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Pier 1 Imports has been focused on improving its omni-channel strategies in an effort to augment its overall customer experience.
So far this year, so good, according to Pier 1 Imports CEO Alexander W. Smith.
“When we spoke to you last quarter, we told you that fiscal 2016 would be the start of a multi-year period during which we will exploit the strength of our brand and our new omni-channel business model, and leverage the investments we’ve made in people, systems, and physical infrastructure,” Smith said during Wednesday’s first-quarter earnings conference call, according to Seeking Alpha. “Our stated goal is to move our profitability levels toward our historical highs. Our plans and strategies to do this are in place, and while we’re just one quarter into the year, we are making progress with our execution. As I said during the last call, the totality of our customer’s experience as she shops us, how and when she wants, gets better and better. So with that as a backdrop, we feel the year is off to a fairly good start.”
Total first-quarter sales increased 3.1%, while same-store sales rose 2%.
“We experienced healthy sales growth for much of the quarter, but had some challenging weeks in April,” Smith said. “Ecommerce, which accounted for 17% of total sales in the quarter, up from 9% a year ago, once again outperformed our expectations. We enjoyed strong growth in online traffic, conversion, and average tickets. Conversely, sales through the POS in stores were below our expectations. Online-only SKUs are taking a larger share of our sales, which gives us great confidence in our ability to maintain the fast growth in our online business, as we build out and expand our assortments.”
Smith said his merchandising team is executing well, and continues to do a great job developing the unique special and trend-right products that customers expect from Pier 1 Imports.
“We’re stepping up promotions on outdoor furniture in Q2 to ensure clean store inventory by the time we do our fall transitions,” he explained. “Pressuring our merchandise margins, as discussed on our year-end call, are the temporary costs at our distribution centers and the fact that our DCs are not performing at operational optimal efficiency. The DCs are going through their own omni-channel transformation and are behind the stores in this process. We expect to see improvements throughout the year, helped by bringing our inventories back into line.”
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