Can The Nordstrom Family Outrun Retail’s Woes?
Many retailers, pummeled by online competition and shifting consumer tastes, are slashing costs and closing hundreds of stores. Nordstrom Inc. JWN +2.50% is doing the opposite. The family-run company has been investing heavily as it tries to outrun the forces battering the industry. It is revamping some of its 122 department stores and spending more than $500 million to gain a toehold in Manhattan. It has snapped up e-commerce companies including flash sale website HauteLook and subscription service Trunk Club. And it has launched new concepts, including a store in Los Angeles called Nordstrom Local that doesn’t stock any clothes. So far, those efforts have failed to pay off in rising profits. As Nordstrom has been ramping up capital spending, revenue for the six years ended in January 2017 increased by more than half to $14.76 billion, but profits over that period fell. Much of the revenue growth has come from opening Rack off-price stores and e-commerce. Sales at the department stores have declined each year since 2012. The company is scheduled to report results for its recently completed year on March 1. Read more at The Wall Street Journal.
