US apparel retailers managed to shrug off the harsh winter weather seen across many parts of the country in January, posting surprisingly strong revenue gains in a climate that many observers feared would put consumer spending on ice.

Not only that, but several companies were also able to beat estimates and even raise fourth-quarter earnings forecasts. And worries that heavy markdowns would be needed in January to clear excess inventory seemed to be unfounded, as shoppers clamoured to snap up winter merchandise and spend the gift cards they received during the holidays.

"A combination of rising consumer demand and strong pricing continued to drive retail sales in January," explains Michael McNamara, vice president of research and analysis at MasterCard Advisors SpendingPulse, which follows retail sales across all payment forms.

"Although less robust, the trends we observed were similar to those recorded in the fourth quarter of 2010. Most sectors continued to post positive year-over-year results during the month despite consumers taking a pause in spending and repeated snow storms affecting the east coast."

"Retailers weathered the storms in January, both literally and figuratively," agrees Michael Niemira, chief economist at the International Council of Shopping Centers (ICSC).

Based on ICSC's tally of 32 retailers that reported monthly sales, aggregate industry comp-store sales beat its forecast to rise by 4.8% in January.

"Although retailers were impacted by storms in the northeast and southeast, in particular, strength across the board helped to lift overall industry sales performance."

SpendingPulse calculates that total apparel sales in January saw their sixth consecutive month of positive year-on-year growth - albeit at a slightly slower rate than December's 10.9% gain. The strongest risers were the family (teen) and men's categories, increasing 12.8% and 8.1% year-on-year respectively.

Among January's winners were Limited Brands, Zumiez, Wet Seal, Nordstrom and Gap whose same-store sales all came in ahead of estimates. But there were disappointments too, including Target and JCPenney.

With the inevitable a mixed pattern of results, just how big an impact the weather has on shopping trends can be open to question.

Indeed, there are two sides to every story, and cooler weather may even have helped drive sales of warm and waterproof clothing. The snow may also have provided a boost to online sales, with shoppers choosing to sit at their computers rather than venture outside.

Road to recovery
The question now being asked of course is whether the US apparel retail sector really has turned the corner on the road to recovery.

Most retailers were up against tougher comparisons with last January, but better control of inventories meant they didn't have to resort to steep discounting to clear unsold merchandise.

There are also signs that the momentum that began with a strong back-to-school season and carried on through the festivities is continuing to build. But while this is obviously good news for the sector, the current first quarter could still prove be tough if consumers overspent during the holiday season.

And of course there is the issue of rising costs to consider too. Not only higher cotton and transport costs for retailers, but higher living expenses such as gasoline and food prices for shoppers. Which could well collide in the worst possible way, with retailers having to raise prices at a time when consumers have less 'extra' money or discretionary funds to spend.