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Consumers Shopped Cautiously in April

BY CSA STAFF

New York City Apparel chains struggled through another dismal month in April, but discounters fared well as consumers searched for bargains to buy necessities.

Chains selling must-have items like food and milk at a discount — such as Wal-Mart Stores and Costco Wholesale — were standouts.

Many retailers have struggled in recent months as consumers pare spending on less essential items in light of soaring gasoline prices and grocery bills.

Wal-Mart said same-store sales rose 3.2% in April, excluding fuel sales — topping the average analyst estimate of 2.1% growth, according to Reuters Estimates. Meanwhile, Costco posted an 8% increase in April same-store sales, while total sales climbed 12% to $5.54 billion.

Children’s Place Retail Stores said April same-store sales surged 15%. Analysts had expected same-store sales to rise 5.3%, according to Reuters Estimates.

Pacific Sunwear of California said same-store sales climbed 4%. Meanwhile, Limited Brands said April same-store sales fell by a wider-than-expected 5%. Analysts, on average, had expected a same-store sales decline of 2.5%.

Some companies benefited from Easter falling in March, meaning retailers had an extra day of possible sales during April. The holiday fell on March 23 this year, the earliest Easter since 1913.

Warmer weather during the first half of the month drove a brief spike in demand for spring and summer apparel. However, cold and stormy weather toward the end of the month crimped monthly totals for some chains.

The cold snap made for the coldest April in eight years, according to Weather Trends International.

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Cadbury Schweppes launches Dr Pepper Snapple Group

BY CSA STAFF

PLANO Cadbury Schweppes has spun off its Americas Beverages business into a separate company dubbed Dr Pepper Snapple Group, which was initially listed on the New York Stock Exchange May 7.

The DPS brand portfolio includes flavored carbonated soft drinks, ready-to-drink teas, juices, mixers, waters and other premium beverages. According to DPS, three quarters of the company’s volume comes from brands that are either number one or two in their category. The company had 2007 full-year revenues of $5.7 billion.

“Today marks the beginning of a new era for our business. We have a strong and sustainable business model and can leverage our integrated system for future growth,” said Larry Young, president and chief executive officer of DPS. “We have confidence in the beverage industry and we are looking forward to seizing the opportunities as a stand alone company.”

The DPS portfolio includes popular brands such as 7UP, Mott’s, A&W, Sunkist Soda, Hawaiian Punch, Canada Dry, Schweppes, RC Cola, Diet Rite, Squirt, Penafiel, Yoo-hoo, Rose’s, Clamato and Mr & Mrs T mixers.

The DPS business was formed in 2003 by bringing together Cadbury Schweppes’ four separate North American beverage business units: Dr Pepper/Seven Up, Mott’s, Snapple Beverage Group and Bebidas Mexico. This move brought more than 50 brands under a common vision, business strategy and management structure.

In 2006, the company acquired and began integrating three major independent bottling companies (Dr Pepper/Seven Up Bottling Group, All-American Bottling Company and Seven Up Bottling Company of San Francisco). The following year, the company acquired Southeast-Atlantic Beverage Corp., then the second largest independent bottling company in the U.S.

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Home improvement retail to rebound in ’09

BY CSA STAFF

LAS VEGAS A leading research firm said Tuesday that home improvement retailers should expect sales to jump 3% in 2009 as the housing industry recovers. That’s what Home Improvement Research Institute (HIRI) managing director Fred Miller told a packed room Tuesday on opening day of the National Hardware Show in Las Vegas.

During his Future Trends in Home Improvement seminar, Miller said he expects the housing market to bottom out this fall and start recovering before the end of the year. But even with a late rebound, total sales are expected to drop 1.5% this year to $302 billion following a 2% decline to $307 billion in 2007.

“It will mark the first time we’ve seen sales decline in back-to-back years,” said Miller. HIRI has been tracking the industry since 1981.  

The show floor at the Las Vegas Convention Center was busy the first day, as thousands of attendees milled around 2 million square feet of exhibit space. Separate venues at the show, which runs May 6-8, include New Product World, Lawn & Garden, Homewares and new area for green and sustainable products.

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