Sales last week suffered their steepest decline in more than two months — and their third down week in the last four – as consumers seemed to favor bargains on summer merchandise over new styles.
The Weekly Chain-Store Sales Index of The Retail Economist LLC and Goldman, Sachs & Co. declined 1.9 percent in comparison to the prior week during the seven days ended Aug. 15. Year-over-year comparisons were stronger, with the index 0.7 percent ahead of its showing for the 2014 period, but still well below the 3.3 percent annual gain registered during the week ended Aug. 8.
The weekly comparison was down 2.7 percent for the week ended June 6. The largest decline for the year so far came early, with a 3.8 percent drop for the seven days ended Jan. 3.
Weather Trends International said that last week was 3.2 degrees warmer than last year’s week, on average, and 1.7 degrees warmer than its long-term average.
Even with sales-tax holidays lingering into last week, “Mother Nature was spurring consumer demand for summer-clearance merchandise more than back-to-school/fall items,” said Michael Niemira, chief economist and principal of The Retail Economist.
Consumers remained focused on furniture and home-oriented stores, again the strongest categories, and the index reported “modest strength” at dollar stores and discounters.
But business was weak at department and apparel stores, as it was for drug, grocery, electronics, online-online and office-supply stores and wholesale clubs.
After declining for four consecutive weeks, the price of a gallon of unleaded gasoline rose 8.7 percent during the week, reducing the cut in gas prices compared to a year ago to 21.8 percent.
The Retail Economist estimated that same-store sales for August among the companies that continue to report monthly sales would be “relatively steady” with the lukewarm trends of recent months, with sales-tax holidays compensating to a degree for the damaging effects of higher gas prices and hurtful foreign-exchange comparisons.
For August, comp sales among the abbreviated samples of public companies reporting results are expected to range between flat and up 1 percent, well below the 4.8 percent gain registered for August 2014.