Retail Industry Trends

[HenryTo]

Retailiers already bracing for the worst. The $64 billion question is, as always, how bad will this get and how much of this has already been factored into retail stocks?
-----------------------------------------------------------------------------------
Retail Holiday Season May Be Modest
Tuesday October 30, 5:15 pm ET
By Betsy Vereckey, AP Business Writer
Sluggish US Economy May Weigh on Holiday Sales for National Retailers

NEW YORK (AP) -- U.S. retailers are bracing for a difficult holiday season, some industry watchers say, as higher gas prices and a sluggish housing market are expected to continue crimping consumer spending.

At a conference on Tuesday hosted by the Retail Marketing Society, a membership-based organization focused on the retail industry, some industry executives said holiday sales may be sluggish.

"This holiday season will be somewhat Grinch-like," said Carl Steidtmann, chief economist at Deloitte Research.

Steidtmann said retailers are preparing for the worst, especially given tightening credit and problems in the housing market. Steidtmann said it will be at least 18 months to two years before the housing market bottoms.

Merrill Lynch analyst Jaime Sheinheit said higher energy costs will weigh on consumer spending, noting that retailers have had trouble getting customers in the door. However, it's hard to tell whether the sluggish traffic is related to softening consumer spending or warm weather, Sheinheit said.

"Cold weather may spark shopping," she said.

In the luxury sector, Sheinheit said handbag maker Coach Inc. has warned of sluggish traffic in its U.S. stores. The company recently issued a fiscal second-quarter same-store sales outlook it called "conservative." Same-store sales are sales at stores open at least a year, and the industry metric is considered a key barometer of a retailer's health.

David Wolfe, creative director at Doneger Group, a buying office, said Coach has reached its saturation point with aspirational customers, who may not have the money to spend on these handbags but still want quality at a price.

Meanwhile, wealthy customers may help other luxury retailers this season, like Tiffany & Co., as spending patterns among the affluent tend to stay the same, regardless of changes in the economy.

Sectors that might fare better include teen retailers, Sheinheit said, noting that the income of their main customer, teenagers, usually stays the same. Companies in this sector include American Eagle Outfitters Inc. and Abercrombie & Fitch Co.

One company that may emerge stronger, Sheinheit said, is AnnTaylor Stores Corp., which has leaner inventory and a new product assortment at its lower-priced Loft division. In August, the company said it increased markdowns to reduce inventory heading into fall seasons at both its Ann Taylor and Loft stores.

"There is a lot of opportunity for Loft to improve margins this holiday season," Sheinheit said. "As always, what it comes down to is having the right product."

[rffrydr]

You wouldn't know it from Westfield but here's one of our old friends who didn't make it through the bust:

http://www.nytimes.com/2012/02/06/business/making-over-the-mall-in-rough-economic-times.html?ref=business
_________________
Today is the Tomorrow you worried about Yesterday!

[rffrydr]

http://www.theatlanticwire.com/national/2011/12/americans-shoplifted-18-billion-worth-stuff-christmas/46634/


_________________
Today is the Tomorrow you worried about Yesterday!

[HenryTo]

Morningstar on ARO's 3Q earnings.

[rffrydr]

One thing ECRI got right about summer 2010, the Wall Street Journal went into Recession:

http://stockcharts.com/h-sc/ui?s=ODP:RTH&p=W&b=5&g=0&id=p91227189925


RTH bounces off 200dma...strongly. What else should we have expected?!
_________________
Today is the Tomorrow you worried about Yesterday!

[rffrydr]

"Ring in" the Holiday Season!

http://www.latimes.com/business/la-fi-cover-holiday-kickoff-20111106,0,5033667.story

"Retailers are looking at phones and tablets as one more channel to get shoppers, to drive brand loyalty and drive sales," said Jackie Fernandez, a Los Angles-based retail specialist for accounting firm Deloitte & Touche. "Consumers will be able to benefit from the discounts offered through them, especially around the holiday season."
_________________
Today is the Tomorrow you worried about Yesterday!

[rffrydr]

Holiday season is going to be up--just a question of how much. And fewer units get better margins. Macy's 78K hires is...necessary.
_________________
Today is the Tomorrow you worried about Yesterday!

[HenryTo]

It depends on the institution, as least for me. Whole Foods it's worth waiting and speaking to the cashiers. Walmart, not so much, especially if RFID is ever implemented.

[rffrydr]

Though this truth I know, I really felt the cashier was a fading institution.

http://www.cnbc.com/id/44668419

Could Wall St. be responsible for this?? There is something fundamental about a financial transaction carried out between parties, eye-to-eye. It's a win/win. The wait is sort of like a commercial, people USE that time.

Unfortunately the waits are too long for me. Radio chip checkout can't come soon enough. Bring it on, Walmart.
_________________
Today is the Tomorrow you worried about Yesterday!

[rffrydr]

New Highs, Accelerating Volume
By Gary Morrow | Sep 16, 2011 | 3:02 PM EDT

[rffrydr]

INTC Says Computer demand Shifting to Consumers; Faster Refresh Cycle, Track For Another Great Year; EPS & Rev Growth Beating Benchmarks.
_________________
Today is the Tomorrow you worried about Yesterday!

[rffrydr]

Retail Metrics reported August chain store sales up 5.5% y/y compared to a 5.0% forecast.

Meanwhile on the champagne circuit: filled gap and 38% retrace before back to highs...

http://stockcharts.com/h-sc/ui?s=TIF:$SPX&p=D&b=5&g=0&id=p53696332909
_________________
Today is the Tomorrow you worried about Yesterday!

[rffrydr]

Layaway making a comeback. Sears you're new again!
_________________
Today is the Tomorrow you worried about Yesterday!

[HenryTo]

An article of a more practical nature:
-------------------------------------------------------------------------------------
What Outlet Malls Don't Want You to Know

Outlet malls have exploded in popularity in recent years, becoming one of the fastest-growing segments of American retail. For many shoppers, this siren song of bargains and high-quality designer merchandise at a low price is too irresistible to avoid, and they simply must stop to shop. But beneath all the fancy sparkle and fresh spackle of the countless outlets popping up all over the country, do they really deliver all they promise? It turns out that outlets have a few sneaky ways of tricking us into thinking we’re getting a much better deal than we actually are.

The Merchandise Isn’t What You Think

The original outlet and factory stores sold overstocked, discontinued items, and imperfect merchandise unfit for retail sale; that’s what made the prices so cheap. But nowadays, the majority of common outlet stores supplement their stock with merchandise created especially for outlet-store sale. These lines carry the brand name, but they’re made with lower-quality fabrics and cheaper construction techniques. The companies depend on customers’ inability to tell the difference between the quality of real designer merchandise and the lower-quality knockoffs carrying the same label. The knockoffs may be cheap, but that cheapness comes at the expense of quality.

It’s All About the Marketing

Merchandise at outlet stores usually comes with a price tag that prominently displays both the retail and the outlet price: “Manufacturer’s Suggested Retail Price $100, Our Price $25.” The tags lead customers to believe that they’re getting a huge discount. But the truth is that the listed MSRP is whatever the store wants it to be—there’s no guarantee that the item is really worth that much, or that it was ever listed for that price at a retail store. This trick, called “reference pricing,” is widely used to assuage shoppers’ anxieties and loosen their purse strings by convincing them that they’re saving more money than they’ve spent.

The Location is Remote So You Never Leave Empty-Handed

Outlet malls are notorious for being located in out-of-the-way suburbs and off deserted interstate highways. One big advantage of the remote location is a psychological effect called the “sunk cost fallacy,” according to Ellen Ruppel Shell, author of Cheap: The High Cost of Discount Culture. By driving twenty-five, fifty, or one hundred miles to the outlet mall, customers invest serious amounts of time and energy; it’d be a pity if they didn’t leave with something. Customers don’t like to feel like they made a bad investment, and making purchases justifies all that effort. Of course, behavioral economists know that it’s irrational to spend more time and money to justify spending time and money, but whoever said that shoppers were rational?

What Kind of Shopper Are You?

How to Out-Smart the Outlets
In reality, outlet malls promise something—high quality for a low price—that is very hard to deliver. The next time you’re tempted to swing through an outlet mall, consider these savvy shopping tips.

Look at apparel tags. Irregular or imperfect merchandise usually carry tags that are sliced, marked on, or otherwise altered to indicate that it’s not fit for retail sale, whereas knockoffs usually carry different tags altogether. At Gap Outlets, the tags are white with blue lettering, the reverse of the retail tags. At Banana Republic Factory Stores, the tags have three small diamonds indicating they’re not retail quality. Get familiar with real retail tags, so you can spot the impostors at outlet stores.

Know what an item is really worth. How can you know whether you’re getting a great deal at the Samsonite outlet if you don’t know the real retail price of a suitcase? Comparison shop for large purchases; don’t rely on the reference price quoted by the store.

Think seasonally. It’s a good bet that any in-season merchandise is from an outlet-only line. Real retail overruns don’t arrive in outlet stores until after the season has passed.

Remember that fewer stores = better quality. If you’re shopping at a store that has posts in every outlet mall in the country, you’re almost guaranteed to be getting outlet-quality merchandise. At an outlet with only a few locations, the merchandise is more likely to be true overruns, discontinued items, and last-season’s line because the company doesn’t have to fill hundreds of stores.

Shop the sales. Outlet stores have sales at the same times that normal retail stores do, and customers can often get even better discounts at these times. But sales at retail stores can offer savings just as valuable as regular outlet prices.

[rffrydr]

The stock market is starting NOT to matter:



I see this as a good thing right now.

http://www.minyanville.com/businessmarkets/articles/wealth-effect-quantitative-easing-qe2-qe3/5/23/2011/id/34684
_________________
Today is the Tomorrow you worried about Yesterday!

[HenryTo]

Morningstar on ARO's 2Q results: