January Retail Report – Waiting For Spring To Be Sprung

The Big Picture
The U.S. economy continues to slowly revive and consumers have taken note. Consumers’ confidence in the economy is at its highest level since May of last year, mostly due to the decrease in unemployment numbers, according to a recent survey by Gallup.

While this is good news, experts warn that already high gas prices could continue to climb this summer due to Iran’s anger over Western embargoes, eroding consumer confidence. But for now, the mood is positive and we expect decent retail sales this spring.

January’s Slow Start
Most stores have seen a slow start to the season following better-than-expected holiday sales. The final December numbers are in, showing a 8% increase in menswear and a 7% spike in women’s wear, according to Blacks’ exclusive trends.

Menswear sales were led by demand in the clothing category, including suits, dress shirts, neckwear, dress pants, and sportcoats, which all saw double-digit gains.

In women’s, accessories and special order propped up sales, while ready-to-wear posted a decent 5% gain.

(For specific trend numbers and predictions for the next two seasons check out our Trends by Class page.)

The Seasons Ahead
We expect spring sales to pick up in February when retailers begin to put on trunk shows, and hopefully, the weather starts to warm. Just remember to start promoting your trunk shows early so you can get on your clients’ calendars. Start advertising a few weeks in advance, and consider contacting clients directly while the event is going on via phone or text message to give it a personal touch.

As you buy more goods for late spring and fall, keep in mind that you will have to be as promotional this year as you have been in the past so make sure that you build in enough margin. This is especially true for the fourth quarter when most retailers will have to put on heavy promotions to drive decent holiday sales. Since this year is an election year, it’s difficult to say what kind of mood consumers will be in, so it’s best to have a number of promotions in your pocket.

Blacks Bottom Line
Make sure you exit your old product quickly and are able to bring in new spring merchandise to spark sales.