Hey Friends,
It is good to be back. We are in the process of moving and it has been one s***show after another, which we’ll talk about in a minute, but I am back in the saddle and ready to bring you the latest industry updates from the past week.
I can’t imagine the difficulty of leading the National Retail Federation right now and maintaining a middle ground that supports your retail stakeholders but doesn’t brandish you a political traitor. That’s the position Matthew Shat finds himself in now. Speaking on Fox Business, NRF President Matthew Shay acknowledged the political value of tariffs, calling them “an extraordinarily important tool” for national competitiveness. However, he stressed that “uncertainty” remains a bigger issue for retailers. The NRF continues to advocate for affordability and has voiced stronger opposition to tariffs elsewhere, warning of rising costs for consumers and small businesses.
What it means: The NRF is walking a tightrope—balancing its public message in a contentious election year while still voicing industry concerns behind the scenes. Expect more behind-the-curtain lobbying as tariff policies evolve.
This Week in Retail Therapy
As I was putzing around Best Buy this weekend, I noticed something very interesting. Square POS is offered at Best Buy. As a retail enthusiast, this has me intrigued, as a technology integrator, this has me cautious.
Have we entered the age of consumerism dominating the enterprise? Have we completely abandoned the need for large POS integration systems, that require months of consulting and integration? To me it tells a picture of the retail economy perfectly - Business users want simplicity of systems, and availability thats familiar - these should mostly be commonplace, but I’m also seeing the trend of “out-of-the-box” serving the needs of the majority better than before.
I also think this telling a story about the state of small business. This signals that Best Buy believes a serviceable size of its customer base is looking for an easy way to transact with their customers. Will this shift continue? Does Best Buy adopt a model similar to Staples Business Advantage or are they just trying to capture the local business owner as he or she is there buying monitors and other equipment? Maybe they are trying to capture on the trend of the “side hustle” as economic stability remains uncertain
Here’s a few statistics from the 2025 National Small Business Week proclamation:
33 million small businesses operate in the U.S.
These businesses employ 61.7 million Americans.
That’s nearly half of the entire private-sector workforce.
Small businesses are responsible for creating almost two out of every three new jobs in the country.
Maybe Best Buy is on to something…….
The Federal Reserve's Federal Open Market Committee (FOMC) decided to maintain the federal funds rate at its current range of 4.25% to 4.5%. This marks the third consecutive meeting where rates have been held steady, reflecting the Fed's cautious approach amid ongoing economic uncertainties.
Key Reasons Behind the Decision
Economic Uncertainty: The Fed highlighted increased uncertainty in the economic outlook, particularly due to ongoing trade tensions and tariff policies. These factors pose risks to both inflation and employment, the two pillars of the Fed's dual mandate.
Inflation and Employment Risks: Fed Chair Jerome Powell noted that while the economy remains resilient, there are rising risks of higher inflation and unemployment. The central bank is closely monitoring these developments to determine appropriate policy responses.
Wait-and-See Approach: Given the current economic conditions, the Fed has adopted a "wait and see" stance, allowing flexibility to adjust rates if necessary. This approach aims to balance the potential need to combat inflation with the risk of slowing economic growth.
Political Context
President Donald Trump has publicly criticized the Fed's decision to keep rates unchanged, urging for rate cuts to stimulate the economy. Despite this pressure, the Fed has maintained its independence, focusing on data-driven decisions to fulfill its mandate.
Market Implications
The Fed's decision to hold rates steady has led traders to adjust their expectations, scaling back bets on near-term rate cuts. Improved trade relations, particularly between the U.S. and China, have contributed to a more optimistic economic outlook, reducing the perceived need for immediate monetary easing.
The next FOMC meeting is scheduled for June 16–17, 2025. Market participants will closely watch upcoming economic indicators, such as the Consumer Price Index and employment data, for signals on the Fed's future policy direction.
President Donald Trump and UK Prime Minister Keir Starmer announced a new U.S.-UK trade agreement—the first major deal of Trump’s second term. While touted as a breakthrough, the agreement is more limited than comprehensive, reflecting Trump's broader protectionist trade strategy.
Key Provisions of the U.S.-UK Trade Deal
Automobiles: The U.S. will reduce tariffs on up to 100,000 British-made cars annually from 27.5% to 10%, aligning with the administration's minimum tariff threshold. This quota nearly matches the UK's total car exports to the U.S. in the previous year.
Steel and Aluminum: Tariffs on British steel and aluminum exports to the U.S. will be eliminated, providing relief to the UK's struggling metals sector.
Ethanol and Agricultural Products: The UK will remove its 19% tariff on U.S. ethanol imports, allowing up to 1.4 billion liters annually. Additionally, the UK will permit up to 13,000 metric tons of U.S. beef imports, up from a previous cap of 1,000 tons.
Aerospace Components: British aerospace parts, including Rolls-Royce engines, will be exempt from U.S. import tariffs, benefiting the UK's £40 billion aerospace industry.
Economic and Political Implications
Limited Scope: Despite being labeled a "historic" deal, many tariffs remain in place, including the U.S.'s 10% baseline tariff on most imports. Analysts view the agreement as a modest step rather than a comprehensive free trade deal.
Domestic Reactions: In the U.S., some automakers have criticized the deal, arguing it could disadvantage domestic manufacturers. In the UK, bioethanol producers warn that removing tariffs on U.S. ethanol could harm local industries and threaten energy independence.
Strategic Positioning: The agreement underscores Trump's preference for bilateral deals that prioritize U.S. interests. It also reflects the UK's efforts to strengthen trade ties post-Brexit, though some critics argue it may have conceded too much for limited gains.
For retail, the Fed’s decision to keep interest rates steady signals a continuation of current borrowing costs. This affects both retailers and consumers:
Consumer Spending: Higher interest rates can dampen consumer spending by increasing the cost of credit cards, auto loans, and mortgages. While rates haven’t risen further, they remain elevated, which could continue to suppress discretionary purchases, especially big-ticket items.
Retail Financing & Expansion: For retailers, maintaining current rates means the cost of borrowing to invest in inventory, new stores, or technology upgrades remains high compared to pre-2022 levels. This might lead to cautious expansion strategies.
Inventory & Pricing Strategy: With consumers potentially pulling back, retailers may continue emphasizing promotions, discounts, and value-based offerings, particularly in categories like apparel, home goods, and electronics.
The U.S - U.K trade deal may open some specific opportunities and risks for retail, depending on the product category and supply chain involvement:
Lower Tariffs on UK Goods: U.S. retailers that import British goods—especially automobiles, specialty foods, alcohol (e.g., Scotch whisky), or luxury items—could benefit from reduced tariffs, potentially lowering costs or improving margins.
Increased U.S. Agricultural Exports: UK retailers could see more U.S. beef and ethanol products on shelves. This could affect domestic producers and influence pricing and product mix in UK grocery and general merchandise retail.
Bioethanol Impact: UK retailers tied to fuel or convenience sectors might benefit from cheaper ethanol imports but face backlash from local producers, leading to potential regulatory pushback or public relations challenges.
Bottom Line for Retailers: The Fed’s pause on rate hikes means continued pressure on consumer demand and cautious capital investment. Meanwhile, the U.S.-UK trade deal offers targeted supply chain and cost benefits in specific categories but doesn’t change the global trade environment significantly. Smart retailers will continue watching inflation, interest rates, and trade negotiations closely to navigate pricing, sourcing, and consumer engagement strategies.
The United States and China have agreed to take steps to ease trade tensions and foster a more sustainable, mutually beneficial economic relationship. By May 14, 2025, both countries will suspend 24 percentage points of additional tariffs on each other’s goods for a 90-day period, while retaining a 10% tariff. They will also remove certain other tariffs and countermeasures imposed in early April 2025.
Additionally, China will suspend non-tariff countermeasures taken against the U.S. since April 2, 2025.
Following these actions, the two nations will establish a formal mechanism for continued trade discussions, led by high-level officials. Talks may rotate between the U.S., China, or a third country. Working-level consultations may also be held as needed.
Skechers, the third-largest footwear company globally and a Fortune 500 brand known for its comfort-driven designs, has agreed to be acquired by investment firm 3G Capital. The deal values Skechers at approximately $9.4 billion and marks a major transition for the founder-led company, which generates $9 billion in annual sales.
Despite the acquisition, Skechers’ leadership — including Chairman and CEO Robert Greenberg and President Michael Greenberg — will remain in place, and the company will continue to be headquartered in Manhattan Beach, California. The brand will also maintain its strategic focus on international expansion, DTC growth, and product innovation.
3G Capital, known for backing iconic consumer brands, called Skechers a “founder-led brand with a track record of creativity and innovation” and said it intends to support the company’s long-term global growth. The Skechers board unanimously approved the deal, including an independent committee of directors.
Nike has announced a significant leadership restructuring as part of its "Win Now" action plan, aimed at accelerating growth and enhancing brand focus. Amy Montagne, a 20-year Nike veteran, has been promoted to President of the Nike brand. She previously served as Vice President and General Manager of Global Women's and has held various leadership roles across Nike's global business categories, including merchandising.
This leadership change follows the retirement of Heidi O’Neill, who served as President of Consumer, Product, and Brand. O’Neill, a 26-year Nike veteran, will remain in an advisory role until September 2025. Her responsibilities have been divided into three distinct areas: Consumer and Sport, Marketing, and Product Creation (including Innovation and Design), all reporting directly to CEO Elliott Hill.
Additional leadership appointments include:
Phil McCartney: Promoted to Executive Vice President, Chief Innovation, Design & Product Officer. He will oversee product creation for Nike, Jordan, and Converse. Fashion Dive+6Business Wire+6Business Wire China+6Business Wire China+6Fashion Dive+6Retail TouchPoints+6
Nicole Graham: Elevated to Executive Vice President and Chief Marketing Officer, leading storytelling and marketing efforts across Nike, Jordan, and Converse.
Tom Clarke: Appointed as Chief Growth Initiatives Officer, focusing on driving strategic growth opportunities.
CEO Elliott Hill, who returned to Nike in October 2024 after previously retiring, is spearheading these changes to realign the company's leadership structure and reinforce its commitment to innovation and consumer engagement.
These leadership shifts are part of Nike's broader strategy to revitalize its brand and maintain its position in the competitive sportswear market. By appointing seasoned internal leaders to key roles, Nike aims to leverage their deep understanding of the company's culture and operations to drive future growth.
I feel like on this newsletter eBay doesn’t get quite the hype it deserves. eBay is the OG online marketplace, and I believe that since most users have been with eBay since it’s inception (or close to it) they don’t identify the company with retail or being tech forward. But that’s not the case……eBay has introduced a new conversational AI shopping assistant designed to enhance product discovery by offering personalized suggestions and advice based on customers' shopping preferences.
Key Features of eBay's Conversational AI Shopping Agent
Personalized Recommendations: The AI assistant provides real-time, tailored product suggestions, helping users discover items that align with their interests and shopping history.
Seamless Integration: The tool appears inline on the current page, either when requested by the customer or through predictive messaging, ensuring a smooth and intuitive shopping experience.
Enhanced Fashion Shopping: Building upon features like "Shop the Look," which curates outfits based on user preferences, the AI assistant further personalizes the fashion shopping experience.
eBay's move to integrate conversational AI aligns with a broader trend among online marketplaces to adopt AI-driven personalization, similar to strategies employed by social media platforms. By leveraging AI, eBay aims to create a more engaging and tailored shopping experience, potentially increasing user engagement and sales. The rollout of this AI assistant is currently limited to a subset of U.S. customers, with plans for broader implementation in the near future.
GameStop Corp. has sold its Canadian division, Electronics Boutique Canada Inc., to entrepreneur Stephan Tetrault. The 185 stores will be rebranded as EB Games Canada, reviving a brand that holds nostalgic value for many Canadian gamers. This move aligns with GameStop's strategy to streamline operations and focus on core markets, as the company continues to close stores and exit international markets. The reintroduction of EB Games in Canada under new ownership could reinvigorate the gaming retail sector by focusing on localized strategies and customer engagement. For GameStop, this divestiture allows the company to concentrate on digital initiatives and explore new investment avenues, including cryptocurrency.
DoorDash is moving from being just a food delivery platform to a broader restaurant tech and international logistics provider:
Deliveroo (reportedly in advanced discussions or recently acquired): Would mark DoorDash's biggest international acquisition to date. It would give DoorDash strong footholds in the UK and Europe and increase access to premium restaurant partners.
SevenRooms: A New York-based restaurant tech platform that provides CRM, reservations, and waitlist tools. The deal enhances DoorDash's ability to offer value-added services to restaurants, especially those looking to reduce reliance on third-party platforms.
Together, these moves indicate a “platform play” — similar to how Shopify supports merchants — DoorDash is aiming to be the digital backbone for food businesses.
Hudson’s Bay’s demise marks a historic moment in Canadian retail. Having decided to shut down all its stores, including the Saks Fifth Avenue and Off 5th businesses in Canada, the company is now in court-supervised liquidation. Filings show the chain has drawn “several” bids, none from insiders, which suggests chairman Richard Baker may be walking away. With liquidation sales outperforming expectations, the company is looking to use that cash to retire $25M in debt. The void left by HBC’s departure — especially in smaller Canadian markets — opens the door for competitors like Simons, Nordstrom Rack, or even Walmart and Amazon to gain traction.
REI’s progressive reputation took another hit last week when its own members voted down three board nominees — including two incumbents. This followed a campaign led by the REI Union, which has gained momentum since 2022 when store workers began unionizing. The labor group had proposed its own candidates, including environmental and labor leaders, but REI’s leadership didn’t include them on the ballot. REI’s financials showed a 6% sales decline but a significant reduction in losses, and the co-op celebrated hitting “zero waste” targets. Still, union advocates say meaningful change must come from the top, and want those empty board seats filled with their nominees.
Boot Barn has officially appointed John Hazen as CEO after a months-long search. Hazen, formerly chief digital officer, brings deep e-commerce and omnichannel experience from Nike, True Religion, and Amazon’s Ring. His leadership suggests Boot Barn will continue investing in its digital infrastructure, possibly integrating more tech into stores and expanding online offerings. With strong rural and Western-wear positioning, Boot Barn is also seen as insulated from many urban retail pressures.
BuyBuy Baby has officially relaunched under new ownership. Acquired by Beyond (the rebranded Overstock), the site is offering deep discounts as part of a “Welcome Baby” event. The comeback is a strategic bet on a trusted name in baby retail — and a test of how quickly brand loyalty can be reignited.
Lets finish with some news our of big tech…..OpenAI and Microsoft are renegotiating the terms of their multibillion-dollar partnership to enable OpenAI’s potential IPO while preserving Microsoft’s access to advanced AI technology. Microsoft, OpenAI’s largest investor with over $13 billion committed, is a key player in discussions over a restructuring plan that would shift OpenAI further from its nonprofit roots. A central issue is how much equity Microsoft will receive in a restructured entity, especially for technology developed after their current 2030 agreement ends.
OpenAI plans to convert its business arm into a public benefit corporation (PBC), a model combining profit with social mission—adopted by competitors like Anthropic and Elon Musk’s xAI. This change would let OpenAI offer equity and pursue an IPO, a requirement for raising substantial capital.
While Microsoft and OpenAI remain close partners—Microsoft supplies infrastructure and integrates OpenAI tech into its products—tensions have grown. Some Microsoft insiders describe OpenAI’s stance as arrogant, while OpenAI sees Microsoft’s role as primarily financial and supportive.
OpenAI’s restructuring is also under legal and regulatory scrutiny. Elon Musk, a cofounder who left in 2018, has sued to block the transformation, alleging the nonprofit’s assets are being handed to a for-profit enterprise. Critics argue the move prioritizes profit over OpenAI’s original mission of advancing AI for public benefit.
Despite these concerns, OpenAI executives remain optimistic about investor support. They acknowledge that a capped-profit structure is unsustainable for raising the billions needed to compete with major tech rivals. Still, approval from state authorities in California and Delaware is needed to proceed with the restructuring and ensure the nonprofit retains sufficient control.
In short, OpenAI’s future hinges on finalizing a delicate balance: satisfying investor demands—especially Microsoft’s—while preserving its public mission and clearing regulatory hurdles for a corporate transformation that would enable it to scale and possibly go public.
That’s all folks……Have a great week