November retail sales blew by analyst estimates, posting one of the biggest increases in three years. þþThe results released Thursday reinforced reports from Black Friday weekend showing consumers shopped, spent and are buying non-necessities again. þþSales at stores open at least a year — a crucial indicator known as same-store sales — rose an average of 6 percent, according to Thomson Reuters, well above the 2.6 percent that analysts had expected. That was the biggest increase since 2007 except for a 9.2 percent rise in March of this year. þþAdded to the report earlier this week that showed consumer confidence at its highest level in five months, it suggested more spending might be on the way. þþ“The good news is that consumers spent throughout the month of November,” and not just on Black Friday, said John Long, a retail strategist at the consulting firm Kurt Salmon Associates. “But it’s difficult to say whether the promotions we saw in November, particularly early on in the month, pulled forward some of the volume we would be expecting to see in December.” þþAlso, he said, December same-store sales would need to rise more than November ones to end up with a similar increase. In December 2009, sales were up 3 percent, compared to November 2009, when they were up just 0.4 percent. þþStill, he said, retailers seemed confident. þþ“The performance that most retailers turned in in November has given them some confidence and some spring in their step,” he said. “I think most retailers are expecting a very good holiday season, and so there’s no need to go to the deeper discounts.” þþTed Vaughan, a partner in the retail and consumer product practice of the consulting firm, BDO USA, said: “We’ve seen the number of shoppers go up, but we’ve seen the volume per shopper go up. Year over year the discounting is probably about comparable, but they are buying more items and that’s what’s really driving the over all increase.” þþRetailers were highly competitive in November, with some starting their Thanksgiving promotions in October , many offering Thanksgiving-day online specialsand others offering in-store shopping on Thanksgiving. Promotions were numerous. Stores like Sears and Kmart touted layaway programs; Target offered its credit card holders 5 percent back on all purchases; the Gap ran Black Friday promotions where everything in the store was half off; and Wal-Mart agreed to match its competitors’ door-buster prices. þþThe Thomson Reuters data showed that retailers marketing to teenagers had the best performance, posting a 9 percent increase over last year. (To be fair, teenage retailers also had the sharpest decline in the month a year ago, when November same-store sales declined 7.8 percent.) þþAs usual, though, there was wide variation in how well teenage retailers did. Three — American Eagle Outfitters, Aeropostale and Hot Topic — were among the worst performers for November, while Abercrombie & Fitch and Zumiez were among the best. þþDiscount stores had the biggest increase as a category, rising 7.1 percent on top of a 2.1 percent rise last year. However, the discount category does not include Wal-Mart, the nation’s biggest retailer, which has been trying to turn around six consecutive quarters of same-store sales declines in the United States with major discounts, promotions like free shipping with no minimum purchase on a swath of online items and adding merchandise back into stores. þþLuxury stores, which have been prospering since the stock market has been doing better, continued to do well, with Nordstrom posting a 5.1 percent increase and Saks Fifth Avenue a 5.3 percent increase. þþBut the more modest department stores had even stronger results, with J.C. Penney rising 9.2 percent, Dillard’s up 8 percent and Kohl’s up 6.1 percent. þþ“You saw an increase in people purchasing for items for themselves, whether they’re impulse items or door busters where they’re buying two and keeping one,” Mr. Vaughan said. þþOn Black Friday, Eve Dong, a 19-year-old freshman at Macalester College in St. Paul, was one of those shoppers. She was plopped on a bench on the third floor of the Mall of America, surrounded by six bags and waiting for her friends to return. She had been there since 5 a.m., and had spent about $500 on items like clothes, skin care, makeup and shoes. þþ“I’m so tired, “ she said, “but they continue to shop.” þþ
Source: NY Times
