While
the parking lots are full at most malls
across the country, Canadian consumers were
playing one of their best games of "cat and
mouse" with the country's retailers and it looks
like the consumer has won!
Retailers
appear to have finally taken a page from their
U.S. counterparts and started to offer up real
discounts compared to the loss leader variety
seen in most Canadian stores in the
past.
What
sparked all this "Christmas
generosity"?
October
retail numbers!
The
October numbers were disappointing,
showing only a 1.5% increase in All
Store sales which did not meet the 4.8% run rate
the industry was expecting.
So
in a word...retaillers were
"spooked".
Even
though Canadian Thanksgiving in no way compares
to the U.S. event, retail activity was flat,
even by Canadian standards.
Here
is the news by retail sector:
- Building
Material and Garden Equipment Stores
-7.2% Down
- Sporting
Goods, Hobby, Book and Music Stores 2.2% Flat
- Clothing
and Accessories 3.2 Up - early
discounting may save the day
- Health
and Personal Care Stores sales declined
-3.3% in sales.This is a general
trend across most drug retail chains
and department stores. Down
- General
Merchandise Stores were Up 1.9% just
barely above the monthly increase.
- Furniture
and Home Furnishing Stores sales grew by only
1.7% reflecting the ongoing slow growth in the
housing market. Recent reports show only a
likley 2% increase in average prices for next
year barely keeping pace with inflation.Flat
- Electronics and Appliance
Stores grew 3.5% on the strength of new
product introductions by RIM and
Apple.Up.
- Sales
in luxury products, perfume and
jewerly only grew 0.5% reflecting the
general retail caution.Flat
- Miscellaneous
store sales or specialiaty shops showed a
decline of -6.9%. This is one of the more
disturbing numbers as declines in
new retailing concepts and specialty
products point to a general weakening in
the retail sector...the canary in the coal mine
in our view. Down
These
are not good results for
Canadian retailing headed into the busiest
season of the year.
