Ross Stores.docx - Running head ROSS STORES 1 Ross Stores...

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Running head: ROSS STORES 1 Ross Stores: Big Winner of Brick-and-Mortar Retail Harold Eric Warriax Post University
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Ross Stores: Big Winner of Brick-and-Mortar Retail 2 Abstract While the traditional retail department stores have been witnessing plunging sales and diminishing consumer traffic, online sales have been on the rise and booming. The consumer base is increasingly drawn by Amazon's gravitational pull and the appeal of ordering things online. However, there exists a bright and booming sector within retail, namely the off-price retail industry, that has managed to not only survive the online competition, but also thrive in the e-commerce subjugated retail industry. This paper primarily focuses on discussing the key characteristics of a single company, Ross Stores, Inc. and how it has managed to stay afloat, profitable and expand in these modern e-commerce driven environment with streamlined costs and higher than average margins.
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Ross Stores: Big Winner of Brick-and-Mortar Retail 3 A current widely upheld theory about the fall of overall retail sales in the US is that it is directly correlated to the rise of e-commerce. More specifically, online sales from companies such as Amazon are showing astounding sales growth of about 15% year over year, while in comparison total retail sales show only about 4% growth. To put these numbers into better perspective, according to the US Census Bureau, total e-commerce sales account for only a mere 8.5% of total retail sales in the US, while 91.5% comprise of traditional brick-and-mortar sales. This tells us that despite malls closing, previous retail giants experiencing lower sales growth than ever, and the staggering rate of store closures and bankruptcies, to date majority of the retail sales are still conducted in stores and in person. At a time of widespread distress in the brick- and -mortar retail industry, there are certain business models that have been able to improve its profitability consistently, and remain impervious to the Amazon vortex. In this paper, I will examine the core reasons and creative organizational strategies displayed by one such company, major discount retailer Ross Stores (ROST), which has proven the ability to survive and gain momentum in the current ecommerce driven retail world. Ross Stores' Lean Business Model Operating as a leading off-price retailer of name brand and designer apparel, accessories, footwear, and home goods, Ross Stores is ranked 237th on the Fortune 500 list. The company operates principally through two retail brands: Ross Dress for Less (Ross) and dd's Discounts. The Company offers products for men, women, and children of all ages, although according to a recent investor presentation published by the Company, Ross Stores' target demographic is predominantly value-conscious females, who appreciate good quality brands while also enjoying shopping for bargains. These core customers are characteristically from middle income households and likely make two or three store visits each month, making the company currently
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