BEIGE BOOK: STORES UPBEAT DESPITE LAG
Byline: Jennifer Owens
WASHINGTON — Even though early fall’s sales results were mixed nationwide, retailers told Federal Reserve researchers at mid-October that they were optimistic about their holiday prospects, listing the search for seasonal employees as their only concern.
According to the latest edition, released Wednesday, of the beige book, a regular six-week survey of business conditions in Federal Reserve Districts nationwide, retailers blamed warmer weather for slow apparel sales in September, while crediting the beginning of cooler temperatures for boosting mid-October sales.
Overall, retailers said, prices and wages remained steady during September and early October, and inventories remain satisfactory. The survey, of course, was completed before the wild gyrations on the world’s stock markets started last week, injecting at least a touch more uncertainty into short-term outlooks.
In New York, economic growth moderated since the previous beige book, and most major retailers reported that sales were well below plan in September and early October, although a small pickup was noted in mid-October. Compared with a year ago, same-store sales in September ranged from a 4 percent decline to a 6 percent rise.
“Most contacts sense some weakening in underlying demand,” the report stated. “Much of the weakness was concentrated in apparel. Only one contact reported a discernible impact from New York State’s week-long waiver on moderately priced clothing (in early September), but even in that case, monthly sales were soft.”
Philadelphia-area merchants showed even more sales distress, reporting that results were below year-ago levels. “The normal fall pickup in sales has been delayed, according to store executives, because of unusually warm weather during this period. In addition to clothing stores, many department stores and general merchandise stores have not met sales plans as a result of weak apparel sales,” the report stated.
For some Philadelphia stores, the “shortfall has been significant,” the report said. “Some merchants believe that consumers who have put off apparel purchases have cut back on shopping trips and reduced other buying as well.”
But with colder weather, Philadelphia merchants expressed hope that fall shopping would soon pick up. In fact, most said they believe consumer confidence has not ebbed in Philadelphia, and thus, they have not altered their fourth-quarter sales goals.
As in various other regions, Cleveland retailers are also anticipating a late fall sales rebound after September’s warmer weather brought weak apparel sales. Respondents there said they had already registered a sales improvement this month.