June Sales Surprisingly Good
Discount and off-price stores helped drive June sales to a surprisingly good performance, according to the New York–based International Council of Shopping Centers.
The ICSC reported sales from the research sector increased by 4.3 percent compared with the performance of June 2007. The performance beat the ICSC’s June forecast of an increase of 2.5 percent to 3.0 percent, said Michael Niemera, chief economist of the ICSC.
“June came in better than expected thanks to stimulus checks and warmer weather,” Niemera said.
The federal government’s economic-stimulus checks started going out in May, and many people seemingly spent these checks at discount and off-price retailers. Pleasanton, Calif.–based Ross Stores led with the best performance by a discounter—an 8 percent increase in same-store sales in June. Ross Chief Executive Officer Michael Balmuth said delivering bargains to Ross’ customers was responsible for the company’s good June performance.
Department stores, however, suffered in June. Nordstrom reported an uncharacteristically steep 18 percent decline in its same-sales numbers. Luxury store Neiman Marcus also reported a 2.4 percent decline in its June same-store sales.
Saks Fifth Avenue was one of the few winners among department stores. It posted a 1.9 percent increase in same-store sales in June.
Specialty stores did not fare much better. Fort Myers, Fla.–based Chico’s F.A.S. Inc. reported a major 12.9 percent decline in its same-store sales in June. Gap Inc. posted a 7 percent decline.
Wet Seal Inc.’s Wet Seal division experienced a 0.8 percent decline in June, while its more-contemporary Arden B. division stumbled, reporting a steep 10.7 percent decline in same-store numbers.
Pacific Sunwear was a June success story. The mall-based teen activewear retailer beat the forecast of analyst Liz Pierce of Roth Capital Partners, based in Newport Beach, Calif. She had forecasted the retailer would report a 2 percent to 4 percent decline in same-store sales. Instead, the retail chain reported a 3 percent increase. Pierce credited the increase to good merchandising and a strategy of sales and promotions. —Andrew Asch
