Dan Hanson, Portfolio Manager at Jarislowsky Fraser Global Investment Management, says that in the context of the online retail world taking over, TJX Companies Inc (NYSE:TJX) has a business model that has proved very resolute.
In the case of TJX, they’ve got a unique ability to deliver a treasure-hunt shopping experience to customers who come back. And you see it in the traffic, which has been remarkably resilient through economic cycles and through the increase of online shopping activity.
TJX has really built a unique supply chain and purchasing organization. It’s a capability at scale that has proven to be responsive to consumers’ and shoppers’ needs, and will uniquely continue to deliver value to customers.
Hanson says retailing has become even more competitive today with instant information, social media and online competition. Therefore, his firm looks for an underlying source of value.
Value to the consumer is in the DNA of the company. When they started out, the department stores had much stronger pricing power. That power has eroded the department store, but TJX has continued to add value to customers.
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