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Club channel comps not as solid as they seem

BY Mike Troy

ISSAQUAH, Wash., and WESTBOROUGH, Mass. — Costco and BJ’s reported some impressive same-store sales for June, but peel the onion back a bit and the numbers are not quite as stellar as they seem.

Costco reported a stunning 14% same-store sales increase in June, but that figure benefitted from a number of factors unrelated to selling an increased volume of goods. For starters, there is the issue of gas price inflation and strengthening foreign currencies, which inflated the comp figure. These beneficial effects enabled Costco’s U.S. comps to hit 12%, and its international comps reached 18% for the combined total of 14%.

Strip out gas inflation and currency impacts and those figures drop substantially, with the U.S. comps dipping to 8% and the international figure cut in half to 9%. Then there is the issue of this year’s June reporting period including an additional day when compared with last year. This anomaly aided total sales and comp sales to the tune of 2% to 3%.

Costco’s total sales for June increased 18% to nearly $8.7 billion, bringing the company’s total sales for the first 44 weeks of its fiscal year to $73.4 billion, a 14% increase from the prior year.

Meanwhile, BJ’s said its June comps increased 7.3%, but strip out the impact of higher year-over-year gas prices and the gain from merchandise sales was a more modest 3.5%. Total sales at BJ’s increased 10.3% to nearly $1.2 billion, and through the first 22 weeks of the company’s fiscal year, its total sales were up 10.2% to $4.9 billion.

The issue of food price inflation also had an undetermined but positive impact on comps, as both companies passed through higher costs to consumers.

BJ’s ended June with 190 clubs in 15 states, while Costco ended the period with a total of 584 worldwide clubs. Its store base is comprised of 427 units in the United States and Puerto Rico, 81 clubs in Canada, 32 in Mexico, 22 in the United Kingdom, eight in Japan, seven in Korea, six in Taiwan and one in Australia. Costco plans to open up to eight additional warehouses prior to the end of its 2011 fiscal year on Aug. 28.

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Febreze kicks off Breathe Happy campaign

BY Allison Cerra

CINCINNATI — Febreze officially has launched a new campaign that features real people participating in live scent experiments.

The air freshener brand’s Breathe Happy campaign shows consumers’ reactions to odor scenarios and the "air transformation" that Febreze provides, the company said.

In addition to its TV ads, Febreze said it will extend its Breathe Happy campaign to Facebook and Twitter (@Febreze_Fresh) with various promotions, including live freshness experiments, user-generated rewards and free product giveaways.

“Breathe Happy is a first-of-its-kind campaign in the air care industry, rooted in the Febreze brand purpose to give people the fresh air that they deserve and desire,” said Jeff Pierce, P&G’s Febreze external relations. “Following [the] advertising launch, we will spread Breathe Happy to people everywhere, delivering unique moments at events and on Facebook [and] helping the world to Breathe Happy no matter what their surrounding conditions.”

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Rite Aid shuffles executives in HR, operations departments

BY Alaric DeArment

CAMP HILL, Pa. — Rite Aid announced Thursday changes in its human resources and operations departments.

The 4,700-store chain named Brian Fiala as EVP human resources and Robert Thompson as EVP store operations. Rite Aid also appointed Bill Romine as SVP of the chain’s Western division.

Fiala previously served as EVP store operations, having joined the company in 2007 after working for 24 years at Target. He replaces Steve Parsons, who is leaving the company to take another position, and will report to president and CEO John Standley.

Thompson will replace Fiala as EVP store operations, reporting to COO Ken Martindale. Thompson began at Rite Aid in 2007 and has been responsible for operations at the more than 850 stores the company operates in the Western United States. Before joining Rite Aid, he worked at Target for 20 years.

Romine, formerly group VP for Metro New York, will replace Thompson. Romine joined Rite Aid in 1996 when the company acquired the Thrifty PayLess drug store chain; he began working for PayLess in 1976, starting as a cashier and working his way up to store manager.

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