Tractor Supply Continues to Outperform Other Retail Rivals
“We are a needs-based business, so the customers that buy at Tractor Supply need the things that we sell; so we are not a discretionary store, per se,” – CEO and President of Tractor Supply Co. Gregory Sandfort.
Tractor Supply continues to buck the trend of many struggling retailers in 2015, evidenced by its impressive third quarter financial results. The retailer’s competitive advantage outlined above by its top executive Sandfort is putting Tractor Supply in a place to succeed, especially against many other brick-and-mortar focused retailers.
Tractor Supply noted in a press release that comparable store average transaction counts increased for the 30th consecutive quarter, while comparable store sales increased 2.9% from prior year’s quarter. In other words, customers are putting more items in shopping carts during visits. Net sales for the third quarter 2015 increased 8.5% from prior year’s third quarter. Conversely, the company’s stock performance has been impressive throughout 2015.
Pet supplies and animal categories have been a key growth driver for the company, which coincides with its ‘need-based’ mantra. Third quarter figures were all the more impressive because of the unseasonably warm weather in much of the country, which has caused many other retailers to have disappointing sales performances. The company opened another 30 new store locations during the third quarter (same amount as third quarter 2014) and is on track to open 114 new stores total for fiscal 2015.
TS is positioned for a strong 2016 as well. The company has pointed to the West Coast for possible expansion opportunities, while it will go head to head with Lowes and Home Depot in Long Island, NY for the first time. The company prefers to hire associates with experience in welding and ranching, and does not anticipate labor issues for hiring or retention, a topic on the mind of most retail executives approaching next year. Store managers and associates are eligible for monthly bonuses based on sales goals, and are offered company stock for purchase at a 15% discount.
Related Article – Tractor Supply: Amazing Growth Through Good Times and Bad