NEW YORK — The strong fashion cycle that boosted retail sales in the first half of this year — and most of 2003 — could be nearing an end as same-store sales came in soft for a second consecutive month.
As a whole, retail comps — sales at stores open at least a year — have decelerated since June and failed to be helped, as largely expected, by a strong back-to-school selling season. Instead, it seems shoppers have cooled their spending as broader, macroeconomic issues stymie their confidence.
“It would be safe to call [September’s results] flat,” said Janet Hoffman, a partner in Accenture Ltd.’s retail practice. “There were one or two outliers, but [the results were] by and large disappointing.”
Hoffman stressed two main reasons for the month’s weakness. First was the strength of comps in September 2003. “That was kind of the beginning of the [retail spending] turnaround,” she said. Secondly, Hoffman cited the poor weather from several hurricanes that slammed the East Coast in the past month.
“I typically don’t want to put too much emphasis on the weather, but clearly the hurricanes and the impact on the East Coast…didn’t make for a positive outcome,” said Hoffman.
Even though September’s same-store sales were up against the hardest comparisons of 2003, as well as weather, which was not ideal, many analysts were focused on the state of the consumer, which implies that more of the same comp weakness could be ahead if the economic picture doesn’t improve.
Among the 50 retailers tracked by WWD, 31 retailers came in with positive comps while 19 posted negative results. Specialty chains had the biggest aggregate increase with 2.4 percent, while mass merchants came in with the weakest gain of 0.2 percent.
Goldman Sachs Retail Composite Index rose 1.9 percent in September, an improvement over August’s meager 0.4 percent rise, though still the second worst gain in the last year. Showing similar results, aggregate September results as tracked by the International Council of Shopping Centers increased 2.4 percent. That compared with the ICSC’s 1.1 percent increase in August, which was later revised to a gain of 1.3 percent.
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