Consumer Spending Drops Significantly

[molson_golden2002]

http://www.nytimes.com/2008/10/09/business...amp;oref=slogin

 

Sales at some of the nation’s best-known retailers fell by double digits in September, highlighting the rapid deterioration of the economy and raising fresh questions about how many of those chains can survive.

 

Retail analysts and executives said they had not seen such a rapid slowdown in consumer spending since the nation’s last deep recession, in the early 1980s. Retail executives, though braced for bad news, were stunned at the magnitude of the drop-offs reported on Wednesday. Retailers high and low — like Nordstrom, J. C. Penney and Kohl’s — lowered their earnings projections.

 

September sales for stores open at least a year, known as same-store sales, a barometer of retail health, plunged 14.8 percent at Stein Mart, an off-price department store. That chain, like many others, was already in trouble a year ago, but the drop-off last September was only 9.1 percent.

 

Sales at Dillard’s dropped 12 percent, compared with a 7 percent decline last year. J. C. Penney’s same-store sales fell 12.4 percent, compared with a decline of 3.7 percent for the period a year ago. Sales at Kohl’s decreased 5.5 percent, compared with a 3.2 percent decrease last year.

 

At Bon-Ton Stores, same-store sales decreased 4.6 percent, and they declined 3 percent at Target.

 

The sales results laid to rest any lingering notion that the nation’s luxury retailers might be impervious to the downturn. Same-store sales in the specialty retail segment of Neiman Marcus, which includes Neiman Marcus Stores and Bergdorf Goodman, tumbled 15.8 percent. Saks’s same-store sales sank 10.9 percent and Nordstrom’s were down 9.6 percent.

 

Blake W. Nordstrom, president of Nordstrom, said the deteriorating consumer environment led to “a weakening sales trend that was greater than our earlier expectations.”

 

Specialty retail sales figures, too, were soft. At Zumiez, same-store sales were down 9 percent compared with a 13.9 percent increase in the year-earlier period. Same-store sales at Wet Seal were down 7.5 percent. Sales at American Eagle Outfitters and Limited Brands decreased 6 percent. At Pacific Sunwear, sales were down 5 percent, while Children’s Place fared slightly better. Its sales were flat compared with a 2 percent decrease last year. The exception in this category was Aeropostale, which reported a 5 percent increase in same-store sales compared with a 1 percent increase in the year-earlier period.

 

Dean Hillier, a partner and a retail specialist with A. T. Kearney, a management consultant, said the Christmas shopping season “could quite frankly be one of the worst we’ve seen in 25 years.”

[/dev/null]

In other news Clay Aiken is gay