Apparel Retail Sales Underperform Industry in October

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Traditional apparel retailers continued to turn in lackluster sales growth in October.

According to the U.S. Census Bureau’s advance monthly report released last week, total retail sales, which include gasoline, groceries and automobiles, were $465.9 billion last month—an impressive 4.3% increase over October 2015’s $446.7 billion. On a 12-month smoothed basis, sales rose 5.4%.

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Automobile sales were a key driver, so to speak. Sales at automobile dealers and parts stores increased 8.4% on a smoothed basis, to $96.8 billion.

Traditional apparel channels failed to participate in the uptick, however. Although clothing and accessories store sales edged ahead by 2.3% to $21.6 billion, those at department, chain and discount stores fell by a dramatic 7.3% to $12.7 billion, bringing down the collective channel total, a reliable barometer of apparel retail sales, by 1.5% to $34.2 billion from $34.7 billion a year ago. Unseasonably warm weather in key parts of the country and unease over the polarizing election season shared part of the blame.

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Non-store retail sales, most of which is e-commerce, rose a staggering 12.9% over the same month last year, to $48.2 billion. Though growth has slowed in the sector in the past few months, most industry pundits expect e-commerce to continue to grab share from brick-and-mortar.

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The National Retail Federation expects 2016 Holiday sales to rise 3.6% to $655.8 billion, which could be encouraging news for apparel retailers, whose November and December sales typically represent between 21 percent and 24 percent of their annual business.

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