Trading Partners

Target Corp. and Best Buy didn't just talk the talk when it came to killing a border adjustment tax on imports that was the centerpiece of House Republicans tax reform plan.    In the first six months of 2017, Best Buy spent $1.71 million in lobbying efforts, twice as much as it spent the entire year in 2016, the Star Tribune reported. Target Corp. spent $1.48 million lobbying from January through June 2017, which was slightly less than it spent all of last year.  

The arrival of German discount grocer Lidl and Amazon's purchase of Whole Foods Markets have ratcheted up the already intense grocery wars and put new pressure on existing players, including Walmart. But one analyst thinks the discounter is well-positioned for the battle.  

In May, United States Trade Representative (USTR) Robert Lighthizer began the formal process for renegotiating the North American Free Trade Agreement (NAFTA), which establishes the rules of trade among Canada, Mexico and the United States. The retail sector has urged USTR to preserve NAFTA’s basic structure, while advocating changes that could help retailers begin sourcing more items from NAFTA countries rather than Asia. As explained below, the outcome of NAFTA renegotiation also will signal the future direction of U.S. trade law and policy.  

Macy's and Sears are by no means the only department store companies with valuable real estate.    Activist investor Snow Capital Partners has built a position in Dillard's Inc. and is planning to push for changes at the retailer, including unlocking the value of its real estate portfolio, Bloomberg reported.  

Staples met the first requirement on its road back to private ownership.   The office supplies giant, which is being acquired by private equity firm Sycamore Partners, has been granted early termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. This act states that no merger or acquisition can take place until the United States Federal Trade Commission and Department of Justice have determined that the filed transaction will not violate U.S. commerce antitrust laws.   

Macerich CEO Arthur Coppola had the potential for total compensation worth about $12 million in 2016, but his company’s recent proxy filing showed him receiving less than half of that.   Coppola is just one of many senior executives of publicly traded mall-owning companies to feel the sting brick-and-mortar’s right-sizing in his pocketbook, according to a report in the Wall Street Journal.   

The import tax proposal has officially been removed from the tax reform plan — which is welcome news for retailers across the industry.   On Thursday, congressional and administration leaders announced they would remove the Border Adjustment Tax (BAT) from consideration, and announced an outline for comprehensive tax reform. The BAT provision would have ended importers’ ability to deduct the cost of merchandise purchased from other countries.   

Walmart is stepping up efforts to drive energy efficiency across its distribution network.   The discount giant is adopting fuel cells and hydrogen stations from provider Power Plug — a move that will bolster its energy efficiency at up to 30 more locations. Walmart already has Plug Power fuel cells installed at 22 distribution centers, according to USA Today.  

Rent-A-Center is being selective about potential business opportunities.   According to sources, the nation’s largest rent-to-own company brushed off takeover interest from private equity firms HIG Capital and Lone Star Funds. The snub took place prior to turning down an offer of $800 million from buyout firm Vintage Capital earlier this month, according to Reuters.  

Since reports began to swirl around a possible sale of True Value Company -- or at least the consideration of such a move – the Chicago-based co-op’s CEO has downplayed the story as “rumor.”   But that hasn’t stopped rival co-ops from weighing in with their own statements.