Below is a note from a former client, Anne Beneville, who owned an upscale shop in Nyack, NY named Hip Chik.  I assisted her in closing the shop in the Fall of 2007 because her husband was being transferred to another city. 

The talk she mentioned was written to deliver at the Las Vegas MAGIC Show, Feb 16, 2009. MAGIC is the largest men’s, women’s, children’s apparel and accessory show held in the world, twice a year in Vegas.  So large that the new convention center cannot hold all the vendors and now the show has spread to three or more other convention centers and hotels … 90,000 +/-

From: Annie Beneville
Sent: Sunday, February 22, 2009 6:20 AM
To: TheWaldoffGroup

Well, hello Milton! 

What a great speech you gave - so appropriate & succinct.  I see now the mistakes I'd been making owning Hip Chik.  I'm relieved to have had the reason to close when I did otherwise I would not have survived.  

Your words are pearls of wisdom & those who follow will survive.

Sincerely,

Anne

Do lean inventories mean retail holiday woes?

Excerpt from MRketplace.com - October 16, 2009

As consumer spending has fallen amid the economic downturn, U.S. retail chains have cut back savagely on inventory to save cash. An understandable reaction, but one that could spell trouble for suppliers and retailers alike in the run-up to the holiday season, reports Richard Woodard.

The grim specter of last year's Christmas holiday shopping season is still casting its gloomy shadow over the U.S. retail sector as the year's most crucial trading period beckons once more.

Retailers have spent much of the past 12 months cutting staff, shuttering stores and renegotiating credit lines in a bid to stay profitable -- or just to stay alive.

And one thing is clear: this time around, they are determined not to be stuck with unwanted merchandise which will have to be sold off at deep discounts in the new year.

In many cases, inventories have fallen harder and faster than sales as companies look to reduce their cost base and boost gross margins.

To take a few recent examples of inventory cuts: Talbots (Q2) -- down 29% on last year; Neiman Marcus (Q4) -- down 23%; Tween Brands (Q2) -- down 18.5% per sq ft; Saks (projected, H2) -- down in the low to mid teens percent.

No wonder then that companies like Brown Shoe, for instance, have seen fierce cuts in wholesale revenues -- in the footwear company's case, down 21.1% in the second quarter.

Caution and conservatism

Clearly, caution and conservatism are the dominant emotions this year, and for good reason.

But if these emotions are not kept under some control, retailers could find their shelves emptying at an alarming rate during what should be the most lucrative trading time of the year.

According to the snappily titled "U.S. small and mid-market outlook 2009: Retailers and suppliers take stock of economic downturn," a report compiled by Forbes Insights in association with financial services company CIT, this year's retail picture isn't just about lean inventories.

The survey found that retailers wary of losing sales momentum to competitors were likely to discount more and earlier this holiday period -- viewing this as an easy way of injecting quick cash into their hard-pressed businesses.

Meanwhile, retail consultant Emerson Advisors suggests splitting shipments into multiple deliveries, effectively committing to purchases at the latest possible date and giving the opportunity to cancel or reduce if the trends don't look promising.  

The company also recommends, where possible, holding back up to 20% of deliveries, watching demand and then sending merchandise to stores where it's selling, rather than where sales are weak.

Playing with fire
All of these tactics make sense, but they're also playing with fire. Get it right and you maximize profits, minimize expenses and those gross profit figures look rosy; get it wrong and you risk missing out on desperately needed sales.

No retailer wants to be left with racks full of unsold stock as 2009 comes to a close, running inventories lean and mean may make economic sense, but the margin for error is wafer-thin.

Milton Waldoff note:  Independent retailers have a huge advantage over chains, they can turn on a dime: -

- Jump on a plane and go to NYC on a Sunday return 2 to 4 days later having replenished their inventory into the categories and items that are selling.

- They can schedule an email or ad last minute!

- They can move the store around in a matter of minutes to feature what’s selling.

- Owners are right there to lead, motivate, follow up and sell!

Don’t lose sight of the great opportunities afford you as a independent store with one or a few stores.

Customer Service Overhaul

Excellent article! 
Take the time to read and implement!
It has been my experience that many retailers think they are giving better customer service than they are.
Really good customer service is ‘exceeding the customers expectations’, which includes a phone call or thank you note following the customers visit to the store!
Milton 

Customer Service Overhaul                                                                              
From the Internet by DMS
We all think we know how important customer service is to being successful in retail. Then why    do we, as consumers, keep getting lousy service wherever we go?
Assuming most customers are reasonable people, the answer to the above question is:
 1. Store staff doesn't know or don't understand what the expected behavior in terms of customer    care is or
 2. Management gives the issue only lip service and does not establish firm criteria to maintain high customer service levels.
It always boils down to quality of management doesn't it?  In both of the above cases, it's management that is squarely responsible. So, before things get even worse, here are the commandments you need to put in place and make sure they are ingrained into everyone's mind:
1.   A Vision of Customer Service  Excellence That is Clearly Developed and Communicated: If you do not set the expectations right from the beginning, you can't blame anyone but yourself.
2. Recruit, Hire, Train and Promote People with People Skills: When you are interviewing for new people, look for indications of a friendly, helpful nature and ask questions probing for the level of people skills . When evaluating staff performance, make sure there is considerable emphasis on their performance in the area of customer service.
3. Measure Individual Service Performance, Report Results and Celebrate Victories: What is not measured can not be managed.  End of story. Develop a performance chart for each staff member and rate them from 1 to 10 for their Customer Service performance. You'll see a marked improvement almost immediately.
4. Solve Problems When and Where They Occur - that means immediately: Customer studies show that as long as a problem is resolved fast and to the customer's benefit, most become very loyal customers for life. Study your policies and procedures and eliminate the fluff and unnecessary steps that take up time. To speed up the problem resolution process, empower your staff to make certain decisions without having to look for management.
5.  Stay Close to Your Customer: When was the last time you took one of your customers to lunch or even a coffee? I know a lot of you are laughing at me at this point; but unless you know their honest opinion, how are you going to improve your operation? Think about it.
Review the above points in your retail environment and make sure you are 100% on top of all of it. That, in itself, would be a major accomplishment.
Milton Waldoff added this reminder:  The customer that is easiest to get back into the store is the customer that has shopped the store and been delighted with the customer service and likes the merchandise!

Sales Tip: The Value of Follow-Up AFTER You've Made the Sale!

Everyone that has worked with me has heard me say over and over again the great importance of follow up after the sale. I believe that when most people hear the words customer service, they automatically think of the service that occurs during the actual sale.  It is just as critical after the sale!  It is the icing on the cake!  It solidifies the relationship between the customer and the store, not just the sales person.

Remember ‘excellence is in the details’!

Milton Waldoff Group

The Importance of Customer Service After The Sale                                  
From the Internet by Brad Huisken

We have spent hours and hours talking about the importance of customer service and how that should be the foundation of every sale that you make.  We have not talked however, about the importance of customer service after the sale.  I believe that when most people  hear the words customer service, they automatically think of the service that occurs during the actual sale.

Most salespeople provide quality customer service during the sale because the satisfaction   is    immediate and it is a means to an end.  In other words, good customer service leads directly to a sale.  However, the top salespeople are not on top because they make one sale   to each customer. They are on top because they make multiple sales to repeat customers.  So,    what sets them apart from others?  The difference is that the professional salespeople are providing that same high level of customer service after the sale as well.  I know that people want to buy from their friend in the industry.

My automobile guy is my automobile guy because he is my buddy in the business.  We do not socialize very often; in fact, we rarely see each other.  However, he is my guy.  Since he is my guy, he has also sold cars to my sons, daughter, and friends of mine who are in need of a car.  I just happen to mention his name and give out his business card.  My insurance guy is my insurance guy not because we are friends but because he is the nephew of my wife’s best friend.  For this reason alone, we have our homeowners insurance, car insurance, business insurance, and health insurance with him.  I imagine you can guess with whom my children have their insurance. Your right, my insurance guy.  I might also add that once these two people had secured my business they have lived up to my high expectations, which in turn has caused me to give them a tremendous amount of referral business.

Your business is no different, get your customers to think of you, as their friend in the industry and you will be amazed at the snowball effect it will have on your productivity.  Some of the things that need doing should be obvious to you including: follow-up calls, written thank you notes and so on...

Too often...many more things that need doing are usually overlooked...to the great determent of the business.

Thoughts gathered from the Internet

Thoughts gathered from the Internet by Milton Waldoff Following the retail press and talking with clients and others over the last month or so, the conversation has evolved from "will things turn around this fall?" to "how do we succeed in this new environment?"   The comps get easier as we move into the 4th quarter, mainly because the big down turn started in Sept and Oct 2008, so the reported numbers should improve, and perhaps the overall tone of the reporting, but few think we'll see the economy and consumer spending bounce back dramatically. Everybody understands that business will have to be earned, one sale at a time, one customer at a time. The pieces I've chosen for this month focus on this theme; one sale at a time, one customer at a time.  From Hurlburt & Associates How Do I Drive More Traffic Into The Store? "When I was writing Shopportunity! I was told a reportedly true story of a Nordstrom shoe department sales person in Los Angeles. You've certainly heard her legend: She sells more than $1.5 million worth of shoes a year and is the number one sales person in all Nordstrom. Customer-by-customer she's built an amazing business and one that is not dependent upon traffic. One of the underleveraged elements of a great retailer selling great merchandise through great sales people is the ability of the person on the floor to educate. But you don't have to be talking with the customer in real time to educate. You can mine your past sales, determine what the customer might like to know about now and reach out to (her)." From Retail Customer Experience... Retailers Try To Get Personal With Shoppers  "If there is a silver lining to the current recession and any signs of hope for a fashion retail environment that has been hammered by the Internet, it may be this: Shopping is about to get interesting again. Retailers are in the process of shifting from being brand and product-centric to being market and consumer-centric. In other words, the shopper is in the driver's seat. Stores at every price point are having to work harder than ever to get people in the door, and, once they get them there, to pique their interest in what they're selling." From the Los Angeles Times.com... Recession Forcing Retailers To Think Small  "The Great Recession and Americans' retreat into thriftiness are teaching retailers a new lesson: How to survive when consumers are focused on "needs" rather than "wants."   For years, shoppers splurged on everything from $5 lattes to $200 jeans, and retailers responded by opening more stores and offering more choices. Now, beset by high unemployment and limited access to credit, shoppers are limiting most of their purchases only to essentials or the best deals. The changes are likely to last for years. Even when the economy improves, it will take years before the debts that piled up during the decade-long shopping spree are paid off. Americans are also getting used to their newly adopted frugal habits of saving more and spending less." From the Associated Press... Small Business: Keeping A Sales Team, Well, Sailing 'With all the doom and gloom in the marketplace, it's easy to fall into a slump, particularly when sales are down and the pressure is on to perform. But now's the perfect time to be working with your sellers on perfecting their pitch and helping them see beyond all the negativity so they're better equipped to deal with the challenges ahead." "Owners and managers' primary job right now should be to find a way to keep their sales team out of a negative pattern and help them find the silver lining in this supposed dark cloud." From Newsday.com...

Retailers and suppliers brace for slow recovery

The following is a copy and paste from MRketPlace.com received today via email that I thought you might find of interest.  The yellow high lights were done by me.

As you have heard me say:

Control inventories! ... Do not allow slow sellers to remain on your floor! ... Take fast markdowns!... Don’t over buy! ... Make more market trips! ... Give the customer better service then they expect!... Write thank you notes to every customer!

Milton Waldoff
The Waldoff Group

In The News

Retailers and suppliers brace for slow recovery 

September 18, 2009

Faced with one of the most challenging years on record, retailers and their suppliers are being forced to adjust their business strategies to deal with this drearier operating environment. And with retail inventories down, discounts up, and credit still tight, many believe that consumer spending will lag the turnaround of the U.S. financial markets, new research reveals.

Few industries have felt the effects of the recession as acutely as retail.

The impact of plummeting consumer spending on the sector has been well documented, with many retailers dealing with tumbling revenues, slow-turning inventory, steep discounts, and stressed cash flow.

As a result, many middle-market merchants have spent late-2008/2009 in a state of strategic and operational stasis, limiting activity, slowing spending, renegotiating leases, and holding on tight as they wait for small signs of recovery.

The impact has not just been on retailers, but also on the vendors that manufacture and distribute the apparel and other goods retailers sell.

With retailers working hard to conserve their cash and deal with declining demand, they are purchasing less from their suppliers, and may be paying those suppliers more slowly, straining their cash flow.

How harsh have things been?

According to a new study produced by Forbes Insights in association with financial services firm CIT, nearly two out of three suppliers say they have been impacted by a retail customer bankruptcy this past year.

And worryingly, many retailers are taking a more conservative and cautious approach to the upcoming holiday season by controlling their inventories, and are planning more aggressive discounts earlier in the season.

"Many retailers continue to be concerned about consumer demand and are following conservative inventory and pricing tactics in anticipation of the upcoming holiday season, trying to maintain liquidity, so that they can be better positioned for what is hopefully resumption in consumer spending in 2010," explains Burt Feinberg, managing director and industry group head of retail finance at CIT.

Key findings
Key findings of the research report, 'U.S. Small and Middle Market Outlook 2009: Retailers and Suppliers Take Stock of Economic Downturn,' include:

Cautiously awaiting the return of consumer confidence. While half of middle-market retailers saw their revenues decline over the past 12 months, 41% expect their revenues to grow over the next year. However, growth rates may be tempered by a slow recovery in consumer spending.

Cutting costs and conserving cash. Falling revenues have caused many retailers to take steps to cut costs and conserve cash. They have halted planned expansions, put off store renovations and redesigns, re-merchandised their shelves, and closed existing stores.

They are also revising their leases, and seeking new terms with creditors.

Increased M&A activity on the horizon. The primary drivers of M&A activity will be the greater availability of credit, reduced valuations and the need for weaker companies to merge.

Inventory issues: Slow-turning inventory has been a burden for middle-market merchants. Even though they are stocking less than they did a year ago, many still feel that their cutbacks have not been deep enough. As a result, discounting has been rampant as retailers look to turn slow-selling goods.

Retailer bankruptcies impacting suppliers. Nearly two out of three have been impacted by a retail customer bankruptcy this past year, and nearly the same number expects additional retail bankruptcies in the next 12 months.

Many are turning to factoring and credit insurance more to protect themselves from possible customer bankruptcies.

. Managing customer relationships. To protect their businesses, suppliers are doing less business with retail customers with weak finances, they are monitoring their accounts receivable more closely, and are imposing more stringent credit terms and deposits for new customers.

At the same time, many are offering incentives to retail customers who pay early.

Guarded about the future
Not surprisingly, retailers remain quite guarded about the future, with most believing it will take several years before consumer spending returns to pre-recessionary levels.
Nevertheless, they remain hopeful for a possible turnaround beginning in 2010 to set their industry back on course.

And for those retailers and suppliers that are able to weather these challenges, better times may lie ahead.

A copy of the complete report can be downloaded here. (Note: Since this is a copy and paste you cannot download the complete report here, however you can go to MRketplace.com and you will be able.

See other news from around the world at Just-Style.com

Get breaking news stories from MRketplace.com by e-mail. Register today.

Opinion: The difference between clerking and selling

By Bob Phitts -  23 Sep 2009 

Times are tough. Good help is hard to find. Got it.

But wouldn't you think, if you weren't making money, you'd change your ways?
I'm talking about sales and how your crew is or isn't doing it. Here's how what I call "low-hanging fruit clerking" goes:

Customer walks in. Employee yells across the counter, "How are you today? Looking for anything special?"

Customer looks around, after a while asks employee, "Do you have this in a set?"

"I do right over here."

"I'll take it."

That is not selling.

That would be about as much like selling as a guy walking into a Ford dealership: "Yeah, I'm looking for the Mustang GT 5-speed in grey with black seats." "Right over here."

That is clerking. It is what passes for customer service. A real sale would be if the guy came in for a Focus and drove off in the Mustang because the salesperson found things in common and the customer opened up to him that he always wanted one since he was 16 in Toledo, Ohio and first saw it on the Ed Sullivan Show.

True selling is the whole tree, not just picking what you can reach without effort. When a customer thinks they can't afford it, when the wife says "you better think about it," when the customer selects a product that won't do what they want — that is when selling makes the difference. It's not pushy, and it's not cheap or tacky. It's the stuff of American business success.

When I was selling western wear in college at a store in the Santa Monica Place mall, I had a guy who came in to the store and immediately told me he needed a red shirt for a party. "Why red?" I asked. "My girlfriend told me to." I showed him how red really wasn't a good color for his skin, shared the mistake I'd made getting one once and found a good blue shirt he would wear more than once to a party.  He also got a pair of boots and jeans — about $300 worth.

He returned to me after he received a handwritten note from me thanking him for his purchase. "You know, most people would have just gotten me the shirt and been done with it. But you took the time to educate me.  Everybody said I looked so great, I should get more, so I'm changing my wardrobe." With that he purchased thousands of dollars of product.

Low-hanging fruit would have been to clerk a $30 shirt.

You want to compete in a global marketplace? Standout from a world that is overbuilt with power centers? Take money out of the business instead of putting it in every month? Reach higher. Hire salespeople. Encourage them to reach higher with every sale.

As any gardener can tell you, the ripest fruit hangs at the top, not near the bottom.

Opinion: Retailers need to cut their SKUs

Although Bob Phibbs addresses his comments to large chain stores, I thought you might find the article below of interest. Click here to read his article.

I have added my comments to his article, they are in red.

Additionally I have hi-lighted in yellow comments that I strongly agree with.

Milton

Opinion: Retailers need to cut their SKUs by Bob Phibbs

A recent article in the Wall Street Journal talked about how all the largest chains are reducing choices for consumers. 

Pharmacy chain Walgreen Co. is cutting the types of superglues it carries to 11 from 25. Wal-Mart Stores Inc. has decided that 24 different tape measures is 20 too many. Kroger Co. has tested stripping out about 30 percent of its cereal varieties.

In the next year or so, these and a few of the other largest retailers are expected to slice the assortment of products in their stores by at least 15 percent, industry executives and analysts say. 

"All that go-go 1990s where we were adding items in and adding items in, and people wanted more, more, more, more choice… just didn’t pay off," said Catherine Lindner, Walgreen’s divisional vice president for marketing development, at a recent conference. Looking at store shelves, "people say, 'Whoa, you’re bombarding me. Help me figure out what I need.'"

 
Specialty stores key to success are ‘edited selections’, fresh new merchandise items customer are looking for now, attentive caring customer service, personal relationships, convenience and competitive prices.

If the big guys are doing it, you should be too. Here’s how: Not necessarily!

• Take a look at your inventory categories’ sales figures by month and year-to-date.   Know what ‘categories’ are selling and the percent of your monthly and annual business they produce profitably, plus how that compares to your monthly and annual inventories.                                                                    

·         Within each category, look at your bottom 20 percent 30 or 40 or ??% of your inventory — the ones ‘catagories’ not moving.

• Cancel all orders to replenish  This is big box computer lingo for automatically reordering!  In specialty store language, we’d refer to this as a mindless re-order.
• Come up with a sale to clear them out The sooner the better!
• Use money saved to add to your top two categories of merchandise Or perhaps simply reduce total inventory so as to improve turn, gross profit and reduce debt!

It’s never easy to let go of items we personally thought would be good movers but when you have 20,000 (too many) SKUs, how much duplication of selection do you need?

The big boys know: too much selection does not improve sales. Same with you.

It is very important to keep in mind that a store cannot be all things to all people! 

Remember - carve a niche, focus, fast markdowns, turn, newness and gross margin!

Keep your focus on turn, gross margin and newness … that means you are focused on the core items of your business and you are turning your inventory at least 5 to 8 times a year based on monthly sales to inventory by category, dept, class … at retail!

Never ever carry over anything from one season to another.  If your customers didn’t buy it this season, why will they all of sudden they want it next season?  It the item going to improve with age?  All of the sudden they are going to start liking corsets? 

Do not get emotionally attached to inventory!

Wanna understand this better … call me!

Same Store Sales Don't Really Show the Growth, Recovery or Hope First Reported by U.S. Retail Industry Experts in September, 2009

This is one of the most accurate and informative analyses of what is happening in retail and the media coverage I have seen!

Take the time … the yellow hi-lights and dark face hi-lights were done by me.

Milton Waldoff

Same Store Sales Don't Really Show the Growth, Recovery or Hope First Reported by U.S. Retail Industry Experts in September, 2009 By Barbara Farfan

Monday October 12, 2009

Comparing this year's sales in stores open for at least a year with last year's sales in stores open for at least a year is supposed to reveal the strength of a retail chain. This is the premise of same store sales figures and this is what motivates members of the U.S. retail industry to go to the trouble of calculating, reporting, and analyzing same store sales monthly, quarterly, and annually.

Based on this premise of "strength," same store sales of the Old Navy chain not only had strength in September 2009, the chain seemingly developed super powers. With an impressive 13% increase in same store sales as compared to September 2008, Old Navy rocketed into positive sales territory faster than a speeding retail recovery.

To be fair to all other publicly traded U.S. retail chains, Old Navy was at a distinct advantage because it was comparing this year's September sales with last year's September, which saw an embarrassing 24% same store sales drop. And that 2008 drop was in comparison to its September 2007 sales drop of 8%, which was compared to its 3% drop in 2006, its 7% drop in 2005 and its 6% drop in 2004. In fact, Old Navy hasn't seen a same store sales increase in six years worth of Septembers.

So is this year's 13% increase really a show of Old Navy's "strength?" As much as sitting up in the intensive care unit after being hit by a bus can be viewed as strength, Old Navy did show some signs of recovery progress in September, 2009.

The problem with same store sales numbers is that they represent a limited view, but they are often given a very broad interpretation. An article in the Wall Street Journal said that the 2009 September same store sales figures "indicate that consumer confidence is beginning to return." Other headlines declared that sales were "better than expected," "on the rise," and "bouncing from the bottom." ABC News said that retail sales in September were "a sign consumer spending has started to recover and the economy was growing again." Really?

The New York Times tried to put things into perspective by reminding its readers that even though there was an upturn in September, 2009, the sales in major retailing categories were only back to 2005 levels. This is a good reminder. But let's also not forget that for some retailers, even getting back to 2005 levels is a faraway dream that is not going to be realized any time in the near future.

As an example, the executives at Limited Brands were likely giddy about seeing a plus sign in front of the chain's September, 2009 same store sales figure. It's the first time that's happened since August, 2007, so it was something worth celebrating.

A plus sign in front of same store sales is not only supposed to be a sign of strength, it's also supposed to indicate "growth." Let's take a look at the Limited's "growth" by comparing its sales figures from previous September months:

• $654.8 million - September, 2009
• $673.4 million - September, 2008
• $713.2 million - September, 2007
• $781.3 million - September, 2006
• $687.3 million - September, 2005
• $679.3 million - September, 2004
• $714.4 million - September, 2003
• $642.5 million - September, 2002

So, yes. The Limited saw some growth - if you're comparing its September 2009 sales with its September 2002 sales. But if you're comparing this September with any other September for the past seven years, the 2009 results can hardly be labeled as "growth."

Despite all other evidence, whenever a magical "plus" sign pops in front of a same store sales percentage, any history beyond one year seems to be disregarded by retail experts, who respond with unreasonable optimism.

The reward to Limited Brands for doing nothing more than exceeding its September 2002 sales levels was an immediate 4% lift in its stock prices. That puts the company's stock prices at least 10% higher than they were in September 2002. Somehow that much of a reward seems like major exuberance for a minor uptick that really wasn't all that positive.

Same store sales figures are a financial shorthand intended to provide investors with a year-over-year benchmark. But when the meaning of the numbers are misinterpreted, misunderstood, or misrepresented, it's like the shorthand has been written by a stenographer with bad handwriting. Instead of taking the time to figure out what the numbers really mean, the interpreters just see what they want to believe and then respond in an oddly disproportionate way.

Let's take a holistic and realistic look at the September, 2009 same store sales figures. Aeropostale had a 19% increase. That's on top of a 5% increase in September, 2008 and a 1.3% increase in 2007. That's what "growth" looks like.

Buckle posted a 5.1% sales increase in September 2009. That's on top of a 19.7% increase in September 2008, and a 10.9% increase in September 2007. That's what "strength" looks like.

Kohl's showed a 5.5% same store sales increase last month. But that was on top of an identical drop of 5.5% in September 2008. And that was on top of a 3.2% same store sales decrease in September 2007. Kohl's numbers might have looked positive last month, but they didn't exactly represent the "strength" or "growth" that positive same store sales are supposed to indicate.

Looking at a history of September same store sales figures reveals that of the 14 retail chains that posted positive same store sales figures in September, 2009, nearly half of them were comparing themselves to the negative numbers they had posted in September, 2008. It's easy to look positive when you're comparing yourself to your own negative past.

Of the 26 chains that still had minus signs in front of their same store sales figures last month, more than half of those declines were on top of declines in September 2008 as well. Negative on top of meltdown negative is not just doubly negative, it's more like negative squared.

Speaking of September 2008, the negative same store sales numbers that where posted that month by Neiman Marcus, Dillard's and Stein Mart were blamed in part on the impact of three major hurricanes. This year, those three chains had sales that fell even lower than last year's post-hurricane levels. Perhaps there are a few chains that are "bouncing off the bottom," but clearly there are still many U.S. retail chains that haven't found their bottom yet.

In response to the September 2009 retail sales numbers, the chief economist at the International Council of Shopping Centers declared "Let the retail recovery begin!" We'll just file that in the same folder as Ben Bernanke's "Recession is over" declaration last month, to be pulled out and re-read at a more appropriate time. At some point in the future both men will be right. But as long as jobs are still scarce, stores are still closing, and same store sales are still coming in at 2002 levels, neither economic expert is right quite yet.

Hope is an essential ingredient for economic recovery. But too much hope too soon could prove to be a setup for a huge consumer confidence disappointment. And when faced with record high unemployment, rapidly disappearing unemployment benefits, and a less than jolly holiday budget, the one thing that will snap consumer wallets shut even tighter than they've been before is another crisis of confidence.

While September same store sales are not really as good as many people want to believe they are, they're at least good enough to inspire cautious optimism. Considering the state that the U.S. retail industry was in this time last year, cautious optimism represents a huge improvement. For now, that is enough.