New York City -- The discount and wholesale club sector was hit and miss in November, as Costco shone with a 9% rise in same-store sales for the month, but Target missed Wall Street expectations with a weak gain.
Despite a strong turnout on Black Friday, not all retailers received the expected sales benefits in what was a heavily promotional environment. “The consumer has become insanely focused on promotions," David Bassuk, head of the global retail practice at AlixPartners, told Reuters. "The consumer is willing to spend money, that's the good news. But consumers need to be convinced."
For Target Corp., which recorded a 1.8% rise in November same-store sales, which missed Wall Street’s predicted 2.7% gain, average ticket was higher in November but overall traffic was down. The biggest merchandise disappointments, according to Target, were toys, music and movies. Strong sellers were food and beauty products. Total sales for the month rose 3% to $6.19 billion, and Target said it expects its December same-store sales to rise in the low- to mid-single digits.
Costco Wholesale Corp. turned in a far better performance in November, reporting a same-store sales rise of 9%, topping the expected 6.5% gain. The strong showing was due in part to higher gasoline prices, the operator said.
In other discount same-store news:
- Ross Stores rose 5% in November, beating expectations.
- TJX Cos. meet expectations, with a 4% same-store sales gain in the month.
- Stein Mart recorded a 4.6% decline, widely missing Wall Street’s expected 0.5% gain.
- Fred’s was up 1.5%.
- Duckwall-Alco dipped 0.2%.