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TJX leverages flexibility

Ed English listed opportunism and flexibility as the TJX Companies' advantages during economic downturns. In addition, its inventories are its "single greatest asset," he said, as they allow TJX to buy into trends and opportunity.

Speaking at TJX's third quarter conference call, the company's president and ceo said the retailer's "nimbleness and flexibility of business model" enable it to cost-correct quickly and places it in good shape for the fourth quarter, as well as its ability to maintain liquidity.

After Sept. 11, TJX "sharpened prices and maintained aggressive markdown strategy," he said. "We were rewarded with solid sales," which included strong showings in home and apparel.

It will stick to this strategy to remain "under market" from competitors, including department stores, which have also become more aggressive in pricing.

The company's strategy has resulted in a gain in its average ticket, English said, because it has purchased more higher-ticket goods than normal, such as sweaters, and that has paid off. The home and gift areas, however, have less price sensitivity.

The Marmaxx group, which includes Marshalls and T.J. Maxx, operated with an inventory decrease of 10 percent against last year.

The new Marshalls DC that opened in June, as well as the planned T.J. Maxx DC that will open in a little over a year, show the company is "well positioned to support growth."

English was also pleased with the seven openings of the HomeSense stores in the Toronto area. The stores "have continued to exceed expectations," he said, and he believes that Canada can eventually support 60 to 80 such stores.

In the United States, the HomeGoods format performed well with 7 percent comps against a flat performance last year. With a planned 31 locations by yearend, HomeGoods could be a 500-store chain, as well as having 150 superstores, English said.

English said TJX still plans to grow its store base 10 percent annually.

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