https://www.forbes.com/sites/abrambrown/2019/04/01/the-outlandish-story-of-ollies-a-5-billion-retail-empire-that-sells-nothing-online-but-is-beating-amazon/amp/?fbclid=IwAR0G8FXaImvSAKjQNO5nhHa62WETyUOa8H9K2TQb8iV10e-rhxl7JPNt4dQby Abram Brown
April 1, 2019
Ollie’s is very possibly the only company in America whose brick-and-mortar stores are not just surviving but thriving. Butler focuses exclusively on traditional retailing, selling not a thing online. Read that again: nothing sold online. Nonetheless, Ollie’s sales have doubled in four years. It moves more than $1 billion a year of low-priced goods from its large (30,000 square feet or so), no-frills stores like the one in Sterling. Profits are at a high, nearly $130 million.
Most other retailers seem headed in the other direction. The internet now accounts for 10% of American shopping—up from below 4% less than a decade ago—and e-commerce topped $130 billion in the fourth quarter of 2018, a 12% increase from a year ago. Meanwhile, companies announced 3,400 store closures last year, with plans to shutter a record 155 million square feet of shops. Those numbers will skyrocket in 2019: Retailers announced 4,300 store closures in just the first nine weeks of the year.
Ollie’s is the exception to the rule. Not only is it opening new locations, its stock is on a tear. Even after a recent sell-off, shares in Ollie’s have quintupled since its IPO in 2015. This handily beats the performance from the rest of retail (the SPDR S&P Retail ETF has actually lost 12%), the broader stock market (the S&P 500 has gained 34%) and even high-flying Amazon (up nearly 290%). Ollie’s shares now trade at 34 times earnings. No one has benefited more from the run-up in Ollie’s stock than Butler himself, who has an estimated $1 billion fortune, nearly all from his approximate 15% stake in the company.
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