Warm weather = bargains in department stores

I was listening to business news on National Public Radio today and among other things they were talking about how warm weather negatively affects sales at department stores and profits of the businesses behind. From Associated Press:

Several of the nation’s largest retailers cut their earnings forecasts Thursday after lingering summer weather and an uncertain economy kept consumers from shopping last month and left the big merchants with disappointing sales.

Not that I feel sorry for the likes of Wal-Mart, Target, and J.C. Penney, but there was an interesting bit that really caught my attention. Nordstrom reported that “larger than planned markdowns used to clear excess inventory will hurt profits for the remainder of the year” (emphasis mine).

The logic is very simple. Businesses stock up seasonal merchandise anticipating a certain level of sales. Warm weather along with gas prices and credit crunch keeps consumers home forcing companies to mark down prices in an attempt to clear inventory of coats and sweaters. Guess who wins? It is us, bargain hunters!

Now I have an explanation to the fact that my wife comes home lately with stuff for kids that she literally buys for pennies.

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2 Responses to “Warm weather = bargains in department stores”

  1. 1 Yan Oct 12th, 2007 at 11:58 pm

    By the way, here is another interesting correlation, Gas Prices up Obesity Down. :-)

  2. 2 Yan Oct 16th, 2007 at 5:03 pm

    Oldnavy apparently have a sale going right now. Here is a discussion at SD:

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