Discounters: TVs, PCs Bucked June Sales Trends

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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.

Nevertheless, 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.

President/CEO 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.


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