TJX - A Dominant Off-Price Retailer
Background In the advent of the COVID-19 pandemic that practically forced the global economy to a halt, a significant number of American citizens have lost their jobs or have been furloughed and many businesses have struggled to stay afloat following the significant drop in demand. As of May 6th, 2020, an estimated 23,000 (both public and non-public) filed bankruptcy cases were reported by U.S courts (1). In the retail industry alone, bankruptcies included popular brands such as J.C. Penney, Aldo, and J. Crew. As industry experts try to grapple with the effects of sudden drops in both supply and demand, it’s evident that there still lies great uncertainties ahead. As businesses await for a resurgence in demand, I believe some companies will be better positioned to come out of this crisis. An example of such an opportunity lies in the retail space, where some off-retail price companies will be better positioned (relative to their full-price retail peers) to return to profitability despi...