Retail Sales Slumped In October
By Alan Wolf -- TWICE, 11/6/2008
New York — Retailers, buffeted by the roiling financial markets and sagging consumer sentiment, reported weak sales in October, with little help from CE.
Among national discount chains, Wal-Mart said net sales at its flagship discount stores rose 5.3 percent to $18.4 billion in October, while same-store sales increased 2.2 percent. Eduardo Castro-Wright, the chain’s United States president/CEO, attributed the month’s sales and traffic gains to the retailer's “highly competitive pricing.”
At Target, net sales slipped 0.7 percent in October to $4.4 billion and same-store sales fell 4.8 percent amid what president/CEO Gregg Steinhafel described as “daily volatility.” He called the results “very disappointing” and said he expects the challenging sales environment to continue into the holiday season and beyond as a result of the ailing economy.
Within the wholesale club channel, Costco said net sales rose 2 percent to $5.3 billion worldwide in October, while U.S. same-store sales grew 2 percent. The company reported lower comp sales across all hardlines categories, including A/V and major appliances, and specifically cited PC and camera sales as soft.
Unit sales of TVs were up 20 percent year over year, but dollar volume declined due to price deflation. Only cellphones and accessories showed strength within the CE category, Costco said.
At Wal-Mart’s Sam’s Club division, net sales rose 4.5 percent in October to $3.4 billion and same-store sales increased 3.6 percent. Sales were largely driven by strength in food and consumables, while electronics were among the month’s weaker performers.
BJ’s bucked last month’s negative sales trend with an 11.6 percent increase in net sales, to $738.8 million, while same-store sales increased 6.6 percent. Like Sam’s Club, much of the gains came from food sales, BJ’s said , in contrast with TV, prerecorded video and other CE categories, whose performances were described as weak.
Conn’s, the multiregional CE and appliance chain, said two major hurricanes in September contributed to sales volatility during its most recent quarter.
Net revenue rose 2.3 percent to $3.8 million for the three months, ended Oct. 31, while same-store sales fell 5.8 percent.
The multiregional chain said same-store sales were up slightly in August, were hurt in September by Hurricanes Gustav and Ike, and rose again modestly in October as consumers replaced goods damaged by the storms.
Broken out by category, Conn’s said continued consumer interest in LCD TVs and increased sales of home theaters helped offset declines in projection and plasma TV volume.
Sales of major appliances also declined during the quarter, reflecting continued weakness throughout the industry, although the category saw “a solid increase” in October, led by gains in laundry, which offset lower cooking and refrigeration sales.
The company also enjoyed increased sales of laptop computers, DVD players, GPS devices and accessories, which were partially offset by lower sales of desktop computers, video game equipment and MP3 players.
Conn's opened one new store during the quarter, and will report earnings for the period on Nov. 26.
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