Evening star., 1941-01-26
Retail Declines
To Be Smaller
Than Usual
SoIes Expected to Hold
5 to 10 Per Cent
Above Year Ago
Special Dispatch to The Star.


NEW YORK, Jan 25-The sea-
Sonal decline in retail sales which
normally follows the high levels of
the holiday period is expected to be
smaller than usual during early 1941
according to the Standard Statistics
Co. since increasing employment
and national income should provide
the basis for continued good sales
gains on year-to-year basis.
For the first half of l94l. retail
trade as a whole is expected to run
5 to 10 per cent ahead of 1910. and
some lines of trade may do even
better
Retail trade is now entering the
slack midWinter season, when sales
normally tall to relatively unprofit-
able levels before the recovery
which usually gets under way shortly
before Easter. There are various
factors, however, which suggest that
this pattern may be modified this
year and that the drop in retail
trade during the first several months
OF 1871 will not be so great as the
1lVL mai StdSoIIdl experience.
Inventories Reduced.
MarkdOWnS for clearance sales
may be less than average in view of
the depletion in store inventories
caused by the exceptionally high
level of holiday business and this
Will bolster dollar sales. Moreover.
tie later Easter April 13. compared
with March "a in l940D should be a
beneficial sales influence, since the
early Easter and unreasonable
weather restricted sales last year.
OF far greater significance than
these purely trade factors will be the
stimulus 10 retail buying which
should continue from the huge Gov
ernment spending for national de-
fcnSe.
With the peak of industrial pro-
ductiOn under the defense program
Yet TO be reached. further increases
In employment and consumer buy
ing power should be witnessed as
1871 progresses. and this in turn.
will be- reflected in additional I'M
provemen, in retail trade. Some
what higher retail prices also should
nelp to increase dollar sales.
Most lines OF retail trade eniOyed
a better than normal seasonal gain
in sales in the closing months of
t940. with dollar sales during the
Christmas period reaching the best
level since 1929. In fact. when it
Is CONSIDERED that retail prices were
we'll unCer 1929. actual physical
volumes probably established a new
all-time high. exceeding the previ-
GUS 1929 record.
Climb Reviewed.
Department store sales. after az
eraglng % on the Federal Reserve
Board Seasonally adjusted index in
the first 10 months. rose to an aver
age OF about 10l in November and
December, or 8.5 per cent above
year earlier. Full year sales were I'D
about 5 per cent.
Based on present indications. de-
partment store dollar sales for the
first quarter of l94l should average
about per cent higher than a year
earlier. but because of lower prices
they will remain below the 1929
level. They should be the best since
early 1881, however.
Sales Of the mail order and gen.
eral merchandise chains have con-
tinued to record better than aver
age increases as result of larger
farm buying power. expanded store
systems and effective merchandising
policies. Sales of the two leading
companies increased IL per cent to
a new record in the IL months
through December Rural sales in
the first II months of 1910 were
ABOUT per cent higher than a
year before, with a gain of some l3
per cent being shown in November
With farm income holding up well
ana the store chains beneftting
from larger industrial pay rolls,
sales of the mail order and general
chains should continue to record
new peaks for some months ahead
Grocery Gains Cut.
Grocery chains have participated
to a satisfactory extent in the rise
in 1910 trade, although gains in re-
cent months have been smaller
than earlier in 1910. The average
increase in sales in October and
November was 7 per cent. whereas
the gain in the first nine months
was nearly II per cent. For the IL
months the increase amounted to
10 per cent.
AS food prices in this period av-
eraged only 1,3 per cent above 1899
and total unit food volume is nor
mally quite stable, this sales expe-
rlence indicates that the larger
chains have improved their position
IN the trade. Increased consumer
incomes and further diversion of
business from Independents. COM
blned with possible modest price in
creases. should result in further
fairly good sales gains in coming
months, although they promise to
be less than the 13 per cent rise
scored in the 1910 first quarter.
Larger purchasing power among
the lower income groups, particu-
larly as employment increased, has
continued to hold variety store
sales moderately above year-earlier
levels. Sales for December were up
about per cent, while the rise for
the II months was per cent. Fur
ther gains will probably be moderate,
since the tendency of consumers to
adopt more liberal buying policies
as incomes expand will tend to limit
sales potentialities in the ow-priced
goods field.