Sunday, November 11, 2012

The end of monthly same-store sales?

Target logo
Each month, many retailers report same-store sales, which reveal the sales at stores open at least a year. The idea behind these statistics, according to Thomson Reuters (one of the compilers of the data), is "to examine underlying growth trends at a retailer, since it excludes store openings and closings. It also allows comparisons between retail chains that are aggressively expanding and those expanding at a slower pace."

In the last couple months, however, two notable retailers have decided to stop reporting monthly same-store sales:  Target and Kohl's. Both have decided to move to reporting quarterly same-store sales. They are in good company; Walmart doesn't report monthly same-store sales either.

In Target's case, the retailer said that reporting same-store sales quarterly "will create a longer-term focus and provide greater understanding of our sales results in the context of our overall financial performance."

Kohl's said that it will switch to reporting sales results quarterly "to align with the wishes of its investors and the practice of the majority of its retail peers."

Having worked seven years in the public relations department of a major retailer, I understand why it makes more sense for retailers to switch to reporting same-store sales on a quarterly basis. Each month, management at my retailer had to determine why the same-store sales changed. Sometimes it was because Easter had shifted a week. Other times it was because of El Niño or La Niña. Hopefully reporting same-store sales on a quarterly basis will be able to provide a truer comparison.

So, who does that leave as retailers reporting monthly same-store sales? Here's the list:
  1. The Buckle
  2. The Gap
  3. The Limited
  4. Ross Stores
  5. TJX Cos.
  6. Bon-Ton
  7. Costco
  8. Fred's
  9. Macy's Inc.
  10. Stage Stores
  11. SteinMart
  12. JW Nordstrom
  13. Cato Corp
  14. Wet Seal
  15. Zumiez
  16. Walgreen
  17. Rite Aid
While there are significant retailers on this list, there are many noteworthy ones not reporting as well. Take that into account when reading the headlines about monthly same-store sales. Perhaps eventually it just might shift to quarterly same-store sales altogether.
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