Core Store Sales Better than Expected in May
ActionWatch’s preliminary numbers for May tell an interesting tale.
Overall, the retailers on the panel showed combined sales down 5% compared to May 2019.
That was a better result than expected considering some stores on the panel were closed the whole month and some were open only part of the month.
“It’s way beyond what I expected,” Patrik Schmidle of ActionWatch said. “I thought we’d be down a good 50%, especially after April numbers were so dismal.”
He noted that the numbers are preliminary and could be adjusted when the final results are calculated.
Online sales helped boost the May result because the retailers that offer online sales saw a significant increase in demand. If the online channel was excluded, sales declined 15%.
Stores located in states that opened sooner, for example Texas and Florida, bounced back sooner.
In California, results depended on location. Those retailers further south, closer to the beach, and that focus on hardgoods tended to do the best.
The ActionWatch data confirms what SES has been hearing from many industry retailers, several of whom previously told us sales have bounced back more strongly than expected.
We have even heard from a few retailers that they had the best May in the history of their stores despite being closed several days in the month.
Hardgoods continues to be the hottest category. For the approximately 80 doors that are on ActionWatch’s Project United platform, which gives brands access to their own sales at individual retailers, hardgoods sales during May 2020 were up more than 50% compared to the same month last year, including skate, surf, body and skimboards. Wetsuit sales were almost back to May 2019 levels.
However, footwear, apparel and accessories sales have not yet rebounded to the same degree, Patrik said. Those three segments combined declined approximately 30% in May 2020.
“That’s not great, but much improved compared to the more than 90% decline in April,” he said.
Within accessories, jewelry, containers (hydration bottles) and sunglasses declined the least, while watches, socks, underwear and belts declined the most.
Patrik is optimistic the positive trends can continue and sees two major factors contributing to the rebound in core stores.
First, there is a clear trend with people becoming more active and getting outdoors. Second, people have realized they can’t take local retailers for granted and are supporting them. The company that owns ActionWatch, Sports Marketing Surveys, is seeing the same trend for specialty tennis, running and golf shops.
Both of those developments are likely to bode well for industry surf and skate shops in June.
“If the weather holds up and we have decent surf, I bet that we will see positive year-over-year growth for June,” Patrik said. “People are likely going to be surfing, skateboarding, skimboarding, paddle boarding and boogie boarding, and will buy the equipment necessary to engage in those activities, assuming they can still afford to.”