For crippled retailers like Best Buy Co. Inc. (NYSE: BBY) and Macy’s Inc. (NYSE: M), a 3% rise in holiday sales would have been a blessing. The 3% level was the industry average for November and December combined, to $626 billion, according to the National Retail Federation (NRF).
The NRF tried to put a positive spin on the data:
“Make no mistake about it, this was a tough holiday season for the industry. Weather, inventory challenges, advances in consumer technology and the deep discounts that started earlier in the season and that have carried into January presented stiff headwinds as retailers competed with one another and their own bottom line,” said NRF President and CEO Matthew Shay. “Despite these factors, the industry rallied, consumers responded and sales still grew at a healthy rate, which is a huge testament to the resilience, knowledge and expertise of our retail leadership.”
In reality, many of the brick-and-mortar retailers had sales that were off from the same period last year. A look ahead means some of these will need to close stores and lay off workers, a process Macy’s already has begun. The department store also painted its decision as the road to a better future:
“In light of our disappointing 2015 sales and earnings performance, we are making adjustments to become more efficient and productive in our operations. Moreover, we believe we can operate more effectively with an organization that is flatter and more agile so we can pursue growth and regain market share in our core Macy’s and Bloomingdale’s omnichannel businesses faster and with more intensity. We will continue to invest in strategic initiatives that anticipate emerging customer needs and create shareholder value,” said Terry J. Lundgren, chairman and chief executive officer of Macy’s, Inc.
Amazon was left out of the NRF and Macy’s discussions.
Despite a harsh holiday season, the industry cannot help itself as it continues to whistle past the graveyard.
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