With stimulus checks long cashed in and a frenzy to return to stores having subsided after an initial burst, it’s little surprise that retail sales were sagging in July, though some chain stores are faring better than others.
By the numbers, Kohl’s seems to be outperforming competitors in the challenged department store sector. While monthly visits to Kohl’s are still on the decline, the decreases aren’t as steep as they have been at rival retailers, according to data from Placer.ai, which monitors consumer foot traffic.
Data from Placer shows a 26.7 percent decline in monthly year-over-year traffic at Kohl’s in June as the virus surged in states where the chain has a large presence. Footfall improved slightly with a 26.1 percent decrease during the week of July 20. That’s compared with a 76.3 percent plunge in May when many temporarily shuttered stores began opening, and a 97.3 percent drop in April when all four-wall operations were paused.
For the week of July 20, a Placer report shows that Kohl’s, at down 26.1 percent, was outperforming a wider apparel sector that saw a 32.2 percent decline. That compares with a 44.7 percent decline at Macy’s for the same week and a 65.4 percent decrease at Nordstrom, leading Placer to conclude that Kohl’s could be one of the better-positioned apparel-sector players in the months ahead.
What’s more, Kohl’s traffic was just 13.9 percent below prior-year levels during the week of June 15, and was just 4 percent off during the week of June 22. But as COVID-19 resurged and forced some store reclosures in California and Texas, the declines increased to 22.4 percent, 23.4 percent and 36.7 percent, for the weeks of June 29, July 6 and July 13, respectively. In comparison, the weekly traffic visits for Nordstrom for the same period showed a decline of 60.3 percent for the week of June 15, followed by a decrease of 58.7 percent a week later. Falloff in weekly traffic visits grew to down 59.1 percent, 65.9 percent and 69.4 percent for the weeks of June 29, July 6 and July 13, respectively.
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A separate Placer report showed weekly trends at Macy’s, with declines greater than the apparel sector average of 32.2 percent, but better than the 59.9 percent drop during the week of June 8. For the week of June 15 the decline was 39.9 percent, and widened to down 46.6 percent a week later. In subsequent weeks through the week of July 13, the declines on average have been down in the 44.3 percent range, suggesting a plateau around the 44 percent range while the pandemic has reflected a rising rate of infections in California, Florida and Texas.
At bankrupt J.C. Penney, the week of June 8 was down 50.3 percent and the week of July 20 was off by 46.9 percent. For the weeks in between, visits to Penney’s stores have seesawed from down just 27 percent for its best showing during the week of June 15 to down 43 percent for the week of June 29 and then improving to down 35 percent for the week of July 6. That improvement only lasted seven days as Penney’s saw its weekly visits decline to 42.3 percent a week later.
And at Dillard’s, weekly visits have been plateauing at the 44.7 percent range for the weeks of July 13 and July 20. In fact, beginning the week of June 22, weekly visits on a year-over-year basis were down 40.5 percent and have stayed in the down 40 percent range ever since. That’s worse that the 33.1 percent decline for the week of June 8 and the 26.7 percent decrease for the week of June 15. Traffic at Dillard’s stores are likely attributed to a surging virus caseload in Texas and Florida, where the department store retailer has a sizable presence.
The advance monthly report for U.S. retail sales for July is due out on Friday. Given the department store sector’s weekly traffic trends, the numbers will likely reflect a July decline for the department store sector. Separately, Kohl’s is slated to report second-quarter earnings on Aug. 18, and will likely provide some details on sales trends during May through July, as well as possibly an early read for August, the start of the company’s third quarter.