War takes toll on sales, shoppers
April 7, 2003-- Home Textiles Today,
With consumers glued to the tube and watching war news on CNN, and up against a tough comparison with Easter holiday shopping a year ago, same-store retail sales continued their month-long slide, tumbling by 2.8 percent during the third week of March, according to a key gauge of retailing activity, the Redbook Retail Sales Average.
After falling by 1.1 percent the prior week, sales skidded down by almost 3 percent during the third week, hammered by the war news, a faltering economy and increasingly bad news about the job market.
Particularly hard hit, as they have been for almost two years, were the nation's full-price department stores, as consumers continue to root out bargains. Same-store sales at department stores plunged by 8.3 percent during the third week of March, following a 5.0 percent drop the week before. Discounter sales, buoyed in part by sales of everyday consumables, edged up by 0.8 percent, softening somewhat after a 1.4 percent decline the preceding week.
But it wasn't just the war taking its toll on sales. Putting it into perspective, Redbook analyst Catlin Levis observed, "Retailers were up against last year's pre-Easter shopping in the fourth week of March, making for the toughest year-over-year comparison for the month." Levis noted that the calendar distortion was built into retailers' March plans and pointed out that "most retailers suggest smoothing the Easter distortion by simply averaging the March and April performance."
But it wasn't just the tough comparison. "Retailers said the slowdown was caused by a dampening effect on traffic at the malls due to a combination of the 'CNN Effect' as shoppers stayed at home watching TV and a perceived slowing of the economy caused by the war," Levis noted.
Countering war woes somewhat, Levis said "Some retailers noticed a pick-up in some feel-good impulse buying with items such as cosmetics and accessories."
Breaking sales out by merchandise categories, Levis said, "seasonal hardlines such as lawn and garden equipment, consumables and other basic items accounted for much of the strength at discount stores. Elsewhere, warm weather aided sales of women's apparel, intimate apparel and swimwear."
On a regional basis, sales were strongest in the Midwest, followed by the Northeast and South Central regions.
Redbook Retail Sales Average
Fourth week of March
|*Including chain stores and traditional department stores.
Source: Redbook Retail Sales Average, a unit of Instinet, a Reuters company.
Related Content By Author
Industry Related Content
Countdown to Intertextile Shanghai