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The Class Of 2009 Comes To Rescue Of American Retailers

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http://business.timesonline.co.uk/tol/busi...icle6820928.ece

American retailers benefited from a “back to school†bounce last month as parents stocked up on classroom supplies and children’s fashions for the coming academic year and the pace of sales declines slowed.

The later start to the back-to-school selling period and the shift of several state tax-free shopping periods from July to August helped ret-ailers. But this was partially offset by the shift of the Labor Day public holiday, another big retail sales day, into the September reporting period.

However, retailers are still nowhere near to making up for the devastation they have suffered since the credit crunch took hold.

According to Retail Metrics, a market research company, retail sales were down 2.3 per cent in August, continuing their decline of the past 12 months, but the smallest decline since September 2008.

Sales of teenage clothing, one of the hardest-hit sectors of the past year, showed the biggest fall in sales last month of 8.9 per cent.

Ken Perkins, of Retail Metrics, summed up the mood: “Things are looking a little less worse. We are seeing sequential improvements, which means that the [Christmas] holiday season won’t be the same disaster it was last year after Lehman Brothers imploded and the spending spigot shut off.â€

Retailers, having cut back dramatically on inventories over the past year, are now walking a tightrope. Low inventories may be necessary as sales decline but they mean less choice in the store — fewer colours and fewer sizes or varieties of each item — making it harder for stores to lure back shoppers.

Creative thinking is needed to counter this, according to John Morris, senior retail analyst at BMO Capital Markets. “They can’t just offer the 30 or 50 per cent off deal. They need something more exciting. This is why stores, such as Old Navy this week, are saying ‘have 30 per cent off everything you can stuff into one of our bags’,†he said.

At Target, the discount department store chain, total sales in August were $4.9 billion, representing a 2.9 per cent fall in same-store sales over August 2008 — an improvement on July’s decline of 6.5 per cent.

Gregg Steinhafel, Target’s chairman, president and chief executive, said that store traffic was essentially flat compared with last August, marking a meaningful improvement from the first half of the year. At JC Penney, same-store sales fell 7.9 per cent but Kohl, another competitor, recorded a 0.2 per cent increase.

Is this a negative led recovery?

It certainly appears we are being spoon fed positive propaganda at ever opportunity.

Just how a big a jump in sales do US retailers need to make on the "black day" sorry can't remember the name for the day US retailers traditional move into the black, isn't it a date in November (or maybe not as memory a bit hazy)?

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http://www.nytimes.com/2009/09/04/business...mp;ref=business

Not Looking Good So Far for Back-to-School Sales

After posting yet another month of weak sales, the nation’s stores are hoping a late September rush will save the back-to-school shopping season.

Back-to-school has historically been one of the most lucrative times of the year for retailers, but sales in July and August were markedly down as consumers pinched pennies. Spending is still slow despite signs the economy is stabilizing, which does not augur a strong holiday shopping season, a crucial time for stores.

August sales at stores open at least a year, a measure of retail health known as same-store sales, were better than July’s, partly because of tax-free shopping days.

But on Thursday most stores posted significant declines — with the worst coming from chains that specialize in teenage clothing and gear.

“We’re seeing this really continued and resounding reluctance of consumers to pay full price,†said Craig R. Johnson, president of Customer Growth Partners, adding that stores selling higher-end merchandise “continue to bleed share to the discounters and other value players.â€

Indeed, low-price retailers like Aéropostale, Ross Stores, Kohl’s and TJX (the parent company of the T. J. Maxx and Marshalls chains) were standouts, posting sales increases.

Bill Dreher, a senior retailing analyst with Deutsche Bank Securities, said higher customer traffic at places like Kohl’s and Target, while not yet translating into robust sales, was a sign that consumers were considering making discretionary purchases again. Come the holidays, he predicted, Kohl’s and Target “should be destinations for affordable gift-giving.â€

Kohl’s reported a 0.2 percent same-store sales increase on Thursday. Target posted a 2.9 percent decline, but exceeded expectations.

The NY Times take on the same data.

Completely different to the ramping that we are getting.

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