Clothing store sales drop

25 Feb '08

3 min read

Retail sales rose by 0.6% in December to an estimated $35.1 billion on the strength of sales by new car dealers. This was the third increase in retail sales in four months and helped make 2007 the year with the second highest retail growth rate since 2002.

In 2007, retailers sold an estimated $412.2 billion worth of goods and services, up 5.8% over 2006.

Sales in the automotive sector (+3.2%) accounted for most of the December increase in sales. Excluding two of this sector's components, new car dealers and used and recreational motor vehicles and parts dealers, retail sales fell 0.4% in December, the first decrease in five months.

Holiday sales started hot off the mark in November, but lost steam rather quickly, leaving traditional Christmas retailers with rather disappointing sales in December, including clothing and accessory stores (-2.7%), miscellaneous retailers (-1.2%), furniture, home furnishings (-1.1%).

After November posted the biggest jump in monthly sales since early 2007, general merchandise stores (+0.5%) faced only moderate growth in December. Sales at personal care stores (+0.1%) continued to stagnate as in the previous two months.

When price changes are taken into account, retail sales in constant dollars rose 0.5% in December.

In the fourth quarter of 2007, retailers posted a 1.2% increase in sales, mainly due to a 2.9% hike in sales in the automotive sector. This more than offset the 0.3% decline in the third quarter of 2007, which followed increases above 2.0% in the first two quarters of 2007.

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