According to what the CEO Jim Conroy stated during the first quarter earnings call of the company, Ross Stores is currently facing several financial issues. These issues include a fall in sales, loss of foot traffic, and rapidly increasing import costs. Due to this, Jim Conroy warned the customers of Ross stores about a possible hike in prices. The price hike is mainly due to the Trump tariffs that are set to be imposed on many countries around the globe. If you are someone who wants to know more about what Ross Stores’ CEO said about the price hikes, the following article is for you.
Ross Stores Financial Issues Come Into Light With The Q1 Earnings Report
Ross Dress for Less is facing several financial issues this year, which came into light with the company’s first-quarter earnings report. According to what the company said, Ross Stores’ sales this year remained flat when compared to their sales last year. According to the reports, their net income witnessed a significant 2% decline as well and now stands at $479 million. The data from Placer.ai suggests that the company has also seen a major 2.7% decline in average customer visits. The CEO, Jim Conroy, spoke about the company’s issue on the 22nd of May, mentioning it has witnessed a slow start to this spring selling season. He also stated that they are seeing customers’ preferences shift from discretionary items to functional items.
Ross Stores’ CEO Expressed Concerns About Trump’s Tariffs
Jim Conroy also expressed his concerns regarding the new tariffs from Trump that are going to increase the import costs even more. More than half of the products that the company sells come from China, which is most affected by the tariffs. President Trump announced in April that he is going to impose a 10% base tariff on all countries. After that actually happens, over 60 countries around the globe are going to face high import costs. Conroy mentioned that the volatility of the trade policies and their impact on the economy, as well as the customer and their profitability, is highly unpredictable. He further added that the company is going to focus on what it can control and manage its business conservatively.
Ross Stores CEO Confirms The Company Is Looking At A Possible Hike In Prices
Jim Conroy also officially confirmed that the company is currently looking at possible hikes in prices amid Trump’s tariffs. He stated that the company is going to work out the right combination of pricing versus merchandise margin compression. According to him, the company believes they have several levers available to minimize the overall impact. The COO of Ross Stores, Michael Hartshorn, also spoke up about the possible hike in prices, stating that the company wants to be very careful regarding the increase. He added that the company does not want to be the first one to increase the pricing, and they have to maintain their price umbrella against mainstream retailers. Hartshorn said that this is a substantial value gap to ensure the customers get the value they expect from Ross stores.
When Are Ross Stores Going To Increase Their Prices?
According to what the COO of the company, Michael Hartshorn, said, the customers can expect to see the price hike in Ross stores from June or July. Ross stores are currently in contact with their suppliers and are looking into the option of sourcing goods from other countries. However, the shift will only come into effect next year in 2026. According to a survey from Numerator, around 83% of US consumers are already changing their habits, preparing for the hike in prices due to Trump’s tariffs.
