Retailers Continue Post-Easter Momentum
Tue, Apr 13, 11:52 AM ET, by RetailSails.com
After robust sales gains for the month of March and especially during the week leading up to Easter, the post-holiday falloff wasn’t as severe as expected. Retailers continued their positive momentum as warm weather drove strong demand for spring merchandise last week, and consumers are becoming less cautious with their discretionary spending.
The International Council of Shopping Centers (ICSC) reported that chain store sales rose a slight 0.1% from the prior week, the fourth consecutive gain, while sales gained a strong 4.0% from the year-ago period.
As expected, there was somewhat of a drop-off during the post-Easter week compared to last week's 4.7% YoY increase, but lingering warm weather helped to keep apparel sales relatively strong even as customer traffic at discount stores moderated.
"Sales were impacted by the usual post-Easter seasonal weakness, but adjusted for that, sales edged up for the fourth consecutive gain and were helped by seasonally warm weather that continued to drive spring-merchandise demand," said Michael Niemira, ICSC's chief economist.
ICSC Research expects April comp store sales to be flat to down 3% as the earlier Easter pulled sales into March from last year. However, the combined March-April period is projected to show a healthy 4% increase from last year.
Redbook Research reported that same-store sales posted a 3.3% increase for the week ending April 3rd, following a 5.2% gain the prior week leading up to Easter. Relative to March, sales dropped 1.3%.
"The first week of April was satisfactory and most retailers were running at or somewhat better than plan by the end of the period. The unfavorable comparison with the year ago Easter week turned out to be less severe than many had expected," said Catlin Levis, Redbook analyst.
Home furnishings and home improvement-related merchandise saw increased activity as buyers geared up for spring projects. Redbook expects total April same-store sales to be up 2.8% from the year-ago-period.
In another sign that the consumers are feeling more confident in their spending, the Deloitte Consumer Spending Index rebounded in March after 2 straight months of declines. The improvements were driven by improvements in the job market and lower tax rates, while declining real home prices and hourly earnings remain a drag on the index. But, overall the results bode well for retailers:
“Consumers have shed some of their restraint in recent months, but it appears that a significant amount of pent-up demand may still be waiting to be released,” said Stacy Janiak, vice chairman and Deloitte’s U.S. retail leader. ”As retailers plan for the critical fall selling season, they may want to consider the potential for a more active consumer,”
Tomorrow morning, we will get a more complete look at overall retail performance last month, as the Commerce Department will release U.S. Retail and Food Services sales for March.
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