Friday, October 12, 2007

Retail's Weather Excuses

This always amuses me, and I'll explain why in a moment.

Sales at department store retailers like Kohl's Corp., Bon-Ton Stores Inc. and Macy's Inc. did not fare as well as the discount chains in September, with weather being the main culprit for softer sales.

Same-store sales at Menomonee Falls-based Kohl's Corp. (NYSE: KSS) dropped 3.2 percent for the five-week period ended Oct. 6, while total sales rose 5.9 percent to $1.3 billion from $1.25 billion a year ago. Same-store sales is a measure of sales at stores open both years.

"September sales were affected by weak demand in weather-sensitive businesses such as long bottoms, fleece and sweaters," said Kohl's chairman and CEO Larry Montgomery.

Fresh out of college, I did a stint in retail management. Stores are held accountable for their performance, and if performance isn't up to expectations, some explaining needs to be done. Nothing wrong with that, except for the fact that we were absolutely, positively forbidden from using weather as part of our reasoning because the individual stores were expected to rise above weather influences to meet expectations. I suspect run of the mill managers in other chains are forbidden to use the 'W' word, too. Yet when retail chains go to their stockholders to explain sub par performance, weather seems to work its way into the reasoning 50% of the time.

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