Sept. 2023 Retail Report: High-End Shoppers Continue to Spend

The Big Picture

Overall retail sales grew faster than expected in August, up 0.6% compared to a 0.5% increase in July. This was mostly due to high gas prices, according to the U.S. Commerce Department.

But, shoppers also spent on back-to-school items, apparel, and eating out. So far in 2023, sales are beating last year and exceeding inflation by about a point. Inflation was up 3.7% for the 12 months ending in August.

Looking ahead, we do face some economic headwinds. The Fed plans one more rate hike before the end of the year, auto workers are on strike, and Congress is grappling to pass budget legislation, which could lead to a government shutdown.

While there is a lot up in the air, unemployment remains low, and the Fed actually raised its forecast for the fourth quarter.

August Sales

We were up against some large year-ago sales figures last month, with both women’s wear and menswear posting 20% increases in August 2022. So, although it looks like we took a dip, it wasn’t as bad as it seems.

Women’s posted a 4% decrease from last year, while menswear only dropped by 2%. Clothing categories continue to provide momentum in the menswear market, and were up another 5% last month. In Women’s, although ready-to-wear is down, special orders posted a 4% gain, indicating that clients are still excited about new pieces.

In terms of fall deliveries, it has been a mixed bag, with some merchants reporting late deliveries and others saying that they got their goods in early.

It’s important to get our deliveries on time if we want to hit our sell-thru goals for the season. This is especially important for those merchants working on driving down already high inventory levels.

Resilient Demand

As we look forward to the rest of the fall season, we expect sales to be strong in the higher end of the market, at least. Our clients’ trunk shows and other promotional events have been successful in giving customers another excuse to buy.

Great service and unique products are what give clients even more reasons to shop, so focus on these fundamentals and it should be a strong season.

If you have any leftover open-to-buy, commit to goods now because they probably won’t be available later, especially when it comes to landing higher-end goods.

Blacks’ Bottom Line
There is still a lot of business to be done this year, so keep giving your customers excuses to buy.