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Op-Ed: The Meaninglessness of Same-Store Sales Data

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On the first Thursday of every month retailers release their comparable or same-store sales reports, which measures the prior month’s sales growth at their stores open at least a year. Once considered a reliable measure of store productivity, and typically reported along with total sales growth (which is impacted by new store openings), the news is anxiously anticipated by analysts, journalists and anyone else hoping to get a glimmer of insight into the state of the retail industry and the mood of the typical American consumer.

They shouldn’t waste their time, though, because the measures have become meaningless.

Of the almost 70 publicly-held U.S. merchants who sell discretionary consumer products like apparel, footwear, accessories and home furnishings, only eight still report monthly total and same-store sales. This is a sharp decline from five years ago, when nearly all publicly-held retailers reported.

Many of them stopped reporting the data because it was “causing too much volatility in stock prices.” (I guess we should thank them all for getting rid of the volatility in the stock market). Others claimed it was “causing management to focus too much on the short term and not enough on longer term initiatives.” (Thank goodness they nipped that problem in the bud, too.)

To really grasp how insignificant same-store sales figures have become, though, let’s consider for a moment the companies who no longer report them on a monthly basis.

Walmart, the largest retailer in the world, representing more than half of total U.S. retail sales, stopped reporting in early 2009, after the news got so bad month after month that someone in Bentonville woke up to the fact that they were powerful enough to simply refuse to publish the number anymore. As soon as Walmart stopped, Sears, the dollar stores and many other discounters followed suit. In 2013, Target, TJX and Ross, the last holdouts among major U.S. retailers, stopped reporting.

Macy’s stopped about one year and a half ago. Around that same time, Belk, Dillard’s, J.C. Penney, Kohl’s, BonTon, and Nordstrom all went mum. Can you blame them?

E-commerce giant Amazon never did report same-store sales, likely because it doesn’t have any stores (not yet, anyway). They do have sales, though, $61 billion worth last year.

Only one warehouse club, Costco, still reports on a monthly basis. This is not surprising, since Costco is very much into transparency and being different. Big box retailers Best Buy and Bed Bath & Beyond do not issue monthly reports.

In the women’s specialty apparel sector, we know how Victoria’s Secret, Cato, and Gap Inc. are doing, and that’s about it. Same-store sales for Ann Taylor, Talbots, Chicos, Express, Urban Outfitters, Ascena, Charlotte Russe, Charming Shoppes, Francesca’s, Urban Outfitters, Christopher & Banks, Lululemon, New York & Co.—in short, for 95 percent of the rest of the segment—are not available.

And it’s not just the women’s merchants who are holding their tongue. There’s no news from Men’s Wearhouse, Joseph A. Banks, Brooks Brothers or Casual Male, either. Or from Children’s Place, Abercrombie, American Eagle, American Apparel or Aeropostale. The only teen stores still reporting are Kearney, Nebraska-based Buckle, and skateboard purveyor Zumiez. Think they’ll keep reporting if the others don’t? Probably not.

So what are we left with? One tiny regional discounter, Fred’s, and one off-price department store, Steinmart.

When you add it all up, only $140 billion of the almost one trillion dollars in annual retail sales being done by general merchandise and apparel specialty retailers is represented by the handful of companies still reporting same-store sales on a monthly basis. That’s less than 15 percent of the sector, making it impossible to glean from the data whether the market is growing or shrinking, or which retailer or channel is gaining share from another.

Complicating the situation even further is the fact that Gap, L Brands and others now include their e-commerce sales as part of same-store sales. I’m not sure how they can prove to themselves or anyone else that this makes logical sense, but they do it. With online sales growing by double digits, compared to low single digits for bricks and mortar, all this does is introduce even more confusion and insignificance to the measure.

So, later today, if you find yourself anxiously awaiting news about May same-store sales, take a deep breath, relax, and find something more valuable to do with your time.

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