Late Holiday Boost A Welcome Gift For Retailers
By David Kaplan
January 8, 2010
Front Page, Business Section
Last year was not one to remember for most retailers, but many of them at least had a solid holiday season
A robust December helped boost overall sales for the 2009 holiday season —the months of November and
December — to a higher-than- expected 1.8 percent increase over last year, according to figures released
Thursday by the International Council of Shopping Centers.
While 1.8 percent may seem modest, it is a great improvement over the 2008 holiday season when sales fell
by 5.6 percent.
Also Thursday, many chains released sales results for December, and among the chains showing year-over-
year increases were Macy's, Target, Costco, Sears and Nordstrom.
“Large retailers such as Wal-Mart, Target, Toys R Us and Amazon helped drive December sales by offering
very good discounts,” said Scott Testa, professor of business at Cabrini College near Philadelphia.
One analyst feels bullish about the holiday season results and what they mean for 2010.
“The season was fantastic from a profit standpoint. Retailers are sitting on more cash and less inventory, and
I think we're going into a great 2010,” said Love Goel, chairman and CEO of GVG Capital Group based in
Retailers enter the new year “with the wind behind their backs” and an increasingly confident consumer, he
A little less optimism
Another analyst is less optimistic: “All in all, the retail picture is still soft,” said Howard Davidowitz, chairman of
Davidowitz & Associates, a national retail consulting and investment banking firm based in New York City.
Consumers are still in a relatively weak position, he maintained.
Home-related items and footwear were among the product categories that helped lift sales in December by
2.8 percent, said Erin Hershkowitz, a spokeswoman for the shopping center group.
The home furnishings sector experienced a strong surge.
For example, according to Davidowitz & Associates, December sales at Bed Bath & Beyond were up 7.3
percent and at Pier 1, up 8.6 percent.
Some better than others
While the December numbers were generally good for retailers, some sectors fared better than others.
“Discounters continue to gobble up retail market share” and within the discount sector “extreme value
retailers” did the best, Davidowitz said. For example, December sales for T.J. Maxx rose 14 percent, and for
Ross they were up 12 percent, Davidowitz & Associates said.
The department store sector picture, meanwhile, was mixed, said Davidowitz, who noted that December
sales were up for Macy's and Kohl's and down for J.C. Penney and Dillard.
In the electronics sector there is still a huge demand, but prices and margins continue to come down, he
said. In the toy sector, video game sales have been down significantly, while the rest of the toy category is
doing pretty well, he noted.
At Houston-based Stage Stores, which includes the Palais Royal chain, December sales were down 2.2
percent, but they were better than expected and much better than both November's and last year's sales, said
Bob Aronson, the company's vice president of investor relations. He is expecting improved performance at
Stage Stores in 2010.
“Consumers are still concerned about the security of their jobs,” Aronson said, and after employment
stabilization is reached, “we should see an uptick.”
Kept up its inventory
At Houston-based Academy Sports + Outdoors, “we feel really pleased about December and the holiday
season,” said Anita Sehgal, the company's vice president of marketing and advertising.
The company benefited by not cutting back on its inventory — despite the economy — and seeing customers
respond favorably to the wide assortment of merchandise, she said
Sales for department stores as a whole rose 0.8 percent in December, noteworthy in that it is the first positive
monthly gain for that segment since April 2008, according to the ICSC.
Luxury department stores staged a big comeback in December with sales gains of 7.1 percent, the sector's
strongest monthly performance since November 2007.
Luxury chains even outperformed the discount chain sector, which saw its sales rise by 4.3 percent in
December. Target's December sales rose 1.8 percent. Wal-Mart does not release monthly figures.
Toys R Us sales climbed 4.6 percent for December, while Macy's rose by 1 percent.
In addition to positive December sales, Macy's received more than 1 million letters to Santa from its
customers, enabling Macy's to make a $1 million donation to Make-A-Wish, said Betsy Zeino, Macy's regional
director of stores in Houston.
For January, the ICSC expects sales to be anywhere from flat to up 1 percent.
For the year, the trade group is forecasting a bigger increase of 3 to 3.5 percent, Hershkowitz said.