Retailers suffer week from hell

Retail’s hell week ended with a collective thud on Friday.

At least half a dozen of the county’s largest retailers, including Macy’s, Nordstrom and JCPenney, saw their shares pummeled by investors after they reported disappointing results in the first quarter.

Shoppers were just not spending money at malls, it turned out.

Across the board, the retail chief executives told investors this week that fewer customers had shopped in their stores, leaving them with too much inventory and a growing sense of desperation.

“We are not counting on the consumer to spend more, so we are working harder to give customers more reasons to buy from us by delivering outstanding style, quality and value,” Macy’s CEO Terry Lundgren told investors when it reported same-store sales slipped 6 percent in the three-month period which ended April 30.

JCPenney, which trimmed employees’ hours in the final weeks of April, reported that its same-store sales slipped 0.4 percent — its first decline in 10 quarters.

The chain unveiled a new strategy in hopes of wooing back shoppers: selling appliances and relying less on apparel.

Macy’s, in light of an overall revenue drop of 7.4 percent, lowered its guidance for the year. Its shares were off 15 percent for the week.

Meanwhile, luxury department store Nordstrom saw same-store sales sink 7.7 percent in the quarter.

Gap, which has struggled mightily for years, reported a horrid quarter, with same- store sales company-wide decreasing 5 percent. Its Banana Republic nameplate experienced an 11 percent drop.

Industry experts, meanwhile, say the signposts for these results have been apparent for a while.

“This is the new normal, except that it’s not really that new,” said Nomura analyst Simeon Siegel. “At the end of the day, e-commerce has changed the rules of the game, and it’s going to take a long time for the retailers to adapt.”

The Commerce Department report showed that consumer spending was up 1.3 percent in April, the biggest gain in a year. More telling was that internet and mail-order sales increased more, by 2.1 percent.

As consumers increasingly turn to their mobile devices for their shopping needs, abandoning malls and shopping centers along the way, a paradigm shift is occurring.

“Having a lot of stores used to be a competitive advantage,” Siegel, said, adding that now it’s a formula for “too big to succeed.”

Department stores control just 1.7 percent of retail spending today, compared with 10 percent in 1985.

The number of bankruptcy filings in just the past several months, which include Pacific Sunwear, along with recent announcements of store closures from Kohl’s — 18 stores by June — and Men’s Wearhouse — 250 stores this year — among others, provide further evidence of a bricks- and-mortar glut.