US consumer confidence was down in May, with shoppers spending less according to monthly sales data from leading chain retailers released on Thursday.
Several leading retailers suggested that bad weather in the first part of
the month, and a shift in the timing of Memorial Day holiday shopping, may have affected spending more than continuing macroeconomic concerns.
Ken Perkins of Retail Metrics, which tracks the monthly data, said its index of same-store sales rose 2.7 per cent against the same period last year, 130 basis points below initial expectations.
Sales of summer clothing were also affected by unseasonably wet and cool weather during the first half of the month.
Frank Badillo, senior economist at Kantar Retail, argued that the “results provide some sign that the retail recovery will persist” in spite of wealth declines and economic uncertainties.
Macy’s, the largest US department store chain by sales, which reported a 1.4 per cent increase in comparable sales, cited the impact of the weather, saying its “business trend strengthened toward the end of the month as the weather turned warmer”.
Kohl’s, the lower price department store, noted that business improved during the last week of the month, with its comparable sales up 3.5 per cent, better than it had expected.
Neiman Marcus, Saks and Nordstrom, the luxury and high-end department stores also continued to provide evidence of the recovery in spending by better off consumers.
Neiman Marcus said same store sales rose 7.8 per cent, and noted that its store sales growth was led by its locations in New York City and Texas. Saks comparable sales were up 5.8 per cent, and Nordstrom’s were up 3.7 per cent, with slower growth due to the later start of an annual half-year sale.
Gap, the largest speciality clothing retailer, reported comparable sales growth of 1 per cent, with only its North America Gap brand stores seeing a sales decline, by 2 per cent.
Discount retailers also continued to outperform their full price competition, with TJX and Ross Stores, which sell remaindered and excess branded goods, reporting same store sales growth of 4 per cent and 5 per cent, respectively.
Despite the continued sales growth seen by most retailers, their overall sales remain below levels seen in 2007 and the first part of 2008.
Image: Neiman Marcus
Source: Financial Times