Conversations On Retail

A new Empower survey reveals that shoppers are divided between supporting small businesses and large retail chains. While 29% of consumers prefer local shops for personalized service and locally-made products, 29% gravitate towards big retailers for lower prices, variety, and flexible return policies. A majority (82%) shop at both, spending an average of $106 at small businesses and $333 at large chains each month. However, inflation has made 44% less likely to shop small, with Gen X spending the most across both types. Despite this, many Americans (60%) prefer buying gifts at local shops for unique options, and over half of Gen Zers would shop small more often with faster shipping options. Chain Store Age, Zachary Russell

Returns in 2024 are expected to be about 17% of all goods sold, totaling $890 billion, according to a new report by the National Retail Federation and return management company Happy Returns, a UPS Company. That’s up from 15% in 2023. The growing amount of returned merchandise presents major challenges for retailers, not to mention the environmental cost. CNBC

American Eagle Outfitters Inc. cut its full-year sales forecast and issued holiday guidance that came in below expectations. The apparel retailer saw strong demand during back-to-school but said consumers are pulling back between key moments. American Eagle’s Aerie by AEO, Inc. brand saw strong growth, with comparable sales up 5%, on top of 12% in the year-ago period.

Consumers have entered a new phase of pushing back on rising prices brought forth by inflation, supply chain issues and the pandemic, Richmond Fed President Tom Barkin said at the CNBC CFO Council Summit in Washington, D.C. on Wednesday. That has led many companies to lower prices or increase discounts in an effort to keep consumers wallets’ open and gain market share. But more price increases loom due to pressures from potential Trump administration tariffs, Barkin said, and he believes the barrier to increasing prices is now lower than it was historically.

Washington, D.C., Attorney General Brian L. Schwalb accused Amazon of “secretly” excluding two ZIP codes in the capital city from expedited delivery. The lawsuit says that in 2022, Amazon stopped using its own delivery trucks in two D.C. ZIP codes due to safety concerns. The decision caused more than 48,000 Prime members to see slower delivery speeds than the rest of the district, despite paying the same subscription fee.

Dollar General and Dollar Tree Stores, which will report earnings this week, have cut their sales outlooks even as consumers look for deals. Low-income households, who tend to shop at the deep discounters, have been hit hardest by inflation. Company-specific problems such as messy stores, worker safety concerns and limited e-commerce businesses have also hurt the dollar stores. Walmart

TikTok has already cemented itself as an advertising powerhouse, and with TikTok Shop, the company has been trying to carve out another revenue stream through e-commerce. Amazon sellers are being persuaded to try out TikTok Shop with promises of low fees and steep discounts on products footed by the company, which has also hired talent away from Amazon. Retailers and brands told CNBC they continue to invest in TikTok Shop even though a potential Jan. 19 ban grows nearer.

Nordstrom beat Wall Street’s revenue expectations and delivered a slightly rosier full-year sales outlook. The retailer’s sales growth is notable at a time when discretionary merchandise and the luxury sector have been under pressure. Clothing and shoe purchases lifted the company’s performance, with sales of women’s apparel and activewear jumping by double digits year over year. CNBC

Gap raised its guidance ahead of the holiday shopping season as it touted a “strong start” to the all-important fourth quarter. The apparel giant behind Old Navy, Banana Republic, Athleta and its eponymous banner blew past Wall Street’s earnings estimates despite a tough quarter affected by unseasonably warm weather and hurricanes. Gap is in the midst of a turnaround under CEO Richard Dickson and is leaning into better marketing to drive cultural relevance.

Dollar stores companies were some best performing stocks in the S&P 500 during the Great Recession, said Piper Sandler managing director Peter Keith. But over the past couple of years, dollar stores have not seen the same success. CNBC, Dollar Tree Stores, Dollar General, Walmart