No, consumers did not suddenly return to the mall. That was just a media joke. They shopped online more than ever. Sales at department stores fell.
By Wolf Richter for WOLF STREET.
The retail sales data, reported today by the Census Bureau, is based on surveys of about 5,500 retail businesses in the US, which their Sales were. The measure is designed to track how well retailers are doing for retail categoryand we’ll get into those categories in a moment.
Other measure tracks consumer spending, based on consumer surveys. It is reported separately and comes in a version adjusted for inflation. But not today (here’s “real” consumer spending for June).
Retail sales track sales of goods, not services, and make up only part of what consumers spend their money on, and about two-thirds of consumer spending is for services, and spending has been back on services throughout year.
These are important distinctions between retail sales Y consumer spending. I mention this here because it always filters through our illustrious comments section below the article.
The retail sales data is designed to look at the health of retailers by retail category, not the health of consumers, although we can draw some inferences from those retail sales about consumers.
Retail inflation = price increases. But where?
CPI inflation in July was 8.5% compared to July last year. Compared to June, the CPI remained flat. But this varied widely by product category. The CPI for services is rising steadily, but it doesn’t figure in retail sales because retailers sell goods.
The CPI for gasoline: -7.7% in July from June; if gas stations sold the same volume in gallons in July as they did in June, their retail gasoline sales in dollars would have plummeted 7.7% since June. But they didn’t: they fell just 1.8%, as we’ll see in a moment.
The CPI for “food delivery”: +1.3% in July from June. Which means that if consumers bought the same amount of food and didn’t switch to cheaper products, grocery store sales could increase 1.3% for the month. But they didn’t. They were up just 0.2%, as we’ll see in a moment.
The CPI for durable goods: +0.3% in July from June and, after falling in the previous months, remained stable with February. The spike in durable goods prices occurred in 2021 and has now largely subsided as inflation has shifted into services. Retailers selling durable goods (not food or gasoline) saw relatively minor price increases, if any, in July.
Retail sales in July, at $683 million (seasonally adjusted), were unchanged from June but were up 10.3% from July last year and 31.6% from July 2019, according to the Census Bureau This day.
But gasoline prices plummeted, depressing dollar sales from gas stations; and new vehicle dealers had woefully low inventory (over 70% less than 2019, in number of new vehicles), hurting their sales. So, excluding gasoline and auto dealers, retail sales rose 0.7% in July from June.
Total Retail Sales:
Retail sales minus sales at gas stations and car dealerships:
Sales by retail category.
Sales at new and used vehicles and parts dealers it fell 1.6% in July from June, to $125 billion, seasonally adjusted. Compared to July a year ago, sales were still up 2.1%, and compared to July three years ago, sales were up 21%. This is the largest category of retail sales.
Sales in e-commerce and other “non-store retailers” rose 2.7% in July from June to a new high of $111 billion, seasonally adjusted, up 20% year-over-year and up 73% from July 2019, as consumers did not suddenly and inexplicably return downtown commercial, despite stupid media hype to the contrary. Check out department store sales below to see how it worked for them.
This includes sales from pure e-commerce retailers and e-commerce operations from traditional retailers, along with stall and market sales:
Food and beverage stores: Sales increased 0.2% in the month to $79 billion, up 9.2% year over year and 22% over three years:
Food services and places to drink: Sales in bars, restaurants, cafes, coffee shops, etc. they rose 0.1% over the month to a record $86 billion, up 11.6% year over year and up 32% over three years.
General merchandise stores: Sales fell 0.7% in the month to $56 billion, rising just 0.9% since last year’s miracle stimulus, and 15% in three years. Walmart and Target are in this category, but not the department stores:
Gas stations: Prices plunged in July, and yet sales fell just 1.8% from June, seasonally adjusted, to $67 billion, the second highest on record, behind June. This is up 40% from a year ago and 57% from three years ago, fueled by rising prices that have now subsided somewhat:
Building Materials, Garden Supplies and Equipment Stores: Sales increased 1.5% to $43 billion, seasonally adjusted, up 10% year over year and up 37% in three years:
Clothing and accessories stores: Sales were down 0.6% in the month to $26 billion, up 2% year-over-year and up 15% in three years.
Miscellaneous store retailers (includes cannabis stores): Sales were up 1.5% in the month, 18% year over year and 50% over three years, to $16 billion. This category tracks specialty stores like arts supply stores, brewing supply stores, etc., and cannabis stores, which are the hottest trend in traditional retail:
Furniture and home goods stores: Sales increased 0.2% in the month to $12 billion, up 2% year over year and 20% over three years:
Department store: sales fell 0.5% in the month, down 1.4% year-over-year and 3.3% in three years, to $11 billion. Compared to the peak in 2000, sales fell 44% as thousands of stores disappeared amid an endless series of bankruptcies and liquidations as Americans turned to buying their department store items online:
Sporting Goods, Hobby, Book and Music Stores: Sales increased 0.1% in the month to $9.2 billion, up 4% year over year and 38% over three years:
Electronics and appliance stores: Sales increased 0.4% in the month to $7.6 billion, down 10% year-over-year and down 1% in three years.
This category of retail stores covers only specialty electronics and appliance stores, such as Best Buy brick-and-mortar stores or Apple brick-and-mortar stores. Does not cover other retailers that sell electronics and appliances, such as Walmart, and does not cover e-commerce sales of electronics and appliances:
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