Is Home Emerging From Hibernation?
June 17, 2014,
Branded cookware was a hit for Walmart.
Walmart saw strength in basics as well as cookware brands during the first quarter, calling out Rachael Ray, Farberware, Magic Bullet, and Keurig in particular. Home was also a strong performer on Walmart.com. The home department comped positive at Sam’s Club as well, especially in the seasonal hardware and gardening categories.
At Ross Stores, the home department’s performance was well ahead of the chain, which produced a 1% comp gain. Gift and functional products outpaced domestics, which lagged the department, vice chairman and ceo Michael Balmuth told analysts.
TJX’s HomeGoods format continues to fly, with 9.7% bump in Q1 sales and a 3% increase in comps on top of a 7% jump a year ago. Home [at HomeGoods] was spectacular,” said ceo Carol Meyrowitz.
Some retailers are looking to ramp up their home efforts further.
At Big Lots, soft home was the second strongest department across the store during the first quarter and furniture was the fourth best performer, both generating positive same-store sales.
“It’s still very early in the process,” said ceo David Campisi, who joined Big Lots a little over a year ago. “I’m confident the content and process will get better and better, especially in the Back-to-School season and on into holiday.”
HomeGoods’ Q1 business was “spectacular.”
Sales of soft home were driven by value, fashion and brand, he added. In hard home, on the other hand, Big Lots stores already have or are in the process of exiting tools, paint, auto and some other hardlines. The company continues to stock tabletop, cookware and related categories.
Fred’s, which has been pushing consumables and pharmacy to drive traffic, will now overhaul the store layout to boost higher-margin goods by creating six “convenience centers” largely focused on home categories.
The in-store centers will focus on need-it-now merchandise items in six broad categories: seasonal, bedding, bath, kitchen, pet and home improvement, which includes window.
Bruce Efird, ceo, said during the company’s recent conference call that research found while Fred’s customers consider the store a destination for consumables and pharmacy, they view the rest of the assortment as mere “stuff.” The new layout seeks to move shoppers into remerchandised, home-focused shop-in-shops.
The format will begin rolling out in June and will be substantially completed by the end of the fourth quarter. A new front end will emphasize power displays, palettes and faster checkout. New signage and displays will call out the convenience centers. Pricing will be competitive on everyday price and “much more aggressive” on promotions.
Tuesday Morning plans to focus its merchandise mix on core home categories and get out of women’s apparel and footwear by late August. It’s looking to boost activity in home décor, textiles, rugs, furniture, and other home businesses.
The merchandising strategy calls for broad and shallower buys of branded, better quality merchandise, ceo Michael Rouleau told analysts. “You can see it in our stores. Fresh merchandise is arriving every day,” he said.
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