Taking Stock

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‘Round The Trade

It looks like Stew Leonard’s is close to finalizing a deal to open its seventh store and first in New Jersey. The high-volume perishables-driven family-owned independent is looking to move into the space formerly occupied by a now shuttered Sears store in the Paramus Park Mall in Paramus, NJ…while we’ve devoted a lot of ink in this column to report about the struggles of New York City-based retailers such as Fairway, D’Agostino’s and Gristedes, it appears another Big Apple icon is headed for rocky waters. Dean & Deluca is in the midst of a major restructuring as it closes stores and attempts to refocus on its core business in New York and in northern California. According to the New York Post and several other sources, the company, now owned by Thai entrepreneur Sorapoj Techakraisi, which acquired D&D in 2014, has been closing stores rapidly over the past year, and now operates 18 stores nationally as well as nine licensed stores overseas. The Post story tells of pending lawsuits from suppliers (confirmed by us) and early termination of leases which has angered landlords. Even in Manhattan it is struggling and recently back out of new stores plans for three prospective units in the Meatpacking district, near Wall Street and in the Graybar Building on Lexington Avenue. It has also hired financial investment firm Emerald Capital Advisors to help with its financial mess. To say that Dean & Deluca in no way resembles its former upscale and exotic stature is a gross understatement. As I’ve said many times, when you go from great to (far) less than that in the perishables arena, you’re done or overdone. Today, not only is Dean & Deluca a shadow of its former self, it just isn’t a very worthy shopping experience. And as it can only do, the Post summarized D&D’s dilemma with just one sentence: “Can’t afford that $45 box of cookies at Dean & Deluca? Neither can Dean & Deluca?”…BJ’s quest to go public has created a lot of hoopla over the past month, and no matter what investment path it takes, the third-ranked club store operator will have to continue to move the needle forward if it wants to keep pace with rival and club store king, Costco. That Issaquah, WA based club store king posted another phenomenal sales and earnings report for its third quarter ended May 13. The core numbers: overall revenue up 12.1 percent to $31.62 million; U.S. comps increased 7.7 percent (excluding fuel and foreign exchange); membership fees rose 14.4 percent to $737 million; store traffic grew 5.1 percent; ecommerce sales jumped 36.8 percent; and earnings increased from $700 million to $750 million. During the 13-week period Costco opened two new club stores and plans 25 new units in overall fiscal ‘18. Impressive!…Amazon.com’s Whole Foods has added Philadelphia, Baltimore, Richmond and Boston to its list of cities where it will offer free two-hour delivery of natural and organic products through Amazon’s “Prime Now” service. That announcement comes on the heels of WFM expanding the geography where it will offer a 10 percent savings to all Prime members. That program was initially launched in Florida in April and is now available in 12 more states mainly in the West and Southwest. The service is expected to be offered at all Whole Foods by the end of the year…Walmart is adding some flash of its own, launching “Jetblack” a new personal shopping service that lets customers place orders via text message and receive same-day or next-day delivery, Currently, Jetblack is only available in parts of New York City and membership costs $50 a month. However, this new high-end service, developed by the Behemoth’s in-house incubator, Store No. 8, does not deliver groceries or alcohol.…”Slow” Eddie Lampert, CEO of Sears Holdings and leader of the company’s “crash and burn” extinction tour, is closing another 63 stores (48 Sears and 15 Kmarts), mostly in the West and Midwest. Stores in the Mid-Atlantic/Northeast slated for closure by September include Sears units in Springfield, MA; Peabody, MA;  Lawrenceville, NJ; Ocean, NJ; Burlington, NJ; South Hills, PA; Pittsburgh, PA and Kmarts in West Babylon, NY; Rosedale (Queens), NY; and Latrobe, PA…while I’m not doubting the veracity of Oliver Wyman’s recent survey in which it claims that Lidl is growing  sales and  gaining popularity with millennials, I’m wondering if the Manhattan-based consulting firm took into consideration the bigger issue with Lidl – how many people aren’t shopping at the discounter because of  disappointing expectations which have led to early lackluster sales. Who commissioned this report anyway? Perhaps a more meaningful study by Catalina – “Defending Supermarket Share When Lidl Comes to Town” – points out that sales at 83 supermarkets operating within a 3-mile radius of 30 Lidl stores declined by 7 percent during the first month of a Lidl opening, but bounced back to show only a 2 percent decline within four months…Kroger will exit the Raleigh-Durham area by August. A total of 14 stores are affected, impacting approximately 1,500 associates. However, eight of those stores will essentially change banners as Kroger subsidiary Harris Teeter will occupy them. Jerry Clontz, president of Kroger’s Mid-Atlantic division based in Roanoke, VA (and a former Harris Teeter executive), noted that Kroger has not been able to grow its business the way it would like and, after a thorough evaluation, decided to close or sell its R-D stores. The obvious reason for Kroger’s underperformance in the most affluent part of the state is overstoring created by new competition, especially from Publix, which entered the area in 2015. Coming soon will be four new Wegmans stores which will disrupt the market in an even more volatile manner. The big Cincinnati-based merchant has operated in the Triangle area of the Tar Heel State since 1989…several obits to report over the past month. For the last 10 years, since I began writing about industry members and celebrities passing on, I have noticed an increasing number of deaths by suicide. Two very talented personalities – fashion designer Kate Spade and celebrity chef Anthony Bourdain – both took their lives earlier this month. Spade, who rose from an entry-level position at Mademoiselle magazine to senior editor to fashion designer, took her life at the age of 55 in her home in Manhattan. Bourdain, 61, a colorful personality who was a recovering drug and alcohol addict, had seemingly cleaned up his life and was starring in his Emmy-winning culinary and travel show “Parts Unknown.” He was found dead in his hotel room in France while filming an episode of his show. Very sad endings for two extremely talented artists… also passing away was San Francisco 49ers wide receiver Dwight Clark, 61, who was on the receiving end of “The Catch” in the 1981 NFC championship game against the Dallas Cowboys, which remains one of the greatest individual plays in the history of the National Football League. Clark, who disclosed that he had Lou Gehrig’s disease in early 2017, fought his illness with courage and dignity. The impression that Clark left with his family, friends and teammates was aptly summarized by former 49ers owner Ed DeBartolo Jr.: “I will always remember Dwight the way he was – larger than life, handsome, charismatic, and the only one who could pull off wearing a fur coat at our Super Bowl parade. He was responsible for one of the most iconic plays in NFL history that began our run of Super Bowl championships, but to me, he will always be an extension of my family. I love him and will miss him terribly.”…Gerard Marenghi is dead. You may never have heard of Marenghi, but you certainly have seen him. Marenghi, who changed his name to Jerry Maren when he entered show business, was the last living Munchkin from the 1939 movie “The Wizard of Oz.” He passed away earlier this month at the age of 98. In the classic film, Maren was part of a trio of Munchkins who sang “The Lollipop Guild” and welcomed Dorothy (Judy Garland) to Munchkinland. Presumably, Maren can now be found “somewhere over the rainbow.”