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Discounters: TVs, PCs Bucked June Sales Trends

New York – At least two big-box discounters
cited sales of TVs and computer hardware as the exceptions to an otherwise
dreary June.

Wholesale clubs
Costco and BJ’s both said TVs and PC hardware were among the month’s strongest
performers, with Costco’s TV unit volume up more than 50 percent year over year.

continued price erosion in electronics, along with the weak economy and
unseasonably cool, wet weather, contributed to declines in discounters’ total
and same store sales.

Costco said net
sales fell 4 percent to $6.9 billion for the five weeks, ended July 5, and U.S. comp-store
sales decreased 6 percent.

The No. 1
wholesale club said sales were strongest in non-discretionary categories like
food. Comp sales were “slightly negative” for electronics and appliances due to
continued price erosion, and gains in TVs and PCs were offset by softness in cameras,
navigation devices, cellphones and room air conditioners. The latter was impacted
by unseasonably cool weather, Costco said.

BJs, the No. 3
warehouse club, said June sales fell 4.8 percent to $1 billion for the five
weeks, ended July 4, and comp sales declined 7.5 percent.

TVs, computers and
peripherals were among its strongest monthly performers, while laggards included
other electronics, prerecorded video and room air, BJs said.

At Target, net
sales for the five weeks, ended July 4, slipped 2.6 percent to nearly $5.7
billion, although comp-store sales fell 6.2 percent, reflecting smaller
purchases and fewer transactions.

Gregg Steinhafel said Target’s June sales “continued to reflect a very
challenging economic environment,” and that the company will temper the
shortfall’s impact on profitability with expense controls and a better-than-expected
gross margin rate.