Retailers' back-to-school sales may get passing grade after all
It looks like once it's all said and done, this year's back to school shopping season won't be the debacle it looked like in August. As the weather turned colder and the first day of school loomed, sales appear to have perked up. The International Council of Shopping Centers reported Wednesday sales at chain stores were basically flat for the week ending Sept. 5, down only 0.1 percent from a year earlier. Compared with the week before, sales were up 0.6 percent.
Michael Niemira, the ICSC's chief economist, said cooler weather and a later start to the school year in parts of the country helped drive up sales. Many retailers had mentioned the late arrival of Labor Day this year had dragged down sales last month.
But we're not out of the woods yet. As most retailers have noted, unemployment is still high and consumer confidence still low. Niemira held to his forecast that September sales will be down two percent below last year's.
Right up until Labor Day, retailers had been bracing for a weak back to school season, reading reports of cash-strapped parents putting notebooks (the kind with spirals, not microchips) on layaway. Stores had cut back on inventory, trying to avoid a replay of last fall, when the credit crunch hit home in September and torpedoed fall sales.
This year, back to school inventory was down by double-digit percentages, if retailers reports are to be believed, and the annual tug of war between parents looking for sales and retailers seeking profit looked to be weighed in favor of the stores.
It looks like, faced with the start of classes Tuesday in most of the country, parents blinked and went shopping.
Speaking at annual Goldman Sachs (GS) Global Retailing Conference Wednesday morning, both Ron Sargent, CEO of Staples Inc. (SPLS) and Mike Ullman, his counterpart at J.C. Penney Co. (JCP), said back to school sales met expectations.
"Back to school is always a competitive time of year ... this year was competitive (but) not more competitive than past years," said Sargent. "I don't think this is worse than prior years."
Why is Oprah going to cable? Hint: It's nothing to get teary about
Kisses from Hershey: Candymaker may court Cadbury with $17 billion bid
D-Day for Harry Reid: Can he wrangle 60 votes for Senate health reform bill?
Reader Comments (Page 1 of 1)
9-09-2009 @ 5:01PM
Iridium said...
BS IN CAPITAL LETTERS.
Retailers inventories were far smaller than any previous year I can remember and spent far less time on the shelf. Every back to school section has already been replaced for Halloween in order to get a jump on that market.
Two weeks ago Target discounted all back to school inventory by 50%. They then sold most of the inventory at the reduced price.
If you are speaking of meeting expectations by selling your inventory, then yes it was successful. Measuring against other stores with sales of reduced inventory, yes successful. Measuring sales as a source of profit and by past years, a total disaster.
As I said before. Back to school items are a necessity and most retailers only stocked the necessities and parents put pens and paper on layaway.
But no this back to school gets a passing grade.
Reply