U.S. Chain Store Sales Up 0.1 Percent in September

U.S. chain store sales in September increased 0.1 percent on a same-store basis compared with the same period last year, representing the strongest reading since July 2008, when sales increased 3.3 percent, according to the International Council of Shopping Centers (ICSC).<br clear="none" /> <br clear="none" /> "Small as that gain was, it was the first year-over-year increase since July<br clear="none" /> 2008 and marked a significant turning point for the industry, as well as the start of the retail recovery," Michael P. Niemera, ICSC Chief Economist and Director of Research, said in a statement. "To be sure, the retail recovery will be uneven, and growth will be in spurts and fits, but it seems increasingly clear that it is recovery."<br clear="none" /> <br clear="none" /> Discount stores grew by 0.5 percent, following a drop of 0.1 percent in August. This brings the year-to-date average for the sector to a decrease of<br clear="none" /> 0.7 percent. Target Corporation reported a net retail sales increase of 1.3 percent for the five weeks that ended on Oct. 4, which represents a change of 0.7 percent compared to the previous quarter. In a statement to the press, Gregg Steinhafel, chairman and CEO of Target emphasized the stronger-than-expected retail segment performance had helped boost the company¹s sales. <br clear="none" /> <br clear="none" /> Wal-Mart and K-mart were excluded from the totals as they only publish same-store sales data on a quarterly basis, The next release is expected next month.<br clear="none" /> <br clear="none" /> The wholesale clubs sector also posted a moderate increase, with an overall gain of 0.8 percent. That total is increased to 4.2 percent when fuel sales are excluded. Costco increased its sales by 1 percent to mark its second consecutive monthly increase. This gain is less than the 2 percent uptick seen in Aug 2009. BJ¹s Wholesale continued in its decline, which began back in March, to fall 0.5 percent. This loss is a substantial slowdown of the declines seen in August (down 6 percent) and July (9.1 percent).<br clear="none" /> <br clear="none" /> Comparatively, drug stores did enormously well, posting a 3.7 percent jump in September, marking the largest growth since a 4.6 percent uptick in April. Monthly totals for the market currently average 1.3 percent.<br clear="none" /> <br clear="none" /> Same-store sales at Walgreen¹s continued to increase in September (5.3 percent) to follow in steady growth since March 2009. Year-over-year sales for all stores, including those open less than a year, jumped 10.3 percent from $4.8 billion in 2008 to $5.3 billion. Rite Aid, however, again saw decline (0.3 percent), with a 3.1 percent drop in front-end sales and a 1.1 percent gain in pharmacy sales. The drop follows losses of 1.9 percent in Aug and 0.6 percent in July and June.<br clear="none" /> <br clear="none" /> At J.C. Penney Co. Inc., same-store sales decreased 1.4 percent for the five weeks ended Oct. 3, compared with a 12.4 percent decrease in September 2008.<br clear="none" /> <br clear="none" /> This is better than the company's guidance for the period, which estimated same-store sales to decrease 3 percent to 6 percent. The company, in turn, has raised its earnings guidance for the third quarter. Total sales in September decreased 0.6 percent. J.C. Penney completed its 2009 new-store expansion program during September with the opening of three new stores.<br clear="none" /> <br clear="none" /> Over at Macy's, same-store sales were down 2.3 percent for the five weeks ended Oct. 3, and total sales dropped 2.4 percent to $2.043 billion, compared with $2.093 billion for the five weeks ended Oct. 4, 2008. For the year to date, Macy's same-store sales are down 8.2 percent, and total sales are down 5.5 percent to $13.948 billion, compared with $15.244 billion for the first 35 weeks of 2008.<br clear="none" /> <br clear="none" /> Online sales (Macys.com and Bloomingdales.com combined) were up 14.8 percent in September 2009 and 13.3 percent for the year to date. (Online sales are included in the same-store sales calculation for Macy's.)<br clear="none" /> <br clear="none" /> Meanwhile, same-store sales at Neiman Marcus were down 16.9 percent to $344 million for the five weeks ended Oct. 3, compared with $414 million for the five weeks ended Oct. 4, 2008. Total sales dropped 14.8 percent to $354 million year-over-year.<br clear="none" /> <br clear="none" /> In the five-week September period, comparable revenues in the specialty retail stores segment, which includes Neiman Marcus Stores and Bergdorf Goodman, decreased 17.6 percent.<br clear="none" /> <br clear="none" /> At Saks Inc., same-store sales decreased 11.6 percent for the five weeks ended Oct. 3, and owned sales decreased 10.2 percent to $242.1 million, compared with $269.6 million for the five weeks ended Oct. 4, 2008.<br clear="none" /> <br clear="none" /> The Saks Fifth Avenue stores experienced continued weakness across all merchandise categories during the month. Saks Direct and Saks OFF 5TH showed relative strength in September.<br clear="none" /> <br clear="none" /> On a quarter-to-date basis, for the two months ended Oct. 3, owned sales totaled $402.9 million, compared with $466 million for the two months ended Oct. 4, 2008, a 13.5 percent decrease. Comparable-store sales decreased 15 percent for the two-month period.<br clear="none" /> <br clear="none" /> On a year-to-date basis, for the eight months ended Oct. 3, owned sales totaled $1,573.9 million, compared with $1,959.3 million for the eight months ended Oct. 4, 2008, a 19.7 percent decrease. Comparable-store sales decreased 20.6 percent for the period.<br clear="none" /> <br clear="none" /> Looking ahead, the ICSC expects U.S. chain store sales for October will be flat compared with October 2008. In addition, ICSC Research projects U.S.<br clear="none" /> holiday sales for the November-December 2009 period will increase by approximately 1 percent based on either GAFO store sales or the ICSC's tally of major chain store sales. Shopping center sales are expected to increase by 1.8 percent this holiday season.<br clear="none" /> <br clear="none" /> <i>With reporting by Alex Palmer.</i>