Apparel Stores Pass Surging Cotton Prices to the Customers
February 16 2011 - 11:25AM
Marketwired
Yesterday the Commerce Department announced that US retail sales
rose for the seventh straight month in January. While spending did
not rise as much as economists on average had predicted, analysts
are optimistic that sustained consumer purchases will boost the
economy going forward. While the recent spike in retail spending is
good news for apparel stores, the surge in cotton prices has begun
to shrink the industry's margins. The Bedford Report examines the
outlook for companies in the Apparel Stores Industry and provides
research reports on Abercrombie & Fitch Co. (NYSE: ANF) and
Guess? Inc. (NYSE: GES). Access to the full company reports can be
found at:
www.bedfordreport.com/2011-02-ANF
www.bedfordreport.com/2011-02-GES
The cost of clothes has dropped over the past few years because
of the recession, but that trend looks likely to end. Cotton prices
have reached all-time highs -- more than doubling in the past year.
US Apparel companies have warned that they cannot continue
absorbing the price of cotton and will begin passing the adding
costs onto the customers. Some apparel stores have already begun
raising prices in their spring collections in what's on track to
become a 10 percent price hike.
The Bedford Report releases regular market updates on the
Apparel Stores Industry so investors can stay ahead of the crowd
and make the best investment decisions to maximize their returns.
Take a few minutes to register with us free at
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Earlier this month Abercrombie & Fitch said that its
comparable-store sales in January slipped four percent
year-on-year. For the company's fiscal 2010, Abercrombie &
Fitch reported comparable-store sales growth of 7 percent while net
sales for the period increased 18 percent.
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