NEW YORK - Back-to-school season got a strong start as discounts and high temperatures in July drove shoppers to air-conditioned malls. But merchants worry that the momentum won't continue through the second-biggest shopping period of the year as the weather cools and deals dry up.
A number of retailers Thursday reported July revenue that beat Wall Street estimates, among them Target, Macy's, and the luxury chain Saks. The International Council of Shopping Centers' preliminary tally of retailers' revenue at stores open at least a year - a key indicator of a merchant's health - was up 4.6 percent, a slower pace than June's 6.9 percent gain but in line with forecasts.
Although the numbers offered encouraging signs for the start of the back-to-school shopping period, which runs mid-July through September, there are concerns that shoppers will stick to the habits of the Great Recession, focusing on necessities and waiting for sales. That could be a big problem for retailers, which are raising prices to offset rising fuel, labor, and other production costs.
"Early going, July looks like it's shaping up to be a solid month despite all the economic headwinds," said Ken Perkins, president of RetailMetrics L.L.C., a research firm. "But the concern is whether shoppers will buy back-to-school items at full price."
Back-to-school accounts for 16.1 percent of retailers' annual revenue, according to the shopping centers' group. It's also an opportunity for retailers to gain insight into consumers' shopping habits heading into the holiday season, which starts the day after Thanksgiving.
Retailers will get a better sense of back-to-school spending this month. But analysts and retail-trade groups are sticking to forecasts ranging from unchanged to 3 percent compared with a year ago. The National Retail Federation expects families to spend $603.63 on back-to-school items, from clothing to supplies, down from last year's $606.40.
Target said revenue at stores open at least a year rose 4.1 percent in July as shoppers bought more groceries and health and beauty products. Consumers spent more per transaction, with back-to-school revenue off to "a solid start."
Department stores J.C. Penney and Macy's also had respectable results.
Comparable-store sales were down 7.3 percent, Philadelphia-based retailer Destination Maternity reported.
"We do not believe that July is a good indicator of sales for the upcoming months, which will be driven much more by sales of fall product," chief executive Ed Krell said in a news release that also cited Internet sales.
Destination Maternity had 660 stores and 1,698 leased-department sites in Macy's, Sears, and Kmart at the end of July, compared with 700 stores and 978 leased sites a year ago. It closed three stores last month.
Bon-Ton Stores Inc. said revenue at stores open at least a year fell 1.6 percent, on disappointing sales in juniors, children's, shoes, and furniture.
The drugstore chain Rite Aid Corp., based in Camp Hill, Pa., said last week that revenue rose 1.6 percent in July, to $1.92 billion. Revenue at stores open at least a year grew 1.9 percent; pharmacy sales rose 1.4 percent, with prescriptions up 0.4 percent. Nonpharmacy revenue grew 3.1 percent.