Resisting temptation at Tractor Supply

Tractor Supply posted another strong quarter, with a 20% sales increase and 40% increase in net income. These are on top of record results last year.

How do they do it? It’s complicated. But one secret that emerged from the 1,000-plus location farm-and-ranch retailer’s fourth-quarter earnings call was the importance of resisting the temptation to stray from the categories that connect Tractor Supply to its customers.

Greg Sandfort, president and chief merchandising officer, explained it this way: “I’ve said a couple of times, there are many things we could sell in our store, but we’re going to stay true to who our customer is and service them.”

Even with its 2011 success story, Tractor Supply executives say they’re nowhere near a state of optimized regionalization of merchandise. Sandfort estimated TSCO is just in the second or third inning of proficiency. “There’s still plenty of running room for us,” he said.

Footwear is a for-instance. The first or second quarter will see a reset in the assortments of the highly regional-specific category of footwear. Other changes include product-category extension in the garden area, where more live product will hit stores in 2012.

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