Retail Sales Fall 0.3% in May
Retail sales fell 0.3% in May and April sales were revised down to a 0.7% increase from the 0.9% first reported. It was the first decline in five months and below expectations. Analysts blame surging inflation for necessities such as gas and food for consumers reining in discretionary spending. The national average price at the pump reached more than $5.00 per gallon, up from $4.45 in April and more than $2, or 60%, from May 2021. May sales fell in nearly half of the categories on a monthly basis but were up year over year in eight out of nine categories, led by building materials and supplies, up 0.2% for the month and 8.8% year over year. Online sales fell 1% for the month as consumers returned to shopping in stores but were up 8.5% year over year. Core retail sales rose 1.0% in April and core sales for March were revised up to a 1.1% increase from the initial 0.1% decline reported. Core retail sales correspond most closely with the consumer spending component of GDP.
The Home Depot
THD is moving veteran CIO Matt Carey into a newly created role dedicated to customer experience technology. THD was one of a group of companies that benefited from demand created by the pandemic and introduced many innovations aimed at improving the customer experience. THD says the new role reaffirms their commitment to make shopping at THD a truly interconnected, easy experience for their customers. Fahim Siddiqui will be stepping in as CIO; he’s been the company’s senior vice president of information technology since 2018. Both positions will report to new CEO Ted Decker.
THD launched Home Depot Ventures, a $150 million fund that will invest in companies that advance THD’s ability to provide an interconnected shopping experience and develop new and differentiated capabilities.
THD introduced StyleWell Kids, a collection of 65 home décor items for children, including bedding and shower curtains. The announcement came a day after the launch of a Gap Kids collection at Walmart.
THD passed out 15,000 Kids Workshop Birdhouse Kits to children attending the annual White House Easter EGGucation Roll. Kids Workshops have been going on at THD stores since 1997, but since the pandemic THD has offered kits and video instruction so that children could continue building at home.
THD partnered with Klein Tools to celebrate and support high school, college level and post-secondary students entering the skilled trades industry. The Home Depot Foundations Path to Pro program offers free education, hands-on training and certifications for youth, military service members and underserved communities. Today more than 15,000 participants have been introduced to the skilled trades with more than 5,000 becoming certified.
Lowe’s plans to open their new technology hub in Charlotte sometime this summer. Lowe’s previously said they planned to invest $153 million and staff the hub with more than 2,000 tech employees. They have already hired more than 1,200 people and are still actively hiring. Some will work at the hub full-time while others will have hybrid schedules.
Walmart will soon unveil four next-generation fulfillment centers that will allow them to provide fast shipping for 75% of the US. The first center will open this summer in Joliet, Illinois. The massive FCs will combine people, robotics and machine learning to set new standards for speed of fulfilment while creating a positive work environment for associates. The new centers will employ more than 4,000 workers. WM already has 31 ecommerce fulfillment centers. The new ones feature technology from intelligent-fulfillment firm Knapp, which utilizes robotics and artificial intelligences for logistics. The centers will use a patent-pending process for receiving and unloading cases that is highly automated and makes maximum use of space.
Ace is moving to The Reserve, the 80-acre campus in Oak Brook, Illinois that was the former headquarters of McDonald’s. Ace says the space offers more flexibility, amenities and space to support their continued growth, according to Ace CEO John Venhuizen. Ace has been located in Oak Brook since 1974. The property will go through an extensive interior renovation before Ace moves in. It will the first time Ace’s more than 1,000 Oak Brook-based employees will be in a single building. The new campus will have an on-site cafeteria, state of the art fitness center, heated indoor parking, floor to ceiling windows, outdoor terraces, patios and gathering spaces and easy access to more than 2.5 miles of walking paths and two ponds.
Ace partner The Grommet welcomed Etsy and Amazon sellers to what they termed an alternative selling model that does away with unpredictable and rising fees for a variety of categories. The Grommet makes money by partnering with promising inventor-sellers and working together to reach potential customers and build their brands.
Ace threw a Fourth of July BBQ Party the week before the holiday, which is the nation's largest grilling day of the year. Ace is showcasing a number of grills and offering free delivery and assembly on all grills $399 and up.
Amazon will hold their annual Prime Day sales event July 12 and 13. Prime Day comes as the company is dealing with a slowdown in online shopping. Amazon won’t say how much money Prime Day brings in, but they are typically the busiest shopping days of the year for Amazon. Amazon said 250 million items were bought during the event last year.
Amazon’s chief executive of their online consumer business stepped down in early June. Dave Clark had been with Amazon since he graduated from business school 23 years ago. His departure further solidifies all the executive changes that began with Jeff Bezos turning over the reins to Andy Jassy. Clark tweeted that he had been wanting to “start a new journey” for some time but was waiting for the right moment. There has been constant turmoil in Amazon’s warehouse and delivery operations under his oversight since the pandemic, as more than 150 changes had to be made to warehouse and delivery facilities and procedures. Clark was also faced with an increase in union organizing activity and increased scrutiny of Amazon’s safety conditions, along with a shortage of workers willing to fill warehouse jobs. Amazon recently reported their first quarterly loss since 2015 and is now looking to sublet 10 million square feet of warehouse space.
Company insiders had speculated that Amazon could scrap Clark's role and instead have three retail and operations chiefs report directly to CEO Andy Jassy, but Doug Herrington, the company's senior vice president of North America consumer, was named as Clark’s replacement. However, the title of the job was tweaked and Herrington, now a member of the company's senior leadership team known as the "S-team," will be the CEO of Worldwide Amazon Stores.
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