Just as the coronavirus pandemic created demand that boosted grocers’ bottom lines earlier this year, so, too, did Tractor Supply Co. benefit.
Founded more than 80 years ago as a farming supply store, the company now promotes itself as a “rural lifestyle retailer” carrying animal feed, pet supplies, farm-inspired home decor, rugged boots and jeans, pellet stoves and more.
“As the largest seller of bagged livestock and equine feed in the U.S., along with significant companion-animal food sales, our customers view Tractor Supply as critical to feeding and caring for their animals and pets, just as the grocery store is to their families’ needs,” CEO Harry “Hal” Lawton noted in a March release, citing the company’s “essential” nature as businesses shut down to contain COVID-19.
Like at the supermarket, Tractor Supply customers responded to the pandemic by stocking up – so much so that comparable-store sales, a metric of retail health, rose a stunning 30.5 percent in the April-to-June second quarter. In the prior-year quarter, comp sales were up a more typical 3.2 percent.
The buying continued as the pandemic remained, with July-to-September comp sales up 26.8 percent compared to the 2019 quarter’s 2.9 percent increase.
It also helped that Tractor Supply was able to quickly roll out services already in the works that COVID-wary customers wanted – no-contact curbside pick-up, for instance, and quick home delivery. Also, the website was redesigned early in the pandemic to further encourage online sales, which have seen significant growth. A new mobile app debuted in July.
CEO Lawton, who joined the company from Macy’s mere weeks before the pandemic hit, named “continued digitization of the business” as one of his early goals. At Macy’s, he spent two years as president; before that, he was at eBay. A decade ago, he was an executive at Home Depot, credited with starting and substantially growing online operations.
But Tractor Supply is about bricks-and-mortar, too: In the second quarter, new-store plans were revised to add as many as 80 this year and next. The store count now stands at just over 1,900, with 2,500 as the goal. Locally, we have nine.
Store remodels also are planned – up to 200 next year. And Tractor Supply expects to “transform” the concrete-slab side lots at a similar number of stores in 2021 to basically double their 15,000 square feet of sales space. The lots now hold larger items for storage but would be used in part as covered lawn-and-garden centers, a product area that research shows “our customer base plays in that we currently aren’t a destination for.”
On last week’s third-quarter conference call, officials were clearly pleased with where pandemic demand has placed them.
“We’re on a multiyear journey to evolve the future of our company. We are thriving, as our second- and third-quarter results indicate. And with the actions we’re taking, we’re committed to emerging from the pandemic stronger than before,” Lawton stated.
Marlene Kennedy is a freelance columnist. Opinions expressed in her column are her own and not necessarily the newspaper’s. Reach her at [email protected]
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