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Consumer confidence continued its upward rise back to Spring 2008 levels. While the wet and damp weather that hit east of the Rockies dampened apparel sales, it buoyed other retailers.

Total Sales fell by -2.7% but bettered the year-to-date growth rate of -5.6%. All Stores Less Automotive moved back into positive territory growing by 1.8%.

Food and Beverage Stores and Pharmacies and Personal Care Stores were primarily responsible for the movement into the plus side of growth. The categories grew by 6.2% and 6.4% respectively and well above their year-to-date average.

The big news is the return to growth for Building and Outdoor Home Supplies Stores. In June the category, which accounts for over $2.8 billion in sales, witnessed a 0.9% growth. Strong increases in home resales and new home starts have benefited this category. We expect this trend to continue with the ongoing strength of the housing market through the summer.

While the Building and Outdoor Home Supplies Stores have begun to see customers back in the stores shopping, the Furniture and Home Furnishings Stores category is still down. In June, sales were down -10.2%, marginally better than their year-to-date fall of -11.2%. Typically, this category lags home starts and sales by several months and we expect this category to start to see benefits happening in the next few months.

There is no doubt the wet and cold weather took an early toll on apparel retailers. Both Clothing and Accessories Stores and General Merchandisers did not perform as well as other categories. Clothing Stores were down -5.6% compared to -4.5% year-to-date. Shoes, Clothing Accessories, and Jewellery Stores fell -6.0% compared to -3.8% year-to-date. General Merchandisers were able to maintain growth at 1.1%, but were off their year-to-date growth of 2.3%. While healthy food sales kept the General Merchandiser’s sales in positive territory, the sluggish apparel sales dragged the category down. A recent study by Statistics Canada confirmed the declining importance of apparel and the increasing importance of food and beverage sales for General Merchandisers. In 1999, their top selling commodity group was clothing, footwear and accessories which accounted for 23% of their total sales. However, today this share has dropped to 16%.

Despite the cool and wet weather, Sporting Goods, Hobby, Music, and Book Stores were able to drive ahead a further 3.2% compared to 1.1% year-to-date. Healthy book sales may be partially the reason.

While the summer overall appeared to be a miss for most apparel retailers, early indications are that the Fall is performing better than expected. Pent-up demand and cool weather are helping retailers regain some traction lost in the Spring and Summer.

Release Date of the Next National Retail Bulletin: Septemer 22, 2009


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Toronto Office:  17 Dundonald St., 3rd Floor, Toronto, ON M4Y 1K3 Tel: (416) 921-4181 Fax: (416) 921-4184
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For more information, please contact John Archer or Maureen Atkinson (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) retail sales figures to those in the same calendar month of the previous year. Statistics Canada 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.