Retail Sales Sluggish in August Across Spectrum
Retailers last month got off to a slow start in the fall shopping season as hot weather, staid fashions and a still-languishing economy kept consumers from malls and discount centers.
Chain store sales in August were barely better than flat, with a year-over-year gain of 1% in stores open at least a year, according to Goldman Sachs’ tally of retail sales performance. Bank of Tokyo-Mitsubishi pegged its index of same-store sales at gaining 1.6% over August of last year.
“It’s weak, in some cases surprisingly so, because it appeared that some areas weakened very rapidly, such as Sears appliance sales,” said Michael Niemira, senior economist at Bank of Tokyo-Mitsubishi. “It was clear early in the month that the numbers were not going to be very strong and then Labor Day wasn’t enough to offset the weakness.”
Sears, Roebuck & Co. said sales at stores open at least a year fell 11.1% from a year earlier, while total domestic store revenue for the four weeks ended Aug. 31 fell 8.7% to $2 billion.
For the most part, sales were disappointing across the industry, with even top-tier companies in the discount arena under-performing or coming in at the low end of their sales plans.
Wal-Mart Stores Inc., the world’s biggest retailer and routinely one of the sector’s strongest players, reported slightly lower-than-expected August sales with a gain of 3.8% in stores open at least a year. The company had planned a sales gain of 4% to 6%.
Target Corp.’s namesake stores, another top performer in the retail industry, barely came within analysts’ sales expectations of a flat to 2% rise, with a same-store sales gain of 0.5%.
Sales in stores open at least a year, or same-store sales, are considered a good measure of continuing health because they exclude new and closed stores.
Although the sales numbers seem to indicate that consumers continue to monitor spending, the retail sales numbers released Thursday tell only part of the story, Niemira said. August was the best-selling month for domestic auto sales in nearly a year, as consumers took advantage of no-interest financing deals, which may have siphoned dollars away from other discretionary purchases.
