The Big Picture
Overall retail sales fell for the first time in seven months in October, as consumers took a pause before their holiday shopping began at full steam. Sales were down 0.1%, according to the Commerce Department. This was a smaller decrease than expected, and sales at restaurants and supermarkets remained strong.
Meanwhile, inflation continued to slow. The consumer price index grew by 3.2% for the 12 months ending in October, down from 3.7% the previous month. And thankfully, Congress avoided a government shutdown before the holidays, putting off more budget votes until early next year.
Oct. Sales & Nov. Update
Among our client stores, overall sales were down 2% in October, with menswear taking a 3% dip and women’s falling off by just 1%.
In women’s, Special Orders minimized the slowdown, marking a 15% gain last month, while sales of both Ready-to-Wear and Accessories continued to soften.
In menswear, Clothing categories remained the leaders, posting a 2% gain. Dress Pants did brisk business — up by 14% last month — while Dress Shirts and Sport Coats both ticked up by 2%.
November sales started out slowly, but gained steam going into Black Friday weekend. According to Mastercard SpendingPulse, Black Friday sales were up 2.5% from last year, with online sales outpacing in-store as consumers hunted for the best deals.
Holiday and Q1 Outlook
Although Fall’23 started out soft, we expect the slowdown to be short-lived. We predict small, single-digit increases for the full holiday season, with menswear continuing to outpace women’s. Cooler weather has recently given Sweaters a boost, and Outerwear is already selling at a nice level.
In women’s wear, one of the challenges we face is that there’s really no strong trends driving sales. We also continue to see a weakness in tops, which is taking a toll on our units per transaction.
Given how this fall began, we expect Spring ‘24 to be similar, with sales picking up later in the season. This means you need to be assertive with your holiday markdowns.
If you have inventory that is not gaining traction, mark it down early to keep it from sitting around through early next year. You need new, exciting pieces to spark Spring ‘24 sales.
Blacks’ Bottom Line
After taking a breather, consumers are ready to spend this holiday season. Make sure your promotions and events are fun and festive.
