The answer to that question depends upon who you ask.
Speak to ShopperTrak, they will tell you that even though traffic was off, sales increased 4.5%. The firm measures foot traffic in shopping centers and malls via 50,000+ video devices, and adds in U.S. Commerce Department sales
Holiday sales in the U.S. climbed 4.5 percent, ahead
of ShopperTrak RCT Corp.’s forecast, as retailers lured customers with
discounts on clothing and electronics.
The gain exceeded the projection of a 3.6 percent increase,
ShopperTrak said in a statement today. Customer visits dropped 2.7
percent during November and December from a year earlier, the firm
Other analysts and research firms have projected holiday sales may
be the worst in at least five years. The National Retail Federation has
forecast a 4 percent rise, the smallest since 2002."
Speak to two of the country’s biggest retailers, and you get very different numbers: Wal-Mart (WMT) said in early December that sales would rise between 1-3%; Target (TGT) said same-store sales for December may actually show a decline.
At the same time, the FT reported that "American Eagle, the youth clothing chain, and Men’s Wearhouse, which specializes in business suits, both cut their fourth-quarter earnings guidance on Wednesday – presaging what is expected to be a round of grim December sales figures on Thursday from other leading US retailers."
My take? I suspect the ShopperTrak data has lots of inflation built into to it via the Commerce department. If we go ex-food and energy to back out inflation, we can get Real sales increases (not nominal inflation gains). Then sales were somewhere between minus 1.5% and plus 1.5%.
UPDATE: January 10, 2008 9:32am
A number of retailers cut expectations, led by Kohl’s Corp., as companies largely posted December same-store-sales figures below already lackluster estimates.
One exception was Wal-Mart Stores
Inc., as the giant posted sales at the higher end of forecasts and
reiterated its fiscal fourth-quarter earnings forecast of 99 cents to
$1.03 a share.
The company posted a 2.4% gain in U.S. same-store
sales, excluding fuel, compared with its 1% to 3% forecast. Wal-Mart
stores reported 2.6% growth amid strength in grocery, pharmacy and
electronics departments. Sam’s Club — long the firm’s better
sales-growth performer — had a 1.3% increase amid "slightly lower"
traffic and weakness in home furnishings.
Corp. posted a 5% drop, double the decline analysts were expecting. The
company warned on Christmas Eve that December same-store sales on a
calendar-adjusted basis might range from down 1% to up 1%; on that
basis sales fell 0.6%. The firm late Wednesday announced that Chief
Executive Robert J. Ulrich will retire May 1 and be succeeded by
President Gregg W. Steinhafel
ShopperTrak Says Holiday Retail Sales Climbed 4.5%
Duane D. Stanford
Bloomberg, Jan. 9 2008
Clothing retailers cut their earnings forecasts
FT, January 10 2008 01:44