E-commerce picks up the pace
U.S. online sales of home improvement products increased 34% in 2017, reaching nearly $20 billion, according to ecommerce insights from The NPD Group’s Checkout consumer receipt mining service. Double-digit growth was prevalent across all major home improvement category segments last year – everything from plumbing and hardware to outdoor living and decor.
Several categories, like hardware, lighting and ceiling fans, bath and faucets, and storage outpaced the overall industry’s growth in 2017. However, Checkout e-commerce information reveals that air filters and blinds were the fastest growing home improvement categories in e-commerce this year, far exceeding the industry average with 90% gains in dollar sales compared to 2016, according to the Port Washington, N.Y.-based research firm.
“The home improvement industry is realizing the impact of the ease that e-commerce brings to the consumer shopping experience,” said Joe Derochowski, executive director and home industry analyst at NPD. “And consumers are realizing the ways online shopping can meet their home improvement needs, from auto-replenishment of low-touch, staple purchases, to providing detailed guidance in finding the right product to fit their home.”
While all home improvement categories are growing, some are still experiencing their initial online blastoff momentum with steady rises month after month, like air filters and blinds have seen over the past two years. Reviewing Checkout’s longitudinal e-commerce results, more recognizable sales trends emerge in categories that have had more time to develop in the e-commerce space, like the bath and faucets segment.
Added Derochowski: “The future path for the industry depends on three things – the consumer’s ability to connect products to their needs, the retailer’s ability to keep up with logistical demands around delivery, installation, and returns, and finally, a cohesive relationship between brick-and-mortar and e-commerce that helps consumers with whatever home improvement task is at hand.”
Regulatory Wrap-Up: Minimum wage returns to the spotlight
Maine: Governor LePage is supporting a bill to scale back the scheduled increases in the state’s minimum wage law that passed by ballot initiative in 2016. The proposal would reduce the 2018 wage from $10/hr to $9.50/hr and allow for increases to $11/hr by 2021 instead of the previously approved $12/hr. It would also eliminate the cost-of-living adjustment and establish a training wage. The proposal faces an uphill climb in the state legislature.
Massachusetts: The Joint Labor and Workforce Development Committee heard testimony earlier this week on the merits of proposed ballot initiatives that would mandate paid leave as well as raise the state minimum wage to $15/hr. The legislature could adopt the initiatives as proposed but if it does not or passes legislation that is in anyway different from the proposed initiative, activists could still proceed to the ballot.
Rhode Island: Activists that successfully won a 2017 minimum wage increase to $10.50/hr by 2019 are again pushing legislation – this time increasing the state’s wage level further to $15/hr.
Utah: The Democratic sponsor who annually, and unsuccessfully, introduces legislation to raise the minimum wage to $15/hr is now sponsoring a bill that would require a more nominal increase to $12/hr. Also included in the proposal is an increase in the cash wage to at least $3.25/hr, up from the current $2.13/hr. Due to strong Republican majorities in both chambers, a wage increase is unlikely to pass at this time, but the inclusion of potential changes to the cash wage for tipped employees is a notable development.
Washington: A house committee heard industry testimony in support of a law that would allow younger workers or those out of work more than five years to be paid 75% of the state minimum wage for a limited period of time after hiring.
Redwood City, Calif.: The city council concluded a series of public workshops on legislation to increase the city’s minimum wage to $15/hr by 2019. Current state law calls for a longer escalation to $15/hr by 2022. Several cities in the Bay Area and Silicon Valley are considering, or have already enacted, similar mandates. The bill will be voted on during the March 26 council meeting.
St. Paul, Minn.: During an annual “Meet the Mayors” address to both the Minneapolis and St. Paul chambers of commerce and other business leaders, Mayor Melvin Carter reiterated his intent to pursue a $15/hr minimum wage ordinance similar to the current law in Minneapolis.
Maryland: Senate Democrats have indicated support for a bill that would delay implementation of the recently passed paid leave law but house Democrats are reluctant to revisit the issue. Progress on a delay bill is unlikely prior to the law going into effect Feb. 11.
Georgia: An economic nexus bill that passed the house but stalled in the senate last year, advanced through the Senate Finance Committee this week. The committee vote suggests more momentum in light of the U.S. Supreme Court decision to review the nexus standards of a similar South Dakota law. The bill would require remote sellers with annual retail sales exceeding $250,000 into the state, or at least 200 in-state transactions, to either collect and remit sales tax or report the tax information.
Philadelphia, Pa.: The state Supreme Court agreed to take up the industry-backed appeal of their case to overturn the city’s 1.75 cents per ounce tax on sugary beverages. The case has lost twice in lower courts since the law went into effect in 2017.
San Francisco, Calif.: The city has been granted en banc review of their appeal of the 9th Circuit decision which invalidated a 2015 law mandating health warning labels on some soda advertisements. The rare session in front of an eleven judge panel is only granted in roughly twenty cases per year.
Tennessee: Sen. Richard Briggs introduced legislation establishing penalties for pawn shops and other second-hand stores that do not comply with the gift card database law that passed in 2017 that requires them to input gift card sales into a database for use by law enforcement. Criminals and drug addicts are known to return stolen merchandise to a store in exchange for a gift card which is then sold to a third-party seller such as a pawn shop for cash.
Philadelphia, Pa.: The city council is considering legislation to mandate that chain restaurants include a warning label beside items on their menu that have high sodium content, defined as 2,300 milligrams. Industry representatives continue to negotiate language and the bill now excludes delivery and limited time offerings.
NLRB: The National Labor Relations Board extended the deadline to March 19 for responses to the Request for Information on the agency’s review of the 2014 ambush election rule.
Fight for $15: Marking the 50th anniversary of the famous Memphis sanitation workers’ strike, Fight for $15 will hold protests at QSRs in “two dozen southern cities” on Feb. 12. While QSRs appear to be the initial targets, other restaurants and retail locations could also experience protests and disruptions as well.
- The announcement this week that Amazon, JP Morgan Chase and Berkshire Hathaway are forming a healthcare company to lower healthcare costs for their employees could be a game changer. They intend to leverage their internal technical expertise and take custody of the administration of their self-insured plans instead of outsourcing it to third-party plan managers as most companies do. Sharing resources, they intend to cut out significant amounts of red tape with regard to new models for payment and plan delivery and increase price transparency. Amazon’s involvement should be of particular note to retailers as they look to broaden their competitive advantage over traditional retailers and increasingly, grocery and restaurant operators.
- The upcoming Feb. 12 Fight for $15 protests across the Southeast will likely fail to capture significant national media but may earn meaningful attention in local protest markets. Because they are commemorating the labor strike that ultimately took Martin Luther King to Memphis, it is a natural backdrop to the SEIU’s effort to combine the income inequality and social justice narratives into one campaign – just as they did in 1968.
Legislature Status for Week of 2/5/18
- The United States Senate is in session this week
- The United States House is in session this week
- Forty-one state legislatures are meeting actively this week: Alabama, Alaska, Arizona, California, Colorado, Delaware, Florida, Georgia, Hawaii, Iowa, Idaho, Illinois, Indiana, Kansas, Kentucky, Massachusetts, Maryland, Maine, Michigan, Missouri, Mississippi, North Carolina, Nebraska, New Hampshire, New Jersey, New Mexico, New York, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Utah, Virginia, Vermont, Washington, Wisconsin and West Virginia.
Check out our Working Lunch podcast each week that includes further analysis into these legislative issues, policy, politics and much more. You can find Working Lunch on the Nation's Restaurant News website, or by clicking here, and when you download the podcast and subscribe on iTunes here.
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Tractor Supply kicks off FFA fundraising campaign
February marks the start of Tractor Supply Company’s fundraising campaign for FFA chapters across the country.
The collection coincides with National FFA week, which runs Feb. 17-24. Tractor Supply customers can donate $1 or more while shopping in store or online.
Donations will fund the national Grants for Growing program, supporting local FFA chapters that are making a difference in their communities through unique and sustainable agricultural projects. The program is coordinated through a partnership with the National FFA Foundation and Tractor Supply, the country’s largest rural lifestyle retailer.
“Through the generosity and assistance of our customers and team members, we are honored to support local FFA chapters across the country through our Grants for Growing program,” said Christi Korzekwa, senior VP of marketing at Tractor Supply Company. “This initiative not only allows us to invest in the next generation of agricultural leaders, but also the future of agricultural education.”
Grants for Growing has raised more than $1.4 million for the National FFA Organization since its start in 2016. The initiative has funded a total of 692 grants supporting projects involving more than 69,000 students.
Last October, Tractor Supply held its most successful 4-H fundraising campaign with nearly $1 million raised.
Tractor Supply Company operates 1,685 Tractor Supply stores in 49 states. The Brentwood, Tenn.-based retailer also owns and operates the Petsense banner – a small-box pet specialty supply retailer with 168 stores in 26 states.