Retail Sales Forecast from a Fashion Perspective

My favorite source for all information retail is Jennifer Black of Jennifer Black & Associates. Here's an interesting comment on July's retail sales:

As consumer spending continues be sluggish there are signs in the economy that the recession may be close to an end as we are seeing improvement in manufacturing, employment picked up in the month and construction spending also saw a slight uptick. Manufacturing fell at the slowest pace in 11 months. New orders and production grew at the fastest clip in two years.

We believe that retailers are facing additional headwinds in the month of July with the shift of the tax-free holidays from July into August. This coupled with parts of the country that faced cooler weather, especially the East coast, we believe impacted sales and traffic. However, the West coast was going through a heat wave with temperatures reaching the 100’s for the last 1.5 weeks of July, which drove people to the malls where they found comfort.

Here is an interesting perspective on fashion:

We believe we have entered a new era of retail, putting the spotlight on fashion and the urgency for consumers to be on the cutting edge with the help of new technologies that have uncovered a barrage of opportunities available through MySpace, Facebook, Twitter and blogging that allows consumers to hear it first from celebrities, designers, friends, etc. Trends will appear quicker and depart quicker as the fashion world moves through the Internet at a speed of light, in our opinion.

I think that consumers will be somewhat more value oriented than they were a few years ago, though not going so far as my grandparents' generation. But people will still want to look cool, so look for more grassroots oriented trend setting, as befits the new social networking lifestyle.

Comments

[Ted Hurlbut:]

I'd like to buy in, but what I'm seeing from fashion retailing is the customer buying items instead of outfits, trading down on basics and cherry-picking fashion retailers. As much pent-up demand as there might be for fashion, we won't know which direction the fashion consumer wants to go until they begin to once again pay full retails. That said, there has been a shift from accessorization that we saw as we were falling back into garments, which is a positive sign, but the consumer remains very cautious and discriminating, and units-per-transaction, price points and margins remain under intense pressure.

Aug 05 11:32 AM

[TheCaptain:]

She isn't saying anything that hasn't been true for a long time. Women have long stopped being loyal customers to only one retailer. Now, who ever has what a woman wants at the best price, or at least a price she is willing to pay, gets the dollars. She may have a Gucci handbag with a top from Forever 21 and bottoms from Banana Republic. And if you look at trends, the same thing goes. There hasn't been an honest to goodness real trend in years. Want to wear the 80s? Do it. Want to wear skinny denim? Want to wear boot leg cut? Want to wear leggings? Want to wear a long dress/short dress? Do it all. In short, retail was in trouble long before the recession hit because fashion was in trouble. Retailers look to have trends and without any serious trends, they have nothing to showcase. A recession is good for retail-the playing field was way too level. We need less stores with more ideas. Too bad that won't happen just yet.

Aug 05 03:11 PM