Gas Prices Hurt Back-to-School Sales
DETROIT -- U.S. retailers including Wal-Mart Stores Inc. and Target Corp., the two largest discount chains, face slower-than-expected sales gains during the back-to-school season as rising gasoline prices erode shoppers' budgets, reported the Detroit Free Press.
The International Council of Shopping Centers, which represents mall owners, reduced its estimate for August this week after Wal-Mart cut its forecast for sales at stores open at least a year. Sales growth is probably slowing to as little as 2.5 percent, down from as much as 4 percent at the start of the month, said the group's chief economist, Michael Niemira.
Discounters such as Wal-Mart are more at risk because lower-income shoppers tend to curb spending the most as the price of gas rises, he said. Sales began slowing during the last two months with gas prices 26 percent higher in July and retailers facing tougher comparisons to the same period a year earlier, when consumers were flush with money from tax credits.
The International Council of Shopping Centers, which represents mall owners, reduced its estimate for August this week after Wal-Mart cut its forecast for sales at stores open at least a year. Sales growth is probably slowing to as little as 2.5 percent, down from as much as 4 percent at the start of the month, said the group's chief economist, Michael Niemira.
Discounters such as Wal-Mart are more at risk because lower-income shoppers tend to curb spending the most as the price of gas rises, he said. Sales began slowing during the last two months with gas prices 26 percent higher in July and retailers facing tougher comparisons to the same period a year earlier, when consumers were flush with money from tax credits.