Dublin, Calif. – Ross Stores Inc. sees more room to run for physical retailing and has added hundreds of stores to its long-term expansion plan.
“Moving forward, consumers’ increasing focus on value and convenience along with the large number of recent retail closures and bankruptcies make us confident about our prospects for continued market share gains in the future,” said CEO Barbara Rentler.
The company now projects expansion to 2,900 Ross Dress for Less units, up from the previous goal of 2,400. There are currently 1,629 locations in 40 states.
In addition, the outlook for the dd’s Discount format is now 700 stores, up from 600. The chain currently operates 295 stores in 21 states.
During the company’s fiscal third quarter call with investors yesterday evening, Rentler also addressed the hot button issue of price increases. Ross off-price stores and dd’s Discounts both began selectively raising prices during the last quarter and continue to do so now, she said.
“We’re being cautious about moving the needle given where we sit in the food chain. Value to our customer is the appropriate separation in price between ourselves and mainstream retail,” she added. “Where we have done it strategically and continue to offer great values to the customer, it is working.”
On the subject of supply chain costs, the company is planning for ocean freights rates to remain elevated through the year, but believes they will be heaviest in the first half of the year.
Although Ross carried higher freight, wage and Covid-related costs during the recent Q3, sales and profit significantly outpaced expectations.
For the quarter ended Oct. 30, 2021, sales climbed 19% to $4.6 billion, with comp store sales up 14%. Children’s and men’s were the top-performing categories. Net earnings were $385 million, nearly three times higher than the same period in 2020 and up 3.8% from 2019.
Year-to-date, sales rose 20% to $13.9 billion, with comp up 14%. Net earnings were $1.36 billion, compared to a net loss of $152.6 billion in the year-ago period and up 8.3% from the same period in 2019.