Ross Stores Inc. has joined the growing list if retailers activating contingency plans as the rapid rise in coronavirus cases across the United States takes a toll on the economy and individual firms.
In a letter to vendors today, the off-price retailer said it would cancel all merchandise purchase orders through June 18 due to the impact of COVID-19 on its business, Reuters reports.
“This is the first time in our history that we are unable to deliver exceptional merchandise to our customers,” reads the memo, obtained by the publication.
Dublin, Calif.-based Ross said it would also extend payment terms on all existing merchandise payables by 90 days.
Just last week, Ross was among the scores of fashion and footwear brands and retailers — Nike, Macy’s, Nordstrom and TJ Maxx included — that announced plans to temporarily close all stores in the U.S. in accordance with local and state orders and, in other cases, broader recommendations by health officials.
As it stands, the retailer has shuttered all Ross Dress for Less and dd’s Discounts locations from March 20 through April 3 but will provide up to two weeks of continued pay for any full-time or hourly associates.
The rapidly spreading coronavirus has so far infected more than 80,000 people in the U.S. and is responsible for 1,136 deaths. Prior to the pandemic and its seemingly unprecedented economic impact, Ross has been a key player in the wildly successful off-price channel, which has largely sidestepped many of traditional retail’s challenges by leaning on a “thrill of the find” experience and discount pricing.
Earlier this month, the company logged fourth-quarter earnings per share that climbed 7% to $1.28, versus predictions of $1.25, on profits of $456 million. Revenues had also beat estimates, improving 7.45% to $4.4 billion, compared with consensus bets of $4.36 billion.
While many retailers impacted by the COVID-19 crisis have shifted resources to digital with mixed success, Ross does not currently have an online presence. In fact, just two weeks ago, amid its marked success in physical stores, the discount chain announced new plans to boost its brick-and-mortar presence. It said it would open in fiscal 2020 another 100 stores — 75 locations under the namesake banner Ross Dress for Less and 25 outposts of dd’s Discounts. So far this year, it has debuted 19 Ross Dress for Less and seven dd’s Discount stores.
The coronavirus, which has already led to a record number of layoffs across the country, is likely to upend these plans.
A Ross spokesperson did not immediately respond to FN’s request for comment.