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Warm temps, job actions blunt sales

Retail same-store sales continued to improve during the third week of October, but at a somewhat slower pace than in recent weeks, hampered by the weather and West Coast strikes, the Redbook Retail sales Average reported.

The Redbook Average rose by 3.3 percent during the week, a solid increase but slightly behind the gains of 3.6 and 3.5 percent put up during the two preceding weeks.

Still showing signs of strong improvement, department store same-store sales moved up by 1.5 percent, extending a string of recent gains and reversing a two-year trend of declining sales.

Mass merchant sales, still robust, advanced by 4.5 percent, modestly off their form earlier in the month, when sales climbed higher by 4.8 and 4.5 percent during the two prior weeks.

But blunted by the weather and West Coast blazes, sales for the three weeks month-to-date came in modestly beneath plan, rising by 3.4 percent, missing a targeted gain of 3.8 percent.

"Results in the third week were again below target," said Redbook analyst Catlin Levis. "As far as the week was concerned, most retailers noted that unseasonably warm weather had blunted consumers' appetites for fall apparel and other cool-weather merchandise."

Adding to the weather-related issues were job actions, said Levis. "The performance was in part negatively affected by the Los Angeles transit strike, which began on Oct. 14, leaving idle buses and trains and stranding 500,000 riders a day throughout the area. The Southern California grocery strike also had a negative impact."

Making it even more difficult to get a firm fix on what's happening at retail, said Levis, "retailers with broad merchandise bases reported the turn in temperatures across much of the country had a dual effect on consumers: demand for cool-weather clothing softened while demand for warm-weather categories such as lawn and garden merchandise, paint and accessories, was sparked."

With all the issues confronting the month, holiday sales were holding their own, Levis observed. "Overall, retailers reported good business in Halloween-related sales. On a regional basis, sales were strongest in the Northeast."

Redbook Retail Sales Average
Second week of October

Week ended 10/11 10/18 10/25 11/1 Month Target
*Including chain stores and traditional department stores.
Source: Redbook Retail Sales Average, a unit of Instinet, a Reuters company.
Department stores* 1.7 1.6 1.5 1.6 1.9
Discounters 4.8 4.7 4.5 4.6 5.1
Redbook Average 3.6 3.5 3.3 3.4 3.8


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