What the heck? January retail sales rise
The government reported this morning that nationwide retail sales for January rose 0.3 percent. Forecasters had widely predicted a decline, especially after major department stores, discounters and mall-store chains reported poor January results last week. Possible explanation No. 1: The government numbers are wrong. (Merchants have a much better idea of their results than the Commerce Department.) Possible explanation No. 2: Online sales had a good January. The retailers reporting last week get most of their sales from stores with racks of merchandise and cashiers. Maybe Amazon, which didn't report January sales, had a good post-Chistmas season.
Comments
Or the numbers could be gasoline and auto driven. Higher gas prices and surprising auto sales to consumers (thus, since the auto-makers reported abysmal sales, much, much lower sales to "fleets" by those automakers) make up all the increase. Plus, the government data for the previous two months was revised downwards. Sectors such as department stores, electronics, eating and drinking, and furniture were all down on the month. There was no underlying strength in this report.
Posted by: Mitch | February 13, 2008 1:00 PM
Gift cards are a major factor here. When a company sells a gift card it isn't making a "sale;" it is borrowing money. Only when the gift card is used (after the holidays) is it considered to be revenue.
Posted by: Dave, CPA | February 14, 2008 12:50 PM