Government-we-deserve
    Happiness
    Health
    Helicopter-parent
    Hell
    Holocene
    Honor
    Housing-affordability
    I-love-beaver
    Imf
    Immigration
    Independence-day
    Inefficiency
    Inflation
    Innovation
    Intelligence
    Intergenerational-conflict
    International-relations
    Investing
    Iran
    Iraq-war
    Islamic-reformation
    Italian-travel
    Japan
    Jodie-foster-effect
    Kayaking
    Keynesian-economist
    Kurdistan
    Law
    Leave-nato
    Leave-the-un
    Light-rail
    Maddog-story
    Marine
    Marriage
    Media
    Medical-insurance
    Medicine
    Middle-east
    Military
    Military-waste
    Money
    Monopoly
    Nanny-college
    News
    New-seasons
    Nirvana-is-another-name-for-hell
    North-korea
    Nukes
    Obama-doctrine
    Oil
    Oregon
    Organic
    Parenting
    Partition
    Pearl
    Pensions
    Peter-principle
    Police
    Politicians
    Portland
    Portlandia
    Portland-transit
    Predictions
    President-bush
    President-feckless-odither
    President-obama
    Psychology
    Race-huckster
    Rape
    Recession
    Recipe
    Replace-the-un
    Republican
    Research-studies-are-always-wrong
    Reviews
    Russia
    Salafism
    Sanctions
    Science
    Science-versus-faith
    Self-defense
    Self-drive-vehicle
    Sex
    Shale-oil
    Shia
    Sjw
    Sleeper
    Smart-growth
    Socialism
    Sovereignty
    Sport
    Sunni
    Supreme-court
    Syria
    Tax
    Technology
    Terrorism
    The-fed
    The-house-of-saud
    The-last-economic-superpower
    Therapy
    Trade
    Transit
    True-believer
    Tvfilm-review
    Un
    Union
    Urban-planning
    Urinals-of-note
    Venezuela
    Voter-fraud
    Wages
    Wahhabism
    War
    War-crimes
    Weird
    Weird-science
    Welfare
    Whole-foods
    Work



    RSS Feed

​Maddog's Lair is copyright 2016-2018 by Mark Sherman. Please feel free to quote from this site provided you link back to the original article.
Proudly powered by Weebly
  • Blog
  • About
  • Contact