Grocery Outlet received a warm reception on Wall Street last week when it went public at $22 a share. Part of the appeal is that the operator 316 stores with annual sales of $2.3 billion is a unique animal in food retail with a 15 year track record of same store sales growth.
Recession risks continue to be remote. That is despite the U.S. economy slowing from a nearly four percent rate of growth in the middle of 2018 back towards its long-term trend of two percent by the end of 2019.
Elizabeth Warren recently called for the breakup of giant “tech companies” Amazon, Google and Facebook because they were, “too big.” I intentionally put the words tech companies in quotes, since last I checked the lion’s share of Amazon’s revenue comes from its various retail operations.
Shoppers have high expectations that retailers save them time and money. The result of this dual expectation is a new competitive dynamic where success is based on the “ease of experience” a retailer provides.