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Tax Rebates Boost May Retail Sales
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US Loses WTO Cotton Subsidies Dispute
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UK's Online Spending Still Growing
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1
April International Lingerie Show
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Intimate Graphics
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April International Lingerie Show Continued
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Cotton Traders Customer Information Hacked
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April International Lingerie Show Continued
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Moss Dumped Again
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Protesters Use Youtube as Deterrent
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International Lingerie
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June 15, 2008
Issue #219
22/24
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Tax Rebates Boost May
Retail Sales
New figures from the US Commerce Department show consumers headed back into the stores in May -
confirming monthly sales figures posted by many retailers last week.
Retail industry sales for May (which exclude automobiles, gas stations, and restaurants) jumped 3.8%
over last year and 0.9% month-to-month.
Most shoppers hit discounters and grocery stores in May, stocking up on necessity items.
Clothing and clothing accessory stores also saw their sales increase 0.5% seasonally adjusted from April and
2.4% unadjusted from last May.
"Thanks to the tax rebate checks consumers received last month, the economy got a nice shot in the arm,"
said National Retail Federation chief economist Rosalind Wells.
"It's evident consumers are feeling a bit more confident about their expenditures, especially with
both April and May sales seeing positive increases in many sectors."
A model wears a garment by
La Fresca during the
International Lingerie Fashion
show on April 7, 2008 at the Rio,
Las Vegas. Photo by Studio Time
See more photos from the International Lingerie Fashion
Show on page 5
18/24
US Loses WTO Cotton
Subsidies Dispute
The US could face billions of dollars worth of retaliatory sanctions against its products after
failing to overturn a WTO ruling that it paid illegal subsidies to its cotton farmers.
In a June 2 decision, a WTO appeals panel upheld its verdict last year that the subsidies breach global
commerce agreements.
The ruling means that Brazil, which launched the complaint, can ask the WTO to approve sanctions on
imports of goods and services from the US.
In a dispute going back to 2002, Brazil has accused the US of paying out $12.5bn in subsidies and export credit
guarantees to its farmers.
It also alleges the US kept its position as the world's second-biggest cotton producer because of the
subsidies.
The US, however, maintains it has made the changes necessary and that it has been complying with all WTO
rules since 2004.
This includes eliminating the so-called Step 2 program which meant US exporters and manufacturers would no
longer receive an incentive for buying higher-priced cotton from US cotton growers.
15/24 Photographed
by Lawrence O. Brown
UK's Online Spending Still
Growing
Online spending by consumers shows no sign of succumbing to the economic downturn, with Internet
shopper numbers at an all time high and online spending growing at its fastest rate for six years according to
new research.
In its latest report - UK e-Retail 2008 - Verdict Research says online spending rose by a substantial
35.0% in 2007 to GBP14.7bn (US$28.9bn) - a rate of growth almost 10 times higher than that experienced by
the total UK retail market.
With Internet access growing and users purchasing more frequently and more heavily online, this strong growth
is set to continue, the report says.
It forecasts online retail will reach GBP44.9bn by 2012 - accounting for 13.8% of total spending.
Yet despite some degree of cannibalization, physical shopping is far from doomed.
There is still a need and place for physical locations, the key is to ensure
that synergies with online retailing are exploited to drive footfall to stores.
Online shopping is becoming an integral part of UK retail, with retailers and consumers alike getting
onboard
In 2007, total retail growth was just 3.6% as consumers' disposable incomes were starting to be
squeezed by higher living costs.
However, the online market expanded by over a third in 2007, driven by a 5.9% increase in internet users - to
33.1m - and a 24.7% increase in online shoppers - to 22.6m.
Furthermore these shoppers are purchasing more regularly (an average of 16.9 times per year, an
increase of 2.7 trips on 2006) and each spent an
average of 7.8% more than 2006.
The convenience of the channel is the main reason for its continuing success and is mentioned by more than
half of the online shoppers surveyed for Verdict's report.
"The internet is widely perceived as a cheaper and easier way of finding lower prices and bargains in most
sectors," says Malcolm Pinkerton, senior retail analyst at Verdict Research and author of the report.
"As the cost of broadband falls, consumers become accustomed to Internet shopping and retailers continue
to enhance their online propositions, the channel will find itself extremely well-placed to
capitalize on the falling consumer confidence and lower levels of disposable income currently impacting the retail
market."
Longer term, growth is set to be driven by the ageing population.
Electricals and food and grocery currently dominate the market, accounting for around half of all sales.
Men tend to buy big-ticket items online, such as electrical goods, which pushes up their average spend.
There was also a marginal increase in their number of purchases in 2007, mainly driven by a rise in the
number of men buying clothing online.
Chinese Invoice Scam Unproved
Investigations by a US customs and border protection team into the alleged abuse of tariff concessions by
Bangladeshi apparel exporters have found nothing wrong, according to Anwar-Ul-Alam Chowdhury Parvez, president
of the Bangladesh Garment Manufacturers and Exporters Association.
Parvez said the customs team's report may even help ease shipments of Bangladeshi apparel to the US - where
they generate over US$3bn annually or roughly a quarter of Bangladesh's total apparel exports.
Sources in the industry and the Bangladesh government revealed that according to the investigation team, some
third country exporters stole the invoices which were then used to export Chinese apparel to the US market
showing it to be of Bangladesh origin.
During a wrap-up meeting with officials from the Bangladesh government, the US team praised the
Bangladeshi apparel manufacturers' production and export documentation.
The team investigated documents in 30 apparel factories following allegations that Chinese exporters, subjected
to quota restrictions, are colluding with some Bangladeshi apparel exporters to show Bangladesh as the
country of origin of their goods.
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of Page 1 of 5)
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