Volume 2, Issue 2
January 31, 2014
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December retail sales (excluding automobiles, gas stations and restaurants) increased 0.4% seasonally adjusted month-to-month, and 4.6% unadjusted year-over-year, according to the National Retail Federation.
Total holiday retail sales, which include November and December sales, increased 3.8% to $601.8 billion, which was not far off the NRF pre-season forecast of 3.9% and $602.1 billion.
In addition, non-store holiday sales, which is an indicator of online and e-commerce sales, grew 9.3% to $95.7 billion, NRF said.
The International Council of Shopping Centers said that in spite of some extreme weather and a shortened holiday season, its members reported sales for the November-December holiday period increased by 3.0%.
The December same-store increase was 3.4% on a year-over-year basis, which was stronger than November’s sluggish 2.1% gain, ICSC pointed out.
For the two-month holiday-selling period of 2013, U.S. chain-store sales for the industry companies reporting to ICSC outpaced 2012’s increase of 1.8%. However, the association stressed that individual retailer performance was very uneven and sales were extremely promotional (deeply discounted) across a wide spectrum of retailers, causing some retailers to warn of weaker earnings for the quarter. “While some retailers undoubtedly faced a tough holiday season with more promotional activity, bouts of adverse weather and a cautious consumer, overall industry sales met expectations and managed to outpace last year’s growth rate,” said ICSC Chief Economist Michael Niemira.
NRF President Matthew Shay said, “Considering that retail sales are an important barometer when measuring the overall health of our national economy, this report provides a level of true optimism that the recovery is picking up steam, and retail leads the way.”
December retail sales, released Jan. 14 by the U.S. Census Bureau — which include categories such as automobiles, gasoline stations and restaurants — increased 0.2% seasonally adjusted month-to-month, and 4.1% adjusted year-over-year.
“Retail sales have been volatile all year and the holiday shopping season was no exception,” NRF Chief Economist Jack Kleinhenz said.
“Solid job growth in the months of October and November led to a more-confident consumer and healthy holiday shopping season for many retailers,” he added. “While economic and policy uncertainties remain, the economy seems set for steady growth in the New Year.”
Some of the holiday sales increase came at the expense of margins, Kleinhenz admitted. “Retailers are still stressed and a long-term promotional environment may actually hurt the bottom line. As consumer confidence grows, there will be less need for retailers to heavily promote and discount their offerings.”
ICSC reported that for the full calendar year 2013, industry sales grew by 3.3% — in line with holiday season –and was the strongest annual sales performance since 2011 when sales jumped 4.7%
Looking ahead to what will be the end of the fiscal year for most retailers in the United States, ICSC Research forecasts that January monthly comparable-store sales will increase by between 3% and 3.5% over last year, just slightly under the reported December increase.
The Winners and Losers
NRF said analysis of December retail sales showed that building materials and garden equipment and supplies dealers stores’ sales decreased 0.4% seasonally-adjusted month-to-month, but increased 4.2% unadjusted year-over-year.
Clothing and clothing accessories stores’ sales rose 1.8% seasonally-adjusted month-to-month and 4.7% unadjusted year-over-year.
On the other hand, electronics and appliance stores’ sales decreased 2.5% seasonally-adjusted month-to-month and 1.5% unadjusted year-over-year.
Furniture and home furnishing stores’ sales slid 0.4% seasonally-adjusted month-to-month, yet increased 5.0% unadjusted year-over-year, NRF noted.
General merchandise stores’ sales were flat seasonally-adjusted month-to-month and flat unadjusted year-over-year.
However, NRF reported that health and personal care stores’ sales were up slightly 0.6 seasonally-adjusted month-to-month, and rose 5.9% unadjusted year-over-year.
Sporting goods, hobby, book and music stores’ sales decreased 0.6% seasonally-adjusted month-to-month, but increased 5.8% unadjusted year-over-year, NRF reported.