FINANCE

Department stores disappoint in November

BY Katherine Boccaccio

New York — Blaming superstorm Sandy for its disappointing November results, Macy’s reported a 0.7% dip in same-store sales and missed Wall Street’s expected 1.5% rise. The results were echoed by much of the category.

"Despite the largest-volume Thanksgiving weekend in our company’s history, we were not able to overcome the weak start to the month, which included the disruption of Hurricane Sandy," said Terry J. Lundgren, chairman, president and CEO of Macy’s. Total sales for the month slipped 0.6% to $2.45 billion.

For the year to date, Macy’s sales totaled $20.786 billion, up 3.2% from total sales of $20.145 billion in the first 43 weeks of 2011. On a same-store basis, Macy’s sales were up 3.1%.

Online sales (Macys.com and Bloomingdales.com combined) were up 39.2% in November and 37.1% in 2012 year-to-date. Online sales are included in the same-store sales calculation for Macy’s.

Kohl’s Corp. experienced a dismal month as well, reporting a same-store sales drop of 5.6%, well short of analysts’ predicted increase of 1.9%. Total sales fell 4.9% to $1.84 billion.

President and CEO Kevin Mansell said: “Though November sales were lower than expectations, we are encouraged by improved sales over the Thanksgiving week.”

Other department store results include:

  • Nordstrom slipped 1.1%; and
  • Bon-Ton edged down 0.1%.
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Forget game-changer, U of A group recognized as world changer

BY CSA STAFF

The Sustainability Consortium jointly administered by the University of Arkansas and the University of Arizona, with support from Walmart and many of its suppliers, is ranked among 10 ideas changing the way people live by Scientific American.

The publication’s list of 10 World Changing Ideas for 2012 where characterized as, "innovations that are radical enough to change our lives." The 90-member consortium describes itself as a global organization of businesses, universities and nonprofit organizations that develops science-based tools to advance the measurement and reporting of consumer product sustainability.

"We are honored, and we humbly agree," said Jon Johnson, professor of management in the Sam M. Walton College of Business and the Sustainability Consortium’s co-founder and academic director. "That has always been our focus all along – to develop robust, science-based knowledge and tools that companies all over the world can use. It was our hope that our work would effect real change – economically, socially and environmentally. We are seeing that now, and others are starting to notice, which is gratifying."

The Sustainability Consortium was recognized as a superior sustainability measurement and reporting system because of its comprehensive nature and cross-sector approach. The consortium will publish information for more than 100 product categories in 2012. The organization focuses on the areas of food, beverage, agriculture, electronics, toys, home and personal care, paper, pulp and forestry, and packaging. An additional group focused on clothing, footwear and textiles will begin working in February 2013.

"The consortium’s ratings will factor in closely held data on emissions, waste, labor practices, water usage and other sensitive factors," said Adam Piore, who wrote the article for Scientific American. "The data should make the index more comprehensive than others."

 

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Moody’s: Retailers that opened early on Thanksgiving night gained advantage

BY Marianne Wilson

New York — Retailers that opened early on Thanksgiving evening gained an advantage and that promotional activity was about on par with last year, according to a new Moody’s report, “Thanksgiving Weekend: The Early Bird Gets the Worm.”

“Overall, the trends we observed this weekend are consistent with our expectations of 4% sales growth and 15% online sales growth for the 2012 holiday shopping season,” said Charlie O’Shea, VP — senior analyst at Moody’s and author of the report. “Retailers that opened early seemed to get a jump on those that delayed their openings until early Black Friday morning. We believe the early opening trend is accelerating. Consumers seem to like the option of segueing right from Thanksgiving dinner to shopping and buying.”

The one downside to the early openings was a lull in the stores on Friday afternoon and Saturday, the report said.

“While this is typical, it seemed to be exacerbated by the early openings as mall traffic seemed to slow as the weekend wore on,” O’Shea said. “Nevertheless, given the preliminary positive comments made by retailers that opened early, we feel that the Thanksgiving Day openings are likely here to stay, with ever-earlier openings and online activity," said O’Shea.

Promotional activity seemed to run about even with last year, Moody’s said, with consumer electronics led by flat-panel TVs continuing their prominent role in driving store traffic.

On the apparel front, department store operators such as Macy’s Inc. and Kohl’s Corp. opened early, and promotions ranged up to 65% off for private-label apparel and accessories. Overall inventories in this segment seem well-controlled, as Moody’s analysts observed fewer clearance racks compared with last year.

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