Although retailers have continued to display dismal year-over-year same-store-sales growth rates , week-over-week reports provided some hopes that things were not getting worst.
Source: The International Council of Shopping Centers and Goldman Sachs Retail Chain Store Sales Index
I am not sure sales will hold in March:
ChangeWave’s February survey results point to yet another leg down in U.S. consumer spending going forward. Consumer sentiment has also taken a big hit, as 2-in-3 respondents said they now believe the overall direction of the U.S. economy is going to worsen during the next 90 days.
The ChangeWave survey of 2,701 U.S. consumers was conducted Feb. 2-9.
Grim Spending Outlook
While our January consumer survey contained intriguing signs of a leveling off in the rate of spending decline, the February results show a reversal and represent the worst spending outlook ever recorded in a ChangeWave survey.
Sixty-one percent of U.S. respondents said they’ll spend less money during the next 90 days — four points worse than our early January survey.![]()
Just 12% said they’ll spend more money — one point worse than previously.
A key concern for the immediate economic outlook is that Americans decide to substantially and quickly increase their savings.
(…)For the sixth consecutive survey since July, saving more money (up one point to 42%) has risen as a key concern and is now one of the top reasons why consumers said they are spending less. Reducing debt (down one point to 35%) also remains a top reason.(…)
Where Is Spending Slowing Most?
New record lows for a ChangeWave survey have been recorded in consumer electronics spending and restaurant spending. Durable goods for the home have also taken a big hit. Interestingly, for the second survey in a row, we’ve picked up stabilization in household repairs/improvements spending. One explanation for this may be that some consumers made home improvements their New Year’s resolution.
It seems Costco and Wal-Mart sales are slowing, which, if confirmed, would mean that the slowdown is spreading to discounters which have performed relatively better so far. The chart below reads from left to right as from high-end retailers to discounters.
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Retail Store Trends
Our latest survey results show the United States has hit the point in the recessionary cycle where even the mightiest of retailers are being brought to their knees.
Case in point: Costco (COST), which has already experienced a significant drop in its growth rate in recent months. Nonetheless, the plunge during the past month (-5) appears particularly unnerving, and is the biggest downward move we’ve seen so far for Costco.
Wal-Mart (WMT) has performed admirably during most of this same time period, but it too appears to be hitting a wall going forward. Only 13% of consumers said they’ll spend more at Wal-Mart, while 11% said less, which is a four-point plunge since January.
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Not surprisingly, the greatest weakness going forward is among traditional retailers — led by Macy’s (M) (-13) and Sears (SHLD) (-13).Target (TGT) (-10) has also taken a huge hit in recent weeks, falling three points.
Home Entertainment Shopping
On the home entertainment front, even as Circuit City (CCTYQ) (down four points to 3%) sells off its remaining inventory, Best Buy (BBY)(unchanged with 38%) continues to show few signs of any windfall from the shutdown of its rival. Its market share remains significantly below that of a year ago (-7).
Apple (AAPL) (down two points to 9%) and Target (down two points to 6%) have also experienced declines since January in the home entertainment market.
Amazon.com (AMZN) (25%), however, continues to hold its own, up one point from previously.
Tough Times
Our February survey results show an overall spending environment that remains fiercely negative, as the tiny signs of stabilization we saw last month proved short-lived.
Economically speaking, the honeymoon period for the new U.S. administration appears to be over. Not only are further spending declines in store for the next 90 days, but consumer confidence and expectations for the future have worsened considerably.
After 13 months of recession, U.S. consumer spending is still trending downward.


