Cool weather and late back-to-school shopping lured consumers into stores last month, but it was low prices that encouraged them to open their wallets, allowing retailers on Thursday to report better than expected September sales.
Some of the nation's leading store chains even expressed surprise at their performances, but analysts cautioned against reading too much into the results, since they came on the heels of very poor sales in August.
The figures were of little comfort to those looking for evidence of a strong economy. Another report Thursday, the Labor Department's assessment of first-time claims for state unemployment benefits, was also less than encouraging--while claims fell 24,000 in late September, they were still at a high level of 400,000.
Despite better results in September, retailers remained wary about business.
"We believe it is important to look at August and September sales combined for a more accurate interpretation of the business," said Dayton Hudson Corp. President Stephen Watson. For his company, that meant a rise of 3% over the two months for stores open at least a year, compared to an increase of 6.2% for September alone.
Analysts and investors believe that sales from stores open at least a year--known as same-store sales--provide a more accurate assessment of a retailer's performance than overall sales, which include the results of newer stores. New stores tend to have extraordinarily strong sales that can skew results.
Wal-Mart Stores Inc., the nation's largest store owner, said sales at stores open at least a year were up 12% from September, 1991, while overall business rose 28%.
A late Labor Day pushed back-to-school shopping into September, and sales of clothing went well for many retailers. Mervyn's, Dayton Hudson's moderately priced clothing chain, reported double-digit increases. And J.C. Penney Co.'s same-store September sales were up an impressive 14.4%, largely because of significant sales of children's and adult merchandise as well as heavy television advertising.
Temperatures were an average two degrees cooler than normal across the nation last month, which helped attract shoppers to fall items such as sweaters, jackets and pants.
But Thomas Tashjian, an analyst with First Manhattan Co., attributed the healthy demand for apparel to the simple fact that it is easier--and cheaper--to purchase a wool skirt than a washing machine.
Indeed, sales of big-ticket items--such as refrigerators and furniture--did not live up to the expectations analysts expressed in August, when sales of high-priced durable and non-durable goods appeared to inch higher.
Still, Sears, Roebuck & Co. did single out major appliances, home office equipment and furniture as contributing to its overall same-store increase of 5.3% last month. Analysts credited price cuts.