April 16, 2012
Retail sales jumped 5% last year in Chicago area By Corilyn Shropshire - Tribune Reporter
Retail sales in the Chicago area rose by 5 percent in 2011, to $101.5 billion, the highest since 2008, signaling that consumers are starting to spend again. Sales receipts in the six-county region, which includes Chicago, totaled $101 billion in 2011, the biggest year-overyear of leap since 2006, according to a report released Monday by Melaniphy & Associates, a Chicago-based retail and real estate consultancy. Chicago area shoppers are back in stores after a recession-induced spending break, according to John Melaniphy. "There is optimism that the worst is over, my job is not in jeopardy -- I survived," he said. The boost was led by apparel and accessories sales, which jumped 19 percent last year, climbing to $5.5 billion, the highest since the recession began. Consumers, according to the report, are returning to the mall, but are opting for specialty apparel stores and their specific items and brands such as American Eagle Outfitters, Brooks Brothers and Ann Taylor, rather than big box department stores such as Kohl'sand Target, according to Melaniphy. "People have been frugal for four years," he said. "They are starting to spend and going to stores that have the goods they want, the fashion they want, the labels they want." Wear and tear is also fueling the rebound, according to Melaniphy: Consumer goods -- skirts, shoes, slacks and electronics -- need replacing, he said. With the economy improving, consumers who were pinching pennies are less fearful about dipping into their savings to replace items, Melaniphy said. The automotive and filling station category also posted large gains at 10.2 percent, boosted by new-car sales, a trend Melaniphy expects to continue. The average American car is 10 years old so wear and tear is playing a big role in the uptick, said Melaniphy. "We have a lot of old cars out there," he said. "It isn't the desire, but the need to replace cars." Restaurants and bars also rebounded in 2011, up 5.3 percent, to $13.3 billion, according to the report. Categories in the Chicago metro area that saw declines in 2011 include furniture and appliances, which fell nearly 1.5 percent, and general merchandise, which includes items sold from big box retailers, whose sales receipts dropped 4 percent. Home improvement stores also experienced a dip in receipts, sliding nearly four-tenths of a percent. Sales in Chicago, for its part, surpassed the boost seen across the metro region, rising by 6 percent, to $23 billion. Spending in the suburbs increased by 3.6 billion to $78.5 billion. The sales figures in the Melaniphy report are calculated based on recently released sales tax data from the Illinois Department of Revenue. Illinois is one of the few states that makes retail sales tax data public, allowing analysts to get an accurate snapshot of consumer spending. Retail receipts tanked $4 billion in 2008 in the thick of the recession, and plunged even further, by nearly $9 billion in 2009. In 2010, consumer spending in the Chicago metropolitan area began making its way back, albeit slowly, climbing by $3.7 billion to $96.6 billion. But Melaniphy didn't predict a full rebound until this year. "You can only hold consumers back for so long," he said.
Published on Apr 17, 2012