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In July, consumer confidence took a hit and most retailer categories either maintained their position or lost ground compared to their year-to-date growth statistics. The notable exception was Motor Vehicle and Parts Dealers.

Total sales were down by -7.9% in July buoyed by an improving Motor Vehicle and Parts Dealers category. The sharp contrast of this month’s -7.2% drop for the category compared to the -18.9% plunge year-to-date was welcome news for retailers and the industry overall that has been looking to get back on stable ground. A driving force has been the Cash-for-Clunkers program that has had a positive effect on retail sales growth.

A few other categories performed better than average. Health and Personal Care Stores sales shot up a further 4.7% compared to last July.

Within the Nonstore Retailers’ category, the Electronic Shopping and Mail-Order Houses were primarily responsible for the diminishing negative growth. Sales fell -3.3% in July compared to the year-to-date growth of -5.0%, as the pure-play retailers in this category moved into positive growth territory in June.

Finally, while still in the double-digit negative growth range, Furniture and Home Furnishings Stores
witnessed a -11.9% decline compared to -13.6% year-to-date.

A number of retailer categories maintained the same level of growth or decline and were effectively no better or worse compared to the year so far. These categories include Food and Beverage Stores, Gasoline Stations, Clothing and Accessories Stores, and Food Services and Drinking Places.

Unfortunately, a number of retailer categories stumbled in July. Building Material and Garden Equipment Stores sales fell -15.0% in July compared to -11.8% year-to-date causing concern.

General Merchandise Stores were down -3.4% in July and Department Stores approached double-digit declines. While many retailers have been moderately successful at affecting their profit levels through deep cost cutting, perhaps these measures have been taking a more noticeable toll on sales results. Macy’s reported -10.7% decline in July and -9.7% for the second quarter. Walmart reported that they experienced relatively flat sales growth.

Electronics and Appliance Stores could not entice consumers into their stores with much ease as sales fell
-14.3%. In addition, the same could be said for Sporting Goods, Hobby, Book and Music Stores. Sales declined
-5.4% which was surprising as the category had been performing better than most others.

As consumer confidence slips below 50 once again, retailers are nervous and cautious about the second half of the year. The positive step forward for Motor Vehicles and Parts Dealers shows consumers are opening their wallets wider for the first time in several months.

As children, teenagers, and young adults have either already returned or are about to go back to school, J.C. Williams Group thought that it was timely to provide a supplement on Back-to-School retail trends and statistics. Enjoy.

Special Supplement: Back to School Data

Release Date of the Next National Retail Bulletin: September 15, 2009

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For more information, please contact Jim Okamura at (312) 673-1254, John Archer (416)921-4181 or e-mail or info@jcwg.com; Website:  www.jcwg.com

Please note:

The J.C. Williams Group National Retail Bulletin compares the latest monthly release of “raw” (i.e., unadjusted for seasonality, holiday, and trading day) retail sales figures to those in the same calendar month of the previous year. The U.S. Census Bureau also reports seasonally adjusted sales that are compared to the previous month within the current calendar year to measure change in Gross Domestic Product (GDP). Although other sources use seasonally adjusted figures, J.C. Williams Group believes that using raw figures and making comparisons to the previous year’s performance more accurately reflects the seasonality of the retail industry, and therefore, are more useful in analysis. Definitions can be found on the U.S. Census Website: www.census.gov.