The Remarkable Retail podcast turns six. Steve Dennis and Michael LeBlanc mark the milestone by discussing the Fed's latest move to increase interest rates, record diesel prices, and early holiday forecasts from Deloitte and Bain. They also explore Bloomingdale's record 11.3% comp, Coresight's store opening and closing data, Toys R Us expansion, and earnings from Inditex and Kroger. Steve unpacks his Substack article on whether the race to the doorstep is a race to the bottom, and the “On The Radar Screen” segment covers the Target Beauty Studio launch and the ROI of AI.
The Remarkable Retail podcast turns six. Steve Dennis opens with the macro picture: inflation remains stubborn, driven largely by fuel. U.S. diesel just hit an all-time high, regular gas is up 36% year over year, and retailers absorbing higher freight costs say they're nearing their breaking point. Michael LeBlanc adds that diesel is almost perfectly correlated with food inflation, and that Canadian retailers expect fuel surcharges to persist into early 2027.
The hosts review the first holiday forecasts. Deloitte projects 4 to 4.8% growth for November through January, with e-commerce up about 8%; Bain sees 4.5% growth and roughly 9% online over November and December. Steve wonders whether high fuel costs could push more shoppers online.
At Macy's Inc., Bloomingdale's posted its highest comp ever at 11.3%, while the Macy's nameplate managed just over 1%, in line with Dillard's. Coresight's mid-year data shows store closings down 44% against an unusually heavy prior year, openings at their lowest since 2020, and a widening gap between scarce A-quality space and struggling B, C and D properties. Toys R Us is betting big, planning 120 more small-format U.S. stores before the holidays, though Michael notes the concept stumbled in Canada.
The centerpiece: Steve's Pardon the Disruption post arguing that "the race to the doorstep is escalating." With Amazon rolling out sub-same-day delivery in as little as 30 minutes and holding roughly 40% of e-commerce, most retailers can at best match the offering through store fulfillment and gig partners like Instacart and DoorDash, at far worse economics. The smarter play: reach delivery parity where it matters and compete on reasons beyond ultra-convenience. Both hosts agree traditional grocers sit squarely in the bullseye as Amazon moves from the everything store to the everyday store.
In earning news Inditex posted a 9% August sales gain, Zara plans 20 new U.S. stores, and sister brand Bershka is expanding fast from Miami to New York, India and Brazil. Kroger's sales were flat and guidance was cut, with retail media (up 24%) the lone bright spot.
On the radar screen: Target Beauty Studio replaces Ulta shops in about 600 Target stores, and Michael shares insights from his quarterly retailer conversations on AI's ROI, including a McKinsey finding that change-management costs run roughly three times the technology itself, plus the shock of seat-based bills and exhausted token budgets.