Click on the link below or scroll down for this month’s top headlines and tekservePOS analysis and tips.
• Teen Vogue, HP partner on concept store
• Payless, Nature Conservancy in eco-preservation effort
• The Buckle, Hot Topic, Aeropostale shine in apparel segment
• Family Dollar Q2 profit jumps 33%
• Dollar General to add 4,000 jobs in 2009
• JoS A. Bank full-year profit up 16%
NRF: Retailers should not be required to keep
credit-card numbers
The National Retail Federation told a congressional panel Tuesdaythat security standards imposed on merchants by the credit-cardindustry are only “an elaborate patch,” and that a system in whichretailers would not be required to store card numbers would do a betterjob of protecting consumers against credit-card fraud.
“All of us -- merchants, banks, credit-card companies and ourcustomers -- want to eliminate credit-card fraud,” NRF senior VP andCIO David Hogan said. “But if the goal is to make credit-card data lessvulnerable, the ultimate solution is to stop requiring merchants tostore card data in the first place. The bottom line is that it makesmore sense for credit-card companies to protect their data from thievesby keeping it in a relatively few secure locations than to expectmillions of merchants scattered across the nation to lock up their datafor them.”
Hogan’s comments came as he testified at a hearing on whetherdata-security standards mandated by the Payment Card Industry SecurityStandards Council run by Visa, MasterCard and other major credit-cardcompanies reduce “cybercrime.” The hearing was held by the HouseHomeland Security Committee’s Subcommittee on Emerging Threats,Cybersecurity, and Science and Technology.
The PCI standards include more than 200 requirements intended toprotect consumers against credit-card fraud committed by criminals whohack into computer systems. But Hogan said the guidelines are “onerous,confusing and constantly changing,” and have required retailers toreplace previous security programs with new programs that are differentbut not necessarily better.
"While PCI can reduce some fraud -- at extraordinary cost -- it isnot nearly as effective as a redesign of the card processesthemselves,” Hogan said. “Retailers have been required to takeextraordinary steps to ensure that somewhere, somehow, data is notinadvertently being retained by software.” Read more at NRF’s website. -- ChainStoreAge.com, April 1, 2009
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As seen on tekBLOG:
Whether its right or wrong, for the time being, credit-card security is in the hands of the retailer and it comes with a pretty hefty price tag. In 2008, Gartner reported that merchant spending to protect cardholder data and become PCI compliant increased nearly fivefold during the previous 18 months. Among the Level 1 retailers Gartner surveyed, an average of $2.7 million was spent to become PCI compliant, excluding the costas he testified at a hearing on whethers of PCI assessment services. Level 2 merchants reported spending $1.1 million on PCI compliance (compared with $267,000 in fall 2006) and an average of $135,000 on assessment.
And, the PCI July 2010 pinpad upgrade deadline will only increase the financial burden. The C-store/petroleum industry is estimating the pinpad upgrade will cost as much as $1 billion plus another billion to meet unmanned payment-terminal standards and yet another billion for EMV. Read more here …
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Teen Vogue, HP partner on concept store
The Satiating teen girls’ appetite for fashion and innovative consumer technology, Teen Vogue magazine and Hewlett-Packard launched the Teen Vogue Spring Style Haute Spot concept store that “fuses fashion with function.”
The store, which opened its doors on March 28 at the Mall at ShortHills in Short Hills, N.J., is considered an experiential showcase.Besides featuring the season’s fashion trends, it also has a SpringProm salon, hosts model casting calls and displays cutting-edgetechnology.
HP TouchSmart PCs, which are located throughout the store, enablesshoppers to use an application that superimposes their photographs onthe covers of Teen Vogue, print them or share them withfriends online. Shoppers can also use the PCs to browse video archivesof the MTV/Teen Vogue reality show, “The Hills.”
“One of the most significant shifts we’ve seen in the last few yearsis the emergence of technology as a fashion accessory, especially inthe youth market,” says Laura McEwen, publisher, Teen Vogue.“A computer, cell phone, and other mobile devices have really becomethe next ‘it’ items. We chose to partner with HP because theyunderstand how to blend technology and style [into their merchandise].”
The 3,600-sq.-ft. space also invites shoppers to test HP Paviliondv2 notebook PCs and the Vivienne Tam HP Mini 1000 digital clutch. Themini laptop resembles a clutch bag and features an embroidered sleevedesigned by Tam.
“The technology we choose to carry is an expression of our personalstyle,” said Satjiv S. Chahil, senior VP worldwide marketing, personalsystems group, HP, Palo Alto, Calif. “We’ve taken the personal computerfrom a necessity to a fashion accessory, combining form andfunction.” -- TechTalk Tuesday, April 14, 2009
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Two minds are better than one. And what better way to set yourself apart in this environment than to form a new partnership and create new concepts. We spend a lot of time talking on tekBLOG and tekREVIEW about ways retailers are “thinking outside the box” -- last month it was with social media and this month it’s about forming creative partnerships.
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Payless, Nature Conservancy in eco-preservation effort
Payless ShoeSource is rolling out ecologically friendly shoes andhandbags that will initially raise money to plant trees in Brazil. Thechain announced Monday that it is launching a new brand called Zoe & Zac, that use organic cotton and linen, recycled rubber outsolesand water-soluble glues. The new line features eight women's footwearstyles, two handbags, three girl's shoes, as well as a range of jewelryand socks All of the products are priced under $30.
Payless’ parent company Collective Brands said it will donate to TheNature Conservancy $1 for every Zoe & Zac item sold through May 4and every reusable Payless shopping bag sold throughout the year. Thegroup plans to use the money to rebuild the Atlantic Forest in Brazil.The company said it's committed to raising at least $100,000. --ChainStoreAge.com, April 13, 2009
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In a down economy it’s difficult to believe that sustainability is a top priority for consumers -- but it seems to be just one more way that a retailer can differentiate themselves in today’s market while driving sales. According to a recent article in Retail Customer Experience Magazine, “Today’s consumers want to know that the corporations they do business with operate in an environmentally friendly manner -- and they are rewarding sustainability with their pocketbooks. Forty-six percent of consumers say they would shop at a retailer more if it was environmentally friendly, while 47% say they would pay more for environmentally friendly services, products or brands.” Read more here. |
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The Buckle, Hot Topic, Aeropostale shine in apparel segment
Apparel retailers saw their sales drop in March, as the recessionand a late Easter holiday weighed heavily on March same-store salesresults. Consumers traditionally boost shopping ahead of Easter, butthe holiday falls in April this year instead of March.
Consumers continued to shop cautiously in March amid highunemployment and continued home foreclosures, but there were someglimmers of stabilization in Thursday’s reporting. Gymboree Corp. evenraised its first-quarter earnings forecast.
The Buckle and Hot Topic both reported higher results than analystspredicted. At The Buckle, March same-store sales surged 14.7%,surpassing Wall Street's expectations. For the period ended April 4,total sales gained 21.5% to $77.3 million. Year-to-date same-storesales rose 17.4%, while total sales gained 24.1% to $140.6 million.
At Hot Topic, which boosted its first-quarter guidance afterreporting its results, same-store sales climbed 7.1% in March aftergetting a boost from sales of the "Twilight" DVD.
In other results:
- Gap beat analyst’s predictions, helped by better results from itsOld Navy chain, which it has been trying to turn around. Same-storessales fell 8%, while analysts predicted a 9.9% drop
- Limited Brands on Thursday said same-store sales fell 9% for thefive weeks ended April 4. Analysts expected a drop of 12% in same-storesales.
- Aeropostale said Thursday its same-store sales rose 3% in March asa late Easter this calendar year ate into results. Analysts polled byThomson Reuters had expected same-store sales to increase 3.9%. --ChainStoreAge.com, April 9, 2009
Family Dollar Q2 profit jumps 33%
Family Dollar Stores said Wednesday fiscal second-quarter earningsrose 33% as shoppers turned to the discount retailer for food and othernecessities.
Profit rose to $84.1 million, from $63.3 million in the same periodlast year. Sales rose to $1.99 billion from $1.83 billion, boosted bydemand for consumables, especially food.
“While the current environment has resulted in more budget-mindedconsumers, our strong performance is also the result of significantinvestments we have made to enhance the Family Dollar shoppingexperience. Our multi-year focus on building and retaining greatemployee teams, improving merchandise quality, and enhancing theshopability of our stores has positioned us well to serve our corecustomers better while also satisfying new customers who may bevisiting our stores for the first time,” said Howard R. Levine,chairman and CEO. -- ChainStoreAge.com, April 8, 2009
Dollar General to add 4,000 jobs in 2009
Dollar General Corp. said Wednesday it will add up to 4,000 jobsthis year to support its plans to open 450 stores. The company said itplans to add jobs as it opens stores in many markets severely hit bythe recession. Dollar General had more than 8,400 stores located in 35states as of Jan. 30. -- ChainStoreAge.com, April 1, 2009
JoS A. Bank full-year profit up 16%
JoS. A. Bank Clothiers said Wednesday that its fiscal full-yearprofit climbed 16% on increased sales. The retailer earned $58.4million, compared with $50.2 million a year earlier. Sales for thefiscal year ended Jan. 31 improved to $695.9 million from $604 million,as same-store sales rose 8.9%. -- ChainStoreAge.com, April 8 2009
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Last month we made a commitment to you to continue to highlight the positive in the industry because we believe that focusing on what’s good creates more good. A recent article in USA Today, implies just that -- bad breeds bad and good breeds good. The article suggests that all the negative reports on store closing and bankruptcies can actually lead to the downfall of a retailer -- even if the claims were false to begin with.
According to the article, “Retail industry officials say alarmist media reports screaming about which stores are likely to close, among other claims, are tainting perceptions with consumers, investors, creditors and suppliers.
Soon after the false e-mails, articles on Forbes.com and elsewhere suggested that store closings by a few of the same purportedly troubled retailers, including PacSun and Zales, could presage the end of some well-known chains.
PacSun is feeling the downturn but is hardly at death's door, according to the Z-score data (see chart.) Even if same-store sales decline 20%, the company says, it will end 2009 with $25 million in cash.
Maria Sceppaguercio, spokeswoman for Ann Taylor, says the chain doesn't belong on any likely-to-fail lists. Ann Taylor, she notes, ended 2008 with $112 million in cash. Its plan to close 163 of more than 1,000 stores was designed "to increase our efficiency, effectiveness and profitability and make the company an ever stronger one. Closing underperforming stores is a natural part of business of any smart retailer." Read more here.
Additional stories of interest from ChainStoreAge.com
Wal-Mart CEO sees no quick end to recession
Report: Stop & Shop tests self-scanning
Hhgregg offers discount for Circuit City gift, credit cards
Subway adds new POS chainwide
NRF: Retailers should not be required to keep credit-card numbers
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