The Big Picture
By all accounts it looks like it was a good holiday season for many retailers, although not as strong as last year.
MasterCard reported a 3.1% increase in sales from November to December over the same period in 2022. This growth falls in line with the National Retail Federation’s estimate of 3% to 4% growth for the same period.
Meanwhile, U.S. inflation settled in at 3.4% for all of 2023, with December coming in a little bit higher than expected. Overall, the U.S. economy is entering the new year on solid ground.
December Sales
Among our client stores menswear was up 4% in December, with Clothing categories still leading.
Sport Coats, which have been the clear MVPs, posted a 20% gain, while Suit sales increased by 12%. Much of the momentum in Clothing stems from jackets (of the sport coat, suit and outerwear varieties), as well-to-do consumers refresh their looks with new, expensive pieces.
Women’s was a little more tepid last month, down 1%, as the lack of interest in dresses continued to weigh on results. Dress sales were down 25% in December, while Ready-to-Wear was flat, and Women’s Accessories dipped by 8%. The only growth category last month was women’s Special Order, which was up 8%.
2024’s Slow Start & Fall Plans
Anecdotally, we hear that sales got off to a very slow start this month, which was not that surprising. We expect sales to pick up in early spring, when it starts to warm. This is when dresses will have their opportunity to shine, after a down cycle last year.
The spring season should be decent, but we expect a contraction this fall, so be conservative with your fall buys. In menswear, look for beautiful Sportswear pieces in addition to your Clothing staples. Sportswear was another category that fell off last year and is due for a pickup.
This year is all about restraint as we face political uncertainty and a return to a normalized sales cycle. Think back to the “Hold and Release” strategy that we introduced during the pandemic, where you time your receipts a little more carefully, never spending too much upfront.
Blacks’ Bottom Line
We are returning to more predictable sales cycles. Don’t just look at your trending categories; find opportunities in categories that are about to trend.
