Fast Five | Target & Walmart's Earnings, Instacart's IPO, & Zara Charging For Returns

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This is a podcast episode titled, Fast Five | Target & Walmart's Earnings, Instacart's IPO, & Zara Charging For Returns. The summary for this episode is: In today's episode of the Omni Talk Retail Fast Five podcast, sponsored by Microsoft, the A&M Consumer and Retail Group, Takeoff, and Sezzle, David Ritter and Michael Simoncic join Chris and Anne to discuss: What to make of Target and Walmart’s earnings this week How warm and fuzzy we should feel about Instacart’s IPO plans Whether Peloton planning to sell through third-party retailers for the first time ever makes strategic sense Why Zara’s move to charge U.K. customers for returns feels like a stick now but could be more of a carrot in the long-run And closed with a pragmatic take on Walmart’s effort to lure college graduates into stores with promises of $200K salaries. There’s all that, plus Mexican Pizzas, instant delivery at Disneyland, and ketchup secrets. To learn more about Microsoft, visit: www.microsoft.com/en-us/industry/r…cloud-for-retail To learn more about the A&M Consumer & Retail Group, visit: www.alvarezandmarsal-crg.com/ To learn more about Takeoff, visit: www.takeoff.com/ To learn more about Sezzle, visit: www.sezzle.com/ Plus, check out our ranking in Feedspot’s 45 Top Retail Podcasts: blog.feedspot.com/retail_podcasts/ Music by hooksounds.com
Warning: This transcript was created using AI and will contain several inaccuracies.

Everyone, you are listening to the only talk about five brought you in partnership with Microsoft, the A&M consumer and Retail Group. A golf 10.5 podcast is the podcast that we hope makes me feel a little smarter, but most importantly, a little happier each week to today, is May 19th. I'm your host, and mzenga, and I've Chris Walton, and we are here once again to discuss all the top headlines, Making Waves in the world of omni-channel retailing. Chris. I was making waves last week at my girls trip. I went surfing. I know you were, I know you were any big stores or what else apart from that weekend? Did you get up? You get up on the board? Yeah. I did. I mean, it took me a long time, but I'm very bruised and battered, but I got up again and it's just the San Clemente is, like, I've decided that's just my thought your happy place. Oh my God. I love it.

I know what you've been told. You're opening their to was a big hit was a big like, hello, everyone. That was opening a new twist. You feeling good today. I'm like I went to every day was just your life is just acting like this. Practice is sponsored by the San Clemente Chamber of Commerce. And all right. If I, if they couldn't become a sponsor, I would also advise them of the real estate there. That would be even better. I can't wait to get this. I think this, there's a hell of a lot of meat on the bones of the headlines. This week is going to talk about Walmart Target or any. And of course, we also have this is our monthly podcast, which is my favorite episode with you, every month. Where are A & M friends are going to join us. But before we introduce them and I got an exciting review to read this week, we do. I mean, this is pretty big for us. I'm pretty pumped by this and it's not, I mean, technically it's not a review, but it's a commendation. So I want to read if you got answer those listening to

You so much. We we are pretty much Sol be in seventh position on the podcast ring. He's on Apple podcasts all week. And you know who's in front of us and Mackenzie Mackenzie in front of the front of us. I am dead Target centering, that as my goal now is to get in front of Mackenzie. I think with our guest today, on Anne with an M being joined it, like this is some sharks versus Jets territory right now, I think so too, but I think so too. But anyway, so normally this is where we do our reviews. But instead I want to read an email received this past week from dilip Kumar at Amazon. And for those of you who may not be familiar with Dale at work. He is the vice president of physical retail for Amazon. So kind of a big deal and he was one of our recent army Stars. Recipients the reward we created to recognize the top omni-channel operators for 2022 for the nomination. It's both rewarding and humbling to be recognized. You and I

My favorite part, you and Dan are my must listen list. As you both, you an excellent job with your podcast. Best Philip. I love the attitude. Best Philip. I mean, this is your first, like piece of fan mail, Chris. I feel like this is a big deal. I mean, who is impacting the world of physical retail, in more than Bill up tomorrow at Amazon? Thank you. We really appreciate that, dacian. It means a lot to us. If you want to join dilip and you're listening on Apple podcast. Please leave us a review or Hearts podcast. If you're on Spotify, Google Amazon music, please remember to follow us and subscribe so that we can keep making all this content possible for you and for dilip and all of your team's out there. We may just read it aloud. We may may just do that to review good or bad. We want to read it. But before we go any further, we hacked and now introduce our guests who've been patiently waiting for us.

We do the honors. Yes. We have David Ritter and Mike Simone sick from the A&M consumer and Retail Group. For those who are tuning into the show for the first time. Let's have you tell the onions a little bit about yourselves and your roles at A&M Mike. Why don't you go first? And I'm here, been with the firm for almost 15 years. My careers, 30 years, plus a lot of that in, in industry in short. What I do is want to help companies on the front end strategy, but more importantly, all-around operations and execution. I worked in marketing and Merchandising operations all together to deliver value. So, we're just kind of knee deep in the execution of strategies and driving by you and working across each function to deliver this all nice and perfect gas for the day. You have a roll up, your sleeves. Kind of guy. I take it. I like that. Like, I like that. And we have also,

Our residents and I'm expert. Dave Ritter back on the park. I think it is probably at this point. Thanks for having me again. I'm getting ready. I'm a long time Consulting in the retail space. I was at the apartment Mackenzie for about 15 years before I came over to tell resin Marsalis consumer Retail Group. I do think slightly different with a bit more of an execution impact orientation. So we're going to go for it or 20 Chris today. We've got news on Insta, instacart quietly filing for an IPO emphasis on quietly. Zara charging for returns in the UK plan to sell its products, through third-party retailers for the very first time and Walmart trying to recruit College grads with Promises of $200,000.

Plus store managers salaries. But first Dad, we take off with earnings Galore this week. Oh man, it was everybody said, this is another, I think this is important is another example of just how pervasive the retail industry is, and the impact it has on our global economy because everyone was talking about the target earnings today. Everyone call Ross TJX. Anyway. All right. So Target reported a stunning 52% drop in profit for the first quarter sending the stock tumbling yesterday as much as 27% Walmart. Also, mr. Earnings expectations and they got me, and they really got a beating on the, in the news for the first fiscal quarter as according to CNBC. The retailer, I felt cost pressure fuel prices, higher inventory levels and or Staffing.

Side of things. Home Depot raised. Its full-year Outlook reported strong quarterly earnings and posted its strongest first-quarter sales ever ever. Ever. Yes. Let's go to you first. How, how should we read into these results? What are you thinking about this? And I think target, I think is a strong long. I think they got a surprise. I can quite frankly surprised markets price. A lot of people with the short comes up. Why I like about Target longer-term differentiate from Walmart here at the end of the day. I think target has been finding the right Balance store in Omni and e-commerce. They haven't overbuilt their Network to find The Sweet Spot. I think their pain is more short-term surprising to me in the sense that I think they've been a very disciplined operator, but the short-term pain of the payroll and labor hours in the store, the short and I refer to

Short-term because I believe they will correct their models, you know, if they can't crack inflation to and wages, but they definitely can correctly staff stores, how they build stores. I also think they can't, they will make adjustments relative. The pricing merchandise, mix Etc. The Storm at Adesa is the consumer during the pandemic had money coming in whether it was government-supported money or just not spending the same discretionary. They went out and bought the tickets and they went out and spent a lot of money in in Target was a beneficiary. The bed bath her beneficiary. The consumer now is, is, is scaling back at the scene on smaller purchases, but they're still spending in Home Depot.

The consumer, I think it's holding up, but there is a shift from bigger ticket.

You don't still, what is a city or everyday? And I think that's what Home Depot still playing. And we work with other retailers. I think her and smaller tickets. They're holding up their softness here. Let's not kid ourselves. It's fine Amazon a little different because a lot of infrastructure. Bit vague on everything is delivered in 15 minutes and that they've got some more structural overhead costs. I'll have to check disagree with that. Someone might this is good to have you on the show. So let's see what they've got to say first though.

Yeah, I also kind of disagree Chris. I well I don't think this is a short-term blip for Target or Walmart. Frankly. I think if we look at the p&l of a retailer and play every single part of that and there's no end in sight, right. They cost of goods are passing along to them. I think if you look at indirect cost exploding and laborers, most difficult time and wage rates are going up. So I think we might be in a new normal for a solid 18 months where they're just a less profitable model based on not anything specifically. Did we just market conditions more problem? Yeah, I think so too. And I, I spent, I spent all morning reading these earnings reports, add soap, before I go of what it, what do you take? What you take, you? I mean, I think more than anything. I'm listening to. What Mike saying about what this means, for the reaction from these retailers. Like what are we going to start to see Walmart and Target do as a result of and what Dave saying, what might be planning for the next.

Eighteen months at best. And so my hope is that we have retailers like Target like Walmart who've been a little slow to the game on moving things like figuring out faster ways of of automation in-house how to how to work through some of these scenarios that they're still doing manually and store and that my hope is that we start to see some investment in technology that's going to help. Try to offset some of these things like labor. Like inflation that the team is talking about today. The mic for the kind of the final word here but might take away from these stories after reading that the green earnings report date is, it's all about him and Tori. It's actually all about the supply chain Snapback that these companies are dealing with. And the reason I say that is you look at the numbers and targets. I think the best example of this target said, traffic was up 4%. They did a 3% cop, which means our average transaction was down in a period of inflation. Is your transaction, is your transaction size down? It makes

Sense, and so really what you get back to you as if they were working through a hell of a lot of markdowns and I queried some of my friends in the stores at Target and they said yeah, we're still clearing through, heck loads of inventory. We're still clear through things from Christmas so that puts it in a different perspective and Walmart said the same thing. That was the first thing they found it on. Yes, inflation to factor. But how much does it cost for being passed on to Consumers? It sounds like they're still, you know, someone buying this growth to some degree. And then most of the issues is in the markdown on the inventory side. The other point I would make and this is why I disagree with Mike particularly on targets Outlook. I was looking back at some numbers. I think these are interesting. So targets market cap in 2017 when we left is about 32 billion dollars at the height of the pandemic, which, as we said we would talk about inside car to that's as good as it's going to get, right? It's as good as it's going to get rid of race cars. Business is probably as good as it's going to get for Target in Walmart's business because you had so much money going towards products and versus services. And now that's part of this equation to is. People are snapping back in purchasing more services.

Their market cap got up to a hundred and thirty billion dollars, roughly give or take, you know, during this period time. Now it's at 75 billion. So, you know, I sit back and I said to myself, okay, you know, where does the things settle out and then I put them in comparison with Walmart, where Walmarts, got things like Flipkart, go, local Walmart, plus with a capital Walmart Health. They've got some dry powder in the growth. Keg. Look at Walmart. Where is Matt Grothe Improvement in market cap, That's why they haven't really added many stores. It's all come from pandemic field, growth or markets, your grab that other retailers have gone away because of you Commerce. So that leaves me wondering you. Where is the gross story to come for Target? Here in the future? And that's a big open question for me, quite honestly, and the other point I would make that is I think people are getting the punch line to a joke because target has seen a mass of Exodus. A mass Exodus of good retail count me the company recently as we know from falling our friends on LinkedIn, which other people might not see it, but

Just got their dividends that were more in the first quarter than they were the whole last year. Like. It's like big things like that, like, a long story, but I felt like I was important cover, but might as well go back to you cuz I, you know, I kind of disagree with you. But curious, what you think on that take more in towards Dave said, a 18-month cycle and Cher, I believe these companies and where I think they have prop it up as a shin and Improvement is getting back to the basics that she shared, innovating more in the store, innovating more with categories. The one thing I would I would remind us, you know, I believe the story of Target being in trouble, 20 years ago at right prior to Brian Cornell.

Going to get wiped out in Target, has from my vantage point. It's an enduring Branch, still delivering a nominal value proposition. And I think it has the wherewithal. I agree with that. We got 12 to 18 months of head, when it's not going to be easy to solve that. I actually think this is a management team that can solve it, and I think that that will unlock new growth and I think that they're also

I think they're still very focus on their core, which I think will be a positive to work as as a as a source as they work through the next 12 to 18 months of head. Once. You know what you're saying. There's you rather be a Walmart or a Target in trying to deal with this and say another retailer. That's not on this story of ground, right? That's the key takeaway. I look keep rolling now. So I mention this company already but in sikar, Dan has quietly filed for an IPO again, according to CNBC instacart said late, Wednesday last ones. That actually, it is filed a draft registration statement. The US Securities and Exchange Commission Paving the way for the firm to list its shares. Now, you remember that in March of 2021 instacart was bad at 39 billion dollars.

When it last raised, 265 million, however, as we caught it on the show, extensively that valuation drop this past, March 2020 to roughly one year later. When instacart on its own volition took its valuation down to 24 billion. So David, my question for you and this is a fun one. How does instacart plan to go public make? You feel does the move make you more optimistic about instacart future or do you look at this move is more of a now-or-never. I love my to move feeling quite I know. How do you feel?

It makes me feel sad. That you feel sad. Wow, the press okay on the table. I really believe this unfortunately is an hour. Never move while I'm bullish on the grocery kind of delivery ecosystem, from a customer perspective, your instacart struggle with profitability in a market, where fuel costs are going up. Driver costs are going up. I just think they could be in for a few top years. And this is one of those moods where it's in an IPO Market that is starting to look more and more high profitability as opposed to grow. That. This is an hour never move. So you're not at all optimistic about this like technology platform player that they've switched to, you know, as a backdrop in terms of how they're going to feel this growth as well as a service that they've got whether it's helping with a pic Pac in the stores.

I don't think it's going to justify the kind of valuation that they used to have before. It's just you two have to imagine a lot of adoption to get to the point where those revenues offset. Just the kind of negative things that you get from the from the Core Business, not all night. I'm pretty much where you are. And this one. Mike. What's your thoughts? I don't know where Ani's on this but Mike what's your thoughts on was bullish on the company. Overall. I feel it's an interim, business model to a different. The right solution is in getting grocery to home will not be an Instagram model. I think it will be more clear direct model leveraging, technology leveraging scale. I think it instacart plays it, it kind of a an interim role in our models and I so I think it's an hour and ever and I try to grab what they can but I think they have a tough road. Wow. Okay, it's it's almost Resolute here. Resolutely in agreement here. And what do you think? I agree? I think.

Interesting. What follows along with what we said about Target and Walmart in the last away when they saw instacart, just saw the best situation there ever going to get there, still seeing that I think they're instacart is a Band-Aid solution. We talked about Publix a couple weeks ago. They're helping Publix do 15 minute or less delivery. Like there is still a purpose for instacart right now. So I think it's actually the best time that they could have done this IPO because they have to be still have value that they're showing the market like we can come in and, you know, a few days we can turn on microfilm, we can turn on 15 minute delivery. We can give you delivery, we can do picking and packing in the storage. But I think reminds me of a interview we did this week with Rafi systems talking in the founder of the CEO. Acebo. Donnie said, you need to have this conversation in your organization about build versus buy and what when it makes sense to build something internally versus Outsource it to somebody like instacart. And I think this is an example like Mike. Like they was saying a scenario where

In the long-term Grocers, especially Mass Merchants, the, the giant retailers that instacart needs to maintain viability. Those retailers are going to bring this in-house. And then instacart is nothing. They were, they were renting, it's exactly. The prospects are going worse by the minute, and I also wonder, and I don't know where I read this, but I thought it was interesting cake was and I also wonder if it's that way to get potential acquirers interested in before it goes public to and, you know, Walmart's been thrown around. I still in that around. I'm feeling good about my prediction where I said, you know, we're going to look back in a few years. I said, this in Forbes, think the last year the year before, even when it will be looking at, this is the company formerly known as instacart at some point, you know, it's really going to be that and this is just another indication to me on that. They have no choice but to try to do this yet, by the way, so it's it's probably the smartest move their leadership's made in the last year. Year-and-a-half. Am I?

But alright, let's keep rolling. All right, headlight number three Peloton also had a very disappointing, your glasses year-over-year in the fiscal third quarter grew, 757 million dollars or $2.27 per share versus 8.6 million or 3 cents a share, just a year earlier. Its Revenue dropped to 964.3 million dollars from 1.26 billion dollars and the new CEO Barry McCarthy. According to CNBC said that in addition to expanding subscription Revenue, the company now plans to sell its products through third-party retailers, accept that the company has not yet taken before Mike. Let's go to you. First. I got to hear what what do you think about this move to spell through third parties? Ken Peloton maintain the brand cash, if you can now get them inside of Target, for example.

Yeah, really like to play.

Look back to have a theme here. This is a company that great output of that the pandemic people at home. I think when you look at it, I think it is actually more of a service obviously the bikes. But really, it's the service in the community that makes it at that is differentiating for the business. I actually don't think the bike itself is all that different or some of the other heart if you will, the physical infrastructure

I think this is a really hard pivot for that. I think they have to face a really hard because I think moving to you know, hey, we're going to be a subscription-based model. We're going to go through third-party retail. You talked about you sure the losses. I believe the more interesting play here is as consolidation space and I think Peloton has probably done a sufficient effective job of Brandy. It's it's the leading potential brand in that space. I don't I think it needs a structural solution vs. Own. You know, what I'll just drive is continuous Improvement or take it by summarize. That is they kind of have to do this or possibly look at an acquisition here at some point down the road as well. Okay, brother players. I just, you know, I don't see the space.

It's bad. I think the subscription model is the recurring Revenue that you would want. How do you lower your your overhead near the structure cost to have a very profitable subscription business? And I think that ultimately then gets into the question of I think other providers of the smoke coming to have the brand Effectiveness, the consumer awareness Price, Right. Absolutely. Okay. With Dave. What do you think? Do you agree or disagree with your colleague? Mike?

No, I so I slightly disagree. I understand. I think the wholesale Channel might be a desperation move, but controlling your brand in the wholesale channel is Top. I was actually in the Nordstrom's this weekend and they had to tell all set up and scream experience to try to get as many points of distribution as possible. Given the economic hardships that they're facing a hundred percent. If there's almost no world where they're going to grow up kind of price increases in the kind of economic environment that we talked the whole time just feels like I just didn't feel like a particularly effective strategy then maybe Peloton customer base is more affluent and can handle it.

Recessionary environment filled out of touch with what you're saying. I mean I think it on this one, I kind of hate this move. Yeah, yeah. I mean I really do. I feel like it's I feel like it's Peloton getting hung up on its own bad press of late cuz I think there's some there's some key statistics if you can pull out from these articles like they still gained a hundred ninety-five thousand subscribers last quarter and they're attrition rate actually went down. It went down from almost, you know, .8% 2.75% that's still showed me that. It's a healthy breakfast. Again, it was at its peak and it's still growing. So why would I want to then you know go into a third party for my distribution because then you're just like NordicTrack you know you're the same at your you're busy, developing your brand in my opinion and or you're like like Dave I think the total examples with greater than mere example. I was in Lululemon this weekend, it's no one looking at the mirror, the place is packed. No one's looking at it and was engaging with it. And then the other thing that comes

That you got this really important, you get lumpy inventory, as we said at the outset in the first headline, then you get markdowns, and then there goes your cash. Right? Cuz you have to start discounting this to clear through the inventory. And so I just think with those type of subscriber statistics and you can, yes, you can find the balance on the subscription Revenue to Dave talking about, there's no reason to not go to react in this example, like Bill. Your own stores, keep the network going through your own channels. I think my point about maybe if you're really suffering or need to find an outlet, look in a merger. Look at you. No potential acquirer. Something like that. I don't like the move of third party at all. I completely disagree. Wow, really? I do because I think that Peloton has been going after a very specific Market. They've been going after a high earning individual, they have not been going out for mass, and why you think they should go math. I'm not saying they should just go math, but I think that they should take the approach. That we seem Lululemon that we seen.

Apple do where you have certain retailers who you think can maintain a certain level for your brand, but also allow you like I'm thinking of like Target. Okay. So Target selling at they have Apple products in their stores. It's giving people exposure to the brand and especially when you're talking about what Mike's talking about about the subscription revenue, and you said to, like, that's the subscription is where they're making their money. It doesn't have to be about the hardware itself. And I think that the more people that you get exposed to the brand, being able to have a taste of Peloton at 39. 99 a month is attainable for people. They still get to have the power of the brand, which is in the people that are running the programming and the programming itself. Like this is a future for a lot of people of having a hybrid workout experience and the more access that you have to seeing the bike in your Target store or in, you know, very selected. Maybe a Dick's Sporting Goods or something. I think makes more sense than just completely keeping it.

My emails and only allowing a certain subset of the country, to be able to experience that brand to press you. On this top-notch. We do cancel Amazon, actually, debating. The issues like is, which is incredibly hard to find. And last week. We, we argued that I came to your side. So I'm going to press you a little bit. Okay, I would argue that. It's still accessible. Now, like, based on an internet presence. If you want, a pellet gun is pretty easy to find one. It's not like, it's like being kept from certain people. So like, you know, to decide because we are in the target market, for the end of it, you can easily get one if it provided the inventories there, which granted is a problem. But that's the separate point. My point. My question is, who are those retailers? Who are those retailers? Where you going to like, the kid? That's 18 year old and khakis selling this for you. No way. Not that it's going to become like NordicTrack Best Buy, same issue. Like it's just going to become something in the sea of. All right, doesn't carry.

Exercise equipment at Dicks is maybe one, you know, that's why is another one maybe but then it just becomes another bike or treadmill in the lineup of bikes and treadmills and it's going to be hard to differentiate. So I don't know, I liked but I guess who are those people hate? I guess you're not. I think I think I need to make a point of differentiation about what the the store experience is. And I don't know that it's going to be hard where every single time I still think that there's a potential to create an activation with a brand partnership. For example, with a Target where you have Target in Peloton, teaming up and there's a Peloton like, space in the Target or, you know, you could have a bike there, but it doesn't necessarily mean it's about the bike. I think it's about about the subscription and getting more people exposed to, like, you're the Peloton class. We're going to play at my people would sit and watch the Peloton class depending on who the instructor is that we talked about that before. Like could you have like actually Peloton classes where the bikes are set up for you, but Dave, my candy.

Thoughts on this one. I think the CEO felt I should start spending a lot of time in Oregon is Nike is the I think a Nike acquisition is the smartest moves here that actually makes sense from a marketing perspective, Nike or apple. That's the other thing I was thinking of is an was talking to Mike and he thought this business bleeding Cache, County that stay the course. Keep appealing to the same people might not work, right.

It's not, it's not right. So you should ask yourself. How much more we going to keep bleeding. And I think that, I think they, I think they have to expose the Bahamas. Have to figure out a way to get greater scale. And I think one means is further exposure. I think Dave's on it with a comeback to, I think an acquisition is or some partnership is a power pole, dancers, young boy to like that. I can make me think. Like, I, you know, I would take my rabid fan base and ask them to help us through that issue, then, you know, through the subscription increases to as another Point. Alright, alright, how do I number for Zara is now charging customers in the UK for online returns, according to Industry. Fashion, starting this month, UK, customers who have purchased an item online will, now have to pay a dollar $95. 95 Sterling. It will be deducted from their full product. Refund customers will also have 30 days to return any items and they can no longer return separate orders in the same.

Bought purchases made in store can still be returned free of charge. If they are returned to a store in the same reason. So net-net this means if you live in the UK and you want to return as our item you purchase online and it sounds like you're going to have to pay roughly two quid to do so, so Mike, I'm curious to see. This is a one-off imitation or G. Stacy. This is a sign of something more to come more. Broadly across retail. What's your take here?

I know it's a Braun retail. So we did a lot of research on this. I mean, the cost of returns naana returns. It is very expensive. It's very difficult. The flip side is the consumer wants the easiest simplest, hassle-free experience. And actually, we did a fair amount of research that said a consumer, make a purchasing decision based on their perception of how easy it is to return rightly. So this flies against all of that. Obviously the only guy I would take in czarist cases.

In this is aware. I see a little bit of a hybrid, one off the model of us are dark and summer is going to be to buy 10 things. They have a bit of a more unique tied to their customer model. I don't see this as I go forward into I think this could be a very difficult industry Trend. Then I'll be curious. I don't think it will go well with Zara and you think the same thing. I think I agree doing this like cold turkey and just do, especially as a as an avid Zara Shopper. Like this is going to be a nightmare. If you're going to not, only make me wait in line and you're going to charge me for the returns. Like it's a terrible experience to do in store. Yes. I think you're going to start to see abandonment of baskets of people waiting, the same line to purchase star think. I mean, again, I've said this ad nauseam on this podcast for, like, waiting in line. At Zara on this on a Saturday.

Like an hour-long thing. This is not it's a terrible experience. And now you're going to have people who I think. If you know, if you have people coming in returns and doing that it's going to be a disaster. But my hope is that we start to see Zara. Expand the pilot that they're doing in Madrid right now with like the clever on pickup and return lockers where if you are going to do this, tell me like Mike saying I don't mean advance, I can go in and if I submit this return via the return Locker, then I don't get charged for that. And I do think that because of the impact of returns for other fast Fashion online retailers. Like Zara, we are going to start to see this happen where they're going to get charged or you have to take an option that's going to reduce friction, both from the store associates. And from the Consumer Price high top 10, so, you know, buyer beware and then do we over time so I can come up with new ways to take that cost out of the equation.

Spoke with this morning. I'm going to be interviewing founder of an of a company who used to be in charge of innovation for inditex. He's either Global head of innovation and I asked him about that. I asked him about this and he said, he's like, I think we will start to see so many more retailers. Start to roll this out. Like his perspective was, this is something that the industry could not avoid. There is the cost of returns is so significant, especially in these types of categories that they have to do something to kind of make up for that. That's a really interesting position. I hadn't thought about it from that angle of like, do we reset the level and then give people options coming down that line. I never thought about that. Cuz I was kind of where Mike wasn't initially and even where you are to order. This seems like a hard thing for consumers as well, but maybe not over the long-off. You think about it that way? Dave. What do you think? It's been decades training a consumer to buy a whole bunch of products? Try on different sizes and send them back.

Years of behavior, right? I'm kind of with my car. I think it's risky. That's it. I think it's something to keep an eye on cuz and I think retailers do need to figure out whether that's a two-tiered system. Like you guys were talking about, or Orvis return. It also feels like a lot for that water sizes. Are. It's just, I think it's, I think it'll be tough to, to drive it. Optional, you do actually probably more sales in the UK, but it's certainly something to keep an eye on because it's a problem needs to gets all the answers using. So you think it was one of those questions you think. 22 pounds is a lot roughly. You think that you know for damn that's a lot is my initials on it and it was like that's not that much. Do you like it doesn't actually dissuade me from still doing it or it's still trying it to some degree, but what's your thought on that?

One right. All right, makes sense. Yeah, I actually think it's on to where I think this could have bought. What I am seeing is Taylor's today trying to sense the customer to go to the more efficient model, Amazon set up a deal with Kohl's try to run things, free calls and you actually sent you to get a discount if you go back there. So I think the retailers are at the stage of that sort of speak, trying to get you to find the most efficient path back. I would not surprise me to see them at some sticks. Like if you choose to go the other path. We're going to charge you, the problem gets solved. I need to get the product going in the more efficient return process.

Absolutely. All right, Mike, and Dave, and Christy are going to move on to headline number five. Walmart went out of its way this week to attract college graduates to work. And it stores according to Bloomberg. Walmart has recently unveiled. A new College to the number to Career program. That will provide classroom training, hands-on experience, and mentoring for recent and soon-to-be graduates. According to a Walmart statement, top performers will be offered a newly-created management role as an emerging coach, which provides the starting pay of a, real of at least $65,000 a year and a speedy path to becoming a store manager. They said, quote, we see that merging coach rolls in additional pipeline to develop high potential Talent into future store manager, the latter role with an average weight of a proximately $210,000 in 2021. And quote David. We're going to you first, do you think this will give called grads an enticing recent to look at Walmart as a career opportunity or

Just pure window. Dressing as David Brown said, famously. The store manager is the most important role in retail and is capable of really driving results in an individual box. So at least kudos to them for trying to help their top account levels, whether it's PR or real friend, if you think it's going to be a good test to see if they can move the needle, but to me, it feels much more of just like a test. So in that sense, maybe a bit more PR. One thing I do think such a thing about this in my worried about their approach in this is that many new college graduates are gen Z and water is going back to these level ever of compensation.

We continue to see retailers. Go back to the Well from 10 years ago where wage rate is the thing that matters most and that's not what a Traxxas this demographic of talent. I wish that they be that there are other parts of the program that were more oriented against the college grad, that they're targeting night. I think it is more. PR window-dressing. I think you just look at the numbers. Like, you know, your odds of making the NFL of relative to being a store manager are not that different in the NFL, pay out a lot higher when you think about it. There's only 4600 Walmart stores. So if you hadn't, if you had in the store, the chances of you seeing this payout are really Slim and I'm not trying to be a downer. I'm just trying to be a realist, you know, that you're one of 4,600 opportunities. And many of those are proteins, are already taken up by long-tenured good store manager. So the chances of you getting there are low, you know, it's, I agree. It's like Admiral at the end of the day, but but this is my question is like, when you get down to it.

Robbie, Moore headquarters employees making more than $200,000, or that Sally their courting than there are store managers know what it actually tells me is that our store employees are probably still under paid when you put it in that perspective. So Mike, what do you think? I see you shaking your head in the affirmative. You agree with that. The idea that they got to go to college to get up. Do you want to have all these people in the stores? They should focus on. Maybe it's an old principle, but there are folks who started out as a stock boy who became executive hundred percent agree. And I think they really should be promoting a motion to come in work for us and any entry level. And we have programs in to get to assistant store manager, or to, your points, is a store manager has a pretty. There's only so many I think creating more growth opportunity for the Frontline work and play.

Almost kind of seen some of this. It's kind of a class thing. There's always need to just go find a college. Grad. Why don't you just work with people who are employing and give them greater opportunity will go to you on the clothes up here, by toys. I mean, as a, former district managers for meds for Target, I used to argue with talking to why do we need to hire a college grad? I got tons of really great people working my floors. They could easily be storm and great day. And many of them have become that and I think I'm very good at the job. I think that's the most critical part that we need to address here. Is that you need time in the stores in order to become I think the best HQ employee or a store managers and that's like that's where I'd be focusing. If as if I was Walmart. Is how do you just create a blanket program, where your gold, your goal setting, whether you're in a store employee or going right into HQ. How do you create the best what most well-rounded employee and then goal them at these? These

Not $212,000 a year, but how do you really create that opportunity regardless of where you're coming from? How do you get them to be starting in the store or starting at HQ or like, you know, I just feel like there is no need to be more well-rounded approaches to hiring and how they're going to do that, including. Yeah, and I think they probably are quite honestly, I say, read this story, which maybe they did, or maybe I didn't figure out the latter has many wrongs and it can go in many directions. That's an important point to close this up to the lightning round. So, first question is for David, Dave, recreate is a peer-to-peer retail platform that allows Brands to bring resale on to their own sites and they just raised 14 million dollars to continue to do. So Dave. What was the last thing that you sold online?

Man, that's going to make me sound so old. I personally never saw a market place. They'll give you that kind of Eye Associates. I just wanted to go back to Craigslist tiny. But anyway, all right, Michael Taco Bell's, Mexican pizza is back. What was or still is your go to Taco? Bell Delight. It's like so boring bean. Burrito with hot sauce. What? I told you that what's yours in high schools that tree do, which I don't even think they have any more. I think it was called at your second question for you. Former Disney, CEO, Bob Iger has joined as an investor and advisor for gopuff, Dave. What would you have instantly delivered to you if you knew you had a full day at

Any world ahead of you?

Wow, this is a no-brainer sunscreen and I was going to say, you know, they deliver booze right? Like that's also a possibility because no one's going to know the fair-skinned David Ritter answering honestly and truthfully. I love that. All right, Mike last question. Kraft Heinz has reportedly piloting a paper-based ketchup bottle channeling, my inner Elaine Benes. What is your go to catch up, secret or technique for getting ketchup out of the bottle?

Turn on my TV.

Use the knife or the french fries, if you're watching the video, this is even I love hit the visualization, roughly 45 and watch the girls while we were well worth it. So well, worth your effort that closes up. Happy birthday today too. Hope I'm saying this, right? And please drive me if I'm not cuz I have no idea but JoJo siwa that right. All right, all the time, at one of the most underrated James Bond actress. Has you ever starred on the screen and played May Day In A View to a Kill The Great race Joan. I remember if you can only read or listen to One retail Block in the business, make it on me. Are fast. Buy podcast is the quickest fastest rundown of all the week's, top news in our twice-weekly newsletter, tells you the top five things you need to know each day and also features special content exclusive to us. And just for you, and if it's all was in the preview pane of your inbox, you can sign up today at ww.w dot on me. Talk. Block has always possessed again, please remember, as we said at the outset to like and leave us a review wherever you happen to listen to your podcast or on.

Tube and David people want to get in touch with you guys. Got a little retail pick your brains for advice as consultants. What's the best way for them to do that? We have several options 1st is our website, which is ww.w. Alvarez & marsal prg.com. We have a LinkedIn page, which is Alvarez & marsal consumer and Retail Group. Or finally, they can feel free to reach out to me or Mike directly dealing been awesome. Awesome. And finally apologies to Steve Dennis. Hope to have on this pre-recorded podcast, but we ran out of time and of course as always be careful out there. Yeah. Imma talk fast. Five is a Microsoft sponsored podcast. Microsoft cloud for retail, connect your customers, your people and your data Across The Shopper Journey, livering personalized experiences and operational excellence. And is also brought to you in association with the A&M consumer and Retail Group group is a management consulting firm that tackles the most complex challenges and Vance's.

Science people and communities for their maximum potential. Crg brings the experience tools and operator like pragmatism to help retailers and consumer products. Companies be on the right side of disruption and take off take off is transforming grocery by powering groceries to drive online. The key is micro fulfillment centers. They can be leveraged at a hyper-local scale. Take off also offers a robust software suite. The groceries can seamlessly integrate, the robotic solution into their existing businesses will learn more visit to take off. Calm and finally scheduled sezzle is an Innovative buy now pay later solutions that allow Shoppers to split purchases into for interest. Repayments over six weeks to learn more visit zazzle.com.

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In today's episode of the Omni Talk Retail Fast Five podcast, sponsored by Microsoft, the A&M Consumer and Retail Group, Takeoff, and Sezzle, David Ritter and Michael Simoncic join Chris and Anne to discuss: What to make of Target and Walmart’s earnings this week How warm and fuzzy we should feel about Instacart’s IPO plans Whether Peloton planning to sell through third-party retailers for the first time ever makes strategic sense Why Zara’s move to charge U.K. customers for returns feels like a stick now but could be more of a carrot in the long-run And closed with a pragmatic take on Walmart’s effort to lure college graduates into stores with promises of $200K salaries. There’s all that, plus Mexican Pizzas, instant delivery at Disneyland, and ketchup secrets. To learn more about Microsoft, visit: www.microsoft.com/en-us/industry/r…cloud-for-retail To learn more about the A&M Consumer & Retail Group, visit: www.alvarezandmarsal-crg.com/ To learn more about Takeoff, visit: www.takeoff.com/ To learn more about Sezzle, visit: www.sezzle.com/ Plus, check out our ranking in Feedspot’s 45 Top Retail Podcasts: blog.feedspot.com/retail_podcasts/ Music by hooksounds.com