California Apparel News

Despite skyrocketing fuel prices and the economic devastation caused by hurricanes Katrina and Rita, retail sales for the month of September increased by 4 percent, according to New York–based International Council of Shopping Centers (ICSC). Several retail organizations are predicting that the sturdy economy will result in a rise in consumer spending during the crucial Christmas holiday.

One of those organizations, The NPD Group, released a consumer survey on Oct. 5 that found that shoppers planned to spend, on average, $681on presents this Christmas, compared to $655 for the 2004 Holiday. The survey from the Port Washington, N.Y.–based group also found that 34 percent of consumers said the price of oil and gas would have no impact on their Holiday spending.

The National Retail Federation, based in Washington, D.C., forecast moderate Holiday spending growth in a study published on Sept. 21. It forecast an increase of 5 percent for the Holiday, compared to 6.7 percent during the previous year.

The Christmas season ought to find Southern California in a good mood, said Jack Kyser, chief economist of the Los Angeles County Economic Development Corp.With key indicators such as employment and homebuilding growing around the region, Southern Californian retailers should not expect the worst from the season. “It’s going to be a decent Holiday,” Kyser said. “There will be a lot of nail-biting, but it won’t be too shabby.”

If September sales are any indicator, luxury and teen apparel might prove the big Holiday winners. They both did well during the month of September. According to the ICSC, sales for teen retailers grew 9.7 percent and 5.4 percent for luxury stores.

Dallas-based Neiman Marcus Group was one of the top performers in the luxury sector, reporting comparable-store sales of 9.6 percent during September. Foothill Ranch, Calif.–based Wet Seal Inc. was one of the most successful of the teen retailers with comparable-store sales of 44.9 percent during the last month.

Teen retailer Hot Topic reported a decrease of 5.6 percent in same-store sales for September. Wall Street analysts forecast a sales increase at Hot Topic during its crucial Halloween season in October. However, Liz Pierce, an analyst in the Los Angeles office of investment firm Sanders Morris Harris, said the increase in traffic wouldn’t kick the City of Industry, Calif.–based chain into positive same-store sales.

Rather, she forecast, in a research note published Oct. 7, that the company’s October comparable sales would decline in the low single digits, compared to a 3.8 percent decrease in the previous year.

October sales for the retail sector should increase 3 percent, according to the ICSC.

This issue, the California Apparel News adds Zumiez Inc. to its index. The Everett, Wash.–based retailer of action sports apparel went public on May 5. —Andrew Asch