Roulston Retail Partner Maggie Gilliam on Nordstrom Outperforming the Competition

March 18, 2013

After Thanksgiving, we predicted that perhaps Nordstrom, Inc. might come out on top given the company’s traditional restraint on promotion, along with its unwillingness to be undersold.  Nordstrom posted a 7% comparable store sales increase in the fourth quarter and an earnings increase of 25%.  And this performance comes after a major step in investment in technology, where it is determined to maintain its lead as a fully integrated physical and digital retail entity.  In addition, the company began to invest in its planned expansion into Canada, without segregating the expenses below the line.  While the full line stores are the major business at Nordstrom, the company is performing in exemplary fashion in its Nordstrom Rack off price division.  Here, the company now has as many units as full line stores, and the sales per sq. ft. at $500 both exceed the company average and are well above the $250 to $300 range of the other leading off-pricers.  Further, the Rack stores have so successfully adopted tablet technology that it is currently being used to replace the checkout lanes and thereby release selling space.  Nordstrom remains a real growth player in retail.

Gilliam & Co. is an independent research and advisory firm, specializing in retailing and related fields, and providing consulting and advisory services for both businesses and investors. The company publishes the Gilliam Viewpoint®, a monthly synopsis of current topics, with particular attention towards their longer-term significance, and intended to be an extension of Wall Street Research. This publication is supplemented with timely updates for subscribers on our Website. This article is taken from March’s issue of the Viewpoint and if you are interested in subscribing please visit http://gilliamco.com/?page_id=183.

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