NEW YORK — Could the end of the doldrums be in sight?
The Dow Jones Industrial Average closed above 10,000 last Wednesday — retaking ground not seen since last October — as September sales at specialty and department stores rose and investors got a positive feeling about third-quarter profits in the banking and technology sectors.
And while it’s still clear there will be no quick fix, several footwear and retail players told Footwear News they are feeling more optimistic of late. “Retail is not out of the woods yet, but consumers felt comfortable enough last month to spend on more than just necessities,” said Rosalind Wells, chief economist with the National Retail Federation.
The Commerce Department said last week that September specialty store sales inched up 0.5 percent compared with August, but fell 1.3 percent to $17.48 billion from a year ago. Sales at department stores rose 0.4 percent month-to-month, but declined from last August, dropping 3.7 percent to $15.66 billion.
Meanwhile, citing an increase in customer traffic and buying, DSW Inc. last Thursday lifted its full-year earnings-per-share estimate to 70 cents to 80 cents — well ahead of Wall Street predictions for 44 cents — versus a prior forecast for 37 cents to 45 cents. Comparable-store sales are seen rising 6 percent to 8 percent for the third quarter.
And Saks President and chief merchandising officer Ron Frasch told FN at the FFANY Shoes on Sale event last Tuesday he was feeling “cautiously optimistic” about the upcoming months. “Things are going alright — thank God. I have to be careful saying that … but we are selling, so hopefully it will be good for the fourth quarter.”
Buyers at high-end retailer Bloomingdale’s who attended the event echoed similar sentiments. “Knock on wood, [fall] is good so far,” said Francine Klein, EVP and GMM. Debbie King, VP and DMM of women’s shoes, added, “For fall, it’s all about boots, boots and more boots. We’re doing great with boots.”
Sales also are picking up for independent retailer Peter Hanig of Hanig’s Footwear in Chicago. “We’ve had a tough year, like everyone else, but the business is turning around,” he said.
But even if retail sales were better last month compared with August, they were still worse than a year earlier, and economists said stores have a long slog ahead of them. Indeed, 30 percent of consumers plan to spend less this holiday season from last year, according to an NPD Group survey released last week.
“Consumers will be looking for the right gift, rather than the most extravagant or expensive one,” said Marshal Cohen, the research group’s chief industry analyst. “That, combined with the soft numbers we are up against from holiday last year, and we will see [sales] growth, albeit a modest 0.5 percent to 1.5 percent.”