Nordstrom’s off-price sales
Nordstrom (JWN) operates full-line stores as well as the off-price Nordstrom Rack stores. After reporting double-digit sales growth for 26 consecutive quarters, sales of Nordstrom Rack stores grew by 8.5% in 3Q15, ended October 31, 2015.
Same-store sales fall
Nordstrom Rack’s same-store sales fell by 2.2% in 3Q15. Same-store sales are a key performance metric that measure the year-over-year change in the sales of a retailer’s existing stores. The metric ignores the impact of stores opened or closed during the period. Nordstrom Rack stores have been a key driver of growth for the company. These stores compete with off-price retailers TJX Companies (TJX), Ross Stores (ROST), and Burlington Stores (BURL), slated to report their third quarter results on November 17, 19, and 24, respectively.
Nordstrom didn’t provide any specific reason for the fall in same-store sales at its Rack stores. In the 3Q15 conference call, Blake W. Nordstrom, the company’s co-president, stated that since August, the company experienced a slowdown across its full-price and off-price businesses. He also added that the company has made appropriate adjustments to its inventory levels as it approaches the holiday season.
Nordstrom’s full-line stores fell by 1.9% while same-store sales fell 2.2% in 3Q15. Nordstrom makes up 0.8% of the holdings of the SPDR S&P Retail ETF (XRT).
Store count update
In 3Q15, Nordstrom opened three new full-line stores and relocated one store. In the United States, Nordstrom opened two full-line stores in Minneapolis, Minnesota, and Wauwatosa, Wisconsin. On September 18, Nordstrom opened its first international flagship store in Vancouver, Canada. This store marked Nordstrom’s third full-line store in Canada. Nordstrom plans to open six full-line stores in Canada through 2017.
The company opened 16 Nordstrom Rack stores in 3Q15 in the following locations:
- three stores in New York at Albany, Buffalo, and Syracuse
- Anchorage, Alaska
- Clearwater, Florida
- Mount Pleasant, South Carolina
- Baton Rouge, Louisiana
- four stores in California at Long Beach, Thousand Oaks, Cerritos, and Emeryville
- Newark, Delaware
- three stores in New Jersey at Rockaway, Eatontown, and Wayne
- Fort Collins, Colorado
At the end of 3Q15, Nordstrom had 118 full-line stores in the United States, three full-line stores in Canada, and 194 Rack stores in the United States.