Same Store Sales Boosted by Inflation, Retail Slumming
The monthly retail data was released this morning -- and it was none too pretty. Same-store sales dropped 0.5% for the month of March, according to the International Council of Shopping Centers (ICSC). This was the biggest decline in almost a year.
Two of the trends we have discussed over the past year are still quite evident: Food and fuel inflation, and consumers moving further down market to warehouses and discounters to save money.
"Wal-Mart Stores Inc. and Costco Wholesale Corp. said March sales rose as consumers buffeted by job losses and declining home values sought discounts on food and electronics.
Wal-Mart, the world's biggest retailer, said sales at stores open at least a year increased 0.7 percent, within its forecast, helped by grocery and flat-panel TV sales. The Bentonville, Arkansas-based company raised its first-quarter profit projection.
"The discounters, the warehouse clubs, that's who we think are going to be the winners in this retail environment,'' Joseph Feldman, an analyst with Telsey Advisory Group in New York, said today in a Bloomberg Television interview.
Thomson Financial noted that the majority of retailers that have missed expectations are blaming the Easter effect and macroeconomic conditions.
Wal-Mart (WMT) is faring better than most, reporting a 0.7% rise in same stores sales. Their sales including fuel rose 1.1%. Also selling well are health care products and fuel.
One complaint about Wal-Mart's reporting: They refuse to "ex-out" food in their monthly data. How much of the 0.7% sales (ex-fuel) was boosted by rising prices of groceries is not really known. Hence, we do not get an accurate read on how much of their monthly sales revenue is improvement, and how much is food inflation.
Retail Follow Up (July 2007)
Slowdown biting into discretionary retail sales
MarketWatch, 9:18 a.m. EDT April 10, 2008
No Spring in Retailers' March Sales As Most Chains Post Weak Results
WSJ, April 10, 2008 10:04 a.m.
Wal-Mart, Costco Sales Gain as Bargains Lure Shoppers
Bloomberg, April 10, 2008
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And why is the stock market up?
Posted by: JohhnyVee@tahoo.com | Apr 10, 2008 12:49:27 PM
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