Economic worries, early Easter to hurt March sales
New York (MarketWatch) — A spate of economic worries, coupled with an early Easter, cold weather and lack of new fashions are expected to deliver a disappointing March for retailers, analysts said.
Retailers’ March sales at stores open at least a year are expected to be flat to down slightly, according to the International Council of Shopping Centers. ICSC lowered its sales forecast from an original projection of a 1% gain after sales in the week ended March 29 rose at their worst pace in five years.
The weak job market, higher gasoline and food costs, along with the declining housing and credit markets not only have eaten into shoppers’ budgets, but also have hurt their confidence in the economy and curbed their willingness to spend, according to analysts. The arrival of Easter in March instead of April like last year meant retailers lost one selling day.
Colder and wetter weather, they added, further lessened the appetite for warm-weather clothing; shoppers already lacked a reason to buy spring merchandise in the absence of must-have fashions. Easter is usually the time when retailers plan a big marketing push for spring fashions.
“It’s going to be ugly,” said Walter Todd, who helps manage $750 million in assets at Greenwood Capital Associates, which owns shares of retailers from Wal-Mart Stores Inc.
“People are shopping at Wal-Mart trying to save money and taking fewer trips and buying more at Costco.”Following the patterns of the past few months, Wal-Mart, Costco and other discounters and wholesale clubs are expected to lead other retail segments, while department stores and mall-based merchants for specialty apparel with heavy exposure to clothing are expected to suffer.
