Pier 1 Hitting Profits = Not So Much

If you thought Pier 1 Imports was one of the home-good retailers you could add to the list of those scant few that posted a profit in the first quarter of the year, think again.

“Our first-quarter sales were not as strong as we would have liked,” said Pier I Imports Chief Executive Alex Smith.

Smith also noted that the furniture and high-end lifestyle store suffered from challenges in its store traffic and losses in its outdoor furniture department.

Brick-and-mortar retailers have been dealing with similar issues as customers continue to shift toward e-commerce shopping and the increasing competition from Amazon’s ever growing list of products.

And, if Pier 1’s earnings – and the balance sheets of many, many other brick-and-mortar retailers – are any indication, the trend only seems to be continuing.

Pier 1 said that its sales dropped more than 2.5 percent last year, according to Market Watch, but the company began putting more items on sale to combat its losses – although its online business does not seem to be mitigating its losses at this point.

“We made the strategic decision to accelerate our clearance activity to ensure clean inventory,” Smith said.

And as if adding bad to worse, Pier 1 announced that its sales at stores dropped 2.5 percent last year, its worst sales drop since 2009.

Pier 1 reported a loss of $6 million, which was a drop from its previous year’s profit of $6.9 million.

It should be interesting from here to see if Amazon can cannibalize yet another retail market, or what the existing retailers competing in the space can do to stay ahead of the curve and what new retail innovations they may come up with.