January Another Bad Month for Retailers

Large retailers, still reeling from the poorest holiday season in years, said Thursday that winter storms crushed January sales, although some chains drew shoppers in from the cold with heavy markdowns.

A blizzard in the Northeast and frigid temperatures in other markets dampened business, forcing many stores to close their doors for a day or two last month.

Although some companies such as No. 2 Kmart Corp. posted robust sales because of discounts, business was lackluster at the nation’s largest retailer, Wal-Mart Stores Inc., and at Sears, Roebuck & Co., which ranks third.

“I think the consumer is still reluctant to spend, and the retailers are still having to move merchandise out with heavy markdowns,” said Mark Manoff, director of retail and apparel services at the accounting firm of Ernst & Young.

January is typically a month marked by clearance sales, and the results do not play a big role in the industry’s earnings. But after a surprisingly weak holiday season, the results send a mixed signal about the outlook for consumer spending in the months ahead, analysts said.

Without the blizzard and frigid weather, sales would have been more robust, analysts said. A Salomon Bros. index of sales at stores open at least a year was up 1.7%, but it would have risen about 2 more percentage points without the storms, it said.