Normally double-digit sales declines don’t cheer investors.

But shares of jewelry chain Tiffany & Co rose 4 percent on Wednesday even though it reported that sales at its U.S. stores open for at least a year (”same-store-sales” in industry parlance) fell 10 percent in the third quarter. 

True, much of the hemorrhaging seems to have subsided since last year’s gruesome holiday fourth quarter when U.S. same-store sales fell 33 percent, and November is off to a promising start.

Seems that wealthy Asians and Europeans — in Asia outside Japan, overall sales rose 18 percent while European sales were up 10.5 percent in the quarter — are picking up the slack from rich Americans who seem to be curbing their shopping until the Dow Jones Index is more to their liking… like say 14,000. And analysts were encouraged that the jeweler is aggressively expanding overseas.

Tiffany is so bullish on China in particular that it is planning to triple the number of its stores on the mainland within 5 years. Outside China, the chain is also expanding. It is opening a second store at London’s Heathrow Airport next month and has opened new stores in Amsterdam, a Melbourne suburb, Toronto and Hong Kong this year.

While the affluent U.S. baubles buyer will eventually return, Tiffany is playing it smart by leveraging its strong brand and international footprint to get through the storm, analysts told Reuters.

(PHOTO: Reuters)

Check out all the wine drinking going on.

Two-thirds (67 percent) of Americans surveyed said they partake in wine on holidays and special occasions while at home, while another 58 percent drink wine at home with dinner on an ordinary night, according to consumer trend tracker Mintel.

The wine market has grown 20 percent from 2004 through 2009 despite the recession, but at the peak of the slowdown in 2008 it declined 3.2 percent, Mintel said. With consumers slowly feeling better about the economy, the firm expects the wine market to increase by 2.1 percent this year.

“The future of the wine market looks bright, at least for moderately priced segments,” Mintel senior food and drink analyst Sarah Theodore said in a statement. “Value wines have helped consumers rethink their perceptions about wine.”

And how does wine stack up vs beer?

Mintel said so far this year nearly half (47 percent) of survey respondents say they drink beer compared to 35 percent who drink imported and domestic wines. Champagne and sparkling wines are next at 17 percent, followed by port, sherry and dessert wines at 7 percent.

Certainly wine was on the minds of analysts and executives on Hormel’s earnings conference call on Tuesday.

Hormel, whose foods include Jennie-O turkeys, usually reports its fiscal fourth-quarter results days ahead of Thanksgiving. During Tuesday’s call, Credit Suisse analyst Robert Moskow asked a follow up question — well, really, he gave more of a plea.
 
“I’m just trying to encourage Tim Ramey to call in with a wine selection for Thanksgiving,” Moskow said, referring to a D.A. Davidson analyst, who also follows Hormel and has offered wine pairings with Hormel foods on the call in the past. 
 
“It’s a Thanksgiving tradition. I don’t know where Tim is today,” replied Hormel CEO Jeffrey Ettinger.
 
“Don’t you guys have anything you can throw out our way? I’m more of a Diet Coke fan,” joked Moskow.
 
“I think just as long as you go with a Jennie-O Turkey, or a Cure 81 ham, we have that part of the meal covered,” Ettinger said.
 
When the call wrapped up, Hormel’s director of investor relations, Kevin Jones, offered up some pairing advice. “In response to Rob’s question, a good new Beaujolais, a Chardonnay, or Pinot Noir will go very well with a Jennie-O turkey, and either a Pinot Grigio or Riesling with the Cure 81 ham.”

Rising wine consumption goes nicely with reduced salt intake. Last week, Mintel said in its predictions for consumer packaged goods in 2010 that sodium reduction was poised to be the next big health push.

Also in the basket:

British union to meet Kraft over bid for Cadbury

Tiffany profit beats; view raised ahead of holiday

Wal-Mart has not applied for retail stores-India minister

Starbucks eyes China as next major market

Cheap and Cheerful for the Holidays (New York Times)

(Additional reporting by Jessica Wohl)

(Reuters photo)

Check out the expected increase early next year in import cargo volume at U.S. retail container ports.

The numbers could rise year-over-year in February, for the first increase in more than two years, according to the monthly Port Tracker report released by the National Retail Federation (NRF) and IHS Global Insight.

“This could be the turnaround we’ve been waiting to see for a long time,” NRF Vice President Jonathan Gold said in a statement. “There’s not enough data yet to establish a clear trend, but we’re hopeful that this is a sign of recovery.”

U.S. ports surveyed handled 1.14 million Twenty-foot Equivalent Units (TEU) in September, the most-recent month for which actual numbers are available. That was down 3 percent from August and 16 percent from September 2008.

Volume for October, traditionally the peak month of the year, was estimated at 1.17 million TEU, down 15 percent from last year, according to the survey. November, December and January are forecast to be down 11 percent, flat and down 3 percent, respectively.

However, February, the slowest month of the year, is forecast to report cargo of 973,872 TEU, which would be a 16 percent increase over February 2009, while March is expected to show a 5 percent increase at 1.02 million TEU, according to the survey.

“The second half of 2009 has continued to see declines from 2008’s levels, but not as large as we saw during the first half of this year,” IHS Global economist Paul Bingham said. “These ‘less bad’ numbers are evidence that the industry is seeing early signs of recovery.”

Also in the basket:

Heinz profit falls, raises full-year view

Zale posts wider loss on weak jewelry demand

Hormel 4th-qtr profit jumps despite sales decline

American Eagle posts in-line 3rd qtr profit

Dollar Tree profit beats estimates

Carl’s Jr. restaurants serving Coke’s vitaminwater

(Reuters photo)

For some of Japan's retailers trying to jumpstart consumer spending, setting prices is like doing the limbo: How low can they go?

Japanese retailers reported mostly dismal first-half earnings results, with the industry stuck in a slump as shoppers remain reluctant to open their wallets even as the economy emerges from recession.

With no sales pick-up in sight, stores seem to have no choice but to continue their race to undercut rivals, with prices dropping for everything from cars to clothes to milk.

On the surface it sounds like a shopper's paradise: Who wouldn't mind paying less than 1,000 yen ($11) for a pair of jeans?

But it could also lead to a deflationary spiral in which consumers put off spending in hopes of further falls in prices.

And what's more, these price cuts are slicing into already razor-thin profits at companies, which are then forced to pass on the pain to employees in the form of lower paychecks.

"It's a death march," said Junji Ueda, CEO of FamilyMart, Japan's No. 3 convenience store chain.

"Manufacturers and transportation companies can't make profits, and retail workers can't get pay rises, or even worse, deflation will get to the point where they can't keep their jobs."

But some retail managers say price cuts are not hurting their businesses and there is room for even more markdowns.

"Some say we are cutting prices at the expense of profits, but such an argument is groundless. The problem is how to control inventory efficiency," said Motoya Okada, president of Japan's No. 2 retailing group Aeon Co Ltd, which runs the Jusco chain of supermarkets.

"Some wonder how we can sell jeans at 880 yen, but at the same time, there are many who think they are still expensive.  Recently, I visited Vietnam and was surprised to see items better than ours are sold at half our prices."

Tadashi Yanai, CEO of Fast Retailing, maintains rivals' efforts to undercut each other are self-destructive, although the firm's casual-clothing chain Uniqlo is seen by some as one of the very culprits for fanning the deflationary trend with ultra-cheap apparel.

Fast Retailing is among the few Japanese retailers that have reported robust profit growth,  buoyed by strong sales at the Uniqlo stores.

"Our 990 yen jeans created value, but those that followed, like the ones for 880 yen and 850 yen, -- I guess jeans will be sold for free eventually -- did not produce value at all. I think our rivals will end up hurting themselves through such moves," Yanai said.

I am a bargain hunter and always happy to pay less, but I'm just hoping my salary doesn't decline like the prices of the goods in my shopping cart.

Photo credits: REUTERS/Issei Kato

Written by Tom Hals

As its rivals plan aggressive discounts on flat-panel TVs and round the clock hours to lure in recession-weary shoppers, Kmart is sticking with what worked, even if it is what worked 40 years ago.
 
Chief Marketing Officer Mark Snyder, who joined the company last year just before the holiday season, said the chain had no major new initiatives this year but plans to “build on the successes” of 2008. 
 
In other words, a fresh spin on layaway plans and Blue Light Specials, and of course the deep discount days that are a retailing standard this time of year.
 
One new offering includes a Christmas club, a staple of 1950s household budgeting that only deepens the impression that Kmart is rushing into its past to find the future.
 
The goal is to help households crushed by mounting debt to “leverage their cash,” or in other words, pay when credit is no longer available, he told us.
 
The chain may be onto something.  Kmart’s same-store sales for the quarter ended Oct. 31 rose 0.5 percent, only the second quarterly increase it has posted since 2001.
 
A recent visit to a Pennsylvania Kmart did not turn up any blaring lights or calls of “attention Kmart shoppers.”  It did show that some elements of Kmart’s past are more easily forgotten.
 
Asked by this reporter, the outgoing and helpful staff tried to locate Martha Stewart-branded housewares, possibly the last as their long-standing partnership ends this year. 
 
Another member of staff joined the hunt until a manager reminded everyone that Martha Stewart’s final inventory was sold out the week before, not with blue lights but helped by clearance prices. Like those found at Wal-Mart.

(Reuters photo)

Check out the latest better-than-expected earnings, this time from Campbell Soup and Tyson Foods.

It looks like food investors may have plenty to be thankful for when they sit down to their Thanksgiving tables later this week.

Campbell’s first quarter profit came in well ahead of analysts’ expectations.  The soup maker also said its full-year profit and sales should be stronger than it had expected.  In September, Campbell forecast adjusted earnings per share growth of 5 percent to 7 percent.  Now, just one quarter into the year, it expects adjusted earnings per share to jump 9 percent to 11 percent.

Tyson Foods, the world’s largest meat producer, posted a net loss.  But excluding an impairment charge it earned 28 cents per share, topping analysts’ expectations by 2 cents.  Revenue came in a little bit higher than last year, and well ahead of analysts’ projections.

We’ll hear more about food tomorrow, when Heinz and Hormel issue their quarterly reports.

Also in the basket:

Cadbury hits new high as bidders circle

“Black Friday” deals may not signal retail comeback

Michael Jackson’s glove sells for $350,000 at auction

Forever 21 Launches Beauty Line (WWD, subscription required)

(Reuters photo)

Check out more retailers reminding Wall Street that all is not well on Main Street.

On Friday morning,  AnnTaylor Stores reported lower-than-expected quarterly revenue and gave a cautious forecast for the current holiday quarter.

The operator of the Ann Taylor and Ann Taylor LOFT chains said its fourth-quarter sales would be slightly below those of the third quarter, and that its gross margins would be lower as well, due to heightened promotions it expects to use to drive sales throughout the holiday shopping period.

Meanwhile, Foot Locker late on Thursday reported third-quarter results that missed Wall Street expectations. The athletic shoe retailer cited lower than expected U.S. sales.

On a conference call on Friday morning, Foot Locker said it expected same-store sales for the holiday fourth quarter to be negative.

Foot Locker and AnnTaylor join a chorus of retailers ranging from Macy’s to Kohl’s to Wal-Mart that have warned investors in recent weeks that the holiday shopping season may be a little less merry than the stock market is expecting as consumers continue to show a reluctance to spend.

Or as Doug Scovanner, the CFO of Target, said quite pointedly earlier this week: “In our view, sell-side analysts are somewhat more optimistic across most of our industry than we believe is warranted in light of the harsh realities of the current environment.”

Also in the basket:

US shoppers going green despite struggling economy

Philip Morris ordered to pay $300 million to smoker

P&G repurchasing shares, quiet on potential deals

Ferrero, Hershey would likely break up Cadbury: report

(Photo: Reuters)

Heaps of turkey, stuffing and cranberry sauce will induce a collective food coma on Thanksgiving, sending a majority Americans to their beds for a much-needed nap, if one is to believe a survey released on Thursday by coffee and doughnut chain Dunkin’ Donuts.

About 58 percent of the 500 Americans Dunkin’ Donuts surveyed this week predicted they would succumb to sleep during the holiday next week, according to the chain. Overeating will do that to you.

Unsurprisingly, more men than women are expected to nap, and the number of people jealous of those napping will overwhelmingly be women. But perhaps the fellas, exhausted from carving the turkey, just need to rest before settling in for all that football watching.

Helpfully, Dunkin’ Donuts stores will be open until 2:00pm on Thanksgiving, selling coffee to caffeinate the masses, and maybe keep some of the guys out of the doghouse during the year’s biggest holiday.

(PHOTO: Reuters)

Thanksgiving is a week away, let’s talk turkey.

It’s time to defrost your bird, says Mary Clingman, director of the Butterball Turkey Talk-Line (1-800-BUTTERBALL).

Clingman and her fellow Turkey talk specialists field about 100,000 panicked calls from home cooks each year and have dubbed this Thursday ”national thaw day.”

To avoid a “turkey-cicle” Butterball competitor Foster Farms (1-800-255-7227) suggests that cooks allow two days to defrost a 12-lb bird in the refigerator and about five days for a turkey twice that size.

Retailers like Wal-Mart are using inexpensive turkey and fixins’ to lure shoppers at a time when the sluggish national economy and still rising unemployment is preventing some cooks from going all out on Thanksgiving. Meanwhile, some frugalistas are planning potlucks or other arrangements that help share the cost of the meal.

Here are some other tips from the folks at the turkey helplines: 

*Make sure your oven is big enough for your bird

*Check for giblets – the organs and other bits often found in a bag inside the bird

*Use a meat thermometer

*To avoid setting yourself on fire while frying your turkey, turn off the flame while you lower the turkey into the oil

(Photo/Reuters)

Check Out home-related retailers Sears Holdings and Williams-Sonoma reporting better-than-expected quarterly results. Does this mean consumers are feathering their nests again?

Somewhat, according to Barclays analyst Michael Lasser, who said Williams-Sonoma’s results were “an indication that upper-income consumers are spending a bit more, which is not surprising given the rally in the stock market and the stabilization in the housing market.”

Williams-Sonoma, which also operates Pottery Barn and West Elm, has updated its styles and slashed prices on some items to woo shoppers, despite worries that the move might tarnish its image as a high-end retailer.

But it’s not only high-end chains showing signs of life. Kmart, the value-priced retailer that sells everything from appliances to clothing, posted its first increase in same-store sales since 2005, and only its second since 2001. The chain, which is owned by Sears, took back its shoe operations this year from Footstar, which had operated within Kmart stores.

Even Sears, which depends more heavily on the housing market due to its Craftsman tools and Kenmore appliances, posted its best performance since the fourth quarter of 2007, and outperformed competing home improvement chains like Home Depot and Lowe’s.

Also in the basket:  

Average UK woman wears 515 chemicals a day

New York & Co sees trends to better in holiday qtr

Ross Stores Q3 profit in line, maintains Q4 view

Gamestop third-qtr profit beats estimates

(Photo: Reuters)