Discounters Drag Down Comps
March 26, 2007-- Home Textiles Today,
Hobbled by unexpected weakness at the nation's mass merchants, which offset continued strength at department stores, same-store retail sales rose by 4.0% during the second week of March, but came in well beneath plan for the two weeks month-to-date, the Johnson Redbook Index reported.
Gaining strength moving into the month, department store comps jumped up by 5.5%, improving on a 4.3% gain the prior week. So far during March, department store sales have risen by an on-target 4.9%.
No such luck at the nation's big discounters, where erratic weather may have stymied sales, said Redbook analyst Catlin Levis. Same-store sales improved by 3.1% following a 2.8% gain the prior week. But through the first two weeks of March, sales substantially lagged their target, rising by 2.9%, compared with a target of 4.0% growth.
Balancing out the two channels, overall sales for the first two weeks of the month rose by 3.7%, missing a target of 4.4% growth.
"Sales were mixed to firmer in the second week of March, but remained below plan month-to-date," said Levis. "During the week itself, sales were somewhat volatile day-to-day, largely the result of weather swings affecting customer traffic counts in different regions."
In addition to the weather woes, "Merchandise themes also tended to be somewhat unfocused," said the analyst. "Retailers said sales were propelled by warm weather in the West and Midwest, helping to lift regional lawn and garden sales as well as both apparel and sporting goods, while Northeast sales were dampened by a late-week storm."
Levis said, "Department stores were less affected by weather, and reported reasonable volume in spring apparel, especially higher-priced lines. Meanwhile, sales levels are expected to rise steadily into the Easter weekend at the end of the fifth week. Many retailers planned for a back-loaded month, with seasonal business expected to improve in the second half due to gradually warming temperatures and the early Easter holiday, usually a catalyst for spring sales."
Johnson Redbook Index
Second week of March, year-over-year % change
|*Including chain stores and traditional department stores
Source: Johnson Redbook Index