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Fred’s reports drop in sales for end of year 2008

BY Michael Johnsen

MEMPHIS, Tenn. Discount retailer Fred’s on Wednesday reported a decline of 4% in December sales, posting $201.6 million for the five weeks ended Jan. 3.

“December sales continued to reflect a tough economic environment,” Fred’s CEO Michael Hayes. “Fred’s consumable departments delivered positive comparable results, offset by lower comparable sales in the more discretionary departments, the result of which was flat comparable store sales for the month. Because we have built and executed inventory and cost control plans to address expected volatility in the economy and consumer spending, ending inventories for December were on plan and 5 percent below last year, and the company remains within the forecasted financial range for the fourth quarter.”

Excluding stores closed during 2008, total sales from ongoing stores increased 2 percent in December versus the same month last year. Comparable store sales for the month were flat versus a 1.8 percent decline in comparable store sales for December 2007.

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Walmart moves forward with Operation Main Street Initiative

BY Michael Johnsen

BENTONVILLE, Ark. Walmart on Wednesday announced phase two of its Operation Main Street Initiative—a program designed to maintain the discounter’s “position as America’s low-price leader,” the company said.

“At Walmart, we’re committed to offering low prices every day, not just at Christmas,” stated John Agwunobi, Walmart SVP and president, health and wellness. “While many are still wary of Wall Street, Operation Main Street helps families coast-to-coast save on the items they need most. From January through December this year, our customers can count on us to work tirelessly every day to save them money so they can live better.”

Phase Two of Operation Main Street offers significant savings on products that people are likely to use in pursuit of their New Year’s resolutions, and includes rolled back prices on weight loss-themed consumables like Kellogg’s Special K Waffles and Yoplait Light Yogurt; gym equipment; leisure wear for the physically active; and smoking cessation products like NicoDerm.

Since November, Operation Main Street has saved consumers as much as $400 million, according to Walmart.

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Kroger analyzes loyalty card data to customize coupons

BY Jenna Duncan

CINCINNATI Kroger, working with the data collection and marketing company dunnhumbyUSA, which it co-owns, has started to directly target its customers with personalized coupon offers based on their shopping trends using Kroger’s loyalty card program.

While other grocery stores have long used a system that printed coupons related to customer purchases at check-out, dunnhumbyUSA analyzes shopping habits and also supports them with customer interviews in order to come up with strategies for sending out direct marketing coupons, promotions, and product placement and pricing.

“This level of personalization is a direct link to our customers no other U.S. grocery retailer can replicate,” Kroger CEO David Dillon said to investors Dec. 9.

More than 55 million people have signed up for Kroger loyalty cards in the 10 years the store chain has offered them.

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