The first rise in retail sales in more than a year occurred during the month of September, according to reports in the New York Times. While sales were tempered due to a dismal September last year (meaning the numbers should have been easy to beat), the fact that many retailers beat last year, or bested analyst projections (while still having negative same-store sales) bodes well for an economic recovery.
Or does it?
One month does not a trend make.
For one, Labor Day was later this year, and schools started later, pushing the back-to-school shopping period further into September, possibly inflating sales numbers.
Target reported a rise in shoppers, but still comped negatively, signaling a decrease in average transaction. Value still reigns as Aeropostale reported an 18% rise in sales, due to its Abercrombie-esque clothing that’s considerably less expensive. Aberbrombie & Fitch posted an 18% decline.
Department store Kohl’s reported a 5% increase while Macy’s and J.C. Penney both posted declines. Upscale department store Nordstrom reported a 2.4% decrease while Sak’s and Neiman-Marcus reported double-digit drops.
THE REAL WORLD RETAILING TAKEAWAY
Given the poor performance a year ago September, the fact that many stores are still comping neagatively means we’re nowhere near a recovery.
Value rules and will continue to for the foreseeable future. Warehouse clubs, TJ Maxx, Dollar Stores, Ross all reported strong gains. But even value-oriented retailers like Kohl’s and J.C. Penney still aren’t faring well. Nor are most specialty apparel stores.
Best to continue to pare inventory and expenses for the foreseeable future and ride it out.