US Apparel Retailers Surprised By Better Than Expected Sales

0
164

In recent days, as apparel stores reopened, several retailers have witnessed surges in online sales, and in some cases better-than-expected results from reopened stores. That mostly means that expectations were low, as consumers remain somewhat wary of shopping in stores. Macy’s said reopened locations “are performing better than anticipated,” and that meant on average they’ve brought in about 50% of their usual sales, across various geographies and store types.

American Eagle Outfitters CEO Jay Schottenstein in a statement last week said he was “very pleased to see stores reopening strong,” setting up its namesake and Aerie lingerie brands well for the back-to-school and fall seasons. Abercrombie & Fitch Co. last month said that sales productivity at reopened US stores is at 80%. With stores closed for much of the period, retailers scrambled to boost online sales by offering curbside pick-up and store-based fulfillment, and almost all reported increases.

Also Read  Arvind Fashions, Gap Part Ways After Six Years

Chico’s said first quarter digital sales exceeded the same period last year, with a double-digit increase in April, while overall net sales fell 45.9%. Urban Outfitters, where retail sales decreased 28% and wholesale decreased 74%, saw “low double-digit growth in the digital channel.” Abercrombie & Fitch Co. said overall sales fell 34% but rose 25% in e-commerce. Nordstrom said first quarter e-commerce rose 5% to US$ 1.1 billion, with new online customer growth of more than 50%.

There were some exceptions. Victoria’s Secret last month said first quarter digital sales fell 15% to US$ 307.6 million, partially driven by a six-day closure of the website. In April, with the site up and stores closed, e-commerce rose 30%.

Also Read  UK Blocks Merger Of JD Sports And Footasylum

At Gap Inc. overall net sales fell 43% and e-commerce rose 13% overall, and, at Old Navy, store sales fell 60% and online sales rose 20%. The brand’s online traffic was down from last year, although its site conversion rate was 10% in April, which led to 26% more transactions year over year, according to a report from SimilarWeb. But namesake Gap store sales fell 64% and online sales were also down 5%, and Banana Republic store sales fell 61% while online sales fell 2%. E-commerce volumes couldn’t make up for the massive downturn in sales, but their other downside is added costs. Urban Outfitters, for example, noted that its delivery expense in the quarter “increased primarily due to the increase in penetration of the digital channel, lower average order value and an increase in split shipments.”

Also Read  India Can Improve Its Ranking In Trouser Exports

In general, gross margins plummeted in the pandemic period. Chico’s gross margin was underwater by US$ 11.1 million or negative 4% of net sales, compared to US$ 190.8 million, or 36.9% of net sales last year. American Eagle’s gross margin rate was 5.1% in the quarter, from 36.7% last year.

LEAVE A REPLY

Please enter your comment!
Please enter your name here