Dillard's has gotten more promotional but it is okay for them. They do not have the massive debt load of these other department store chains. They can take some margin hits if that is what is needed to generate revenue to help them with their dividend payments.buckguy wrote: ↑March 14th, 2023, 3:12 pm
Dillard has done well recently because they could sell more full price merchandise until recently but they put out a warning for the near future. They continue to buy back stock to inflate the dividend rather than invest in the stores. Before COVID, their profit margin was cratering because of more promotional activity. They only recently came up with an app and have been an online laggard.
Dillard's is absolutely investing in its store base. A new store opens here and there and existing stores are being maintained by their in-house construction company. The "Outlet" stores are not maintained as those are obviously going to close when they can figure out a way to divest the property or on the few leased ones get through the rest of the lease.
Do you actually think these department store chains are profitable on their online sales? Which of the chains have claimed they are profitable on online sales? We hear Macys brag what percent of their sales are online but are they saying anything about profitability of those sales? Or return rate on those sales? Dillard's has made the right move from a profit perspective not getting too caught up in the online mess. Similar to Ross and Burlington not doing online sales either. Dillard's website is not good and I think they'd be better off eliminating online sales entirely. Luckily for customers who can go to a Dillard's store they can have a good experience and hopefully the chain redeems itself from its poor online site.
Dillard's focuses heavily on "return rate" - are you aware how high the return rate is on online clothing purchases? For some retailers the return rate is close to 50%. Even if you try to get the customer to pay return shipping (and piss them off doing so and ensure they will never shop you online or in store again) just the product handling alone turns this into a loss making activity.
Dillard's is doing a great job managing their assets. If they continue the current path and do not let activist shareholders or private equity get into their affairs they can continue to run their company in this manner for decades to come.
Dillards stock has also had an exceptional run since COVID. March 1, 2020 the stock was around $10. Now it is $332 (off from a bloated high of 417 not long ago). I think the stock is really bloated badly. But the company has an extremely strong balance sheet.
We won't even talk about how Macys stock has done since COVID (okay it is up 4 times from its low).
Or how Nordstrom stock has done since COVID (basically flat from March 2020 to now).