ActionWatch Update

As posted in Transworld Business, the ActionWatch Retail Panel (same-store set) reported apparel sales were 23% lower in Q1 2009 compared to last year’s first quarter. However, the average inventory level in Q1 2009 was almost 8% higher than it was in the previous year. While all categories tracked showed decreased sales for the period, apparel was the only category that also had increased inventory levels. That is, retailers on the panel seem to be managing inventory levels of their other categories more closely to sales patterns. What does this mean for the second quarter? Unless we see a big turnaround in sales (which is unlikely), many retailers will need to apply more discounts to turn their old inventory fast enough to be able to replace it with fresh goods. Of course, the discounts will probably be combined with lowered orders from suppliers, but we’ve already been hearing about that from the industry’s public companies. Not everything is bleak. April same-store sales for the core shops on the ActionWatch Retail Panel showed the best year-over-year numbers we’ve seen so far in 2009. After two months of being down more than 19%, it was a relief to be down only 14% in April 2009 compared to last year. Apparel showed the best improvement with a sales decrease of only 10% compared to being down almost 25% in the previous month. Also, retailers’ margins on apparel sales have steadily improved over the last three months although April’s 46% apparel margin was still two points lower than last year. When drilling down into apparel classes, we find boardshorts sales were actually up...

SIA Predicts Grim Season for Snow Retail This Winter

The SnowSports Industries America reported a sobering assessment for the upcoming snow season and the impact of weak sales and increased discounting during the past season. In its report on the 2008/2009 season, the trade group said the recession could have a major impact on stores and brands. “The peculiarities of this recession resulted in strangled credit markets, higher costs and reduced sales in the snow sports market that had significant negative impacts on both retailers and suppliers,” the SIA said. “Additionally, first indications of pre-season order activity for next season suggest that retailers are not betting heavily on increased sales for the 2009/10 season. As a result of this season’s lackluster results, we anticipate some consolidation of retail shops, reduction in chain store fronts, and consolidation of brands.” Overall, sales fell 5 percent to $2.8 billion. The current season equipment category was the weakest performer, with retailers selling 75,000 fewer alpine skis, 8,000 fewer Nordic skis and 34,000 fewer snowboards. Accessories sales were close to last year’s totals, the SIA said. Increased discounting was the theme of the season as illustrated by apparel sales, which increased 2 percent in units but fell 6 percent in dollar sales. The only distribution channel where sales increased was the Internet. Specialty chains were especially hard hit, with that channel selling 2 million fewer units of goods. The accessories category was especially impacted, with 1.6 million fewer units sold. Chain stores sold 302,1000 fewer units, with equipment the weakest category. The Internet saw unit sales increase by 1.1 million, with increased results for every category. Ominously, unsold inventory of equipment as of...

2008 Year-End Specialty Retail Survey

The results of the latest quarterly action sport retail survey, conducted by Board-Trac and the Board Retailers Association (BRA) are in and yielding some interesting results: 1. 65.2% of specialty retailers reported that comp stores sales were down Q4 2008. 68.4% indicated that margins were down as well. 2. 58.2% reported that their overall 2008 sales compare to 2007 were down. 31.6% reported an increase with sales/discounts being the single largest contributing factor. 3. 45.6% of retailers reported that the sale of hardgoods are down while 54.4% indicated a decrease in apparel sales. 4. 63.4% of retailers under forecast actual sales for 2008. Looking forward, 31.6% expect to increase sales in 2009 while 37.4% expect to have a decline. 5. 65% of retailers reported that they either didn’t have an ecommerce site or that it was less than 5% of annual sales. 6. Almost 70% of retailers expressed interest in carrying new brands. Diversifying product is key to success and a way of creating a unique retail destination. Log into www.boardretailers.org to see the complete survey results. If you participated in the survey, you will receive the full report and accompanying analytics via email from Board-Trac and...