July spending results in robust growth
ATLANTA — Retail spending growth was at an 11-month high in July as summer vacation travel led strong spending during the month, according to data reported by payment technology and services provider First Data Corp. The First Data SpendTrend analysis looked at the period July 1 through 31, 2014, compared to July 2 through Aug. 1, 2013.
SpendTrend tracks same-store point-of-sale data by credit, signature debit, PIN debit, EBT, closed-loop prepaid cards and checks from nearly four million merchant locations serviced by First Data in the U.S. Overall retail spending growth was at its strongest levels in a year as nearly all retail categories turned in improved numbers. Led by categories such as building material & garden equipment and furniture & home furnishings, the growth suggests the impact of fewer foreclosures and increased construction. Still, consumers remained hesitant to make big ticket and non-essential purchases.
July’s dollar volume growth of 3.9% was robust, marking an improvement from June’s growth of 3%. A year-over-year spending uptick was driven by hotel and travel categories, where dollar volume growth was 7.9% and 4.6%, respectively, as travelers went on holiday around the globe. Positive growth at food and beverage stores, at 5.3% and in the food services & drinking places category, at 4.4%, also contributed to July’s growth.
All regions across the U.S. saw positive dollar volume growth and, with the exception of New England, all regions experienced stronger sequential spending growth. Spending growth of 5.5% and 4.3% in the Midwest and West regions remained strong, up from June’s growth of 3.9% and 3.2%. The Midwest region saw the strongest spending growth, possibly due to nonfarm employment increasing faster in the Midwest than in other regions.
July’s average ticket growth of 1.5% (vs. 0.9% in June) was the strongest monthly growth all year, supported by average ticket growth in categories such as food and beverage stores, which saw growth of 2.0%. Retail average ticket growth of 0.4% in July was a slight increase from June’s negative growth of -.2% as fewer retailers engaged in clearance promotions.
On a same-store basis, dollar volume of credit card transactions rose 6.2%, while volume of PIN debit transactions grew 3.9% and prepaid card transaction volume increased 3.3%. Signature debit card transaction volume increased 0.4% and the dollar volume of check transactions dropped 5.7%.
“It is also notable that both credit spending growth, which was 6.2% in July, and credit transaction growth, at 7.5% this month, were up significantly over June growth results,” said Krish Mantripragada, senior VP, Information and Analytics Solutions, First Data. “That growth was driven by the categories we’ve detailed in this report, where credit is the preferred method of payment. Consumers are once again motivated to travel, while those who opted for ‘staycations’ increased spending in home-related categories. Looking ahead, we anticipate August’s back-to-school sales and state tax-free holidays should spur spending growth in related categories.”
Supervalu announces first-ever sales expo
EDEN PRAIRIE, Minn.— Supervalu is hosting the company’s first-ever national sales expo, a three-day trade event, in St. Paul, Minn. The expo will feature more than 20 educational sessions and more than 330 expo booths, providing more than 3,900 independent grocery retailers from more 1,250 stores the opportunity to gain insights, merchandising ideas and grocery retail solutions from industry experts.
Seasonal merchandise offerings, consumer packaged goods suppliers and service providers from across the country will offer solutions for Supervalu’s independent retailer base. Expo guests will also have exclusive access to new products and Supervalu’s private brand lines, as well as limited-time promotional buying opportunities.
Supervalu has also launched a mobile app to assist attendees with an event map, a schedule of educational sessions and activities, articles related to topics discussed throughout the event and more.
ConAgra CEO Gary Rodkin to retire
OMAHA, Neb. — ConAgra has begun its search for new CEO, following Gary Rodkin’s announcement to the board that he plans to retire at the end of the company’s fiscal year, May 2015.
The board of directors has established a search committee, led by independent director Richard Lenny, to identify Rodkin’s successor. Lenny is the former chairman and CEO of the Hershey Co. and has served on the ConAgra Foods board since 2009.
“ConAgra Foods is making good progress on its priorities, and we are confident in the company’s ability to deliver on its fiscal year EPS commitments. The board is extremely appreciative of Gary’s leadership, vision and accomplishments over his almost nine years as CEO of ConAgra Foods,” Steven Goldstone, chairman of ConAgra Foods, said. “Under his stewardship, ConAgra Foods has transformed from a holding company into one unified company, with a well-balanced portfolio of consumer, commercial and private brand businesses, and strong operating capabilities. To achieve this transformation, Gary made necessary and bold moves with the company’s portfolio and drove significant cultural change throughout the business. We thank him for his hard work and commitment to ConAgra Foods and its 34,000 employees. We also appreciate the early notification Gary provided, so that we can begin the search and put the right successor in place over the course of this fiscal year. We look forward to Gary’s participation in the succession process.”
“It is a great privilege to lead ConAgra Foods, and while I look forward to retirement, I will miss working alongside so many smart and talented people who I’ve watched grow tremendously in my nine years here,” Rodkin said. “I’m pleased we are beginning my last fiscal year at ConAgra Foods by making good progress, and I have deep conviction that we are on the right path to deliver sustainable, profitable growth due to our significantly improved operational capabilities and our differentiated portfolio that is right for today’s value-oriented consumers. I will continue to lead our team with focus and enthusiasm until my successor is on board, and I look forward to helping with the transition process.”
Rodkin, 62, joined ConAgra Foods in October 2005. Prior to joining ConAgra Foods, he was chairman and CEO of PepsiCo Beverages and Foods North America, where he led a $10 billion organization that included leading brands such as Pepsi, Gatorade, Quaker Foods and Tropicana. He joined PepsiCo in 1998 after it acquired Tropicana, where he had served as president since 1995. From 1979 to 1995, he held marketing and general management positions of increasing responsibility at General Mills, with his last three years at the company as president of the Yoplait yogurt division.
Rodkin graduated Phi Beta Kappa with a bachelor's degree in economics from Rutgers College and an M.B.A. from Harvard Business School, where he was recently named a Fellow of Executive Education. He serves on the board of overseers for Rutgers College, the board of directors for Grocery Manufacturers Association where he is also past chairman, the board of directors for Food Marketing Institute and the board of directors of Avon Products. Rodkin also is chairman of Boys Town, a member of the Strategic Air Command Consultation Committee and a member of the Omaha Chamber of Commerce.
ConAgra Foods portfolio of brands include Banquet, Chef Boyardee, Egg Beaters, Healthy Choice, Hebrew National, Hunt’s, Marie Callender’s, Orville Redenbacher’s, Pam, Peter Pan, Reddi-wip, Slim Jim and Snack Pack, along with food sold by ConAgra Foods under private brand labels, in grocery, convenience, mass merchandise, club and drug stores. Additionally, ConAgra Foods supplies frozen potato and sweet potato products as well as other vegetable, seasoning blends, flavors and bakery products to commercial and foodservice customers. ConAgra Foods operates ReadySetEat.com, an interactive recipe website that provides consumers with easy dinner recipes and more.