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Apparel Depresses Retail Sales Growth in October Department, discount, and chain stores fall and specialty apparel slows

Total retail sales growth slowed in October, led by slowing of key apparel channels and reversing the trend of the prior three months, according to just-released government figures. Sales grew 3.6% on a 12-month smoothed basis, below September’s 5% growth rate, but better than August’s 3.4% increase.

Autos had a smaller impact in October than in previous months. Taking autos out of the mix, total retail sales increased by 3.4% – very close to the total growth rate. Gas stations continued to post record sales.
Total retail inventory surged by 7.9% in September (the most recent month for which this measure is available), its smallest increase in four months. Inventory-to-sales ratios fell for all key retail channels.

Oct retail 1

Department, discount and chain store sales fell in October for the fourth straight month. Big store inventory dropped by 7.2%, its biggest monthly dip in over three years, and the inventory-to-sales ratio fell slightly.

oct retail 2

Specialty apparel store sales growth slowed to 4% in October from the over 5% growth rates the channel enjoyed from July through September, but continues to outpace growth at department stores. September inventory rose by 4.9% as stores stocked up in advance of the holiday season. Inventory to sales ratio edged down slightly in September.

oct retail 3

The combined department, chain, discount and apparel specialty retail sector, a fairly reliable barometer of total apparel sales, enjoyed a sales improvement of only 1.8% on a 12-month smoothed basis, well below the prior month’s 2.5% gain, due to the softness in both the specialty and big store sectors.

oct retail 4

 

Retail Sales & Inventory
$MM — Adjusted for Seasonality

Oct-12

Sep-12

Oct-11

Total US Retail Sales

411,591

412,869

396,407

Department Store Sales

15,211

15,264

15,348

Apparel Specialty Stores

20,077

20,094

19,036

Total Dept & Specialty

35,288

35,358

34,384

Sep-12

Aug-12

Sep-11

M & B Specialty Sales

N/A

N/A

N/A

W & G Specialty Sales

3,497

3,473

3,265

Total Retail Inventory

503,041

501,565

467,454

Dept Store Inventory

29,282

29,734

31,006

Apparel Specialty Inv

48,139

48,104

45,783

Dept & Spec Inv:Sales

2.19

2.20

2.23

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