Comps fall as chains clear soft goods, consumers buy staples   

-- Home Textiles Today, 1/21/2009 1:47:00 PM

New York – While clearance activity is in full swing, retailers still slipped further behind comp-store sales goals in the second week of the January retail month, the Johnson Redbook reported today.

The Index was negative 2.3% for the week, following a 1.9% drop the prior week, yielding a month-to-date 2.1% drop vs. the target of a 1.8% drop.

For comparison, the Index for January 2008 was a comp gain of 0.5% (missing the goal of 1.1%), and for January 2007 was an on-target gain of 2.8%.

“Year-end clearance dominated sales activity,” said Redbook analyst Catlin Levis. “Consumers continue to redeem gift cards. Department stores are working through the annual clean out of winter inventories and driving sales by pricing and advertising.”

“Discount stores, on the other hand, returned to a more normal environment with business in consumer basics and food. Sales leader lists varied widely from store to store, fairly typical of a transitional, trend-less, promotion driven month.

“At the same time,” she said, “retailers don’t read too much into January, since it is a transitional month with low volume business driven by price markdowns. With its focus on shifting goods to make room for Valentine’s Day and spring merchandise, retailers are very cautious by keeping their inventories tight until they see signs the economy is growing again.”