VIEWPOINT: US apparel retail sales shine in June
Promotions helped US apparel retailers to clear inventories in June
While cold weather, storms and flooding dampened demand for spring and summer merchandise in May, US apparel retailers rebounded with a better than expected performance in June after a combination of lower gas prices, sunshine and deep discounting encouraged shoppers to hit the stores.
Retail same-store sales booked yesterday jumped to 7.1% growth in June according to Kantar Retail - beating the 5.7% same-store sales gain last month and a rise of 3.2% in June last year.
Growth held up in discretionary purchases at specialty apparel and department stores, helped by promotions to clear inventories of summer lines to make way for back-to-school ranges.
"June is peak season for weddings and graduations, and this may have helped the continuing strong growth of both luxury and jewellery sectors," adds Michael McNamara, vice president, research and analysis for MasterCard Advisors SpendingPulse, which follows retail sales across all payment forms.
He also notes that strong sales of specialty apparel in June were helped by easy year-on-year comparisons, "given that in April 2010 this sector started to record some weakness that lasted a few months."
Tony Buccina, vice chairman and president of merchandising at department stores operator Bon-Ton Stores Inc, said the arrival of more seasonal weather in the second half of June "led to the best sales performance of warm weather categories we have experienced all season."
And JC Penney said its men's apparel businesses saw "solid sales increases" thanks to the Father's Day shopping period - but was forced to lower its same-store sales forecast for the second quarter.
Other winners included Victoria's Secret operator Limited Brands Inc, which booked 12% same-store sales growth, as well as teen retailers Hot Topic (+0.4%), Buckle Inc (+10.8%) and Wet Seal (+ 7.3%). Even Gap Inc managed a gain, coming in with 1% growth.
Luxury retailers like Neiman Marcus, Saks Inc and Nordstrom also had a stellar month, with the sector as a whole racking up its ninth consecutive month of year-on-year gains, according to SpendingPulse.
While June is traditionally a clearance month, retailers are no doubt hoping that this strong sales momentum will continue into the all-important back-to-school season - the second-largest selling season after the holidays - which gets underway in July.
"High fuel and food prices will still take a toll, but a sustained letup in gasoline prices will help ensure that the toll means slower growth instead of outright declines in discretionary spending in the months ahead," believes Kantar Retail's Badillo.
Average US gasoline prices have slipped to $3.58 a gallon after peaking near $4.00 a gallon through mid-May, according to data from the US Energy Information Administration.
"With growth holding up - particularly discretionary purchases at apparel and department stores - an expected letup in the coming months may prove to be more modest than feared," Badillo adds.
But after a month largely driven by discounts, the worry of course is that retailers will need to continue to offer deals to entice back-to-school bargain hunters - and that promotions will eat into their second-quarter earnings.
Hanging over the bottom line too is the impact of rising cotton, transport and labour costs, which are set to kick in in the form of higher prices on early autumn and back-to-school items.
Companies: Bon-Ton Stores Inc, JC Penney Company Inc, Macy’s Inc, Kohl’s Corporation, Victoria’s Secret, Limited Brands, Hot Topic Inc, Buckle Inc, Wet Seal Inc, Gap Inc, Neiman Marcus Group, Saks Incorporated, Nordstrom Inc
While some retailers continued to be vulnerable to cost-cutting, swingeing redundancies and store closures in 2011, others acted swiftly to respond to the changing economic circumstances, offering rea...
Premium and value were the big winners as US retailers reported their all-important December sales results yesterday (5 January)....
The following is a general roundup of US apparel and shoe retailers' December 2011 sales results....
The following is a general roundup of US apparel and shoe retailers' November 2011 sales results....
Department store operator Macy's has announced a series of openings and closures among its network of Macy's and Bloomingdale's US retail outlets....
- TPP trade pact in milestone signing by 12 nations
- US apparel retailers' January 2016 sales roundup
- Cheap polyester contributes to cotton import shift
- Combating the new normal – 10 trends for 2016
- Under Armour defends questions over strategy
- Southeast Asia – a strategic sourcing review
- H&M and Primark price rivalry reaches equilibrium
- Bangladesh factory fire renews worker safety fears
- Ethiopia textile and apparel exports lagging
- China factory activity continues to deteriorate
- Southeast Asia strategic sourcing review – a focus on Cambodia, Vietnam and Myanmar
- Wearable technology: The future market potential for smart garments and e-textiles
- Global market review of denim and jeanswear – forecasts to 2021
- Wearable Technology Market by Product, Application, Type, & Geography - Global Forecast to 2020
- E-Textiles: Electronic Textiles 2014-2024