OPERATIONS

NRF: Weather dampens Jan. retail sales

BY CSA STAFF

Washington, D.C. — Consumers leveled off post-holiday shopping and spending in the beginning of the year due in part to severe winter weather in much of the country. According to the National Retail Federation (NRF), January 2014 retail sales, excluding automobiles, gas stations and restaurants, were flat seasonally adjusted month-to-month, yet increased 3% unadjusted year-over-year.

January retail sales released by the U.S. Census Bureau, which include categories such as automobiles, gasoline stations, and restaurants, decreased 0.4% seasonally adjusted month-to-month, yet increased 2.6% adjusted year-over-year.

Other findings from the January retail sales report include:

  • Building material and garden equipment and supplies dealers stores’ sales increased 1.4% seasonally-adjusted month-to-month and 3.3% unadjusted year-over-year.
  • Clothing and clothing accessories stores’ sales decreased 0.9% seasonally-adjusted month-to-month, yet increased 1.4% unadjusted year-over-year.
  • Electronics and appliance stores’ sales increased 0.4% seasonally-adjusted month-to-month, yet decreased 4.9% unadjusted year-over-year.
  • Furniture and home furnishing stores’ sales decreased 0.6% seasonally-adjusted month-to-month, and 2.1% unadjusted year-over-year.
  • General merchandise stores’ sales decreased 0.1% seasonally-adjusted month-to-month, yet increased 1.4% unadjusted year-over-year.
  • Health and personal care stores’ sales decreased 0.6% seasonally-adjusted month-to-month, yet increased 3.1% unadjusted year-over-year.
  • Non-store retailers’ sales decreased 0.6% seasonally-adjusted month-to-month, yet increased 6.5% unadjusted year-over-year.
  • Sporting goods, hobby, book and music stores’ sales decreased 1.4% seasonally-adjusted month-to-month and 1.5% unadjusted year-over-year.

“Following a solid holiday sales season, it seems that many consumers decided to take a break from the stores and shopping malls this January in an attempt to avoid winter weather,” NRF president and CEO Matthew Shay said. “While the dip in retail sales was somewhat anticipated, it is concerning that both jobless claims came in above projections and that consumer spending were flat in January; it’s not the way to kick off a new year.

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Customers won’t pay more for Amazon Prime

BY Dan Berthiaume

Chicago — Consumers reportedly are not willing to pay higher fees for Amazon Prime subscription service. According to the Wall Street Journal, a recent survey of 300 current Amazon Prime members from research firm Consumer Intelligence Research Partners indicates fewer than half of members would renew their subscription at a higher cost.

At a $99 price point, fewer than half of Amazon Prime members said they would “definitely” or “probably” renew, and that percentage dropped to 40% when the price jumped to $119. Amazon currently charges $79 for a yearly subscription to Amazon Prime, which includes free two-day shipping, a streaming video service and a digital Kindle library.

In January, Amazon said it might raise the annual fee for Amazon Prime by $20 to $40, although no timetable was released. The main rationale for potentially raising the cost of Amazon Prime is reportedly that it has not changed since the program launched in 2005 and fuel and shipping costs have gone up significantly.

The news for Amazon Prime is not all bad, however. The survey also showed that 94% of Amazon Prime members said they will “definitely” or “probably” renew at current rates, and 100% of members who use the Amazon Prime streaming video service at least once a week also will definitely or probably renew if the price does not rise.

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Wal-Mart halts India expansion

BY Dan Berthiaume

Bentonville, Ark. — Wal-Mart is reportedly halting its Indian expansion plans, at least for now. According to the Financial Times, Wal-Mart has not opened any new cash-and-carry stores in India since October 2013 or any new convenience stores there since November 2013.

In addition, Wal-Mart’s Indian partner Bharti Enterprises has reportedly terminated more than 12 leases for what would have been new convenience stores in the past several months. According to the Financial Times, the Indian government may be investigating a possible loan Wal-Mart gave a loan to the Easy Day convenience store business it operates with Bharti, in violation of laws against direct foreign investment in Indian retail businesses, as well as allegations Wal-Mart may have bribed Indian officials. A Wal-Mart spokesperson declined comment.

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