Chain Store Sales Dramatically Rise at End of March

April 8, 2010

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Warm weather and the impending Easter holiday drove strong chain store sales performance [pdf] during the last two weeks of March 2010, according to the Weekly Chain Store Sales Snapshot compiled by the International Council of Shopping Centers (ICSC) and Goldman-Sachs.

Weather Boosts Sales This Time
As opposed to February 2010, when unusually cold and snowy weather dampened chain store sales (although less than expected), warm weather and the approaching Easter holiday drove strong chain store sales increases in March 2010 (with the final week of the month ending April 3).

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The Chain Store Index for the week ending April 3 was 512.7, up 4.7% from the previous year and up 2.1% from the previous week. This marked the Index’s best year-over-year growth pace since it improved 4.9% the week ending March 31, 2007. Apparel, department and discount store traffic drove this increase, with the one-week shift in the Easter holiday as a primary cause.

However, even with adjustments for the earlier Easter holiday, the ICSC said year-over-year sales were still strong for the week. Unseasonably warm weather likely played a role. National temperatures during the week ending April 3 were 5.2 degrees Fahrenheit warmer than the equivalent week in 2009 and 4.4 degrees Fahrenheit more than the long-term average, according to Weather Trends International (WTI). WTI said that average temperatures across the nation were the warmest in at least 18 years.

For the week ending March 27, the Chain Store Index was 502, up 3.2% year-over-year and 0.6% from the previous week. The Index was 499.2 the week ending March 20, up 3.7% year-over-year and 0.1% from the previous week. During the week ending March 13, the Index was 498.9, up 3.2% year-over-year but down 0.4% from the previous week. That week (ending March 6), the Index was 500.7, up 3.4% year-over-year and 2.9% from the previous week.

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Chain store sales in 1977 are set to a score of 100.

February Comp Sales Outperform Predictions Despite Cold Temps

Although multiple snowstorms caused a 1% drag in chain store sales during February 2010, comparable-store store sales continued a pattern of above-expectation sales growth as the industry posted a solid 3.7% gain from the same month of 2009, based on an updated tally of 31 retail chains compiled by ICSC. Previously, the ICSC had forecast that industry comp-store sales for February 2010, which is the start of the retail fiscal year and one of the lowest sales volume months of the year, will be up by about 2%. Comp-store sales rose 3% in January 2010, significantly better than the ICSC’s prediction of 1% growth based on heavy post-holiday discounting.

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For March 2010, the ICSC expects chain store comp sales to grow 8-10%, with the shift in the Easter holiday driving 6% of that growth.

Easter Sales Expected to Rise
Consumer spending for the April 4, 2010 Easter holiday was expected to mildly improve from 2009, according to the National Retail Federation (NRF) and BIGresearch.

The NRF predicted average Easter spending per person of $118.60, up 1.7% from 2009. Total spending was expected to reach $13.03 billion, a 2.3% increase from $12.73 billion in 2009.

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