Retail Report
Blacks Retail Report is a free monthly newsletter providing expert information and advice on the current retail market.
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Blacks Retail Report
Luxury Apparel
October 2006
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Table of Contents
The Big Picture
Although the housing market continues to stagnate, declining oil costs have led to lower consumer prices and a bump in spending. Economists are signaling concern over the core inflation rate, however, which has risen to its highest level in 10 years.
The slowing economy may stave off inflationary concerns, but it's still hard to predict how macroeconomic conditions will play out in coming months.
September Surge
What we do know is that strong fall sales hint at a cheery holiday season. The season got off to a brisk start when consumers began snapping up new fall merchandise in July and August, and September sales were stronger than they have been in years. According to Blacks exclusive data, apparel sales were up almost 19% in September.This spike is partially due to vendors' attention to providing quality product - despite the lack of new fashions - and due to our place in the current retail cycle. After two years of sluggish business, it's time for a pickup.
Some believe that consumer resistance to buying big-ticket items, such as homes and cars, has led to an increase in sales of smaller-ticket items, such as apparel, and this may be the case. The dip in oil prices and recent stock market boom may have had a positive psychological impact on buying as well.
Holiday High
At this point in the season retailers have made their purchases and are busy preparing for holiday sales. If October is as strong as September it could be a very Merry Christmas indeed. Trunk shows have not been performing as well as they have in recent seasons but this is probably because rack sales have been so strong.Concentrate on marketing for the holiday season and looking at the balance of your on-orders. You'll also want to see if there are any additional orders you need to make to fill out your holiday assortment.
In menswear, clothing has been performing well, and we saw a pop in knitwear early in the season, in both cashmere and wool classifications. Sportswear is also a strong play as men continue to build their dress-casual wardrobes.
In women's, dresses continue to sell well, along with sweaters and outerwear. Bags have stagnated somewhat, probably due to healthy sales earlier in the year and the fact that current styles are a bit too oversized. But with so much going right in the current retail market, merchants should do their best to make October a banner month.