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Tuesday, March 13, 2007

Frigid Same Store Sales for February

February was a bad one for US retail stores. Wal-Mart missed their mark prizing analyst bringing in an increase of 0.9% compared to their predictions missing their prediction of one to 2%. And compared to last year's numbers when they saw their gains of 8.1% that number was pretty chilling.

An index of 45 major retail chains as compiled by the Lazard capital markets LLC showed that crossed the border was only 1.9% increase in same-store sales compared to a 3% gain in February of last year. There are several factors that contributed to this decrease in great change. Chief among them was the extremely cold weather of February. Any retailers already put away their winter clothes replaced him with warmer spring here. So stores that heavily relied on clothing sales saw a big drop-off as they were unprepared for the type of demand that they would see or did not see.

Wal-Mart however has analysts concerned about the potential for recession. Wal-Mart doesn't relies heavily on clothing sales and the miss at Wal-Mart indicates additional problems hidden in the economy and in the area of consumer confidence, which drives spending.

Wrong Wal-Mart Move at the Wrong Time

Wal-Mart is trying to make the larger move into clothing so it to port to make this move, as spring fashions hit in the middle of a frigid February.  However, frigid temperatures and records knows cannot account for the entire mess.

Consumers snowed in chilled out are probably a big part of the problem is that many shoppers just opted to stay home warm and safe rather than go shopping. Those that did go shopping couldn't find the winter wear clothing that they were looking for.  Let's hope that the weather doesn't bring a frigid spring as well!