Blacks Retail Report

Luxury Apparel
March 2007

Table of Contents

The Big Picture
Back To Busines
Fall Strategy
Blacks Bottom Line

The Big Picture

The Federal Reserve recently announced that it was keeping interest rates steady at 5.25 percent, citing continued concern over inflationary pressures. The board predicted moderate economic expansion over the next few quarters, noting that the economy is "mixed" and the housing market is still adjusting.

For retailers, March was off to a slow start, partially due to decent selling in January and February. With their closets already stocked, shoppers are waiting for brighter weather before they start picking up spring goods. Business has also been affected by severe weather patterns in parts of the country, and jitters caused by the stock market plunge in late February.

Back To Business

With the fashion shows over and fall buying almost done, retailers are back in their shops and focused on spring business. At this point in the season, merchants should be taking a look at their remaining on-orders to determine if they still need those goods, or if they can cut deals with vendors. Most of the product is in and the shipping door will be closing on March 30th.

For men, early seasonal frontrunners include jackets, sports coats and hybrid pants. Once trunk show season kicks into high gear we will have a better idea of how suit trends are developing. So far, early suit sales have been strongest at the upper end.

In women's wear, we're seeing early sales in the collection business as well as in contemporary classifications. Jackets are doing particularly well, with merchants reporting double-digit growth.

As we forecasted earlier, dresses are producing brisk sales. We haven't seen much of a refresh in the accessories business, however, as shoes and handbags continue to stagnate.

One of the issues with shoes is that the spring lines are filled with short dresses requiring high heels. On the East Coast in particular, the weather hasn't gotten warm enough for ladies to switch from boots to heels. We expect to see a pickup in the shoe business as we head into warmer weather. That said, ballet flats are still a big hit and will continue to be bought well into fall.

Fall Strategy

Speaking of fall, remember that last year sales were strongest in the early part of the season. Consumers with money would rather buy new, full-priced merchandise than hash through seasonal leftovers. Plan your early fall deliveries appropriately.

Blacks Bottom Line

This season’s profits will depend on how you manage your spring on-order balance.

Retail Report