Retailers, consumers and prices
Check out the modest gains expected for U.S. retailers in July.
U.S. retailers look set to report a small improvement in same-store sales for July as anxious consumers cut back on spending and big chains returned to discounting to lure them into stores.
Analysts are expecting same-store sales growth of 3.1 percent, compared with a decline of 5.1 percent last year, with department stores and discounters showing the biggest gains, according to Thomson Reuters.
July would be the 11th straight month of improving sales, but analysts warn beating last year’s weak results isn’t anything to crow about and new threats are on the horizon as consumer sentiment in July sagged to its lowest level since November.
“The consumer confidence numbers are hideous, and the promotions we’re seeing in the malls are pretty intense,” said Cowen & Co analyst Laura Champine.
Check out how high March retail sales bounced off last year’s weak results — and how April sales are expected to falter.
March same-store sales topped expectations for retailers ranging from teen-focused stores to discounters and department stores, helped by an early Easter, warmer weather and a recovering job market.
Check out Macy’s disappointing fourth-quarter forecast.
Apparently, the Thanksgiving Day Parade may be the highlight of the quarter.
The department store chain operator forecast fourth-quarter profit below analysts estimates and its shares fell Wednesday morning.
The retailer also expects same-store sales to drop 1 percent to 2 percent in the quarter. While that is less of a decline than the full year, it is also off a pretty easy comparison. Same-store sales fell 7 percent in the year-earlier fourth quarter, when the country was waist deep in a recession and credit crunch.
Check Out J.C. Penney’s new store in Manhattan.
On July 31, J.C. Penney will open its first Manhattan store in the midtown area, promising to deliver trendy yet affordable items for New York’s notoriously savvy shoppers.
Penney is taking direct aim at rival Macy’s, whose flagship Herald Square store is a block away.
Check out the expected June sales declines at U.S. retailers.
Cooler and wetter weather made things tough for companies, especially those selling summer products in the first three weeks. Overall same-store sales for the month are expected to be down 4.8 percent, according to Thomson Reuters.
“The consumer is still up against too many hurdles to be spending too much money,” Storehouse Partners retail analyst Patricia Edwards said.
Check out the October monthly sales results due this week.
Retail chains, like Wal-Mart, Costco and J.C. Penney, will release October results on Wednesday and Thursday, and Thomson Reuters is forecasting a decline of 0.1 percent.
Check out Coach opening stores.
The pricey leather handbag maker saw earnings fall in the quarter and also ratcheted down its sales forecast for fiscal 2009. But that sales forecast still calls for a 10 percent increase from a year ago.
And even in what some economists say is already a U.S. recession, the company is moving ahead with dozens of store openings and, in fact, those openings are ahead of the company’s plan, CEO Lew Frankfort said.
Coach plans to open 40 stores in this year in North America, 10 in Japan and five in China.
“Our new store openings are profitable from the first day,” Frankfort said in an interview. “All new stores are opening ahead of plan.”
And that isn’t just because it’s easier to get better terms from landlords as other retailers go bankrupt. Frankfort told Reuters the retail bankruptcies have had no near-term impact on Coach’s leasing arrangements, though the company should be able to get better terms over the midterm.
Like other retailers, Coach is also managing expenses. While there is not a hiring freeze, the company is tightly managing recruitment of new personnel through a “hiring frost,” Frankfort said.
Ahh, the first frost of the season. Can Christmas be far?
Also in the basket:
Ferragamo says uncertain on Q4, no IPO hurry
Brinker quarterly profit falls on weak demand
Owners say franchisers are passing on more costs (WSJ)
Fashion trends toward Obama in presidential race (WWD, subscription required)
Check Out Macy’s opening up shop in Dubai.
Two Bloomingdale’s department stores are scheduled to open in the United Arab Emirates’ largest city in February 2010. Macy’s, which owns the Bloomingdale’s chain, says the store’s merchandise and upscale ambiance will be similar to Bloomingdale’s in the U.S., while being ”sensitive to local preferences and customs” of the oil-rich states.
In another sign the Middle East remains a robust market for foreign retail brands, Kuwaiti retailer Villa Moda is partnering with the Dubai International Financial Center, which is owned by the Dubai government. The DIFC is buying a majority stake in Villa Moda, which operates seven multibrand shops in the Gulf region and offers high-luxury brands such as Gucci, Prada and Dolce & Gabbana.
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.