Check out Nike just not doing it in the U.S.
 
The athletic shoe and apparel maker apparently is not immune to the sluggish U.S. economy. The company said Wednesday that U.S. orders for goods through November were flat.
 
It also said sales in the fourth quarter rose 4 percent in the U.S., compared with a 16 percent increase for the entire company. U.S. apparel sales rose only 2 percent.
 
Nike said it will focus on more premium merchandise that is better distributed and can stand out. It also stressed that U.S. profit margins are not eroding.
 
For Nike, getting through the tough U.S. economy might just be an invigorating workout.
 
“Strong companies who are able to navigate through those tough times can come out even stronger,” Nike CEO Mark Parker said in a conference call.
 
Ooh, feel the burn!
 
Also in the basket:
 
Anheuser-Busch to reject $46.3 billion InBev offer
 
The road runs out: Streetwear adapts as market implodes (WWD)

Steve & Barry’s Hits Trouble: Hyped clothing retailer hires turnaround help (WSJ)

The U.S. government is currently putting $100 billion into consumers’ hands in the form of tax rebates, hoping the fresh cash will stave off a recession.

It’s a plan similar to the once the government followed in 2001, except at that point, the economy was already in a recession.

Back then, the National Bureau of Economic Research said the U.S.  economy entered a recession in March 2001. To get the economy out of its funk, the government passed a stimulus package and mailed out rebate checks over a ten-week period from late July to the end of September 2001, according to research conducted by Thomson Reuters.

When looking at the monthly year-over-year changes, U.S. retail sales started slumping in the beginning of 2001 and reached their lowest level in September 2001, according to the research report. The Thomson Reuters Same Store Sales Index registered a rise of just 0.8 percent in September 2001, but then began to bounce back once the rebate checks were mailed out, with October notching a 1.6 percent gain.

“When comparing the sectors within our retail universe, we find that the discount sector performed the best during the 2001 recession and remained within the 3 percent - 6 percent growth range,” the Thomson Reuters report states. “It registered its strongest same store sales result ever of 9.5 percent in February 2002.”

The report said similar trends are being repeated now as middle class consumers cut back on spending and head to discount stores.

“In 2001, Wal-Mart beat Target’s same store sales results 11 out of 12 months. Today, we’re witnessing a similar trend as Wal-Mart has smashed Target’s comps over the last six months,” the report stated.

During the 2001 economic slowdown, the apparel sector performed the worst and posted its weakest comp ever of -9.5 percent in September 2001, the research shows. It also said the teen apparel group and department stores underperformed and posted sluggish comps during the period leading up to September 2001, but were able to bounce back shortly after.

“If past behavior is a good indicator of future behavior, we are likely to continue to see an increase in consumer spending in the short-term while the 2008 rebate checks are distributed,” the report states. “This in return could help improve the overall economy since consumer spending accounts for about 2/3 of GDP. The discount group is expected to post a 3.1 percent comp, but analysts continue to look for an even stronger 3.5 percent result excluding Wal-Mart.”

(Photo: Reuters)

Check out the loss of more retail jobs. 

Another 27,000 retail jobs disappeared in May, according to the U.S. government’s monthly employment report. That makes 152,000 retail jobs eliminated since the beginning of the year.
 
Overall, nonfarm payrolls fell by 49,000. But even more worrisome for the economy and for retailers could be the jump in the unemployment rate to 5.5 percent. That half-point jump was the largest such move in 22 years and brought the unemployment rate to its highest level in 3-1/2 years.
 
Retailer’s May sales reports yesterday were mostly better than expected, causing some analysts to think they could signal the beginning of a consumer turnaround.
 
But others said it just showed a blip in spending that was caused by the tax rebate checks consumers have begun to receive. 
 
Economic concerns could still linger after all that stimulus money is gone, they say, and things could get worse if consumers, already hit by $4-a-gallon gasoline, soaring food prices and falling home values really start to worry about their jobs.

Wonder how a half-point jump in the unemployment number plays into that?
 
Meanwhile, to take your mind of the jobs report, there’s always the company pep rally that masquerades as the Wal-Mart annual meeting. The world’s-largest retailer flies in employees from all around the world to help pack the basketball arena at the University of Arkansas, where stars entertain the crowd (this year’s acts include Miley Cyrus), everybody does the Wal-Mart cheer, and, oh yeah, shareholders get to ask questions.
 
Also in the basket:
 
New Wal-Mart director may herald changing of the guard (Wall Street Journal, subscription required)
 
Target grows makeup artist brands, adds testers (WWD)

 (Photos: Reuters)

Despite the credit crunch and weak U.S. economy VF Corp went shopping again.

The company, once known for functional brands like Wrangler, Lee, Eastpak and JanSport, said on Wednesday it acquired a one-third interest in Mo Industries, owner of the Splendid and Ella Moss brands.

Terms of the deal were not disclosed, beyond saying that it valued the brands at close to 7.5 times expected 2008 earnings before interest, taxes, depreciation and amortization.

Splendid and Ella Moss clothes are sold at high-end retailers such as Bloomingdale’s and Nordstrom and together brought in over $80 million in revenue last year.

Mike Egeck, president of VF’s contemporary brands segment, said the acquisition allows the company to broaden its offering of knit tops and provide synergies with its 7 For All Mankind and lucy brands, which respectively sell designer jeans and yoga clothes.

(Photo: www.splendid.com)

Check out the weak sales week.
 
Chain store sales posted their weakest year-over-year increase in five years in the latest week, according to the International Council of Shopping Centers-UBS index. Sales were up only 0.5 percent in the week ended March 29, the worst performance since April 5, 2003.
 
One culprit: weak sales of spring clothes.
 
In a survey taken for ICSC-UBS on March 27- March 30, 59 percent of consumers said they cut back on spring apparel purchases or eliminated buying it altogether.
 
Just over one-third of people surveyed cited budget constraints, while 10 percent cited weather.
 
“For the month, ICSC expects industry comparable-store sales to be flat to down slightly on a year-over-year unadjusted basis,” ICSC Chief Economist Michael Niemira said.
 
ICSC now estimates Target same-store sales to be down 1 percent in March, Kohl’s to be down 8 percent, J.C. Penney to be down 11 percent and Wal-Mart to be up 1 percent.
 
Also in the basket:
 
Talbots sees loss in 2008
 
Electrolux says to make Q1 operating loss
 
(Phoot: Reuters)