Morning Brew - ☕ Paw and order

The design behind Petco’s NYC flagship.
February 20, 2024

Retail Brew

Walmart Marketplace

It’s Tuesday, and the retail portion of earnings season is officially here. This is for Q4 results, of course, which means we’re still talking over the holiday season. What’s the consensus so far? Not bad, depending on who you ask…

In today’s edition:

—Andrew Adam Newman, Alex Vuocolo, Kristen Parisi

STORES

Pet project

An interior shot of Petco's New York flagship shows some of the store's tree sculptures. Petco

In 2023, the Petco in New York’s Union Square relocated to…Union Square. It moved just a block east, from the park’s northwest corner to its northeast corner, but when it comes to design, the store’s in another galaxy.

Visiting the old store, for example, you may not have noticed that it had a pet grooming department, tucked as it was in a corner of the basement. But enter the new store, which occupies the 95-year-old Tammany Hall building, and you can’t miss it: There it is, just to the left, looking like a classic New York barbershop. There’s a barber chair, black-and-white mosaic tile floors, and a gold-leaf sign painted on the window: “Ruff’s Barker Shop.”

A fluffy dog getting a summer cut can be adorable to behold, and that’s not lost on Petco.

“It’s not just dropping your dog off for grooming,” Rick Neira, VP of creative, visual merchandising, store design, and merchandise operations at Petco, told Retail Brew. “Now there’s theater in it.”

Keep reading here.—AAN

     

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DTC

Redirection

Multicolored Crocs hanging on a wall rack in a store. Ucg/Getty Images

Crocs, Inc. just turned in strong quarterly earnings, despite its Heydude brand continuing to see declines in both wholesale and DTC revenue. For the company as a whole, DTC revenue increased 6.8% and wholesale fell 4.6% in the fourth quarter, but much of that decrease stemmed from Heydude’s losses.

  • The comfort footwear brand, which Crocs bought in 2022, saw wholesale revenue drop 28% in Q4 and DTC fall 9% compared to the year before.

The upside is that Crocs moved to make Heydude’s sales more profitable by pulling back on price matching, which involves lowering prices to keep up with competitors. As a result, the average sales price for e-commerce jumped 15%.

The company also shed a sizable amount of Heydude’s inventory in 2023, dropping 38% from last year and 6% from the third quarter.

Keep reading here.—AV

     

FOOD & BEV

Gaining accessibility

A close up image of a green Starbucks apron, with Starbucks spelled out in American sign language Starbucks

Starbucks is introducing new accessibility features that the company hopes will benefit disabled employees and patrons at its new US retail locations.

Starbucks unveiled its Inclusive Spaces Framework on Feb. 16 at the newly opened store in Washington, DC’s Union Market neighborhood, and will incorporate it into all new US locations going forward. The move is part of the company’s overall strategy to make its stores more accessible to employees and customers with disabilities.

Keep reading here on HR Brew.—KP

     

TOGETHER WITH LTK

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SWAPPING SKUS

Today’s top retail reads.

Big money merger: One of the country’s largest banks, Capital One, plans to acquire one of the largest credit card networks, Discover Financial Services, in a deal valued at $35.3 billion. (the New York Times)

Proxy fight: A proxy bottle is now underway at Macy’s, as private equity firm Arkhouse Management, which previously tried to buy out the struggling department store, nominates nine individuals to its board of directors. (Reuters)

Beer run: Hundred of Teamsters members staged a walk out at a Molson Coors brewery in Fort Worth, Texas, over the weekend, and the union is signaling that it plans a similar action at Anheuser-Busch InBev’s US breweries if a new deal isn’t reached by March. (Fox Business)

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