NEW YORK — Good, not great, is the sentiment surrounding Thursday’s barrage of August same-store sales results.
But if August’s sales were hampered by hot, muggy weather — and to some extent Hurricane Katrina — then September is sure to see a boost thanks to pent-up demand, analysts predicted.
In all, August same-store sales, a metric tracking sales at stores open at least a year, showed strength among the usual standouts in the luxury space, such as Neiman Marcus Group Inc., Saks Fifth Avenue and Nordstrom Inc. with respective 8.2 percent, 5.3 percent and 8 percent in August comp gains.
“People with money, they don’t care how hot it is. They know when the new styles hit the stores. The personal shoppers call, and they make their appointments. And they don’t care how much gas costs,” said Mark Rein, senior manager at Capgemini’s retail practice.
Strong back-to-school traffic rewarded several specialty retailers, including Abercrombie & Fitch Co., which had a 24 percent rise in August comps, Citi Trends Inc. with a 20.3 percent jump in comps and Wet Seal Inc., which posted a 48.3 percent August comp increase. Other specialty chain outliers were women’s apparel retailers Dress Barn Inc. and Cache Inc., both with 11 percent monthly sales advances.
Meanwhile, Kohl’s Corp. showed up the moderate department store sector with a 4.6 percent rise in August comps, while J.C. Penney Co. Inc. said comps increased 2.8 percent.
“It’s the same old companies that are continuing to perform very well. They’ve continually kept that momentum just rolling and rolling and rolling,” said Chris Donnelly, a partner in Accenture Ltd.’s retail practice. He added, however, that “again, it seems to be the companies that have had some changes in connection with the right assortment mix and finding the right kind of customer proposition that are still struggling.”
Among the 50 retailers tracked by WWD, 33 companies posted positive August same-store sales, while 15 had negative results. Sales were not available for two companies, Deb Shops and Walgreen Co. At 5.1 percent, the specialty retail sector had the highest average comp rise, while mass merchants beat out the department store group with a 2.6 percent total August comp increase, versus a 2.1 percent aggregate increase for the department stores.
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According to the International Council of Shopping Centers, same-store sales in August rose a softer-than-expected 3.6 percent. The ICSC said more consumers were “paring” their discretionary spending due to high gas prices (see sidebar), causing aggregate comps at the 67 chain stores it follows to come in below its 4 percent forecast.
Wal-Mart Stores Inc., for one, which posted a 2.6 percent increase in August comp sales at its discount stores, warned that September sales results will likely be hurt by high gas prices as well as the impact of Hurricane Katrina, which devastated much of Louisiana and Mississippi.
Of course, Katrina is on retailers’ minds, as several other companies noted that the storm affected August results. Federated Department Stores Inc., which posted a 1.1 percent rise in August comps, said Thursday that comps were lower than expected due to Katrina’s impact on its stores in Florida and Louisiana. In addition, Cato Corp. said late Wednesday that 125 of its 1,200 stores were affected by Katrina; about 50 of its stores remained closed on Wednesday.
Looking to September, analysts were concerned about the impact of Katrina. Thursday’s “numbers all represent August, of which we had a big disaster earlier this week. So there’s uncertainty, and where there’s uncertainty — consumers don’t like uncertainty — so that is cause for a lot more caution going into next month,” said Accenture’s Donnelly. However, “recent weather events excluded, you look at these [August] numbers and you’d have to feel really good about September because you have good momentum going into a pretty strong buying season.”
According to a Capgemini informal survey of 107 consumers conducted online on Wednesday, roughly 70 percent of those surveyed had not yet started purchasing fall apparel. And among those who have already started buying fall clothes, 34 percent began purchasing one week ago.
Capgemini’s Rein said, “I think we’ve got a lot of pent-up demand for September. When you start thinking about apparel, I think there’s some new looks that could potentially take off. I think people are evaluating them.”
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