December retail sales: Were expectations too high?

Most of the post-mortems on December comp sales — after sales reports were released on Thursday the 6th — noted that the numbers came in lower than expected. And there were a couple of legitimate disappointments in the numbers; both Target and Gap delivered significantly lower sales results than their November results would lead observers to believe. But the overall comp gains of about 3.5% would have had most of us feeling pretty bullish based on the pessimistic climate six months ago.

Historically, it’s hard to deliver big back-to-back sales increases in both November and December, and there is little doubt that stores were promoting hard to capture market share before Thanksgiving instead of waiting for Black Friday. Add the effects of the post-Christmas blizzard on a wide swath of the East Coast, and the numbers really aren’t a negative surprise. Let’s wait and see what the full 4th quarter looks like — and what quater-end inventories — before jumping to too many conclusions.

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