US: What Walmart+ means for the future of retail
Walmart is about to dive into the world of subscription delivery and discounts, and the ripple effect could hit the rest of the retail industry. Walmart is in a race to stay the world’s largest retailer and beat out Amazon, and in the process will change the future of retail. Walmart+ is Walmart’s upcoming membership/subscription program poised to compete with Amazon Prime. Walmart first announced Walmart+ in early 2020, but the coronavirus pandemic pushed back the launch date until later this summer. Walmart has been close-lipped about its new service, but most reports suggest Walmart+ will cost $98 a year and include unlimited same-day delivery of groceries and products from Walmart stores, discounts at Walmart gas stations, early access to deals, scan and go service inside stores and more.
Amazon announces new fulfillment center and delivery station in Forney, Texas
Amazon.com, Inc. announced plans to open its first fulfillment center in Forney, Texas. The new fulfillment center, which is anticipated to launch in 2021, will create over 500 new full-time jobs with industry-leading pay and comprehensive benefits starting on day 1. “We’re excited to be expanding our network of operations in Forney”, said Alicia Boler Davis, Amazon’s vice president of global customer fulfillment. “We are grateful for the strong support we’ve received from local and state leaders as we broaden our footprint around the Dallas-Fort Worth metroplex. We look forward to creating over 500 jobs for the local Forney community, with industry-leading pay and comprehensive benefits starting on day 1”.
US: Retail sales rise 1.2% in July, says Commerce Department
Retail sales in July rose 1.2% on a month-over-month basis, the U.S. Commerce Department reported in its advanced estimate. Total sales for the month clocked in at $536bln, up from $529.4bln in June. The Commerce Department reported sales reached $527bln in February, marking the first time during the pandemic that retail sales have exceeded pre-pandemic levels. Furthermore, the Commerce Department revised its May to June growth up 90 basis points to 8.4%. Despite the growth, the total volume of retail spending wasn’t as robust as economists surveyed by Dow Jones expected. Economists forecast a 2.3% increase from June. A major reason for the sales coming in lower than expected was due to auto sales falling behind. The Commerce Department reports that excluding auto sales, retail would have grown 1.9%.
Spanish supermarket chain Dia sees credit rating reduced by one American Agency
Credit agency Standard and Poor Global has reduced its rating of Spanish supermarket chain Dia to CC from CCC as it believes that there may be long term liquidity problems despite the company returning to a small profit. In 2019, Russian businessmen Mijaíl Fridman who owns the bulk of shares started transferring its assets to Luxembourg based company LetterOne. Now because LetterOne has approached holders of interest-bearing bonds to purchase them, there is a fear that there will be insufficient funds available to repay the principal when it falls due.
China: JD.com to buy controlling stake in logistics provider Kuayue Express for $432mln
JD.com Inc. entered a deal to acquire a controlling interest in Chinese air freight and logistics company Kuayue Express Group Co. Ltd. for a total consideration of 3bln Chinese yuan, or $431.8mln. The e-commerce company said that the "limited-time express service" provider will be merged with its logistics arm JD Logistics. The transaction involves the acquisition of Kuayue Express' existing shares and subscribing for newly issued shares of Kuayue Express, subject to customary closing conditions.
UK: Morrisons trialling paper bags amid plans to drop plastic ‘bags for life’
Morrisons is planning on getting rid of its plastic “bags for life” while running a trial for paper alternatives in its stores, the retailer has announced. From Monday 17 August, the supermarket will start the bag trial across eight shops, with customers being offered sturdy paper bags when they checkout. If the trial proves successful, paper bags will be introduced across all of its 494 branches.
Ireland: SuperValu launches new compostable packaging on organic produce
SuperValu has announced that all packaging on 19 organic produce lines in store is now fully compostable. Organic products now sold in compostable packaging include Avocados, Aubergine, Tomatoes, Ginger, Sweet Potatoes, Fresh Beetroot, Cabbage, Cauliflower, Peppers, Mango, Butternut Squash, Kale, Turnip and Leeks, with further product lines moving to compostable packaging in the coming months. The compostable packaging can be disposed of in the brown bin that is found in most homes and many businesses, it is then fully broken down once taken to industrial composting. SuperValu have been on a mission to make packaging as sustainable as possible as part of their commitment to making 100% of SuperValu own-brand, fresh produce and in-store packaging recyclable, reusable or compostable by 2025.
Russia: X5 Retail Group sees LFL sales up 4.3% in second quarter
Russian retailer X5 Retail Group has posted a 4.3% increase in like-for-like sales in the second quarter of its financial year, a period in which it had to adapt to a "rapidly changing environment", its CEO said. Net retail sales were up 13.2% for the period, to RUB493bln, with its Pyaterochka and Perekrestok banners both posting double digit sales growth, of 16.1% and 12.6% respectively. Karusel posted a 34.3% decline in sales in the period. On a like-for-like basis, Pyaterochka posted a 6.0% increase in sales, with a 24.8% increase in basket size offset by a 15% reduction in traffic, due to the impact of COVID-19. Perekrestok, meanwhile, posted a 2.4% decline in sales (incorporating a 32.6% decrease in traffic and a 44.9% increase in basket size), while Karusel saw like-for-like sales down 8.4%.
UK: Asda partners with packaging firm to develop more sustainable point of sale
Asda is working with packaging company DS Smith to eliminate non-recyclable elements from in-store point of sale. The supermarket giant continues to focus on the removal of unnecessary plastic in stores, targeting a 15% reduction on own-brand plastic by 2021, and approached DS Smith to develop more sustainable in-store solutions.
UK aid to protect high street supply chains
The UK Government launched a new programme to help high street businesses, including Marks & Spencer, Sainsbury’s, Tesco, Morrisons, Co-op and Waitrose, to strengthen their global supply chains by supporting workers in developing countries during the coronavirus pandemic. The new funding announced by International Development Secretary Anne-Marie Trevelyan includes investment from UK businesses to keep vulnerable workers in their supply chains in safe and secure employment.