October's Mixed Results
Warm weather at the beginning of the month took a bite out of sales of fall merchandise for many retailers, but others reported strong year-over-year sales in October.
A cool snap at the end of the month help lift sales at Ross Stores Inc., which saw same-store-sales increase by 4 percent, according to Chief Executive Officer Michael Balmuth.
“We saw increased traffic to our stores,” Balmuth said. “Dresses and home remained our top-performing merchandise categories for the month.”
New York–based International Council of Shopping Centers blamed the unseasonably warm weather across much of the United States for curbing demand for fall merchandise, said Michael Niemira, chief economist for the ICSC. U.S. chain-store sales increased 1.6 percent compared with the same time in the previous year.
Yet, MasterCard Advisors’ “Spending Pulse” report, released Nov. 3, said fashion retailers basically had a good October. Year-over-year apparel sales were up 8.2 percent, the report said. Women’s apparel increased 5.3 percent. Children’s sales increased 8.7 percent. Men’s apparel reported the only decrease, with a 0.3 percent decline.
Retail analyst Adrienne Tennant wrote in a Nov. 2 research note that sales and promotions also had an impact on October sales.
“October is typically a clearance- and markdown-driven month,” she wrote. ’Moving into November, we could expect to see ongoing discounts to generate customer interest.” Tennant works for Philadelphia-based Janney Montgomery Scott LLC.
Boardsports apparel retailer Zumiez reported robust sales for October. The retailer’s same-store sales increased 21.5 percent. Total net sales increased 27.3 percent to $31.4 million in October 2010, compared with $24.7 million the previous October.
Zumiez Chief Executive Rick Brooks said the good performance would not change his company’s outlook for the economy. “However, as we plan the important fourth quarter and fiscal 2011, we will continue to be cautious, reflecting the continuing economic challenges.”
Hot Topic’s October same-store sales declined 8.5 percent, but its Torrid division reported a good month. Its same-store sales increased 2.9 percent compared with the same time in the previous year.
The news was mixed for department stores. Macy’s Inc. continued to post gains, reporting a 2.5 percent increase in same-store sales, while Kohl’s saw a drop of 2.5 percent in its same-store sales. Luxury seemed to fare even better, with Neiman Marcus reporting a robust 11.1 percent increase in comp-store sales, Saks Inc. reporting a 8.1 percent increase in comp-store sales and Nordstrom reporting a 3.4 percent increase.
The discount and off-price sector also fared well. TJX Cos. Inc., which reported increases all last year, reported flat same-store sales for October. And Target Corp. reported a 1.7 percent increase in comp-store sales.—Andrew Asch
