Labor Day Sales Focus on Apparel
By Doug Desjardins
With a few rare exceptions, retail sales were down in nearly every retail channel and product category this summer as the recession and rising unemployment tempered spending among wary consumers. That was more bad news for retailers but good news for consumers looking for bargains during annual Labor Day summer clearance sales.
According to the International Council of Shopping Centers (ICSC), overall retail sales slumped 5% in July and were down again in August with an estimated 3.5% decline for the month. What that means is most retailers - even those prepared for a lousy summer - are going to have leftover inventory that will have to be sold off fast to clear the way for fall product, a seasonal turnover that will be even more pronounced this year.
For bargain-hunting consumers, deals on clothing are likely to be the best ones to look for this Labor Day. Weak sales weren't unique to apparel retailers this summer, but they seemed to have taken the worst of it. Department store sales were down 6.9% on average in August and sales at Sears were down 13%, signs that shoppers continue to migrate to lower-priced retailers to shop for clothes and other items that typically drive sales in the department store channel. And the ICSC reported that sales at retailers specializing in teen and children's apparel slumped 9.5% in August.
So it's no surprise to see retailers in every channel blowing out inventory in Labor Day clearance sales. Kmart, which reported a 3.9% drop in August sales, is offering discounts of up to 80% on apparel during a limited with a focus on women's tops, slacks and tanks starting at $4.99. Most of the inventory is priced in the $4.99 to $14.99 range and Kmart is discounting fall apparel from Basic Editions as well. Sears is looking to clear out its inventory for Labor Day with up to 85% off women's and men's summer apparel and 50% off on all plus-size women's apparel in stores and online.
As more shoppers continue to scour the Internet for coupons, many retailers and suppliers are promoting sales with online coupons. Eddie Bauer is cutting prices by up to 70% for its summer clearance sale and there are Old Navy coupons good for a 20% off sale on all of its apparel.
The Children's Place, a specialty retailer for children's clothing, is cutting prices up to 91% on some products as it clears the aisles after a sub-par summer when sales slumped 6.6% for the quarter that ended Aug. 1. Even discount apparel retailer Stage Stores is cutting prices up to 85% for its Labor Day clearance sale after reporting an 11% decline in same store sales for the quarter that ended Aug. 1.