Retailers, consumers and prices
Check Out the drop in sales.
It was no surprise that sales were weak in December, though some retailers stood out Thursday for their worse-than-expected performance.
Wal-Mart, the world’s largest retailer, said sales at U.S. stores open at least a year rose just 1.7 percent, while analysts were expecting a 2.8 percent increase. Wal-Mart and other chains such as Macy’s cut guidance for the fourth quarter ending later this month.
Shares of Wal-Mart fell more than 9 percent on Thursday morning, dragging the Dow Jones industrial average into negative territory as well.
Research firm Retail Metrics said that while the month was not as bad as it could have been, it was still ugly.
Among the retailers that bucked the trend:
Target‘s same-store sales fell 4.1 percent, but that drop was less than expected.
Discount chains TJX and Ross Stores said same-store sales were in line with last year, while analysts had expected both of their sales to fall. Kohl’s, meanwhile, said same-store sales fell only 1.4 percent, while analysts expected a 5.5 percent dip.
Some teenagers apparently still have some money to spend — or they got others to buy them gifts last month. Aeropostale‘s same-store sales jumped 12 percent (analysts predicted a decline) and Hot Topic‘s same-store sales rose a better-than-expected 4.3 percent. Guess people are still heading to the stores for ”Twilight” perfume, shirts and other items.
If you’re spending the holidays baking cookies and brushing up on your needlepoint and macrame, you’re not alone. Some 14 percent of Americans are opting for home-made gifts this year, according to a holiday shopping poll from Consumer Reports.
But if canning okra isn’t quite your thing, you may be altering your spending habits in other ways, the poll found. Spending limits on gifts are now de rigueur, and some 37 percent of families have set them as a way to cut down on unnecessary purchases in tight financial times.
Retailers say it can be difficult to measure their monthly sales results accurately on a year-over-year basis because of calendar shifts — sometimes a holiday falls in one month, boosting results, while the next year the holiday shifts into a different month, hurting results.
The most drastic case of this is usually seen in March and April, when the timing of the Easter holiday can help March sales and hurt April, or vice versa.
Target has said its food and consumable items, like paper towels and toilet paper, are flying off store shelves, while its trendy clothes and home decor languish as newly thrifty shoppers avoid unnecessary spluges.
This past Saturday at a Target store in New Jersey, the diverging sales trends were evident.
Polo Ralph Lauren reported higher second quarter profit, citing increased sales and a lower tax rate.
Polo, whose brands include Polo, Chaps and Club Monaco, affirmed its earnings outlook for fiscal 2009, but it tempered its full-year sales forecast. It now expects a low single-digit increase in 2009 revenue, instead of a low-to-mid single digit increase as earlier expected.
We’ve all seen stores touting reusable shopping bags. They’re a trendy way to ditch those regular plastic bags and they’re often pretty cheap — 99 cents at Target and some supermarkets, 50 cents at Wal-Mart and sometimes they’re even free.
Now, Target is taking the reusable tote idea to a new medium. The discount chain took out ads on the inside front cover and the back cover of the latest issue of People touting green ideas. The most intriguing one if you’re in the market for one of those bags is to use the cover as an envelope, send in five plastic Target bags and get a coupon for a free Target tote.
Readers don’t even have to pay for the stamp — Target and TerraCycle, the company that made the “Retote” bag, already paid the postage.
Last month, in a poll conducted by SheSpeaks, a women’s insights marketing firm, almost 50 percent of respondents said they would spend less this holiday. That was up from nearly 30 percent who answered the same way last year.
In a new poll, SheSpeaks asks where shoppers intend to spend fewer dollars. Here are the results from the updated poll:
Check out the cool and wet weather that hit U.S. retailers in September as the month will go into the books as the fifth coolest in the last seven years and much cooler than last year, according to Planalytics Inc, a business weather tracking company.
While the mean September temperature in the 96 largest U.S. metro areas fell about 4 points from last year to 64.2 degrees, retailers selling rainwear (demand up 29 percent based purely on weather), pants (up 13 percent), dehumidifiers (up 10 percent) and hot cereal (up 2 percent) benefited, Planalytics said.
99 Cents, which sells a variety of household, food and other items often priced at 99 cents, says it will now focus on its core markets of California, Arizona and Nevada, where it has 230 stores that make up 90 percent of its sales.
Those states are also some of the hardest-hit by the U.S. housing crisis and credit crunch, and consumers pressured by rising gas and food prices are trading down from higher-priced stores to discounters to save money, a positive for 99 Cents.
It’s Target‘s take on the local New York City bodega as the discount retailer prepares to open four “Bullseye Bodegas” in Manhattan.