- Retail sales in the US were mixed in March, with vehicle, clothing, and restaurant sales down but building materials, health/personal care, gas, and general merchandise up. - Hudson's Bay will invest $750-850 million in renovations, technology, and expanding Saks Off 5th stores, opening 7 new Saks stores and 32 Off 5th stores. - Sears will close 68 Kmart stores and 10 Sears stores in July and September to generate cash as it deals with over $1.2 billion in debt.

1. Retail Sales – USA – March
2016
By: Paul Young, CPA, CGA

2. Disclaimer
• This presentation discuss Retail Sales and Trends for USA

3. Paul Young - Presenter
Bio
• CPA/CGA
• 25 years of experience in Academia, Industry and Financial solutions
• Youtube Channel -
https://www.youtube.com/channel/UCAArky1bAXPSuV2NLtUnyLg

4. Agenda
• Retail Sales – March 2016
• Housing Market – USA
• Tonnage – Truck
• Expansion
• Closures
• Bankruptcies
• Omni Channel

5. Retail Sales Trend – Canada – March 2016
Aside from cars, the
numbers were ok. Aside
from vehicle sales and
clothing, sales at eating
and drinking
establishments (-0.8%
m/m) were weak. The rest
of the report, however, was
ok. Building materials
(+1.4% m/m), health and
personal care store sales
(+1% m/m), gasoline store
sales (+0.9% m/m), and
general merchandise sales
(+0.5% m/m) were all
positive.

6. Housing - USA

7. Tonnage – Truck - USA
• American Trucking Associations’ advanced seasonally adjusted For-Hire Truck Tonnage Index decreased 4.5
percent in March, following a 7.2 percent surge during February. In March, the index equaled 137.6
(2000=100), down from 144 in February. February’s level is an all-time high.
• Compared with March 2015, the SA index was up 2.2 percent, which was down from February’s 8.6 percent
year-over-year gain. Year-to-date, compared with the same period in 2015, tonnage was up 3.9 percent.
• The not seasonally adjusted index, which represents the change in tonnage actually hauled by the fleets
before any seasonal adjustment, equaled 142.1 in March, which was 10.2 percent above the previous month
(129).
• “As expected, tonnage came back to earth in March from the jump in February,” said ATA Chief Economist
Bob Costello. “These things tend to correct, and March took back more than half of the surprisingly large
gain in February.
• “The freight economy continues to be mixed, with housing and consumer spending generally giving support
to tonnage, while new fracking activity and factory output being drags,” he said. “In addition, freight
volumes are softer than the overall economy because of the current inventory overhang throughout the
supply chain.”
• The decrease is the largest monthly contraction for the index since September 2012 (-5.3 percent).

8. Store - Expansion
• Hudson’s Bay Co. (HBC), parent company of Saks Off Fifth, Lord & Taylor, and
Hudson's Bay, said this week that it will make significant investments in store
renovations, technology, and a expansion of its Saks Off 5th stores. The
company recently reported healthy Q4 profit and revenue thanks in part to
real estate initiatives. HBC said it will make some $750 million to $850
million in capital investments, with about 70% going to growth and 30% to
maintenance. Tech investments will see 30% of that budget, including robot-
based automation of the its Toronto distribution center and a new U.S.-
based fulfillment center. And 40% will go to store remodels, including its
Saks Fifth Avenue flagship in Manhattan. Nearly a third (30%) will go toward
launching seven new flagship Saks stores and 32 new Saks Off 5th off-price
stores, which will be added to its existing 38 Saks Fifth Avenue stores and 90
Off 5th stores.

9. Store - Closures
• Sears Holdings Corp. said Thursday that it will close 68 Kmart and 10 Sears
stores nationwide this summer. The move follows the company’s
February announcement that it would accelerate closings of
underperforming stores,according to a press release.
• Sears expects the closures to “generate a meaningful level of cash” as it
liquidates store inventory and sells or subleases some of its real estate.
Along with more than $1.2 billion in debt financing the company disclosed
earlier this month, Sears says it believes it “has taken important steps
toward its primary 2016 objective to restore profitability.”
• All of the targeted Sears stores and nearly all of the Kmart stores will close
in late July; two Kmart stores will close in mid-September. Eligible
associates impacted by the closures will receive severance and have the
opportunity to apply for open positions at area Kmart or Sears stores

10. Stores/Bankruptcies
• Teen apparel retailer Aeropostale is preparing to file for bankruptcy as soon as this
month, sources have told Bloomberg. The move would allow swift closure of
underperforming stores in Aeropostale's 800 store repertoire.
• The company is seeking to reorganize and work on financing to fund operations
under Chapter 11, but hopes to avoid that or find a buyer, sources told Bloomberg.
• Aeropostale also announced Friday that it wouldn’t fight a delisting notice from
the New York Stock Exchange, which suspended trading of its stock effective
immediately, and has begun trading on the OTCQX Best Market marketplace.
• Last month Aeropostale reported that Q4 same-store sales, which includes e-
commerce, fell 6.7% year over year, a stark contrast to the rebounds seen at rivals
Abercrombie & Fitch and American Eagle Outfitters. The company closed 13 stores
in the fourth quarter, while net sales decreased 16.1% to $498 million, from $593.8
million year over year, missing estimates of a net loss of $519.69 million.

11. Omni Channel
• Omnichannel (also spelled omni-channel) is a multichannel approach to
sales that seeks to provide the customer with a seamless shopping
experience whether the customer is shopping online from a desktop or
mobile device, by telephone or in a bricks and mortar store.
• Retailers admit they are still struggling to deliver omnichannel experiences to
consumers due in large part to the absence of quality customer data insights,
according to the results of a survey released Thursday by Periscope, a unit of
management consultancy McKinsey Solutions.
• Only 21% of retail executives surveyed at April’s World Retail Congress 2016 event
said they are more confident than a year ago about their company’s ability to deliver
omnichannel services, and 45% said their efforts are not advancing fast enough.
• Just 6% of survey respondents described their omnichannel readiness as “Excellent—
fully implemented,” while 36% said their companies are still “Testing a proof of
concept.”