Deloitte Consumer Spending Index rises in December
New York — The Deloitte Consumer Spending Index, which tracks consumer cash flow as an indicator of future consumer spending, rose in December 2013. The Index, which comprises four components, tax burden, initial unemployment claims, real wages and real home prices, increased to 4.3 in December from 3.9 the prior month.
"Retailers need to keep their foot on the gas in light of the positive signals that suggest improved consumer confidence and spending levels in the months ahead,” said Alison Paul, vice chairman, Deloitte LLP and Retail & Distribution sector leader. “The holiday season underscored that consumers are not only willing to shop, but expect to do so on their time and on their terms. Retailers can keep up the momentum by targeting consumers across different channels and geographies with more personalized, high-touch connections through mobile and online points of contact that reach a broader swath of shoppers with greater precision.”
Highlights of the Index include:
Tax Burden: The tax rate is up now at 11.8%, a 0.6% increase from last month. A rising tax rate is associated with increasing incomes.
Initial Unemployment Claims: Claims declined 14% from the same period last year, falling to 324,000.
Real Wages: Real hourly wages rose 1.3% from this time last year to $8.83, showing a second month of accelerated increases.
Real New Home Prices: New home prices climbed to $116,000, an increase of more than 5% from the same time last year.
Report: FBI warns of more retail data breaches
Washington, D.C. – The FBI has reportedly issued a confidential report to U.S. retailers warning that more cyber attacks like the ones recently suffered by Target and Neiman Marcus will occur. According to Reuters, the three-page report was distributed Jan. 17 and informs retailers that the FBI has discovered in the past year there have been at least 20 attacks using the same type of malware used against Target.
The report, which an FBI spokesperson verified for Reuters, said that malware attacks designed to steal credit card data from retailers will increase in the short term despite increased efforts to prevent them. This increase is due to the wide global availability of the malware as well as the potential for significant financial gain. The report said most malware attacks the FBI has discovered are launched against small or mid-sized and regional retailers.
Starbucks Q1 profit jumps 25%; sales miss
Seattle – Starbucks Corporation’s profit in the first quarter rose 25% to $540.7 million from $432 million in the year-ago period, better than analysts expected.
Revenue for the quarter ended Dec. 29, 2013 rose 12% to $4.24 billion from $3.79 billion. Same-store sales rose 5%, beneath Wall Street expectations of 5.9%.
Same-store sales in the Americas region also rose 5%, while analysts had expected a 6.4% increase.
For fiscal 2014, Starbucks boosted its fiscal earnings per share forecast guidance and said it expects to open 1,500 new net stores, including 600 in the Americas.
Starbucks said that online shopping, particularly during the month of December, kept more consumers at home and reduced their visits to its coffee bars
“Holiday 2013 was the first in which many traditional brick-and-mortar retailers experienced in-store foot traffic give way to online shopping in a major way,” said Howard Schultz, chairman, president and CEO of Starbucks Coffee Company. “As our solid traffic growth and record Q1 results demonstrate, Starbucks unique combination of physical and digital assets positions us as one of the very few consumer brands with a national and global footprint to benefit from the seismic shift underway.”