Five Below CEO Joel Anderson told CNBC on Monday that the discount retailer is well positioned to handle inflationary pressures during the pandemic economic recovery.
“As inflation emerges, we can approach it both ways: either with moving the top-line retail or else creating more value for our customers,” Anderson said in an interview on “Closing Bell.”
The company’s relatively new category called Five Beyond — in which some products are for sale above $5 — represents one response to price pressures, Anderson said.
“If you’d asked me that a couple years ago, I would have probably said, ‘You know, that’s a challenge.’ But since then, we’ve launched Five Beyond,” said Anderson, who has led the Philadelphia-based company since 2015. He’s also the former president and CEO of Walmart.com.
Inflation is currently a key issue for the economy, as businesses develop responses to rising costs for some commodities and wage increases.
Five Below has raised its minimum wage to attract workers, Anderson said. However, he said that in general, Five Below will be able to stand out to bargain-seeking shoppers in an inflationary environment.
“Five Below has always been a value retailer,” he said. “And the last thing we do is try and raise our retails. So I think as inflation goes up, it gives us an opportunity to, actually, really increase the value that we bring to our customers.”
The company reported quarterly results last week, with net sales for the period ending May 1 coming in at $598 million. That’s up 64% compared with the same quarter in 2019 and 198% compared with 2020, when Covid-related store closures significantly hampered sales.
Shares of Five Below closed Monday’s session down 2.5% at $185.47. The stock is up roughly 6% so far in 2021 and 68.5% in the past 12 months.