The Supply Side briefs: Target video, TJX profits, Retail imports slow

• Target tests video-streaming
Target has launched a Netflix-like video-streaming service with its employees, according to published reports.

The company is testing the waters in a crowded field that includes retail rival Wal-Mart, which owns the Vudu streaming service.

The big box retailer website says "Target Ticket beta" contains 15,000 film and TV releases, which can be accessed at www.targetticket.com/home/beta. All that is needed to access the entertainment during this test phase is the employee identification number.

With the service, Target is not only taking on Netflix. in the video streaming field, but also YouTube and Hulu, Wal-Mart’s Vudu and Amazon’s Prime Instant Video which was recently expanded to 40,000 plus titles.

• Discounter TJX posts solid results
TJX, the parent company of T.J. Maxx, Marshalls and HomeGoods stores, posted slowing first-quarter sales, but said the second quarter was off to a strong start.

Earnings per share climbed 13% to 62 cents, matching the consensus estimate of Wall Street analysts.

Sales rose 7% to $6.2 billion, a hair over the $6.16 billion analysts were expecting. A year ago sales had climbed 11%.

Same-store sales, a key industry metric, grew by 2%. Those sales were up 8% a year ago as the company cited difficult quarterly comparisons for the slower growth.

"The second quarter is off to a strong start and we are in an excellent position to buy into the enormous opportunities for quality merchandise that we are seeing in the marketplace," CEO Carol Meyrowitz said in a statement.

Rival discounter Ross Stores (ROST) will report Q1 results after the close Thursday, (May 23). Analysts expect earnings to rise 15% to $1.07 per share. Sales are expected to top $2.52 billion, up  with sales up 7%.

• Retail imports expected to slow
Import volume at the nation’s major retail container ports is expected to increase 3.3% in May over the same month last year but growth could trickle to a standstill by the end of the summer, according to the monthly Global Port Tracker report released by the National Retail Federation and Hackett Associates.

“The weak cargo increases expected over the next few months are consistent with other signs that the economy is slowly improving but show that retailers remain cautious, especially when it comes to stocking their inventories,” NRF Vice President for Supply Chain and Customs Policy Jonathan Gold said. “We’re looking at barely 1% of year-over-year growth through the early summer, and August and September are expected to be basically flat even though they’re supposed to be two of the busiest months of the years.”

He said with consumer confidence low, employment struggling to recover and less money in shoppers’ pockets because of the payroll tax hike, action is needed from Washington that will provide some fiscal certainty for families and businesses alike.

Cargo import numbers do not correlate directly with retail sales or employment because they count only the number of cargo containers brought into the country, not the value of the merchandise inside them. But the amount of merchandise imported nonetheless provides a rough barometer of retailers’ expectations.

U.S. ports followed by Global Port Tracker handled 1.14 million (Twenty-foot Equivalent Units) in March, the latest month for which after-the-fact numbers are available. That was down 10.9% from February and 8.6% from March 2012. One TEU is one 20-foot cargo container or its equivalent.

April cargo imports were estimated at 1.29 million TEU, down 1.4% from a year ago.

The May forecast at 1.42 million TEU, up 3.3% from last year. Cargo is expected to level off by August, with an anticipated 0.1% increase predicted.

The first six months of 2013 are expected to total 7.8 million TEU, up 2%  from the first half of 2012.

“Despite the Fed pumping liquidity into the market, consumer confidence still has not turned the corner,” Hackett Associates Founder Ben Hackett said.“We need to see the economy strengthen in the coming quarters before we can begin to see the threat of a further economic downturn dissipating.Trade will remain at low growth levels until we reach this stage.”