Retail watch: Apparel sellers suffering from crowding out effect

Analysts don't think the challenges facing apparel retailers in the U.S. will go away anytime soon.

Pent-up demand in the housing and auto sector has crowded out consumer spending on clothes to push the sector into a highly-promotional stance heading into the Back to School and holiday seasons.

While retailers selling appliances (CONN, HD, LOW) are forecast to benefit from the trend, mall-based chains (KSS, BKE, ANF, WTSL, ZUMZ, GPS, URBN, GES, PSUN, ARO, EXPR, AEO, JCP, M, DDS) are on watch.

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Comments (4)
  • bakmanone
    , contributor
    Comments (39) | Send Message
    If this is a fact then it seems a good time to focus on Furniture and home items. Something has to fill these new homes being purchased. Just a thought.
    6 Sep 2013, 07:45 AM Reply Like
  • Herbert Samuel Jennings
    , contributor
    Comments (299) | Send Message
    ARO fell because it has high operating costs... it's earnings drop was nothing compared to that... all it needs is cutting the dead weight and it will rocket back into profitability.
    6 Sep 2013, 08:17 AM Reply Like
  • Truth_Investor
    , contributor
    Comments (374) | Send Message
    Either way parents are going to focus on back to school, and hold off on remodeling. Not really believing the "pent up demand" analysis.
    6 Sep 2013, 10:04 AM Reply Like
  • gatorj
    , contributor
    Comments (111) | Send Message
    Macys is still challenged in several markets by over population of its stores due to the merger. In the Mid Atlantic region. The Federated stores did not have the customer income of Macys. Those stores still do not have the customer income to qualify as Macys. Macys stores are no more than a 15 minute drive from one another. Most are under 175k square ft and lack the variety and quantity of merchandise.
    With six Nordstroms in the region, the old Macys customers with money tend to shop for clothes at Nordstroms. At the lower end, the Nordstrom Rack stores are growing in our region and taking away ladies sales especially in shoes. Nordstrom is so confident of its Rack plan, that it put a Rack store within walking distance to one of its Nordstrom stores in a mall that also holds a Macys. Norstrom suffered very little erosion, however, Macys took a hit.
    6 Sep 2013, 10:12 AM Reply Like
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