Retailers got a lift ahead of Sandy
- Article by: STEPHANIE CLIFFORD
- New York Times
- November 1, 2012 - 7:41 PM
Shoppers continued to spend steadily at retailers in October, from discounters all the way to the high end, suggesting consumer confidence heading into the holiday season.
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 East Coast storm.
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."
Minneapolis-based discount retailer Target Corp. said same-store sales rose 2.4 percent, as customers spent more on food and health and beauty items.
Analysts expected a bigger 3.3 percent increase, according to Thomson Reuters, but CEO Gregg Steinhafel was optimistic about the all-important upcoming holiday season. Retailers can make up to 40 percent of the year's revenue from holiday shopping.
"As we enter the fourth quarter we feel very good about our holiday season merchandising and marketing plans and our ability to deliver outstanding value for our guests while generating strong financial performance for our shareholders," Steinhafel said in a statement.
All retailers' eyes were on the impact of superstorm 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 closings, were not included in October results.
Some analysts have said that consumers may direct their money toward home repairs in the storm's wake, rather than toward early holiday shopping. However, home improvement retailers and discounters might benefit from shopping for storm supplies.
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."
The Associated Press contributed to this report.
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