Consumers went shopping in force in the traditionally weak month of February, snapping up brand-name apparel and home goods and driving sales at the nation's biggest retailers above expectations.
"February was an excellent month coming off a dynamic fourth quarter," said Howard Davidowitz, chairman of Davidowitz and Associates Inc., a national retail consulting firm.
Chain stores posted an average 7.6 percent gain at stores open at least a year, compared with February a year ago, according to the Bank of Tokyo-Mitsubishi's tally of 83 chain stores.
Sales rose an average 10 percent for apparel stores, 9.1 percent for discount stores and 11.7 percent for electronics retailers, the bank's tallies by sector showed.
"This industrywide tally was considerably stronger than expected for the month," said Michael P. Niemira, Bank of Tokyo-Mitsubishi vice president.
The overall strong performance came out of a month known for generating some of the lowest sales of the year, typically a time when retailers try to clear fall merchandise, said Philip Abbenhaus, a retail analyst for KPMG Peat Marwick.
Still, the robust economy persuaded consumers to spend, much of it on spring merchandise.
For consumers, "there's not a huge amount of concern from an economic standpoint," Abbenhaus said. "People may have a little more spending money as a result of the economy."
Recent trends that have shaped retail continued, as shoppers sought bargains at mass discounters and wholesale clubs, or zeroed in on brand-name clothing at specialty apparel chains.
Sales jumped 10.8 percent at Wal-Mart Stores Inc., 10 percent at Costco Cos. Inc., 8.3 percent at Dayton-Hudson Corp., which runs Target stores, and 5.8 percent at Kmart Corp.
Chains such as American Eagle Outfitters, Abercrombie & Fitch Co., Gap Inc. and Limited Inc. continued to strike a nerve with teen-aged and young adult shoppers.
Using catchy advertisements, Gap Inc. has been able to generate excitement for its Old Navy, Banana Republic and Gap divisions, boosting the retailer's sales 12 percent for the month.
"Consumers are driven by two things; one is value, and also by something exciting," Davidowitz said.
The success of those sectors came at the expense of the moderately priced general merchandise and department store retailers, many struggling to find a niche.
Sales were flat at Sears, Roebuck and Co., down slightly at J. C. Penney Co. and up only 1 percent at Federated Department Stores Inc., which runs Macy's and Bloomingdale's. Sears, however, reported strong sales of washers, dryers and refrigerators.
"If you project a strong image with a strong brand, you do well," Abbenhaus said. "If you don't have a strong image, you're probably not going to do that well in today's environment."
Household-related goods and consumer electronics sold well in February, Niemira said. The footwear industry remained weak but appears to be turning around, he said, noting for instance, that comparable-store sales rose 5.5 percent at Shoe Carnival.
Analysts warned that sales will likely slow from the brisk pace set in February, the start of the fiscal year for most retailers.
"The consumer can't go on forever at this pace," Davidowitz said. "February numbers are not going to be indicative of the year or the quarter. It's not going to be bad, but there will be some slowing."
Monthly retail sales
Company February sales* February same-store pct. change
Circuit City $893.7 +12%
Dayton-Hudson $2,008 +8.3%
The Gap $548 +12%
J. C. Penney $2,220 -0.4%
Kmart $2,306 +5.8%
Kohl's Corp. $209.6 +11.2%
The Limited $633.6 +13%
May Dept. Stores $852.1 +3.7%
Sears $1,890 +0.8%
Wal-Mart $10,703 +10.8%
* In millions Note: For most retailers, this was the first month of their fiscal years.
,16,22,22 Pub Date: 3/05/99