The first eight months of 2017 have been focused on the retail apocalypse (overblown), the growing impact of Amazon and the struggles of department stores.
But as housewares suppliers and the retail world as a whole turn their focus to the holiday season, the home segment is proving to be a shining star and helping some retailers drive sales growth and allowing others to offset softness in product segments such as apparel.
As leading retailers in August reported second quarter results, the constant theme heard from many was the positive impact home had on revenue.
TJX, the parent company of HomeGoods, Marshalls and T.J. Maxx, reported another solid quarter, with net sales up 6% and comparable store sales up 3%. Of particular note was the same-store sales growth at HomeGoods, up 7% over the second quarter of 2016, which followed a 5% increase when comparing the second quarter of 2016 to the second quarter of 2015.
The Home Depot also enjoyed a strong second quarter, with total sales up 6.2% and comparable store sales at U.S.-based stores up 6.6%. Company officials reported that the $2.7 billion in sales for the quarter was the highest quarterly sales mark in company history.
While Big Orange is still mainly about lumber, kitchen remodels and hardware, its growth is also good news for the housewares segment. The retailer for more than a year has been working to expand its assortment of housewares with a focus on e-commerce and catalog. Adding a retailer of this size can only be a boon for the housewares segment.
J.C. Penney is also reaping rewards from its efforts to expand its home assortment, which now includes major appliances and mattresses. Marvin Ellison, the company’s chairman/CEO and a former Home Depot executive, noted in a recent conference call that the retailer’s home refresh delivered positive comps in its home division during the second quarter.
Company officials also said that home currently accounts for about one-fifth of total floor space in store and generates approximately 14% of sales. Perhaps most interesting is that the addition of appliances, mattresses and furniture over the past year has driven store traffic as consumers want to see these products first hand.
So, this holiday season when retailers work to drive traffic to their stores and websites, home may be the gift that keeps on giving.