By  on May 14, 2007

WASHINGTON — April sales at apparel and accessories stores fell a seasonally adjusted 2 percent compared with March, while volume at department stores slid 2.1 percent, the Commerce Department reported Friday.

"Consumers were faced with three elements last month — rising gas prices, unseasonably cool weather and an early Easter — which impacted April retail sales," National Retail Federation chief economist Rosalind Wells said in a statement.

A gallon of regular gasoline sold for an average of $3.04 cents Friday, up from $2.80 a month earlier and just below the all-time high of $3.06 recorded in September 2005, according to the American Automobile Association.

Since gas is a relatively small portion of average household spending, consumers can often absorb a few extra cents at the pump, though lower-income shoppers are hit harder. Increases in gasoline prices are also highly visible and can feed a negative consumer psychology.

On Thursday, retail giant Wal-Mart Stores Inc. reported a 4.6 percent same-store sales drop at its flagship division, and that, according to a national survey conducted internally, "the top three concerns among discount store consumers, as well as regular Wal-Mart shoppers, were money-income-finances, the cost of living and gas prices."

Against a year earlier, sales at apparel and accessories stores were rosier, increasing 4.7 percent to $18.5 billion. On the other hand, sales at department stores dipped 2.6 percent, to $17.3 billion for the 12 months.

Even after smoothing out some of the give and take of the Easter shift, sales at specialty and department stores diverged. Comparing the three months ended April with the preceding three-month period, and adjusting for seasonal changes, sales of apparel and accessories grew 1.2 percent, as department stores, a category that includes some discount merchants, posted a 1 percent dip.

The impact of higher gas prices on lower-end shoppers and consolidation in the marketplace accounted for some of the discrepancy between the two channels, said Scott Hoyt, director of consumer economics at Moody's Economy.com.

Consumers in general were feeling pressured not only by higher energy costs, but by the fallout of the housing market and reduced credit availability, he said.

"Year-over-year growth in total retail sales is about half of what it was this time last year," said Hoyt. "That's indicative of the financial stress that consumers are under and the fact that they can't support the level of spending growth that they could a year or two ago."

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