Retailers, consumers and prices
Analysts, on average, were expecting a drop of 7.8 percent, according to Thomson Reuters data.
In November, which represents the start of the crucial selling season, same-store sales at its namesake stores fell 14.5 percent.
The Commerce Department said total retail sales fell 1.8 percent in November to a seasonally adjusted $355.66 billion following a revised 2.9 percent plunge in October.
Excluding motor vehicles and parts, sales were down 1.6 percent in November after a revised 2.4 percent October fall.
Check out why Heinz didn’t suffer like Hormel did in the past quarter.
Food companies have found it tough going as commodity costs shoot up, but Hormel was particularly hard hit. The reason? It raises the turkeys that it eventually sells — meaning spiking corn feed costs hurt its results.
Rapper LL Cool J says he is just as passionate about selling a new clothing line at Sears as he is about his music.
His casual wear collection, to be rolled out at 450 Sears stores on Sept. 7, features clothes for men, women and children. Prices start at $24 for T-shirts, $50 for jeans and $60 for outerwear.
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)
Sears Holdings Corp reported a quarterly loss this morning. But the thing that left analysts like Credit Suisse’s Gary Balter scratching their heads was the company’s expectations for higher earnings before interest, taxes, depreciation and amortization (EBITDA) for the full year.
“We are struggling with what we are missing in the context of Q1 being down over $385 million in EBITDA and other comments in the release that talk about the expected difficult sales and gross margin environment,” Balter said in his research note.
According to interviews Reuters conducted with consumers across the United States over the past week, the answer seems to be that most of the extra money will be heading toward the basics — like food, fuel and credit card payments — with just a little left over for splurges.
AnnTaylor reported a quarterly loss on Friday as the struggling clothing retailer, facing lagging sales and falling store traffic, took a charge to restructure its operations. But not to worry — the CEO is aware of the problems facing the retailer and is “all over it.”