EP 240: How to Bridge the Retail Tectonic Shift

Special Guest: Jan Kniffen, CEO of retail consultancy, J Rogers Kniffen Worldwide 

Today's retail industry faces unprecedented transformation driven by three major forces: tariff restructuring affecting global supply chains, AI implementation across all business functions, and evolving consumer behaviors that reject mediocrity. Industry expert Jan Kniffen, CEO of retail consultancy, J Rogers Kniffen Worldwide says, this is a "retail tectonic shift where the industry isn't simply evolving but "being torn down and rebuilt on a dead sprint.”  Join Shelley and Jan as they discuss how the retail industry stands at a pivotal moment that will determine which organizations thrive in the next decade. They also caution that retailers merely reacting to disruption face increasing irrelevance in a landscape dominated by forward-thinking competitors who manage the onslaught of change.

For more strategic insights and compelling content, visit TheRobinReport.com, where you can read, watch, and listen to content from Robin Lewis and other retail industry experts, and be sure to follow us on LinkedIn and Twitter.

Transcript

I really do believe that someday in the future, AI 3D printing and automated knitting will localize all production. Globally, right? Like if you're gonna sell it in China, you'll make it in China or nearby. If you're gonna sell it here, you'll make it here or nearby, but that won't bring back factory jobs to the United States.

Retail Unwrapped is a weekly podcast hosted by Shelly Cohan from the Robin Report. Each episode dives into the latest trends and developments in the retail industry. Join them as they discuss interesting topics and interview industry leaders keeping you in the loop with everything retail. Hi everybody, and thank you for joining our weekly podcast.

I'm Shelly Cohan and I'm very thrilled to welcome back Jan Rogers Niffen. He's the CEO of Jan Roberts Niffen Worldwide consultancy. You also were a formal, uh, retail executive and a frequent, when I say frequent, you're always on the news contributor of CNBC, Fox Business, Schwab Network, and all kinds of other news network.

Channel and you're always giving advice your retail expert in terms of what's been happening in the retail world. You also sit on many advisory boards on retail and tech, retail tech companies. And one of the funnest things you do, which I find really fascinating, is you're an expert witness for legal disputes.

How fun is that? I mean, I don't mean fun, but um, that must be really interesting work. It's one of my favorite things to do and people who are actually attorneys talk to me and say, you're an idiot. But it's, I love it. I love doing it. I think it's really fun. I like matching wit with guys who get out of Harvard and think they know a lot about retail but don't.

I think it's great. And, um, you also consult with investors as they make decisions to act actually, you know, invest or not invent, invest in retail companies. So you're, you have a pretty, uh, good handle on the retail industry and you have a lot of, uh, credibility of course in the retail industry. So welcome to Retail Unwrapped.

Thank you. So I always like chatting with you 'cause I never know where the conversation's gonna go. So let's start. I have to start with the top of mind topic, which is tariffs. I've had a couple podcasts about tariffs, but I wanna hear your view, what the heck is going on with tariffs and you know, what should retailers be thinking about or doing?

Well, I've been saying, you know, that this is a. Retail tectonic shift. Okay. It's tariffs, it's ai. It's the collapse of being good enough, and I don't think, it doesn't feel any more like retail's evolving. It feels more like it's being torn down and rebuilt like on a dead sprint. Matter of fact, one, a retailer had to be recently, it's like doing open heart surgery on a moving train.

That may sound extreme, but I understood what he was saying. Because you know, the SU supply chains have kinked and cracked and they were just getting back to normal. And the consumer is more fickle than ever. I mean, they've always been fickle, but they've been worse during and after Covid and proven margins have just evaporated.

Like, you know, summer clearance and heat wave, I don't know, just bang. And so it's tariffs, it's artificial intelligence. It's the dominant of these big mega retailers now, you know, that are just taking market share. And then. Nursing that post covid whiplash thing. And so you have to rewrite your survival manual.

You can't really, you can't coast on brand equity or nostalgia. You'll, you'll just sink. And so when you look at the tariffs, this is just the newest thing that came on, right? Except they're not that new because Trump's original tariffs from Trump 45. We've still got those. Biden left them in place and we got to dealing with them.

We got used to it. We made it work. But no politician running for reelection was ever gonna campaign on. We're gonna be less tough on China, so you get apparel, footwear, home goods, every category, slim margins are getting squeezed, but apparel probably faces maybe a 15% tariff when this. And we were already pivoting away from China, right?

We were going to Vietnam, we were going to India, we were going to Mexico, but we were, we were getting outta China before Covid and before tariffs. It's, it's been in motion a long time, but it takes time. It's costly, it's slow, and Nearshoring is even more expensive than moving to other places in Asia. And then reshoring, you know, I'm a big fan of that, but that's kind of a fantasy, right?

As of about now because. 3%. I dunno if this is a right number, but the government says 3% of the apparel sold in the US is made here, right? That's probably high, but that's their best guess and it's probably close enough. So I really do believe that someday in the future, AI 3D printing and automated knitting will localize all production.

Globally, right? Like if you're gonna sell in China, you'll make it in China or nearby. If you're gonna sell it here, you'll make it here or nearby. But that won't bring back factory jobs to the United States. It'll just create new jobs in robotic technology and facilities engineering and new infrastructure build, right?

Because we'll have to convert places to make.

That'll be the real transformation. But, but there won't be anybody working in those factories, unfortunately, other than the technicians and the facilities manager people, because all of the product will be automated or it won't be here because we, we just can't afford to bring it here. So I think that will happen, but that's not gonna happen soon.

So, so what really happens with tariffs? Well, my bet is we wind up with a 10% tariff globally and 20 or 30% on China. Right now, the bettings 30, my betting is actually 20, but whatever it is, you're gonna get somewhere between four and 6% requirement for raising retail prices, right.

The business that turns out to be tariff. And that's assuming of course, that, that you don't manage to offset it somehow. That I'm gonna put into the category of we beat the hell out of the vendors, the supply chain, our own operations, and maybe we only have to raise prices two or 3%. Instead of four to 6%, but it's, but some price increases are gonna be unavoidable and there's gonna be some erosion in gross margin dollars and there's absolutely gonna be a, a meaningful erosion in gross margin percentage 'cause we are not gonna raise the price more than enough to cover the tariffs that that's not gonna happen.

So see some gross margin percentage erosion. So, so that's where I think we're on tariffs. I think that's where, where we, we all thought it might be even worse. I never did. I have always thought 10% globally more on China and enough more to get people to continue to move out. And I think that's where we're going.

And I think in 30 or 90 days, that's where we'll find out. We are, and I think most of the retailers are only getting hurt right now because of the. Should I not bring it in? Should I keep it in the warehouse? Should I not order it? Should I cancel it? 'cause I think we're down right now for holiday placements by about 25%, and I think a hundred percent of the reason for that is tariffs, right?

So we've gotta make that back up here to get enough product in for the fourth quarter. But as of the day that we heard, oh, 90 more days, the product started to flow like water. My biggest fear is 21 days from now, when I look at the Port of Long Beach, I'm gonna see boats stacked up to the horizon. Right?

Yeah. Just like we did during Covid, because you know that that dislocation of, you know, at one point in time we had 31% fewer boats setting off the port recently than we would've this time last year. So that, that's gotta work. Its through the system. So tariff painful, settle in 10. 20 or 30 on China just because they've caused this deal dislocation.

But longer term, if we really just have to do a onetime price raise of two, two and three, maybe even three and half percent, we can probably deal with that. It's interesting. First of all, I appreciate the positive outlook and I, I trust your word over a lot of other things that I'm reading and seeing because I, I know that you just have a wealth of experience.

Um, in kind of thinking about the retail landscape, one thing I wanna ask you is, you know, as, as we came out of the pandemic and now the tariffs hit, I just feel like retailers are just in this massive. Uh, reaction phase. So we're pivoting here. We're pivoting there. So have we lost a little bit of innovation because we're so distracted with things going on, or do you think that's pushing retailers and brands to be more innovative?

Well, I think briefly, yes, we have lost our focus because we only have time to focus on one thing right now is, what am I.

The biggest thing we've gotta do right now is survive through Christmas. And so that's got everybody's complete focus. And yes, everybody's working on new technology, everybody's working on ai 'cause that's been going on really since before Covid and really actively during Covid. And since then we've been pushing really hard on all the technology.

But AI's the one I'm the most. Fascinated with and the one that seems to be getting all the attention, but right now they're sort of like stuck in place in general in retailing because they're waiting to get a definitive number on what I've gotta do with my gross margins. And you know how this is gonna work.

We're going to do all the things I said about trying to control to tear, tariff, gross margin component. And then we're finally gonna just say, okay, we gotta raise the price by x. And in about 12 seconds, the consumer's gonna tell us whether or not they're gonna accept that, or if they're gonna trade down, or if they're gonna substitute, or if they're just gonna turn around and walk away.

And if they just turn around and walk away, what happens next? What happens next is we drop the price, right? So everybody's waiting to see what happens. So they don't have time right now to do all the cool in adopting technology, but as soon as this. We'll be right back to if you're not adopting ai, you're in trouble.

So let's talk about ai. So I've heard a lot of use cases for ai. I'm sure you have a lot of experience with what's happening with ai. Do you think it's completely overdone in retail? Is it really important? Like what's your view on ai? And AI is such a broad topic. Maybe you can tell us, you know, where retailers and should be spending time and focus related to ai.

Wow. You know, I'm one of those people. I'm an early adopter of technology. Okay? I've got electric cars sitting in my garage. I'm one of those kind of people. Yay. I look at AI and I say, do you think the rise of the agrarian society was a big deal? Do you think the rise of the city state was a big deal? Do you think the Renaissance was a big deal?

Do you think the industrial revolution was a big deal? You ain't seen nothing yet. Ai, in my opinion, is a bigger change to society than any of those things I just said. Now, let's bring that down to retail. I think it's the biggest thing that's happened to retail, I don't know, since the rise in death of the department store, since the rise of the suburban mall and the death more or less of the suburban mall.

We've seen all of those things. This is, this is bigger. I mean, this is.

Control approach the customer and control our expense structure. Um, it, it's not hype anymore. It's, it's it's retail's power tool, you know, we'll see us optimizing inventory, optimizing pricing, really succeeding with personalization, completely customer service. So not only will you not just get a machine that you hate.

A person that doesn't know what you should do, you will get a machine that you don't even know is not a person that knows exactly what you should do and

told you this. Think I have. I've been working on a, um, research paper on AI with Professor Jerry Wind at Wharton and another co-author that we, we have already submitted actually to HBR, but we may have to submit it to something else, depend on how they feel about it. But so we've done a lot of work here.

We've talked to a lot of retailers and you know, we've talked to Amazon and Walmart, andry, and.

At least in my opinion, how much Walmart is doing number one compared to everybody else. But even how much people that are more focused on how we talk to our consumer, like high end retailers or aspirational retailers, they're using a lot of it to make the sale better so that when you're talking to somebody on the floor, they know more about the product.

So when they display it to you online, it's a better. Starting to adopt AI for.

To how they talk to you, to how you get customer service. And they're moving really, really fast. And as you know, they've got all the capital in the world, they can do anything. So part of the issue with AI is it's expensive, right? You have to spend a lot of money to make it happen. And if you're a poorly capitalized or small retailer, you're getting left behind.

But we talked not only to s to.

And, well, we didn't talk to 'em personally, but yes, we did surveys over 4,000 consumers and we asked them not only about using the AI themselves, but how they felt about interacting with it when they working with a retailer. Right. And there were, there's a million different things we talked to 'em about, but some of the real interesting things are the consumer in general is relatively comfortable with AI as a concept.

And a lot of 'em are using it personally. You know, I just read the other day that 16% of the people use it every week. Our sample used it more, I think, than the national average. And I don't, we thought we had a random sample of consumers, but ours seemed to be a little more focused on AI than what I read in some of other studies.

And the other thing we discovered that it was age related, which you would expect, right? Like if using. If you're more educated, you're more likely to be using it than if you're less educated, but you're also less likely to like it, which I thought was a fascinating outcome. Interesting. The more sophisticated consumer that used it more was very particular about how well you used it with them if you were using it.

Other funny thing that we found out that I find fascinating is people who voted in the last election are a lot more willing to give you information about themselves on AI agents than people who didn't vote in the last election. I'm not sure what that's got to do with anything interesting. It's one of those fascinating sidebars you get that says some people don't really wanna tell you their information and you better out which ones it.

They're gonna be resistant and you, you don't wanna put them in the position of being mad at you over it. So you do have to be careful about how much you're asking for and sussing out what the person wants to give and, and doesn't wanna give. And one of the examples we got from one of the retailers was they're happy to tell me everything about what they want, what the product is, what they like, but they don't wanna tell me that I'm going to a wedding in two weeks.

Really? How interesting. Yeah, because you know, that's the one thing, if you're the retailer you'd like to know, right? You're buying this interesting outfit, oh, and you're buying it because in three weeks you're going into our wedding. And then you'd go, well what about this? What about that? Right? So there's some resistance vans and, and it's going to be interesting, but I think like, I don't know about you, but I use various.

And I've tried all of them because I'm always fascinated they're, they're different, whether it's perplexity or whether it's chat, GPT or one of the other ones. So I use 'em all the time and I, I like them and I find them interesting and I am not thrilled about giving all of my information to say a retail ai AI agent.

On the other hand, I already think they know everything about me. Anyway, I'll tell you when I chat with chat GPT, it already knows everything about me that I haven't told it. If I say it's crazy, can you write something in the style of Jan Rogers sniffing? It just, it spits it right out. And I'm like, how does it know?

I know how it knows, it knows everything. So I think we'll get more and more comfortable. But I also think that, you know, if you're Amazon, if you're Walmart, if you're Dick's Sporting Goods, if you're tapestry, if you're those kind of companies. Where you're big and you have a big customer base, you got a lot of, you can spread your cost over a big base and you've got plenty of money to invest because you're not cash constrained and you're not debt constrained.

You are winning. If you're those other people who are waiting for someone else to do this for you, well that's different. 'cause you're gonna have to find a vendor that can help you do this and spread it over a bigger base and sell you a little piece of it. And then it's not really your stuff, it's.

Somebody else's stuff. But if you're Walmart, it's yours, right? And you're reaching out to make every piece of it work for you. From the time you get that item in the order system all the way to their, their machine now tells them how to stock the truck so that when the truck arrives at the store, they can push it in the aisle in the same order.

They're gonna put it on the shelf. That sounds really like, who cares? But that's labor hours. Man. There's nothing more important. Labor hours and putting. So I, I think AI will take over retailing. Consumers like it when it works. They really don't like it when they know it's AI and it's not really working for 'em.

They like it better when it's just this seamless interaction, and I don't think that's any surprise either, but that's hard to manage. Yeah, it sure is. And I do, I agree with you about the, um, AI and whether you do it in-house or have third party. The big challenge with having the third party vendors do it for you is that if you do a lot of ai, now you're managing all these partners, and that can be for a retailer, very cumbersome, right?

Yeah. I, I think that we will see AI start to make all of those things less cumbersome. But there are, there's always that little bit of a dislocation period. Or if somebody else said to me, I hope this isn't like when we all went to ERP. Right. Took us 18 months to get the system back and working again.

Right. I don't think that is the way it's going to be. I think you can implement AI and near every part individually, and it can also start to work together as soon as it can see its other pieces because it's that smart. And unfortunately or fortunately, for the rest of us, it gets smarter every day. It's pretty, yes, it does.

Smarter than any of us, and I'm a little concerned about that aspect of it. Even though I am an early adopter of technology, I'd like to not be ruled by the technology. On the other hand, I'd really like to see everything works seamlessly in my my car, which our will drive me around by itself. I'll be able to know where I wanna go before I strike out.

'cause I go there every time, every day at the same time. Right. Or something like that. So, yes, I think it it, for retail, it's, I think it's gonna be a bigger impact on retail. Only people understand this than a lot of other parts of society. But what do we do? You know, we shop and we get stuff and we, we, we, we interact, we can interact with it all day, all, all day long.

Every time we do anything, it's a retail transaction. If you're an American, it's pretty much what we do. So here's what I'd, well, first of all, I can't wait to read your research paper, like you have to tell me as soon as it gets published because it's gonna be a fascinating read For sure. Just for you, I can probably bootleg you a trough.

Oh, that'd be great. Um, so tell me about what, who are the most important retailers today and why? And you know, what's happening with the ones that maybe aren't so doing it so well? Well, that's really a hard question when you frame it in that terminology who are the most important. But I can tell you here's the ones I think are doing it the best, and I, here's the five best retailers in America.

So first you have. They've defined speed, convenience, assortment, that kind of stuff. And then you have to talk about Walmart, because Walmart is omnichannel perfected, right? It's E-commerce was up, what, 22% in this last release, I think. And then they're implementing AI from the supply chain to your house.

So it's gonna be. Even more of an impact on retail in your house, Jan? In your house. In your house. Yes. In what? To your house In, I didn't wanna say that. Yes. In your refrigerator for sure. And then Costco, you know? Oh yeah. I dunno what you call Costco, but it's a loyalty cult with a 90% renewal rate. What else you need to know?

With no gross margin. So basically you get it for what they paid for it practically. And then I don't have Target in my top five. But I still think as curation goes for big box, kind of general merchandiser, they're awfully good at what they do operationally. They've had these stumbles, so I don't have 'em in my top five anymore.

But I do think when you're talking about retail and you have to think about create curation, and I think it's hard to. Aspirational luxury retail curation is what you do. That's your life. But if you're a big discount store, curation is not your life. And they're, they're pretty good at that. Then Home Depot, who is on my list, oh, is, uh, they're almost clinical on their execution, right?

They're investing a couple billion dollars annually in the supply chain. The infrastructure integrating ia AI at. They are one of the premier retailers in the country. And then this might surprise you, but I've got Dick's Sporting Goods. Oh yeah. At least I had 'em in my top five retailers before they bought Footlocker.

It'll be interesting to see if I can keep 'em there, but you know. Dick's is what every department store wished it had become. Right? I mean, this House of Sport, for instance, is the, uh, F 80 Jet Fighter compared to the Dick's Sporting Goods. That was the P 51 Mustang. Yes, it was the best fighter in World War ii.

Now they've got House of Sport brand new. So that's, that's why I think doing really well, right? They're selling lifestyle now. They're not, they don't sell markdowns. They sell lifestyle labels really good. Their sales are. And then the Footlocker acquisition is either bold and great 'cause it'll cement their dominance in the athletic retail market, especially with Nike.

Or it'll turn out to be, they inherited footlocker's problems. And I don't know yet, which it'll be, I'm not happy, thrilled that they did the acquisition, 'cause I loved them the way they were just doing what you do. But I.

Foot to do what Ken s got it to do last time, which was what a.

Great brand activity. It does. They've still got lots of boxes to sell the stores out of, and Nike's gonna be more important by the fourth quarter of this year, and then through 2026 than they've been in a long time. And they're gonna be more dedicated to third party sellers of the product, and they've been in a long time.

So that could work really well if you happen to be acquiring Footlocker right now, or if you happen to be Dicks right now. And then of course, last on my list is TJ Max. Why are they last, even though they're one of the top five retailers? Because I don't really like the space. I mean, this is a best in breed off price player in what I think is now a saturated space.

So they're not, and I don't think there's tariff proof as other people think they are. I think they've got the same issues with tariffs as their, their other apparel retailer has. The slight dislocation we're getting right now could benefit 'em a little bit after that. They're in the same boat as everybody else, so.

Execute almost perfectly. Um, but I, I really don't like the space they're in. So now somebody out there that's counting is gonna go, wait a minute, you just listed six and you said this the top five. So why did I list six? Because I don't think Amazon is a retailer. When I look at Amazon, I say, okay, oh yes, stickiest website.

You can imagine. But there's no curation. They're the world's worst brick and mortar retailers. Can anybody even name for me a brick and mortar? That they created and rolled out and as successful, no. Everyone turns out to be a test and everyone, they just go throw in the trash can. That's right. And then remember they bought Whole Foods?

Oh yes. A pretty bad retailer. When they bought them, as you recall, they were struggling. They're still a pretty bad retailer. It's not like they fixed them. So you know, they're a great distribution system for. But what it really was was a vehicle for building all those other businesses. They built like AWS off of the back of it.

Never was great at retail. Right. And then finally, not in my top five, not on my list at all. Other than somebody who's really disrupting things. Is she and a team you? Yes. But of course now that we've just blown up the de minimus rule. And we're gonna be subject to the same problems everybody else has getting product in the country, and they're gonna be subject to tariffs.

They may not be quite as exciting as they were, say, I don't know, three months ago. But they have really, you know, they've invented new rules, right? They're, they're not, they're not what other retailers are. If, if you think they're fast. I mean, I used to think. That the fastest people in the world, the fast fashion industry.

But now these people come along and, and they're like not even the same class as what the fast fashion retailers are. They're just like lightning. They put in what? 10,000 new? It's insane like that. Yeah. So I, I think that'll be interesting to watch and how they, what they do now that the rules look a little different.

But it's still, they're force to be reckoned with. Well, lemme take you to the ex extreme opposite of that. I wanna ask you if you've been to Ton, I'm sure that, uh, you can pronounce it much better than I have, but it just opened as you know, in New York City. Tell us about that and your thoughts on that.

Well, I did study French though. Yes. Open dump any event. Um, they're down on the end of the island here. I'm, I'm in Greenwich actually, but if I was in New York City to be down on the end of the island at one Broadway, it's a new store they just opened. It's uh, not anything near the size of the one in Paris, but it is big, relatively speaking.

It's all carved up into individual display rooms and it is absolutely, in the 55 years I've been wandering around the world looking at retail. 'cause I have that long, believe it not, I already a. And it, it is the most beautiful thing I've ever seen. Everybody should go see it and everybody should buy one thing just so they keep it open so I can keep going there.

'cause it is in a very tough location as anyone knows for retail, it's practically sitting on top of the New York Stock Exchange, um, location wise. But it is an amazing thing to see. It's just, it's just retail done right? You feel like you've stepped into the past, but with all the goods from the future, it's just amazing.

Love it. I love the store design and how you, I feel like when I was walking through there, I was on like this mystical journey, you know, through another world. Going through the different rooms and the designs and just the lighting fixtures and the atmospherics and the different places where you could sit and relax.

I mean, really just amazing experience. The rooms, this is the old Bank of New York building, so it's an historic landmark. One of the rooms they used to display stuff was the room that the high wealth individuals met privately with bankers at BNY and they, all they did was clean all of the gorgeous marble and all of the gorgeous brass.

It's in that room as well as the floor and throw a carpet down and bring in fixtures, and it is absolutely the most gorgeous room in retailing. You feel like you have stepped into a fabulous in Paris. The whole story sort of. Well, supposedly they also have now what, according to the New York Times, the best restaurant in New York, inside the place, they have the cutest bar you've ever seen, and I spent time slopping on lattes in their French bistro.

Or it's just, it's swell. Done. You should go see it if. Absolutely. And also I wanna ask you another question since we're on the retail trail and which we're talking about mergers, acquisitions, things being bought. So do you have a view on, uh, HBC and the Canadian Tire recent announcement? I do have a view.

Um, I can't imagine it. I, I can't imagine anybody thinks it's a bad idea. All they really bought was the ip. And I think the negotiating for some of the leases, so clearly they wanna keep a few stores open it seems like, but you know, they only threw out $30 million in for Canadian Tire. That's like, you know, me dropping a $5 bill.

Um, so that's, it's really no real investment for them and they can use all of the. The Bay name as well as all the brand or private label brands and things like that, that they had inside it because they owe quite a few, uh, intellectual pieces of intellectual property. So I think for the customer, it's great because the Canadian customer is gonna wanna see the Bay's name stay in Canadian hands and continue to operate.

And so if they can just run a few of the stores, if they can put shop in shops inside of some, I don't know really what. Parts Source Sport Check. Canadian Tire Bank, mark Canadian Tire, petroleum Party City, Canada and Sherwood have to do with the Bay, but I am telling you if they can put some of those inside of something like the Canadian Tire Stores, this has gotta be a good thing and.

I've seen several interviews with Canadian consumers and they're just kind of gushing over the fact that the Bay might still be around. I can guarantee you a quarter of the ones that they talked to that were gushing about it haven't been there. And another quarter of them doesn't go there once every decade, but it doesn't mean they don't love the name, right?

And so they're regular customers are thrilled and people who just know the name and associate it with Canadian retailing. Thrilled. It's kind of like whenever we would go have a going out of business sale, people would come shop at one of our stores that hadn't been there forever, but remembered it from when and couldn't imagine why we were closing it.

Well, this falls in that category and I'm thrilled. I love the name. I, we tried to buy them. We tried to buy, we tried, has the right. Do some stores and this will not be a bad investment for Canadian Tire and it might be a really good one. I mean, they could get a triple value out of a $30 million investment if they can use those IP and, and if they get us, I, they'll get that much goodwill just from their Canadian customers to shop at Canadian Tire that maybe never did even shop at the Bay, but they'll feel good about the fact that the company did that.

So I think it was a brilliant move by Canadian Tire. That's great. And do you think it helps, uh, sacks and Neimans and does it take away from some of the distraction at HBC? Do you think there's any benefit that we'll see on the luxury side of HBC's Holdings? No, but at least they don't have to deal with it.

But it's, you know, the bad news has already happened, right? The liquidation that's already gone. Right. The thing, all the struggle brain.

I don't think this does anything really other than that $30 million back in the pot. But, uh, but at least it's happened and they won't have to suffer with it anymore. But I don't think it really has any umbrella. I don't think they get any halo from the fact that Katie and Tire took the brand. And I do think anyone who knows that Neman Saxon associated.

They went down. If you're Canadian, you're not gonna be thrilled with Sax or Neimans. I don't think it has any impact here in their business in the States. Well, thank you Jan. And one last question before we go. I keep saying this and I can't believe it's five years now, and I, I'm still having the conversation.

Are we finally past covid? Is it done? Is it behind us both from a consumer and retailer perspective, it'll never be behind us. The generation that suffered through Covid, whether it's me or whether it's the kids that were in school, will never be unaffected by Covid. In my opinion. It changed all of our lives.

It changed everybody's work life. It changed everybody's school life, and none of that has actually, for most people, gone back to the way it.

You're not wearing a mask anymore, but if you used to go to work five days a week, a lot of people are now going three days a week or two days a week, or one week out of the month or things like that, which changes also the whole shopping retail pattern, right? As far as where people go and what they buy.

So we've seen a lot of little places where the coffee shop nearby, right? They're dead because, but other places have risen up because people are still in their neighborhoods where they were. In the city working before, so, so it's changed all that a lot, but it's changed all of us too. I mean, I don't think the, you only live once thing is over and now I'm wondering is it ever gonna be over?

I remember saying this is like 19, 20 after the 1918 managed flu in the war. Right? When everybody came out and they went flappers and shirts got shorter and speakeasy opened and all that stuff happened because people said, I'm gonna. Well, we certainly saw that at the end of Covid. I mean, all kinds of people went places and did things that they had always wanted to do, and they spent all kinds of money on experiences.

But I'm not sure that goes away for a very long time. I think we may bend that way for a while because of Covid, and I also think that this whole, I need to be dependent on myself. I'm gonna move to the suburbs. No, I'm gonna move all the way out to some rural area. I'm gonna raise chickens and I'm gonna live out here, and I'm gonna work remotely because I don't wanna depend on the system anymore.

I think that's a real thing. And I think if you're tractor supply for instance, it's a good thing if you're somebody who's doing business in the city. It makes it a little tough coming.

To be near your place. So I do think it's, it's dramatically changed. It's dramatically changed everything. And you know, during covid we said we're gonna see 50,000 stores closed and then the government just put so much money into the system that a whole lot of things that were gonna blow up survived.

And you know, they paid their employees, but that whole wave is now starting. To work through because that money is no longer coming in. And now we've got tariffs we're dealing with on top with on top of it. So I think that 50,000 number bokey of people who could close in short order a number of stores is probably new again, I think it's probably real again.

And I think we'll see a lot of attrition sadly of it you never heard of. Right. But they'll be. Getting new jobs and the people that owned it will be recapitalizing what they can, because the big players are still taking market share. I mean, what we see from Walmart, I mean Sam's Club was up, what, 7% or something on store for store sales and Walmart, US was up like four and a half, right?

SCO was always up 7%. That's coming from someplace. When you're that big and that's your store for store sales, somebody down here loses a hundred percent. And I think we're still seeing all that manifest. And I think that's, that's really much of, that's the hangover from Covid. Well, Jan, oh my gosh, it's always a pleasure having you on retail and wrap.

Thank you so much for coming on. If, do you have any clothing closing, uh, thoughts you wanna share? Clothing, thoughts? You mean closing one? Things happening with brands and all that stuff and you know, yes. I'm supposed to have a meeting with authentic brands because you know, they've bought up so many brands, but in general, I think Nike's coming back in the fall and I think their pipeline's reset and people are betting on sometime mid 2026.

I'm betting on the end of 2025 when we really start to see a difference there. So I think that brand's important. I think Levi's right now is a really important brand. Love Levi's, right? That's another thing. Enhanced by Covid because we went to wearing that sort of thing. Because what Sales of business attire still down 40% from what it was in 2019?

I think. So if you look at what's happening, it's more things like that. Um, I'm a big fan of, I told De Tractor Supply because of where they're located, so I don't.

As sort of or boot barn as sort of the brand in Western. And I think the whole Western craze is not just because Beyonce singing Western, I think she's singing Western because of the craze, and then it just enhanced the craze. But I think the craze was enhanced by Covid because I still think that I'm independent.

I'm running my own lifestyle. Why do we all watch Yellowstone? Because we all to be person. Fighting their own battles and running their own life. 'cause Covid kept you from doing any of that. I think that's got a long tail. So those kinds of things are important. I really am a big fan of the tapestry business.

I think that it's in the right place. I think that that aspirational customer, I don't think that we're going into a recession. I think that everybody has a job, and I think all the stuff that consumers telling us about in six months, I'm really worried about inflation. In six months. I'm really worried about the economy.

I believe them, but all they're really reacting to is they're right now, and right now unemployment's 4.2%. Job openings are, I don't know, 8 million. Everybody's got a job. Everybody thinks they're gonna keep their job and everybody thinks that they lost their job. They could get one making just as much or more.

And when that's true, they keep spending. So unless that thing that they see out there, that monster turns out to be real, we're not going to see them lead us into a recession. And if we don't, aspirational retail and luxury retail like LVMH are going to be good, better than what the, the street thinks right now.

Oh, Jan, that's amazing. Thank you so much. What a great recap. And I'm a big boot barn. I love boot barn. They are so quirky and fun. I love them. So thank you so much. Thank you for being here. And um, I wanna thank our listeners. I'm sure you learned a wealth of information from Jan today. So. Um, thank you.

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