As retailers wrapped up their earnings reports this week, most said they're back in cost-control mode and will tighten inventories after the holidays. Shoppers are still spending cautiously and costs are on the rise, so profits will have to be squeezed out of slowly rising sales.
Shoppers are still being careful with their money and hunting for bargains, but generally positive October sales numbers suggest that consumers are beginning to look beyond the basics.
Consumers are still cautious about spending as the effects of the recession linger. But many retailers are feeling more optimistic as we head into the holiday shopping season. Here's a look at the people who are leading retail out of the doldrums.
Knowing customers' likes and dislikes is about as basic as it gets in retailing. But for years, national department stores got it wrong. More concerned with controlling costs, big retailers focused on sameness. Not anymore.
Despite heat waves, penny-pinching parents and a weak job market, most retailers posted solid sales in August. They benefited from better inventory control -- giving local stores more say in merchandising -- and well-timed promotions.
Saks shares have spiked on takeover speculation. Reports say a private equity consortium with U.S. and U.K. players is interested in buying the retailer and could offer some $1.7 billion for it.
With the prospects for economic recovery iffy at best and consumer spending still sluggish, retailers are closing their weakest stores in order to protect profits.
The earnings spotlight falls on retailers this week, and expectations are high for many of them, including Abercrombie & Fitch and Dollar Tree, which has benefited from the recession and slow recovery.
The latest update from retailers shows that shoppers tightened their budgets in April, partly due to an earlier Easter. But after a March shopping spree, one expert says "overall, retailers have to be pleased with the spring selling season."
Macy's didn't waste a good economic crisis last year -- it restructured, refreshed its stores and products and rebounded with what looks to be a strong first quarter, prompting management to raise performance forecasts for the year. In the works: a fashion line from superstar Madonna.
The early arrivals of Easter and spring got shoppers out of hibernation in March. However, experts caution about reading too much into most retailers' strong sales numbers. The trends underlying double-digit sales gains show shoppers are still counting pennies.