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U.S. Jewelry & Watch Sales -1%
Retail Sales of Jewelry Remain 2% Ahead in 2014
Nov 28, 2014 10:49 AM
By Jeff Miller
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RAPAPORT...
U.S. jewelry and watch sales combined fell 0.6 percent year on year to $5.461 billion in October, according to preliminary estimates by Rapaport News. While the data is subject to several revisions, it currently marks the first monthly drop in sales since April 2012. In addition, comparisons were difficult this year given that U.S. jewelry and watch sales surged 8.3 percent in October 2013.
Nonetheless, the jewelry and watch sector began to show some weakness in September when combined sales rose just 1 percent following four consecutive monthly increases of 3 percent or more. That weakness was also observed at specialty jewelry stores in September, which are measured separately and rose only 1.2 percent to $2.244 billion, compared with a solid 4 percent rate of growth so far this year.
Jewelry sales from all retail channels fell 0.5 percent year on year to $4.806 billion in October, according to Rapaport News.
Even with the slight hiccup, jewelry sales for the first 10 months of the year have risen about 2 percent year on year to $49.7 billion.
Meanwhile, watch sales growth, which has experienced more volatility than jewelry, declined 1.5 percent in October to $655 million. Watch sales were flat in September after rising roughly between 4 percent and 5 percent during the previous four months. Sales of watches from all retail channels for the first 10 months of 2014 have risen about 2.6 percent year on year to $6.8 billion.
Overall, analysts at Sterne Agee stated that October's retail sales, while an improvement from September, fell far from being robust, especially as
significant decreases for energy prices eased consumer pain at the pump.
"Against the backdrop of three consecutive months of aggressive energy price reprieve, anything less than a 1 percent bounce
in October retail sales highlights just how fragile the U.S. economy remains, particularly the consumer sector, against the backdrop of
nonexistent wage pressures," wrote Lindsey Piegza, the chief economist at Sterne Agee.
Stores were also battling each other for a share of foot traffic; however, they failed to attract additional consumers, noted Ike Boruchow, the specialty retail analyst at Sterne Agee.
In addition, promotional activity and the level of markdowns increased in October, but the exceptions were at Signet Jewellers Ltd. and Coach Ltd. "Our store work suggests that traffic decelerated further in October, following a weaker than expected September," Boruchow stated. "We'd note that several retailers have already guided down third-quarter over the past few weeks, including JCPenney and Kohl's, as unfavorable weather (way too warm for this time of year) and new must have items (i.e. iPhone 6) keep consumer spending on apparel/accessories fairly muted," he wrote in a note to clients.
In other major jewelry-consuming economies, retail sales surged 11.5 percent in China during October, while they jumped 4.3 percent in the U.K., helped by the largest drop in prices since 2002.
Germany's retail sales in October rose 1.7 percent year on year, which was better than expected and a complete reversal from dismal retail sales figures in September.
Consumers in France, however, held their wallets tight in October as retail spending fell 0.2 percent year on year.
Japan's retail sales improved 1.4 percent but growth was more subdued at the nation's large-scale retailers were revenue rose only 1 percent in October.
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Tags:
analysis, Consumer Spending, Jeff Miller, Jewelry, october, retail sales, watches
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