Price Competition Undercuts Comps
May 5, 2008-- Home Textiles Today,
Retailers saw comparable-store sales slow sharply in the third week of April, dropping the month-to-date gain to 1.7%, just below the targeted 1.8% comp gain, the Johnson Redbook reported.
After a strong start, partly due to the Easter shift, same-store sales have slipped below plan, most noticeably for department stores, where the pace dropped to a comp gain of just 0.1% in the third week.
"Store sales have been driven by promotional activity and price competition especially in the moderately priced sector," said Redbook analyst Catlin Levis. "Weather conditions were varied across the country, sunny and warm in some regions, but unseasonably cool and wet in others. Sales for stores relying on spring-driven apparel reported mixed results for the week, depending on their regional weighting. This stop-and-go pattern of spring shopping influenced by weather has been evident for several weeks, and has primarily disadvantaged department stores with their higher exposure to seasonal apparel."
Levis noted, "Meanwhile, tax rebate checks are coming earlier than expected. Retailers are offering incentives to lure shoppers."
Johnson Redbook Index
Third week of April, year-over-year % change
|*Including chain stores and traditional department stores
Source: Johnson Redbook Index
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