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Retail Apparel Sales Underperform in May

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Total retail sales grew in May, but apparel underperformed, according to just-released Department of Commerce data. Seasonally-adjusted sales at apparel specialty stores declined from last month,  though they increased compared to May 2012. Department store sales fell compared to both last month and last year.

Total retail sales rose by 4.1% on a 12-month smoothed basis, faster than both March’s and April’s gains. Sales at auto dealers and stores continued to drive much of the retail sales growth. Excluding the automotive sector, total retail sales increased by only 3.3%.

Lower prices on commodities allowed consumers to stretch their grocery budgets farther, and sales at restaurants picked up nicely.

Total retail inventory increased by 5% in March (the most recent month for which this measure is available), the smallest increase in 16 months.

Although apparel specialty store sales picked up on a 12-month smoothed basis, the increase was offset by declines at department, chain and discount stores. Specialty stores continued to erode department and discount store market share, though at a much slower pace than in previous months.

Department and discount stores suffered their fourteenth straight month of declines, with sales down by over 4% in May on a 12-month smoothed basis. Big store inventory rose by 3.2% in April, and the inventory-to-sales ratio edged up slightly.

Specialty apparel store sales grew 3.6% in May, less than April’s almost 5% jump. Specialty store inventory rose by only 1.7% in April as stores entered the spring season with conservative stock levels, keeping their inventory-to-sales ratio stable.

The combined department, chain, discount and apparel specialty retail sector, a traditionally reliable barometer of total apparel sales, rose negligibly on a 12-month smoothed basis. April inventories increased 2.3%.


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