Consumer Confidence Made Lovely Valentine's Day

February’s job growth was anemic—only 21,000 positions were created across the United States, according to the U.S. Department of Labor. However, cash registers rang in the most impressive February retail sales since 2000, according to a study from the New York–based International Council of Shopping Centers.

Comparable-store sales grew 6.7 percent from sales in February 2003, the biggest increase since April 2000, when comp sales climbed 7.9 percent, said the ICSC economists. ICSC credited the increase to warmer weather and to Valentine’s Day falling on a Saturday. Other economists said retail sales have been on the upswing since the holidays because American consumers are feeling a lot better since the hard times of 2003.

The February 2004 survey from The Index of Consumer Sentiment, administered by the University of Michigan, said consumer confidence was at 94.4, well above the 79.9 recorded a year ago. Richard Curtin, director of the University of Michigan’s Surveys of Consumers, said this confidence should support overall consumer spending growth of about 3.5 percent during the year ahead.

Consumer confidence translated into double-digit increases for many specialty stores. Chico’s FAS Inc., based in Fort Myers, Fla., enjoyed a comp-store sales increase of 28 percent. Brisbane, Calif.–based Bebe Stores Inc. showed a 24.2 percent increase in same-store sales.

Meanwhile, Foothill Ranch, Calif.–based The Wet Seal Inc. showed a decline—a 12.5 percent drop in same-store sales compared with February 2003. Wet Seal Chief Executive Officer Peter D. Whitford conceded the company has a tough road ahead. However, he said he believes his troubled company has been headed in the right direction, judging from the continued good performance at the retailer’s Arden B. division and an early customer embrace of new Spring merchandise at Wet Seal.

Department stores have continued to rebound this year—they are up 5.4 percent, according to the ICSC. The Neiman Marcus Group Inc. showed stellar comparable-store growth of 24.9 percent in February. The Dallas-based retailer reported particular success with women’s fine apparel and contemporary sportswear.

Off-pricer Ross Stores Inc. reported flat same-store sales, which Michael Balmuth, vice chairman and chief executive officer of the Newark, Calif.–based retailer, blamed on inventory issues. Ross’ distribution center in Fort Mill, S.C., was closed for six days and the company’s Perris, Calif., center, built in late 2003, was still in “ramp-up mode,” Balmuth said. He said he expected inventory problems will be solved to ensure healthy March sales. —Andrew Asch