The sluggish economy continued to take its toll among CE specialty stores last month, while price conscious consumers filled the tills at the national discount chains.
RadioShack, the country's fifth-largest CE reseller, said total sales fell 5 percent to $320.3 million last month, while comparable sales at company-owned stores sank 6 percent. The national chain cited the computer category as its biggest loser, down 40 percent due to a drop in unit volume and lower average selling prices. Sales of DirecTV satellite service fell 20 percent, due in part to more stringent credit checks on new subscribers, while A/V's percentage decrease was in the mid-teens.
On the plus side, wireless accessories were up double digits, wireless handsets were up mid-single digits, and parts, batteries and accessories were up in the low single digits.
"While we were disappointed with our July sales, we are encouraged by the growth we are seeing in computer, wireless and video accessories," said chairman/ CEO Len Roberts. The company added that it would no longer report its sales monthly after January 2002.
By contrast, Ultimate Electronics said sales for the quarter ended July 31 soared 15 percent to $117.5 million. The figure was buoyed, however, by a spate of new store openings over the past year. On an apples-to-apples basis, comparable store sales were down 5 percent for the three-month period, impacted, said president Dave Workman, by "the industrywide slowdown in the more mature categories of home audio, computers and mobile electronics."
The good news, he said, is that Ultimate is enjoying a "significant increase" in DTV sales that has raised the average selling price of all TVs in excess of $1,100, a company record. The chain is also experiencing continued growth in DVD, digital cameras, DBS and other digital categories.
On the full-line front, Sears said sales for the four weeks ended Aug. 4 were down 2.5 percent to $2 billion while same-store sales declined 3 percent. Chairman/CEO Alan Lacy noted that "July was another challenging month as the retail environment continues to be difficult. Strong sales increases in appliances were more than offset by decreases across most other categories."
The story was different for the big discount chains, with Wal-Mart's stores showing a 14.5 percent sales spike to $8 billion last month and a 6.3 percent gain in same-store sales. Wal-Mart said sales were goosed by the first wave of tax rebate checks, which some of its shoppers were spending on TVs, cameras, DVD players and computers (see story, p. 18). Meanwhile, No. 2 discounter Kmart saw sales edge up 2 percent in July to $2.5 billion while comp sales grew 3.4 percent in July.
Warehouse clubs also flourished. Costco reported a 10 percent sales spike to $2.7 billion and 4 percent hike in same-store sales for the four weeks ended August 5, while Wal-Mart's Sam's Club division saw net sales grow 8.7 percent last month to $2.1 billion and a comp-store sales gain of 4.9 percent. Similarly, BJ's Wholesale Club enjoyed a 7.3 percent rise in revenue to $369 million in July and a 3.7 percent spurt in comps, largely on the strength of "excellent" air conditioner sales, reported president/CEO Jack Nugent. Demand was soft, however, for TVs, computers and video games, he said.
Elsewhere, novelty CE chain Sharper Image said sales fell 10 percent in July to $23.2 million — compared to last year's 46-percent gain during the height of the Razor scooter craze — while same-store sales sunk 26 percent.