Consumer sentiment in March fell for the first time in four months even as short-term inflation expectations ebbed.
The overall consumer sentiment index declined to 63.4 in March, down from 67 in February, according to the University of Michigan's preliminary March reading. But the index remains 7% above a year ago.
“This month’s decrease was already fully realized prior to the failure of Silicon Valley Bank, at which time about 85% of our interviews for this preliminary release had been completed,” said Joanne Hsu, surveys of consumers director.
The sentiment declines in March were concentrated among lower-income, less-educated and younger consumers, as well as consumers with the top tercile of stock holdings.
“Overall, all components of the index worsened relatively evenly, primarily on the basis of persistently high prices, creating downward momentum for sentiment leading into the financial turmoil that began last week,” Hsu said.
The decline in sentiment came even as year-ahead inflation expectations receded from 4.1% in February to 3.8% in early March, the lowest reading since April 2021. (Inflation expectations remain well above the 2.3-3.0% range seen in the two years prior to the pandemic.)
Long-run inflation expectations edged down to 2.8%, falling below the narrow 2.9-3.1% range for only the second time in the last 20 months. Long-run inflation expectations remain elevated relative to the 2.2-2.6% range seen in the two years pre-pandemic.
“With ongoing turbulence in the financial sector and uncertainty over the Fed’s possible policy response, inflation expectations are likely to be volatile in the months ahead,” Hsu said.
The family footwear and accessories retailer announced that Erik Gast has been named executive VP, CFO effective April 24, 2023. He succeeds W. Kerry Jackson, who will be retiring after a 35-year career with Shoe Carnival.
Gast will join the company from Fleet Farm Group, where he has been the executive VP and CFO since 2020. In that role, he was instrumental in driving improved financial performance and developing long-term strategic plans, stated Shoe Carnival.
Prior to that, Gast held numerous executive leadership roles at other major retailers and customer-facing brands, including Great Wolf Resorts, Pilot Travel Centers, Family Dollar and Ace Hardware.
“We’re excited to welcome Erik to our leadership team,” said Mark J. Worden, president and CEO. “His distinguished career in finance and accounting, along with his experience in strategic planning, mergers and acquisitions, and his deep knowledge of the retail industry, will play a key role in our strategic growth initiatives as we seek to become a multi-billion-dollar retailer.”
Jackson will continue to serve as the company’s senior executive VP, chief financial and administrative officer and treasurer until April 24, 2023, and will remain with the company as its chief administrative officer until his retirement on May 9, 2023, to assist with the transition.
“Kerry [Jackson] has helped Shoe Carnival accomplish numerous significant milestones, including our initial public offering in 1993, exceeding the $1 billion annual sales mark in fiscal 2016 and completing our first acquisition in the company’s history in 2021,” said Worden. “We deeply appreciate his contributions and wish him the best in his well-earned retirement.”
As of March 16, 2023, Shoe Carnival operates 397 stores in 35 states and Puerto Rico under its Shoe Carnival and Shoe Station banners.
McDonald’s has added a new executive to its U.S. senior leadership team.
Tabassum Zalotrawala has been appointed senior VP and U.S. chief development officer, effective Monday, April 24. She will report directly to Joe Erlinger, president, McDonald’s USA.
“This role has been purposefully elevated to the U.S. SLT as we prioritize development as part of our Accelerating the Arches strategy,” said Erlinger. “Having spent the past five years investing our capital and energy in modernizing our business, we've earned the right to build new restaurants and set aggressive goals, and Tabassum is the right leader to advance our ambitions. “
Most recently, Zalotrawala served as chief development officer at Chipotle Mexican Grill where she led global execution of real estate, with one of her projects named one of 'The Most Innovative Projects of 2020' by Fast Company. While at Chipotle, Zalotrawala led the chain’s new restaurant growth of 750 units since 2019.
Prior to joining Chipotle in 2018, she held several leadership positions focused on real estate, design, and construction at Panda Restaurant Group and Arby's Restaurant Group.
Earlier this year, McDonald’s said it is planning to open 1,900 new locations in 2023, including 400 new units in the United States.
“Tabassum is a values-based leader and is committed to growing the business while providing opportunities for the betterment of people, customers, and communities,” said Erlinger. “On behalf of the entire U.S. Senior Leadership Team, I am confident that Tabassum's leadership will elevate our position as a leading brand and enable McDonald's to serve more customers than ever before. With our sustained success over the past several years, there is still much work to be done. Now is the time to take this important next step.”
McDonald's operates approximately 13,500 U.S. restaurants.
Tuesday Morning Corp. has secured additional financing to help it continue to operate through the bankruptcy process.
The struggling off-price home goods retailer, which filed for Chapter 11 in February, has received $12.5 million in debtor-in-possession (DIP) financing from 1903 Partners together with its affiliates, Gordon Brothers. The new financing from Gordon Brothers brings Tuesday Morning’s total DIP commitments to $27 million.
“After careful deliberation, we have determined that partnering with Gordon Brothers offers Tuesday Morning the best opportunity to save jobs, serve customers and maximize value for the estate,” said Andrew Berger, CEO and director. “Notably, this DIP clears the path for the company to continue transforming our operations through the bankruptcy process. In addition to providing liquidity, partnering with Gordon Brothers will allow us to leverage the team’s deep knowledge and experience in the retail sector.”
Tuesday Morning, which has 487 stores in 40 states, has said it plans to close locations in low-traffic regions while allocating the proper resources to remaining stores in high-traffic region during the restructuring process.
“We are proud to partner with Tuesday Morning through these Chapter 11 proceedings and are confident in Andrew and the leadership team’s ability to minimize disruptions to operations as they work to emerge from bankruptcy as a viable business,” said Kyle Shonak, transaction team and head of North America lending at Gordon Brothers. “The entire Tuesday Morning team has our financial and operational support.”
Munsch Hardt Kopf & Harr, P.C. is serving as the company’s legal advisor. Piper Sandler is serving as the retailer’s investment banker.
Johnson Fitness & Wellness opening 17 stores in Texas
The specialty fitness retailer is opening 17 retail stores, as well as a commercial sales and service division, throughout major metro markets in Texas. (Johnson Fitness & Wellness is the retail division of Johnson Health Tech.)
The 17 new stores will occupy former MyFitnessStore.com retail locations in the communities of Arlington, Austin, Dallas, Fort Worth, Friendswood, Frisco, Houston, Lewisville, Plano, San Antonio, Southlake and Spring, Texas.
The new Texas sites increase the number of Johnson Fitness & Wellness stores to 114 in the United States, and another 364 stores globally. Each store offers a deep assortment of premium fitness and wellness equipment, including treadmills, ellipticals, stationary bikes, home gyms, and accessories, from brands such as Matrix Fitness, Vision Fitness and Horizon Fitness.
"We are thrilled to enter one of the largest home and commercial fitness markets in the U.S. to expand our premium offerings to new customers," said Bob Zande, president of Johnson Health Tech Retail. “The experienced team we have assembled share the same passion as Johnson Fitness & Wellness for providing a customized shopping experience, along with a high level of service and support, to our customers."
Three JFW distribution centers in Dallas, Houston, and San Antonio will support operations, logistics, and customer support for the new markets.
Commercial Fitness provides fitness solutions across hospitality, corporate, medical, multi-housing, gym and fitness centers, and education markets nationwide.
Taiwan-based Johnson Health Tech, is among the world's largest and fastest-growing fitness equipment manufacturers, with brands that include Matrix Fitness, Vision Fitness, and Horizon Fitness. The company manufactures a wide assortment of fitness equipment for both commercial and residential use.
Forrester: U.S. consumers spent an extra $1 trillion in 2022 due to inflation
Higher prices took a big toll on U.S. consumers last year.
Consumers in the United States spent an extra $1 trillion on goods and services due to increased prices in 2022, according to an analysis by Forrester.
Inflation impacted serval personal consumption expenditures (PCE) categories, the firm noted, including. Of the $1.1 trillion attributed to increased prices in 2022, consumers paid $468 billion extra due to increased prices of goods and $636 billion extra due to increased prices of services.
Here’s the impact of inflation across other PCE categories:
Nondurable Goods: The impact of inflation was very evident in the categories of gasoline, food, and beverages. Consumers paid $121 billion more due to increased prices of gasoline and other energy goods in 2022.
Durable Goods: Motor vehicles and parts, furnishings and durable household equipment saw the largest increase in prices, with consumers paying $72 billion and $46 billion extra, respectively for these two categories alone.
Recreational goods and vehicles saw deflation. The prices of televisions, other video equipment and information processing equipment declined instead of increasing.
“Spending growth in these categories was volume-driven, not inflation-driven,” stated Jitender Miglani, senior forecast analyst, Forrester.