Last week 30+ retailers reported comparable year-on-year sales for May 2009 (see below), and the best that can be said of the results is that consumer spending is stabilizing at a very low level. Today, we got updated same-store sales data for the 1st week of June and it’s more of the same:
- Redbook Research reported that adjusted same-store sales at over 9,000 general merchandise stores were -4.4% for the first week of June vs. a year ago
- ICSC Research reported that adjusted same-store sales for 75 large retail chain stores were -0.8% from the year ago period and up marginally from last week. They expect overall June sales will be down 4-5% vs. a 4.6% drop in May.
While there is hope that things will pick up and the economy will continue to improve, even the most optimistic economists admit that the unemployment rate will continue to climb and most likely reach double digits by the end of the year.
On the housing front, foreclosures continue to be a problem as the pain has spread to even the most credit-worthy borrowers – the portion of prime mortgages that were seriously delinquent from the 1st to the 4th quarter of 2008 more than doubled, and the pace continues to accelerate.
Add on the fact that gas prices have climbed for 41 straight days, and now sit at $2.62 from a low of $1.62 at the end of last year. While this is still well below the $4+ that people were paying at the pump last summer, it’s a worrying trend heading into the demand-driven summer season.
The combination of these 3 factors, along with the fact that same-store sales will have to be compared to last year’s stimulus-fueled spending will continue to make it a tough road ahead for retailers.
Below is a summary of YoY comparable same-store data for 34 retailers that reported monthly sales in May. Some notable out-performers have been Aeropostale, Buckle, Ross Stores, and Pricesmart:
ICSC Research
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