WASHINGTON — Consumers shopping for the holidays gave a boost to department stores in November, but they appeared to pull back on their purchases from apparel and accessories stores, the Commerce Department’s monthly sales report showed Thursday.
This story first appeared in the December 13, 2013 issue of WWD. Subscribe Today.
Department stores posted a seasonally adjusted 0.3 percent increase in sales to $14.5 billion last month, while general merchandise stores, a category that includes discounters and department stores, saw a 0.1 percent increase in sales to $55.3 billion.
Specialty stores posted a seasonally adjusted 0.2 percent decline in sales to $21.2 billion in November, following a strong upwardly revised sales gain of 2.6 percent in October.
“This was an incredibly strong report except for apparel specialty stores,” said Scott Hoyt, director of consumer economics at Moody’s Analytics. “I think a lot of the weakness there in November is probably just payback from October, which had a strong increase.”
Hoyt said specialty store sales were up 4.1 percent in November compared with a year earlier, indicating some strength in the category.
John Yozzo, managing director at FTI Consulting, said weakness in the teen sector has brought down the overall specialty store sales numbers.
“I’m not sure that will change until young people have an easier time finding jobs,” Yozzo said. “That accounts for a lot of challenges in that sector. They just don’t have the income.”
Department stores are “holding their own,” Yozzo said, pointing in particular to Macy’s Inc. and Dillard’s, which, he noted, have “become more competitive price-wise” and have also done well online.
Yozzo noted that apparel sales numbers are somewhat skewed because the government separates the category of e-commerce sales, of which apparel accounts for a significant amount, from brick-and-mortar store sales. Nonstore, or e-commerce, sales for November rose 2.2 percent, according to the data.
In the overall economy, retail sales rose 0.7 percent to $432.3 billion, driven by “sizable gains” in autos, electronics, furniture and online sales, said Chris G. Christopher Jr., director of consumer economics at IHS Global Insight.
“This is good news for retailers since coming into the holiday season, consumer mood turned sour,” said Christopher, noting that IHS is forecasting a 3.2 percent increase in holiday retail sales compared with a year earlier and is upping its fourth-quarter real consumer spending growth to 3.2 percent from 2.3 percent, based on the new retail sales data.