Chain sales show no holiday cheer

Dave Gill -- Home Textiles Today, 1/8/2001 12:00:00 AM

NEW YORK -December, yes December, the height of the holiday shopping season, proved to be a uniquely terrible month for U.S. retailers.

When the historians look back on December 2000, they will note that it was the month in which Bradlees and Montgomery Ward announced their liquidations. They will recall Sears' announcement that it would close nearly 90 stores and take a $100 million charge against its earnings. They will see, also, that it was a month in which Santa brought coal to the stockings of nearly every general-merchandise store.

Of the major retailers tracked monthly by Home Textiles Today in its chain-sales report, 12 saw their same-store sales go south. At the very bottom was Value City's stores, whose comp-store sales dived 10.4 percent-followed by ShopKo with a 4.2 percent loss and Dillard's with a 4 percent drop.

Those same retail observers will also remember December as the month in which a Wal-Mart operation finished its same-store results in the red. Sam's Club reported a 0.3 percent decline in its same-store checkouts for the key holiday month.

Continuing the dirge, even the powerful Costco was slammed in the holiday shopping season. The warehouse club chain-which can normally be counted on to report comp-store numbers close to double digits-posted a meager 1 percent same-store gain last month.

Among the scant positive results from December was Kohl's, which boosted its same-store checkouts by nearly 15 percent. It was the only chain that was able to break the 5 percent bar, generally considered the good-health mark for same-store sales gains in a month.

December was also the month in which Kmart posted a 0.7 percent same-store gain-and finished ahead of its rival, Wal-Mart stores, whose comp-store increase was a putrid 0.5 percent. Target led the big mass merchants with a 0.9 percent increase, also far below its standard.

Retail executives commenting on their stores' individual performance blamed the weather (always a popular scapegoat in bad sales months) and excessive sales at promotional prices.

Looking at the month as a whole, said Joseph Ettore, Ames' chairman and ceo, "it was apparent that in making their purchases, shoppers this year were significantly more bargain-conscious than they were last year and purchased more sale-priced merchandise."

"Our December department-store sales were disappointing," said Federated's chairman and ceo, James Zimmerman, "which we think is attributable at least in part to heightened consumer concerns over a slowing economy."

Admitting that his chain's same-store sales "did not meet our expectations," Family Dollar's president and ceo, Howard Levine, added, "Severe winter weather was responsible for a portion of the shortfall. With the economy also slowing, sales of seasonal merchandise in departments such as trim-a-tree, toys and hanging apparel were below plan. The company also faced difficult comparisons as Y2K concerns last year produced strong sales in late December."

The analyst community expressed little surprise over retail's southward plunge. The pundits had been observing many signs of a slowing economy in the latter part of December (such as the tanking of the consumer confidence index to below the 130 mark, the first time it had missed that level in two years), and had heard warnings from retailers such as Wal-Mart that December would be, at best, a very forgettable sales month.

Daniel Barry, retail analyst with Merrill Lynch, noted, "Although sales rebounded strongly at the end of December, it wasn't enough to offset sluggish sales throughout the month." Earlier last week, Merrill Lynch had projected that sales results would fall below plan for many retailers, such as May Co., Saks, Sears, the Target Corp. chains and Costco.

William Ford, senior economic advisor with TeleCheck Services Inc., the firm that tracks same-store sales based on the number of checks written at retailers, cited "the slower rate of growth of the national economy in the fourth quarter. Sales gains were also tempered by heavy discounting as many retailers reacted to the sluggish sales early in the holiday shopping season. Additionally, severe weather over much of the country throughout December contributed to the decelerated growth."

Discounted

Ames	-2.6%
Kmart	0.7
Dollar General	-1.3
Costco	1.0
Wal-Mart stores	0.5
Target	0.9

DECEMBER SALES FOR MAJOR RETAILERS/ PERIOD ENDING 12/30/00 a (sales in $000s)

Company	2000 sales	1999 sales	Total % change	Same store % change
Ames	$684.4	$689.2	-0.7	-2.6
Costcob	4,000.0	3,770.0	6.1	1.0
Dillard's	1,417.1	1,476.8	-4.0	-4.0
Dollar Generalc	644.4	576.8	11.7	-1.3
Elder-Beerman	125.4	124.1	1.0	-0.8
Family Dollar	493.0	447.5	10.2	-0.5
Federated	3,292.0	3,313.0	-0.6	NA
Dept. stores	3,005.0	2,922.0	2.8	1.2
Gottschalks	143.0	107.8	32.7	4.0
JCPenney	4,660.0	4,733.0	-1.5	NA
Dept. stores	2,563.0	2,634.0	-2.7	-1.6
Catalog	523.0	544.0	-3.9	NA
Kmartd	6,056.0	6,142.0	-1.4	0.7
Kohl's	1,176.4	856.8	37.3	14.8
May Co.e	2,860.0	2,750.0	4.0	1.0
Pier 1 Imports	219.9	211.4	4.0	0.0
Ross Stores	351.0	325.0	8.0	0.0
Saks Inc.	1,063.5	1,065.8	-0.2	NA
Dept. stores	705.0	701.1	0.6	1.0
Sears	5,612.1	5,587.6	0.4	NA
U.S. sales	4,422.3	4,426.1	-0.1	-1.1
ShopKo	543.7	539.8	0.7	NA
ShopKo stores	425.0	436.5	-2.6	-4.2
Pamida	118.7	103.3	14.9	NA
Target Corp.	6,092.0	5,777.0	5.5	-0.1
Target	4,894.0	NA	8.1	0.9
Mervyn's	647.0	NA	-2.4	-2.4
Dept. stores	491.0	NA	-5.0	-5.0
TJX	1,333.0	1,234.0	8.0	1.0
Value City	303.8	253.4	19.9	-8.8
Value City stores	222.6	224.8	-1.0	-10.4
Wal-Martc	25,700.0	24,127.0	6.5	0.3
Wal-Mart stores	NA	NA	NA	0.5
Sam's Club	3,390.0	3,313.0	2.3	-0.3
48 WEEKS YEAR TO DATE
Ames	3,718.0	3,650.0	1.9	0.5
Costcob	NA	NA	NA	NA
Dillard's	7,958.1	8,205.9	-3.0	-3.0
Dollar Generalc	4,100.0	3,600.0	13.9	0.5
Elder-Beerman	624.4	611.2	2.2	-0.8
Family Dollar	NA	NA	NA	NA
Federated	17,301.0	16,752.0	3.3	NA
Dept. stores	15,464.0	15,061.0	2.7	2.0
Gottschalks	615.3	511.5	20.3	5.5
JCPenney	30,485.0	30,285.0	0.7	NA
Dept.stores	13,782.0	14,174.0	-2.8	-2.3
Catalog	3,562.0	3,629.0	-1.8	NA
Kmartd	34,378.0	33,827.0	1.6	0.9
Kohl's	5,780.7	4,322.3	33.7	9.1
May Co.e	13,720.0	13,190.0	4.0	0.3
Pier 1 Imports	1,200.9	1,062.5	13.0	8.4
Ross Stores	2,526.0	2,332.0	8.3	1.0
Saks Inc.	6,112.2	6,052.2	1.0	0.2
Dept. stores	3,664.5	3,730.1	-1.8	-2.0
Sears	38,134.1	36,807.7	3.6	NA
U.S. sales	28,190.4	27,196.8	3.7	2.4
ShopKo	3,253.8	2,851.8	14.1	NA
ShopKo stores	2,513.1	2,449.0	2.6	0.7
Pamida	740.7	402.8	83.9	NA
Target Corp.	33,544.0	NA	7.7	2.4
Target	26,673.0	NA	10.4	3.4
Mervyn's	3,745.0	NA	0.4	0.5
Dept. stores	2,725.0	NA	-3.4	-3.9
TJX	9,052.0	8,323.0	8.8	2.0
Value City	2,039.0	1,564.7	30.3	-1.0
Value City stores	1,440.0	1,336.5	7.7	-4.4
Wal-Martc	178,826.0	154,446.0	15.8	5.0
Wal-Mart stores	NA	NA	NA	5.1
Sam's Club	24,839.0	23,172.0	7.2	4.8

^a: Reporting periods vary from store to store.

^b: For the period ending Dec. 31.

^c: For the period ending Dec. 29.

^d: For the period ending Dec. 27.

^e: Excludes sales from stores that have been closed and not replaced.