Shop Talk

Check Out Line: NRF says Americans plan to get their pumpkin on

Check out the spending boost planned by Americans for Halloween.

The National Retail Federation said spending by the 148 million Americans who partake in the “spooky” October holiday is expected to surge almost 18 percent this year as revelers look for any reason not to think about high unemployment and a shaky housing market.

“In recent years, Halloween has provided a welcome break from reality, allowing many Americans a chance to escape from the stress the economy has put on their family and incomes,”  NRF CEO Matthew Shay said in a statement.

“This year, people are expected to embrace Halloween with even more enthusiasm, and will have an entire weekend to celebrate since the holiday falls on a Sunday,” he added. 

Americans will spend an average of $66.28 on costumes, candy and decorations (or a total of $5.8 billion), up from last year’s average of $56.31. However, that is still short of the $66.54 spent in 2008, according to the study conducted by BIGresearch for the NRF. Retailers love Halloween because it comes between the back-to-school and December holidays in luring consumers into stores.

Those selling the latest costumes have reason to be the happiest as four out of 10 people are planning to get dressed up, up from 34 percent last year, according to the survey. And in a related note almost 12 percent will dress their pets too!

A third of those polled will throw or attend a Halloween party, almost three-quarters plan to hand out candy and about half will carve a pumpkin as well as decorate their house or yard, according to the study. In addition, 21 percent will visit a haunted house and 32 percent will take their children trick-or-treating.

Check Out Line: US online retailers dialing up mobile apps

Check out the increasing appetite for mobile applications among U.S. online retailers.

Nearly three-quarters (74 percent) of online retailers either already have or are developing a mobile strategy and one out of every five has a fully implemented mobile strategy already in place, according to a study from Forrester Research and Shop.org, the National Retail Federation’s digital division.

“It’s imperative for online retailers to stay on top of what their customers want and these days it’s all mobile all the time,” Scott Silverman, Shop.org executive director, said in a statement. “Mobile commerce has tremendous potential and will no doubt grow to become a significant part of overall sales volume in years to come.”

“It’s definitely the buzzword in the industry at the moment,” Daniel Latev, retailing research manager at Euromonitor International, said of mobile commerce.

Retail executives agree, saying at the Reuters Consumer and Retail Summit last week that they are taking the potential of this growth opportunity seriously at last.

Earlier this year, Forrester forecast U.S. online retail sales would total $173 billion in 2010.

“Mobile investment is modest now, but we see that it will pick up in the future, especially among the biggest brands that have already invested significant amounts in their mobile operations,” said Sucharita Mulpuru, a Forrester vice president and lead author of the study.

Check Out Line: Retailers don’t see yuan move as all bad

Check out what retailers are thinking about China’s revaluation of the yuan.

Western retailers may pay more for goods they import from China as the yuan appreciates, but the flip side is that the move may create significant selling opportunities by putting more money in the pockets of consumers in the world’s biggest market. 

Executives at the Reuters Consumer and Retail Summit took solace in the idea that any appreciation following China’s weekend statement it would let the yuan appreciate against the dollar would likely be gradual.      They also see room to move more manufacturing out of China and into other countries with lower labor and other costs.   “I don’t think that there is any sense that there is going to be any immediate impact … The open question is how quickly and how far they’ll actually let the currency revalue,” said Matthew Shay, president and CEO of the U.S. National Retail Federation, a retail trade group.       Some retailers will see margins hit because their goods manufactured in China will be more expensive in dollars or euros. Retail stocks dropped more than the broad market on Monday in the wake of the yuan announcement.   Beyond the retail industry, the yuan’s move is expected to help companies that supply commodities or heavy equipment to China’s fast-growing economy, like Caterpillar, and other foreign brands that source and sell goods locally, such as fast-food operator Yum Brands, the parent of KFC.

Also in China, a new strike at an auto supplier plant forced Toyota to suspend production at its Chinese assembly plant, the latest in a string of labor-related disruptions at foreign-owned manufacturers across the country.

Also in the basket:

Walgreen posts weaker-than-expected profit

Amazon, Barnes & Noble slash e-reader prices

Retailers eye some expansion in 2010

After their abysmal 2009, nearly half of all U.S. retail chains plan on at least maintaining their number of stores this year, according to a survey released on Thursday by consultancy KPMG and industry group the National Retail Federation.

Far more retailers were planning to open stores than close them, according to the survey of 310 retail industry executives, representing 138 companies, conducted late last year.

Anecdotally, those intentions seem to be playing out, based on what we’ve been hearing from CEOs on conference calls and webcasts.

Most companies have said they plan to open new stores this year, or were at least considering it. Tiffany, for example, is planning to open another 17 locations worldwide in 2010 (it now has 220). And Saks is opening more of its off price Off 5th stores but is closing its Portland store and could shut others.

Another sign of easing pressure on U.S. retailers: their plan to up spending on the technology which allows them to gather crucial information on their shoppers and their habits.  More than 67 percent of respondents said customer database and data mining will be a priority this year.  That may be just one small factor why investors are so bullish on the tech sector again.

(Reuters photo)

Check Out Line: Magic 8 ball says better year for retail

Check out a prediction for increased U.S. retail sales this year.

The National Retail Federation said U.S. retail sales should rise 2.5 percent this year, signaling that stores have made it through the worst of the downturn as improvements in the housing and job markets bolster shoppers’ confidence.

The projected increase would be a step up from a 2.5 percent decline last year and 1.3 percent increase in 2008, NRF said.

Don’t get excited, however, as the outlook remains modest.

“I wouldn’t describe this as a very strong year,” NRF Chief Economist Rosalind Wells said in an interview. “We’re not going to have a V-shaped recovery in the economy, and we won’t have a V-shaped recovery in consumer spending or retail sales. It’s a slow return to a more normal level.”

U.S. retailers just completed a better-than-expected holiday season as retail sales rose 1.1 percent instead of the 1 percent drop the NRF had expected for the November-December period. Retail chains improved upon a dismal 2008 (sales down 3.4 percent) by cutting inventories and offering more targeted discounts for frugal shoppers.

In its latest spending and saving tracking survey, American Express found consumers entering 2010 with optimistic yet prudent goals. The poll showed 30 percent of the general population and 42 percent of young professionals will rein in extras such as ”morning lattes and manicures.”

Check Out Line: A container in every port?

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.”

This year, a Christmas of blue jeans, not Blu-rays

As we mentioned on Shop Talk this morning, the National Retail Federation expects total holiday sales this year to fall 1 percent.

The trade group held a conference call later in the day to add details about their forecast. Here is what NRF spokeswoman Ellen Davis said about the forces that will shape the upcoming holiday shopping season:

Unemployment:

“The golden ticket this year for the holiday season is going to be unemployment. With the unemployment rate at about 10 percent, we know that a lot of Americans will be pulling back on the holiday season because they have to, because they don’t have a job or because someone in their family doesn’t have a job.

“But the unemployment picture really goes far beyond that 10 percent because anyone who knows someone who is out of a job, looking for work or is concerned about losing their job is going to be pulling back. You don’t want to be the guy who drives up in a brand new BMW if your neighbor just got laid off.”

Retailers’ efforts to prepare for this year’s impending holiday season:

“This year, retailers knew going in consumers would be very price conscious and frugal for the holiday season and they’ve been able to plan accordingly.

Wowing students with indigo laptops, blue flash drives

The National Retail Federation has issued its 2009 back-to-school spending survey and the results show that the ringing of school bells won’t necessarily translate into the happy ringing of cash registers.

But the one part of stores where parents and students expect to boost their spending despite the ongoing recession is electronics.

The average family plans to spend $167.84 on consumer electronic purchases for back to school this year, up from $151.61 last year, according to the NRF survey.

Among college kids, spending on electronics or computer-related items is expected to increase to $266.08 from $211.89 last year.

Those trends are not lost on Wal-Mart.

On its own blog, Wal-Mart is talking about its plan to win sales from back-to-school shoppers:

“This year Wal-Mart Stores and Walmart.com have teamed up with Dell to offer you a Great deal on Laptops.

Check Out Line: Less money for pencils and school books

Check out the expected lower spending on back-to-school items.

Parents plan to spend less money on back-to-school gear for their children this year in another worrisome sign for retailers heading into what is normally their second biggest selling period behind Christmas.

The average family with children in kindergarten through 12th grade is expected to spend $548.72 on back-to-school merchandise this year, down 7.7 percent from 2008, according to the National Retail Federation.

Retailers can take some heart, however, as college students and their parents are expected to boost spending 3 percent to buy the latest pricey electronics and dorm-room decor. Of course, total college spending is expected to fall 4 percent as fewer attend college.

Retailers are taking action to deal with such pressures as department store operator J.C. Penney is launching a website for teens to drive back-to-school sales.

And there are some positive signs of a modest recovery.

Also in the basket:

The recession strikes again

The recession hammered U.S. holiday sales last year and new research suggests that it also drove up ”shrink” — a retail industry term for shoplifting, employee theft, and administrative errors.

An estimated $36.5 billion was lost to “shrink” in 2008, according to preliminary findings from the latest National Retail Security Survey released today.

That figure is up from $34.8 billion in 2007, an increase of nearly 5 percent.

The survey, conducted by the National Retail Federation and the University of Florida, also showed that retail shrink averaged 1.52 percent of retail sales in 2008, up from 1.44 percent in 2007.

“Criminals have found a way to manipulate and corrupt the retail industry,” said Richard Hollinger, lead author of the report and professor of criminology at the University of Florida.

Retailers grappling with the worst recession in decades have been forced to cut spending on everything from security to labor in a bid to protect profits. That scenario ”leaves new opportunities for thieves to take advantage of companies,” Hollinger said.

According to the survey, 44 percent ($15.9 billion) of the 2008 retail losses were due to employee theft. 14 percent of those cases involved collusion with outsiders.