Low-graphic news index |
Friday, November 2, 2012 - Page updated at 07:30 p.m.
October retail sales rose; storm’s effect a concern
The New York Times and Seattle Times business staff
Shoppers continued to spend steadily at retailers in October, from discounters like Costco Wholesale all the way to the high end, including Nordstrom, suggesting consumer confidence heading into the holiday season.
Issaquah-based Costco posted a 7 percent increase in sales at stores open at least a year, while Seattle-based Nordstrom reported a 9.8 percent gain, boosted by strong demand for women’s apparel and growth at its discount Rack chain.
Results tallied Thursday from the 18 national retailers tracked by Thomson Reuters showed an average increase of 2.7 percent in sales at stores open at least a year. The results largely excluded the effects of the hurricane.
Without the Rite Aid drugstore chain, though, that figure would have been 4.7 percent, above analysts’ expectations of a 4.3 percent increase. Rite Aid saw a decline mainly because of a shift toward cheaper generic drugs.
“You’re seeing solid single-digit numbers not just one month but consistently for the past few months,” said Madison Riley, managing director at the retail consulting firm Kurt Salmon. “It reflects a steadily improving economy and therefore, steadily improving consumer confidence.”
Still, all retailers’ eyes were on the impact of Hurricane Sandy.
Most retailers’ fiscal October ended Saturday, so while a few stock-up trips made it into the October results, most of those, along with poststorm spending and the impact of store closures, were not included in October results.
Categories ranging from department stores to discounters to apparel retailers all posted good results.
“What I find intriguing and encouraging is it’s not isolated,” Riley said, “but it’s across the industry.”
Stores for those on a budget continued to shine. The Nordstrom Rack division of Nordstrom, up 10.5 percent, posted its highest same-store sales increase of the year.
Retail analysts were already looking ahead to Sandy’s effect. A Citi analyst, Deborah Weinswig, wrote in a research note that discounters could see a slight lift as people restock supplies after the storm.
But Riley, the retail consultant, said Sandy had arrived early enough to give people plenty of time to shop for holiday items.
“It’s a timing issue, as opposed to, it’s going to affect the holiday season,” he said.
Seattle Times business reporter Amy Martinez contributed to this report.
Low-graphic news index
Graphic-enabled home page