Michaels' (MIK) Partnership With UPS To Boost Stores Footfall
Zacks Investment Research | Oct 08, 2019 10:47PM ET
The Michaels Companies, Inc. (NASDAQ:MIK) is focused on integrating its e-commerce and in-store operations to enhance customer shopping experience. Recently, the company announced a collaboration under which it rolled out United Parcel Service, Inc. (NYSE:UPS) Access Point locations into more than 1,100 of its outlets. This is likely to make shipping or receiving UPS packages easy for customers. At the same time, this tie-up should drive footfall at Michaels stores as the UPS Access Point locations are likely to provide increased convenience to shoppers while picking their craft and decoration needs.
Following this latest rollout, shoppers can now ship UPS packages directly to Michaels’ outlet and drop pre-labeled shipments. Additionally, customers can make easy returns to online retailers providing the UPS drop-off facility.
For further ease of customers looking to set delivery preferences to a particular nearby Michaels’ store, the UPS My Choice for home solution provides automatic rerouting of packages to the desired store location. This latest collaboration allows shoppers to regulate their e-commerce deliveries and returns at their convenient Michaels outlet, quickly and expediently.
We note that UPS is currently working with merchants to offer customers a selection of the nearest UPS Access Point location during their checkouts.
Meanwhile, Michaels’ e-commerce platform has been a significant contributor to the company’s sales growth. In second-quarter fiscal 2019, sales from e-commerce business remained sturdy backed by higher traffic and conversion rate.
Additionally, the company continues to gain from omni-channel capabilities like “Buy Online Pick Up in Store” (BOPIS), which is a cost-effective way of fulfilling online orders as it eliminates shipping costs. In the fiscal second quarter, BOPIS contributed nearly 44% to online sales and was about two-thirds of online orders.
Michaels also completed a major step in the evolution of its e-commerce business by exiting third-party fulfilment providers for online orders. It now has in place a new order management system supported by an in-house customer care team to manage all online transactions. All orders from Michaels.com are now fulfilled by Michaels stores or its own distribution center. This is likely to position the company well for further e-commerce sales growth in the future.
On store front, Michaels remains committed toward expansion and remodeling efforts to boost margins and profitability. This will also lead to higher comparable-store sales (comps), thus generating greater sales and capturing market share. In a bid to enhance services for its patrons, the company has been expanding its store base and introducing technological advancements. Within its 2019 priorities, Michaels is focused on expanding assortments in key growth-driving categories while de-emphasizing on slower moving categories.
Get The News You Want
As part of its first category expansion in all stores, Michaels doubled the space for assortments of tools and technology with recognized brands such as Cricut, Caesar and Oracle (NYSE:ORCL). These efforts are likely to help the company enhance its leadership in the DIY (do-it-yourself) category. Further, the company remains on track to expand its assortments in craft storage, jewelry and art categories. It expects these changes in assortments to boost sales in the second half of fiscal 2019.
Price Performance
Driven by the aforementioned efforts, shares of this leading arts and crafts specialty retailer have gained 13.7% in the past three months. Meanwhile, the Original post
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.