Retail sales growth slowed in March, and department stores suffered another nasty fall, according to just-released U.S. Department of Commerce data.
Total retail sales rose by 3.8% on a 12-month smoothed basis, down from February’s 5.3%. Many stores reported slower traffic due to unseasonably cold weather, which put the damper on sales of new Spring merchandise. Easter’s appearance on March 31 shortened the month by one weekend shopping day compared to last year. There are also indications that consumers continue to spend carefully and to seek value whenever possible in light of higher payroll taxes and a persistently tough job market.
Although auto sales have benefitted from record numbers of people replacing older cars and trucks in the past few months, its impact on total retail sales has begun to wane. Excluding autos, total retail sales increased by only 3.3% in March.
Total retail inventory increased by 8.5% in February (the most recent month for which this measure is available), less than January’s 9.3% increase. The total retail inventory-to-sales ratio decreased slightly.
Department, discount and chain stores suffered their twelfth straight month of sales declines. Big store inventory rose by 3% in February, thought the inventory-to-sales ratio remained relatively stable.
The specialty apparel store sector sales growth of 2.75% in March was even with February’s gain, but well below December’s and January’s increases. The disappointing trend is expected to improve as long as April weather cooperates. Specialty store inventory rose by almost 7% in February, and the inventory-to-sales ratio increased slightly.
The combined department, chain, discount and apparel specialty retail sector, a traditionally reliable barometer of total apparel sales, fell by 1.6% on a 12-month smoothed basis, worse than February’s 1% drop.