May 6, 2019 Consensus

The Weekly Consensus – May 6, 2019 (Volume 11, Number 18)

The Big Story
RetailWire Discussion: Should (Can) Rivals Meet the Free One-Day Delivery Bar Being Set by Amazon?
George Anderson, Editor-in-chief, RetailWire has long maintained that its Prime membership program is “the best deal in retail.” On April 25th, the e-tail giant announced plans to make the program even better by lowering the amount of time it takes to deliver products from two days to one.

Brian Olsavsky, Amazon’s senior vice president and chief financial officer, told analysts on its first quarter earnings call that the e-tail giant was well into the process of “evolving” the company’s free two-day standard option on Prime eligible purchases to one-day while continuing “to offer same day and Prime Now selection in an accelerated basis.”

Amazon, according to Mr. Olsavsky, “has expanded our one-day eligible selection and also expanded the number of zip codes eligible for one-day shipping.” The company plans to invest $800 million in incremental spending during the second quarter to further ramp up one-day shipping for Prime members. Consumer Intelligence Research Partners (CIRP) estimates that Amazon currently has 103 million Prime members in the U.S.

Amazon rivals will be under pressure to keep pace with the e-tail giant as it raises consumer expectations around delivery times.

DISCUSSION QUESTIONS: How will Amazon’s guarantee of one-day shipping for Prime memberships affect the expectations that consumers have about deliveries of online orders? What will this mean for Amazon and its competitors?


Comments from the RetailWire BrainTrust:


The truth is many retailers can go one better: they can offer same-day pickup from stores. It’s more cost effective for them, and many consumers actually prefer it to delivery. Amazon is not so fortunate; it doesn’t have stores that can fulfill in this way, so it has to enhance its delivery options for core customers. That’s going to come with a hefty price tag, albeit one Amazon can afford.

Other retailers now need to determine how they respond in terms of delivery to home. Over time we’re likely to see options enhanced for shoppers, with more of the cost being absorbed by retailers. The question is: how many can afford it in the way Amazon can?

Neil Saunders, Managing Director, GlobalData

Great perspective, Neil. This is a no-brainer for retailers as they continue to compete with Amazon. However, there are organizational, technology and even cultural changes that have to be established in order for retailers to fundamentally turn on the omnichannel switch, and truly provide products the same day or next via the BOPIS value proposition. This is one of the reasons why Amazon acquired Whole Foods, and why they continue to express their ambitions about opening more brick & mortar locations.

Brandon Rael, Strategy & Operations Leader

Once again, Amazon’s super power is both being there at the point in time that a consumer thinks “I need or want X” and then satisfying that need/want as quickly as possible, which happens when the product is in the consumers’ hands. Of course one-day delivery strengthens that super power. What makes this challenging is the comprehensiveness of the offering. No other retailer can afford to make that same offering as comprehensively as Amazon.

It reminds me of the impact of Walmart’s comprehensive EDLP (everyday low pricing) strategy. The only way competitors could respond was through a high/low pricing – strategically lowering pricing on specific items below the point of profitability but making up that profit elsewhere with the trip. The only way other retailers will be able to compete with the Prime offering is to strategically offer something significantly better – likely via in-store pick up.

Another consideration is the fact that Amazon subsidizes the cost of Prime by charging suppliers for being Prime eligible. In a perfect world, that up-charge shows up as higher prices for Prime eligible products on Amazon. In that case, it will be a question of whether low price beats convenience, or vice versa, and how often for how many consumers.

Susan O’Neal, CEO, Dabbl

As a competitive retailer to Amazon, I would not even try to match this latest change. The new standard being set by Amazon is good for Prime members, but could almost be seen as bait for competitors who destroy their margins by trying to keep pace.

I also wonder about the research that Amazon did behind the latest move. There is probably a finite list of the type of products customers may want (need?) with a 24-hour delivery. But most items purchased are not that time sensitive. I wonder if true demand was determined by Amazon in introducing this feature or was it more Amazon wanting to keep the pressure on market rivals?

There is a perception among consumers that faster is always better. I’m not sure that plays into the hands of any retailer over the long run.

Bill Hanifin, CEO, Hanifin Loyalty LLC


Read the complete RetailWire discussion here


Headlines of the Week

Beyond Meat surges 163% in the best IPO so far in 2019

In the strongest market debut so far this year, Beyond Meat shares surged 163% Thursday, giving the maker of plant-based meat substitutes a market value of $3.77 billion. The company is trading on the Nasdaq under the symbol BYND. On Wednesday night, Beyond priced its initial public offering at $25 per share, for an implied market value of $1.46 billion.


PetSmart Is Taking Its Online Pet Business, Chewy, Public

PetSmart is moving forward with a plan to take public its fast-growing online pet business, Chewy, just two short years after acquiring the company. Chewy filed for an initial public offering last week, according to documents filed with the Securities & Exchange Commission. The company is looking to raise $100 million, according to the filing, although this figure is commonly used as a placeholder and is likely to change. The planned IPO comes just two years after PetSmart spent over $3 billion to acquire the e-commerce company. The move was billed as a way for PetSmart to establish a robust online presence that supplemented its sprawling brick-and-mortar footprint of 1,600 stores. Last year, however, PetSmart spun off a portion of its equity in Chewy and set the stage for a potential public offering or sale.



Apparel & Footwear

American Apparel Owner Gildan Puts Plans for L.A. Store on Hold

American Apparel may not be returning to brick-and-mortar after all — at least not yet. Owner Gildan Activewear Inc. said its plan to open a flagship store in Los Angeles, announced a year ago, has been put on hold as the Montreal-based apparel company focuses on e-commerce and wholesale clients. Gildan bought the rights to American Apparel — but not the stores, which closed — in a 2017 bankruptcy auction. Chief Executive Officer Glenn Chamandy said at the time that Gildan was thinking about franchising the brand or opening more stores. Bell said the company’s primary focus has been expanding its clients base in the “imprintables markets” — the wholesalers who buy blank T-shirts and other items to customize them for sports teams or events.

As Payless wades through bankruptcy again, creditors say hedge fund may be to blame

When Payless ShoeSource emerged from bankruptcy protection in August 2017, the national discount footwear company vowed to reinvent itself. But today the retailer and a hedge fund that controls it are locked in a contentious battle over its second turn through bankruptcy. In February, just a year-and-a-half after its first Chapter 11 reorganization case, Payless landed back in bankruptcy court – this time wiping a decades-old retailer off the map in the U.S. and Canada. The turn of events has destined an estimated 16,000 workers for unemployment and disappointed consumers who relied on the chain’s 2,500 stores and website for affordable shoes, boots, and sandals. The company intends to keep Payless’ overseas operations running.

Kurt Geiger owner mulls selling retailer to US group for £450m

Kurt Geiger parent company Cinven is considering selling the British footwear and accessories retailer to a US fashion group for £450 million. Cinven has held unofficial “fireside chats” with possible buyers, according to The Telegraph. Other fashion retailers such as Steve Madden, Michael Kors and Coach are said to be involved in early discussions about a deal. Cinven had acquired Kurt Geiger for £245 million in 2015 from another private equity firm, Sycamore Partners. In 2017, the retailer generated sales of £330 million – an increase of 12 per cent. Kurt Geiger currently has over 320 stores and concessions, including in Harrods and Selfridges, and employs about 1300 staff.

Sonia Rykiel Seeks Bankruptcy Protection in France, Liquidates in the US

After years of business challenges and an unceremonious break up with creative director Julie de Libran in March, famous left-bank fashion house Sonia Rykiel has been placed into receivership, or the French equivalent of Chapter 11 bankruptcy protection. On Tuesday, a commercial court granted the brand’s request for protection until the end of June 2019 while it searches for a new owner. The news comes after Sonia Rykiel Inc. filed for Chapter 7 bankruptcy in the United States on April 16, and shut down several stores including those in New York and London. Hong Kong investment group First Heritage Brands, which bought a majority stake in Sonia Rykiel in 2012 and acquired it outright in 2017, is looking for new investors to take control of the label, which has undergone several business restructurings and rounds of layoffs since it relaunched in 2014.


Athletic & Sporting Goods

Under Armour shares surge as it beats sales and profit estimates in first quarter

Shares of Under Armour jumped after the company beat fourth quarter sales and profit expectations amid growth in shoe sales and overseas, signs, executives said, that the brand is re-connecting with consumers.  The Baltimore-based athletic apparel and footwear maker reported income of $22 million, or 5 cents per share, for the first quarter that ended March 31. Sales rose 2% to $1.2 billion.  During a conference call with analysts, executives touted the success of a turnaround plan that is allowing the brand to operate more efficiently, increase the speed with which it brings new products to consumers and organize around categories such as running, basketball and women’s training.


Fulcrum Capital-backed Athletica buys Becker Arena Products

Athletica Sport Systems Inc has acquired Becker Arena Products Inc, a Shakopee, Minnesota-based provider of dasher board systems and arena aftermarket products targeting entertainment facilities in the United States.  Based in Waterloo, Ontario, Athletica designs, makes, installs and services dasher board systems for hockey arenas and multi-sport facilities.  The company said the acquisition, which follows last year’s purchase of Cascadia Sport Systems Inc, will complete its North American footprint.


Professional Fighters League Secures $30M in Series C Funding

The Professional Fighters League, a mixed martial arts league, secured $30m in Series C funding.  Backers in the round, which brought total funding raised to date to $82m, included:  Mark Burnett: Chairman TV Group MGM; Pioneer unscripted TV, and Elysian Park Ventures: Venture investment group of Los Angeles Dodgers.  Led by Donn Davis, Chairman, and Peter Murray, CEO, Professional Fighters League presents MMA in the sport-season format where individual fighters control their own destiny, competing in a regular season, playoffs, and championship.

Cosmetics & Pharmacy

Travel retail among “strongest growth engines” for Estée Lauder in third quarter

The Estée Lauder Companies generated a strong increase of 11% in net sales to US$3.74 billion in its third financial quarter (ending 31 March 2019) versus the same period in 2018, with nearly all product categories and channels showing growth. For the nine months ending 31 March, ELC reported net sales of US$11.27 billion, a 9% increase compared with the prior-year period. Travel retail was cited as among the biggest growth drivers in Q3 – particularly in the EMEA region – continuing the strong trajectory for the channel seen in prior periods.

Givaudan Buys AMSilk’s Cosmetics Business

Swiss flavors, fragrances and active cosmetic ingredients manufacturer Givaudan has agreed to buy the cosmetics business of Germany’s AMSilk. The acquisition fits with Givaudan’s aim – part of its 2020 strategy – to become a major player in the fast-growing active cosmetic ingredients market. Headquartered near Munich, AMSilk is an industrial supplier of synthetic silk biopolymers, which can be used in a broad range of applications across categories such as haircare and skincare. AMSilk has filed 10 patents for the use of biopolymers in cosmetic applications. Givaudan has not revealed financial details of the deal although said it would fund the purchase from its existing resources.

Hum Nutrition Raises $15M Series B

Hum Nutrition has raised a $15 million Series B. The vitamin brand has closed a second round of funding led by Sonoma brands, with participation from existing investors CircleUp, Imaginary Ventures and Strand Equity. Hum raised $5 million in a Series A in 2017, and has since doubled in size. Hum makes nutritional supplements with whimsical names that tout beauty and well-being benefits. The company’s latest launch is Skin Heroes Pre+Probiotic, $40, which is meant to balance the gut microbiome to benefit acne-prone skin. The brand also makes Collagen Pop, a dissolvable collagen and Vitamin C tablet, $30; Glow Sweet Glow, a $25 vegan gummy with hyaluronic acid and vitamins C and E, and Wing Man, a $25 supplement “widely used for liver detox and related dark circles.” Hum supplements are sold direct-to-consumer, as well as at Sephora, Nordstrom, Neiman Marcus, Urban Outfitters and other retailers.


Discounters & Department Stores

Walmart reportedly changing up store management again

Walmart, one of the nation’s largest employers, has for a time now been in damage control mode when it comes to workplace issues, in an effort to undo years of bad press about low wages and difficult working conditions. Last year, the retail giant bumped its starting wages, instituted new training programs and has made it easier to advance to higher paying positions, although rivals Target and Costco’s starting pay continues to outpace its $11-per-hour minimum. This year new incentives were also added for attendance, among other workforce initiatives. The latest effort entails the hire of employees to work just under the store manager level, to help motivate and train store employees, according to the Bloomberg report. Such new “business leads” will take responsibility for finances and hiring, and earn 10% more than traditional assistant managers.

Nordstrom Expands New York Presence With 2 ‘Local’ Stores

Nordstrom waited decades to expand in Manhattan, but now it’s making up for lost time. The upscale department store chain introduced its men’s store last year and is opening a seven-story flagship store this fall. And Nordstrom has more planned for New York City. In September, it will open two small outposts in New York as part of its new Nordstrom Local chain, the retailer announced Wednesday May 1st. The two smaller stores will not carry merchandise. Rather, they will be hubs for online pickups and returns, as well as services like tailoring and personal styling. New York City is Nordstrom’s biggest market for online sales, but its physical presence has largely been limited to its Nordstrom Rack discount chain. By the end of 2019, there will be six Nordstrom locations in Manhattan.

Target, Walmart envision radically different futures for their growing media businesses

Big-box retail rivals Walmart and Target presented for the first time at the IAB’s Digital Content NewFronts this week, and their shows, held on May 1-2, demonstrated how the two companies continue to pursue drastically different approaches to diversifying and marketing their business. In this case, both are ramping up their media strategies to try and help brands engage with consumers who are cutting the cord and increasingly favoring connected channels, with a trove of first-party data as a central part of the retailers’ pitch to attracting ad dollars. Walmart will leverage that data in tandem with a growing stable of original and library content, along with new products like shoppable in-stream ads, that are all offered through its streaming platform Vudu. Target, on the other hand, is breaking from its chief competitor in not pursuing original content but instead expanding its three-year-old in-house Target Media Network, which has been rebranded to Roundel.

Kohl’s won over moms. Now it’s going after Millennials

Kohl’s has built a loyal shopping base of middle-aged moms. Now, it’s pivoting to chase a group of customers it has struggled with: Millennials. “We have not done our job,” Kohl’s CEO Michelle Gass said last year of the department store’s history with Millennial shoppers. For Gass, who stepped into the top job at Kohl’s a year ago, winning younger customers remains a key priority as she tries to make the 57-year-old retailer more relevant for a new generation of shoppers.



Emerging Consumer Companies

Allbirds launches a ballet flat

Allbirds introduced a line of ballet flats, the Tree Breezers. The shoes are machine-washable, and composed of breathable, lightweight fabric made from tree fiber. The line is available in three colors and retails for $95.

Away launches a duffel bag

Away launched the Weekender, a duffel bag made from lightweight canvas, with a detachable shoulder strap. The Weekender can pair with the Away suitcases via a suitcase-handle sleeve. It currently comes in three colors and retails for $245.

SmileDirectClub partners with CVS to open shop-in-shops

SmileDirectClub and CVS will partner to open hundreds of SmileDirectClub locations, called SmileShops, inside CVS stores this year. Inside the SmileShops, customers can receive a 3D scan of their teeth to be used to create a set of aligners. The companies plan to open more than 1,000 locations.



Grocery & Restaurants

Carrols completes 220-unit Burger King-Popeyes acquisition

Carrols Restaurant Group Inc. has completed its previously announced acquisition of 165 Burger King and 55 Popeyes Louisiana Kitchen restaurants from Cambridge Franchise Holdings LLC, the company said Tuesday. The Syracuse, N.Y.-based Carrols said the acquisition of quick-service units in 10 Southern and Southeastern states brings its total to 1,065 franchised units and solidifies its spot as the largest franchisee of Restaurant Brands International Inc. The deal was valued at about $238 million, and Carrols now operates 1,010 Burger King and 55 Popeyes restaurants in 23 states.

Kroger gets $215 million from Turkey Hill sale

The Kroger Co. closed the sale of its Turkey Hill food brand to a Peak Rock Capital affiliate for $215 million. Financial terms of the deal, which was announced last month, previously weren’t disclosed. Kroger said that it plans to use the after-tax cash proceeds from the sale to reduce debt. Turkey Hill makes a range of food and beverages, including iced tea, lemonade, fruit drinks, milk, frozen dairy treats and ice cream at its manufacturing and distribution plant in Conestoga, Pa. The transaction doesn’t include Turkey Hill convenience stores. Cincinnati-based Kroger had sold those stores in April 2018 as part of the divestiture of its c-store business to U.K.-based EG Group in a $2.15 billion deal.

D.P. Dough Calzone franchise acquired by Calios

The college-campus-focused calzone franchise D.P. Dough has agreed to be acquired by the parent of Calios, a competing calzone chain, the company said Thursday. Terms for the deal, which is effective July 1, were not disclosed. Under the agreement, the 13 Calios units will all be converted to D.P. Dough, which currently has 26 outlets.

Kona Grill files for Chapter 11 bankruptcy protection

Struggling Kona Grill Inc. filed Tuesday for Chapter 11 bankruptcy protection after closing several more locations over the past week. The Scottsdale, Ariz.-based casual-dining chain filed in United States Bankruptcy Court for the Delaware District, citing assets of $53.6 million and debts of $74 million. The company also named its sixth CEO in nine months, saying Jonathan Tibus, managing director with Alvarez & Marsal North America LLC, had been named to the post.

Home & Road

Ethan Allen fiscal Q3 sales off 2%

Vertically integrated home furnishings retailer Ethan Allen increased its bottom line during its fiscal 2019 third quarter despite a 2% drop in sales to $177.8 million for the period. A 30.2% decrease in consolidated international net sales, primarily due to lower sales in China, created a drag on revenue during the quarter ended March 31. Fiscal third quarter net income of $8 million or 30 cents per diluted share compared favorably with $2.6 million or 9 cents per diluted share in the comparable prior-year period. Reduced national television advertising costs and the benefit of higher gross profit created significant growth in operating income, which was up to 6% of net sales, compared with 2.1% of net sales in fiscal 2018’s third quarter.

L&P first quarter sales up 12%

Leggett & Platt reported its first quarter sales grew 12%, to $1.16 billion. The company said growth from its Elite Comfort Solutions and other smaller acquisitions (13%) was slightly offset by a 1% decline in organic sales. Volume was down 3%, with growth in the United States Spring business more than offset by declines in the Fashion Bed, Home Furniture and Automotive businesses, officials said. Raw material-related selling price increases of 4% were partially offset by a negative currency impact of 2%, the company said.

Jewelry & Luxury

James Allen to Offer Laboratory-Created Diamonds

Starting May 1, e-tailer James Allen began offering laboratory-created diamonds, becoming the first Signet-owned entity to do so. “Signet has always wanted us to be a test environment,” says Oded Edelman, president of the site, which was purchased by Signet Jewelers in 2017. “This is a test. If consumers adopt it, then maybe it’s a sign for the rest of Signet to adopt it as well. We’ll wait and see how it goes.” In contrast to some of its competitors, James Allen’s offerings will be high color and clarity, he adds.

Evine Secures Multi-Million Dollar Strategic Investment & Exclusivity Commitment from The Invicta Watch Group; Tim Peterman Returns as CEO

Evine Live Inc. last week announced the execution of several agreements with its largest and most tenured vendor, The Invicta Watch Group (“IWG”).  Evine sold $6 million of common stock at $0.75 per share, to investors including, among others, Eyal Lalo, CEO of IWG and Tim Peterman. The investors will also receive five-year warrants to purchase an aggregate of 3.5 million shares of common stock with an exercise price of $1.50 per share, a 295% premium to Evine’s closing stock price on the day prior to signing the purchase agreement. Among other developments, Evine also secured a $5 million increase in its vendor line for IWG’s family of brands, subject to adjustment from time to time, as well as IWG’s commitment to invest an additional $25 million in product for Evine in 2019. The company also announced Tim Peterman, Evine’s former COO & CFO, as its new CEO, and appointed Michael Friedman, a long standing IWG partner, to Evine’s board.

Diamond Miners Hit Back on Lab-Grown’s Eco-Friendly Claims

The Diamond Producers Association (DPA) has released a report on the ecological and social impact of the diamond mining sector that seemingly refutes lab-grown diamond companies’ claims that their product has less environmental impact than earth-mined stones. The report, “The Socioeconomic and Environmental Impact of Large-Scale Diamond Mining,” was conducted by Trucost ESG Analysis, part of S&P Global, and can be downloaded here. It studied members of the Diamond Producers Association—the seven major miners that comprise 75 percent of world production.


Office & Leisure

Mattel to Launch Family Entertainment Centers Featuring Hot Wheels, Barbie, and Mega Construx

Experiences are the future, and Mattel just announced a big one for families with kids ages 4 to 10. The company revealed plans to create its first multi-branded family entertainment centers featuring Hot Wheels, Barbie, and Mega Construx. Offering immersive hands-on play experiences that marry Mattel’s brands to the worlds of physical and digital play, the centers will begin a global rollout in 2020. The first location is a 25,000-square foot space that will open next spring in Toronto. iP2Entertainment, a company that’s created branded “edutainment” centers for National Geographic and DreamWorks Animation in Asia, is designing the centers. The three themed brand worlds will be focused on the following: The centers will play host to family game nights and special events, offer experiential retail, and a full range of food and beverage options. Similarly, Hasbro announced plans last fall for a family entertainment center partnership with Kilburn Entertainment.

Wynn Resorts fined $35M for handling of sexual assault, can keep license and open in Boston this June

Wynn Resorts has been hit with a record $35 million fine but will keep its license, clearing the way for Wynn’s $2.6 billion Encore Boston Harbor casino in Everett to open as planned in less than two months. The Massachusetts Gaming Commission also ruled Wynn Resorts CEO Matt Maddox will be fined $500,000 and must hire an executive coach. The vote to keep Maddox was not unanimous. The Everett gambling mecca has already hired 3,500 employees, company spokesman Michael Weaver told the Herald. The workforce is expected to grow to 5,000. The June 23 opening date also remains on track, Weaver added. The whopping fine is twofold, the commission stated: to penalize the company for “systemic failures” of some executives and board members over sexual misconduct accusations and to deter future wrongdoing.

Lego Is Making Braille Bricks. They May Give Blind Literacy a Needed Lift.

This week, the Lego Foundation, which is funded by the Lego Group, the Danish toy company that makes the blocks, announced a new project that will repurpose the usual knobs atop the bricks as Braille dots. And because the blocks will also be stamped with the corresponding written letter, number or punctuation symbol, they can be played with by blind and sighted children alike. The project, called Lego Braille Bricks, is in a pilot phase and is expected to be released in partnership with schools and associations for the blind in 2020. Advocates say the product could transform reading for blind and visually impaired children, making the experience of learning Braille more inclusive and helping to combat what has been called a “Braille literacy crisis.”

Technology & Internet

Shopify Raises Full-Year Forecast on Strong Demand for E-Commerce Tools

Canada’s Shopify Inc raised its 2019 profit and revenue forecast on Tuesday, as a booming e-commerce market boosted demand for its tools used in building online shopping apps and websites. The company, which has been investing heavily to increase its market share, launched a new line of point-of-sale hardware and more recently introduced story advertisements on Snapchat to attract new merchants.


Amazon launches new Middle East marketplace, and rebrands Souq

Amazon launched a new Middle East marketplace on Tuesday, two years after buying the Dubai-based e-commerce company for $580 million. With the launch, Amazon said will be rebranded to The URL now automatically takes you to But Souq remains available in Saudi Arabia and Egypt. The change gives Amazon’s Middle East service a more unified look and brand in the region. Until now, Amazon’s only presence in the region was through Souq, which it acquired in 2017.

Amazon’s digital freight brokerage platform goes live

Today, freight brokers’ and carriers’ worst nightmare has come true: Amazon has quietly taken its digital freight brokerage platform live at, and it is undercutting market prices from 26 to 33 percent. Amazon already moves an enormous amount of freight through its distribution and sortation centers and has an extensive network of trucking carriers. For many industry observers, it was only a matter of time before Amazon leveraged the implicit network effect — the total number of shippers and carriers who do business with Amazon — and connected both sides of its business. Part of this business may be to hedge against the volatile price of trucking capacity: by building a large freight brokerage business, AMZN is turning part of its cost into revenue. After all, Amazon is already a top ten international freight forwarder for Asian ocean freight inbound to North America.


Finance & Economy

Fed keeps interest rates steady as U.S. economy motors along

The Federal Reserve held interest rates steady on Wednesday as policymakers took heart in continued U.S. job gains and economic growth and held out hope that weak inflation will edge higher. “The labor market remains strong … economic activity rose at a solid rate” in recent weeks, the U.S. central bank said in a policy statement a day after President Donald Trump called on the Fed to cut rates by a full percentage point and take other steps to stimulate the economy.

U.S. Consumer Confidence Rose in April on Brighter Economic View

U.S. consumer confidence rebounded in April as Americans felt more optimistic about present and future economic conditions, underscoring how a tight labor market and higher wages are underpinning attitudes amid some uncertainty. The Conference Board’s index climbed to 129.2, according to data from the New York-based group Tuesday that topped economist estimates in a Bloomberg survey. The gauge of views on the present situation increased to 168.3, while the expectations index climbed to 103. The greater confidence suggests consumers are poised to keep spending, spurred by a tight labor market, record stock values and lower mortgage rates.

US first-quarter productivity rises at the fastest pace since 2014; labor costs fall

U.S. worker productivity increased at its fastest pace in more than four years in the first quarter, depressing labor costs and suggesting inflation could remain benign for a while.

The Labor Department said on Thursday nonfarm productivity, which measures hourly output per worker, increased at a 3.6% annualized rate in the last quarter. That was the strongest pace since the third quarter of 2014. Data for the fourth quarter was revised down to show productivity rising at a pace of 1.3% instead of the previously reported 1.9% rate. Economists polled by Reuters had forecast first-quarter productivity would advance at a 2.2% rate. The acceleration in productivity was flagged by a surge in gross domestic product growth in the January-March period.