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Retail Sales Rise 0.7% Retail sales rose 0.7% in September after rising an upwardly revised 0.8% in August, well ahead of expectations. Sales were up 13.9% year over year. Sales rose in most categories, but some of the increase came from rising prices due to shortages of products and raw materials and supply chain problems. Sales at non-store retailers rose 1.0% after rising a very robust 5.3% in August. Excluding automobiles, gasoline, building materials and food services, retail sales rose 0.8% in September and were up 11.5% year over year. These core retail sales correspond most closely with the consumer spending component of GDP. Building materials and garden supply stores were up 0.1% from August. The National Retail Federation forecast that 2021 retail sales will rise between 6.5% and 8.2%, which would beat the previous record growth rate of 6.3% in 2004. Christmas in October The Home Depot, Lowe’s, Walmart, and a host of other retailers kicked off their holiday promotions in October, with Amazon leading the way the first week of the month. Amazon tweeted that they sold more than one million toys from their Holiday Toy List in October. A recent poll revealed that half of Americans have already begun their holiday shopping, and a full 70% of early birds have already run into out-of-stock issues. Many retailers, including The Home Depot, Lowe’s, Walmart and Ace, will be closed Thanksgiving Day to allow associates to spend the day with their families, although of course their websites will be open for business. Industry experts are unsure how all the early shopping will impact Black Friday and Thanksgiving weekend sales, traditionally the biggest shopping spree of the year. The Home Depot THD is teaming up with Walmart’s GoLocal delivery service business, which provides same-day and next-day delivery services for businesses. THD will roll out delivery with Walmart GoLocal in select markets, with plans to expand the number of markets through the end of the year. The service will deliver items that can easily fit in a car, such as tools and paint. Delivery speed is one of the areas in which retailers are trying to step up their game as they compete with expectations created by Amazon Prime. Veteran supply-chain executive Mark Holifield left THD the end of October to take a job as CEO of US-based last-mile delivery firm Laser Ship. Holifield has been THD’s senior supply chain exec since 2006 and was among THD’s top five executives. John Deaton, currently senior vice president of US retail operations, was promoted to executive vice president, supply chain and product development. THD introduced Ring Jobsite Security using the new Ring Alarm Pro, which combines features of the Ring Alarm and a built-in eero WiFi 6 router to keep the job site connected. An additional subscription allows the system to use a cellular-only internet connection to keep connected cameras and sensors online. Add-ons include security cameras, smart lighting and various sensors. Job site managers can customize their system based on project needs and easily transfer it to the next site. THD introduced a new app designed to corral all their exclusive smart products and proprietary brands. Connected products are equipped with settings that can be controlled through the Hubspace app and be fully customized by the user. THD committed $10 million to venture capital focused on diversity and innovation by investing in specific venture capital funds that promote diversity, technology and entrepreneurship. Lowe’s Lowe’s kicked off their “Make More Holiday” campaign in mid-October, featuring special services, expanded inventory and more ways to shop. According to Lowe’s, their objective is to take the stress out of the holiday shopping season. They will have special deals weekly on different items, including tools, smart home equipment, appliances and décor. Lowe’s says they have their largest selection ever of artificial trees, wreaths and garlands as well as fresh-cut trees that will be available in mid-November. Lowe’s holiday survey showed that 90% of consumers intend to spend as much or more this year on gifts as they did last year, and 85% plan to participate in holiday traditions. Lowe’s will bring back PROvember during November, with special deals that cater to Pros. Mike Shady will take on an expanded role with Lowe’s as senior vice president, online. He will be handling all aspects of online strategies. He was recently vice president of Lowe’s online business and has more than 20 years of retail experience, including 16 years in ecommerce and omnichannel merchandising. Prior to joining Lowe’s in 2018 Shady held various leadership roles at The Home Depot. He’s replacing Mike Amend. Lowe’s said they want to build on the 110% growth their online segment produced in 2020. Lowe’s launched Lowe’s One Roof Media Network, a retail media service designed to provide a portfolio of omnichannel advertising services to connect brands with their customers. Reportedly more than 100 brands, including Samsung, Kohler and GE Lighting, participated in early beta tests and saw exceptional returns on their investment. The platform includes data-driven insights integrated with analysis of consumer behaviors and home category trends as well as customized advertising products. Lowe’s partnered with retail media technology and service providers CitrusAd and Criteo to develop the network. Lowe’s execs will appear on a USA Network television show, “America’s Big Deal.” The show is a shoppable, live competition show that will air weekly. Every week, inventors and small-business owners will pitch their products to America. The four retail panelists will offer marketplace insights and business advice. Several different execs from Lowe’s will be featured on different episodes. CEO Marvin Ellison said that Lowe’s is participating as part of their efforts to support small businesses and entrepreneurs and give them a chance to have their products sold on Lowe’s website and in stores. Walmart Walmart announced that new subscribers to Walmart+ will get a $9.95 rebate, reportedly in response to Amazon announcing that Whole Foods will start charging Amazon Prime members $9.95 for delivery. Walmart+ membership costs $98 a year, or $12.95 a month, and includes free delivery and shipping with no minimum order limit. W.W. Grainger Q3 sales rose 11.7% to $3.4 billion. Organic sales were up 11.9%, driven by strong performance in both the High-Touch Solutions N.A. and Endless Assortment segments. Grainger CEO DG Macpherson said that demand for core products was very strong throughout the quarter, and they were confident of their ability to deliver through the fourth quarter despite supply chain disruptions and shortages. Amazon Q3 sales rose 12% to $110.8 billion, below expectations. For the fourth quarter, Amazon lowered their sales forecast to between $130 billion and $140 billion, representing annual growth between 4% and 12%. Amazon warned that rising costs, including labor, labor-related productivity losses and higher steel and trucking expenses, added approximately $2 billion in operating costs in the third quarter and will add an expected $4 billion in the fourth quarter. Amazon expects to spend billions during the fourth quarter to ensure that they meet customer and partner expectations and deliver holiday goods on time. Amazon plans to hire an additional 150,000 seasonal workers in the US in hopes of being able to keep up with seasonal demand. Amazon is also trying to hire 125,000 permanent workers and 40,000 people for IT and corporate. As of July, Amazon had 950,000 employees in the US and 1.3 million permanent workers world-wide. Amazon is reinforcing their supply chain to meet holiday demand. They’ve increased ports of entry across their network by 50%, doubled their container processing capacity and expanded their ocean freight carrier network partnerships to secure capacity in critical ports. The Amazon Freight network operates a pool of more than 50,000 trailers, with more than 800 delivery stations globally and 260,000 drivers worldwide, along with hundreds of thousands of Amazon Flex contract drivers. Amazon will let individual teams decide how many days each week corporate employees should come in to the office to work. Earlier, Amazon had stated that employees needed to come back to the office at least three days each week beginning January 3. Company directors will have the discretion to allow teams that they manage to continue working remotely. Most of Amazon’s more than 1 million global employees cannot work remotely because they work in the company’s fulfillment and transportation division. About 50,000 tech and office employees work at Amazon’s headquarters in downtown Seattle as well as other locations. Amazon will invest more than one billion dollars in education and skills training in the US. They will now fund full college tuition, as well as high school diplomas, GEDs and English as a Second Language (ESL) proficiency certification. Amazon is also adding upskilling programs to provide employees with the opportunity to learn skills within data center maintenance and technology, IT and research design. Amazon launched a cloud service that identifies defects and anomalies in manufactured products called Lookout for Vision. It’s available in select Amazon Web Services (AWS) regions. Lookout for Vision uses artificial intelligence (AI) to detect cracks, dents, incorrect colors and irregular shapes in products. Customers pay per hour to train the model; Lookout for Vision reports analyzed image data that deviates from the baseline on the service dashboard or in real time. Amazon is reportedly shopping for long-range jets that can fly directly from China to the US, according to Bloomberg News. Amazon is looking for refurbished cargo versions of 10 Airbus A330-300 aircraft as well as an unknown number of 777-300ER aircraft. The mid-sized Boeing 767 has been the backbone of Amazon Air’s fleet for the past five years. © Robert Bosch Tool Corporation. All rights reserved, no copying or reproducing is permitted without prior written approval.
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