Private equity firm Apollo Global Management will take Rackspace private in the all-cash deal.
No matter how you cut it, retail sales had a bad year in 2008. Sales excluding autos, gasoline stations, restaurants, bars, and fuel grew only 1.4% from the year before—and much of that growth was from grocery price hikes. Web sales, meanwhile, grew 6%.
No matter how you cut the numbers, 2008 was a bad year for retail sales, says the full year retail sales report from the U.S. Department of Commerce, which was released today. Total sales-which include autos, gasoline stations, restaurants and bars, and fuel sales-shrank 0.17% last year from the year before, to $4.474 trillion from $4.482 trillion.
But to compare sales that could happen offline to those that could happen online, it is necessary to exclude autos, gasoline stations, restaurants, bars, and fuel sales. Excluding those categories, sales at remaining stores grew 1.41% last year to $2.74 trillion from $2.70 trillion. Online sales last year grew 6% to $130.1 billion, according to comScore Inc.
ComScore numbers do not take into account sales on eBay. Assuming that about half of eBay’s $48 billion in gross merchandise volume (excluding automobiles) occurs in the U.S. and that about 70% of those sales could be considered retail sales (meaning the sellers make all or a substantial portion of income from such sales, as opposed to individuals selling stuff they don’t want any more), U.S. retail-equivalent sales on eBay amounted to $17 billion in 2008. Adding comScore’s retail sales report to the $17 billion from eBay results in $147 billion in online sales in 2008.
Excluding sales at grocery stores from the mix, since so few grocery sales take place online and increasing food prices in 2008 skewed the sales numbers, total store sales grew 0.44% to $2.15 trillion from $2.14 trillion. Adding the e-commerce sales for each year takes those figures to $2.297 trillion from $2.278 trillion a year earlier. The web then accounted for 6.4% of sales in 2008 vs. 6.0% a year earlier.
In the fourth quarter, sales excluding autos, gasoline stations, restaurants and bars, and fuel sales shrank 2% from the year before. Excluding groceries, sales were down 3% from the prior year. Q4 online sales were also down 3% from the year before, according to comScore.
In an interesting twist on traditional retail sales, consumer buying in January increased 0.5% over December, reports the National Retail Federation, a retailers’ trade association. January sales usually take a dive after December.
Year-over-year, however, January sales, excluding autos, gasoline and restaurants, fell 2.1% from January 2008.
“While 2009 got off to a surprising start, it’s going to be difficult for retailers to maintain this momentum,” says NRF chief economist Rosalind Wells. “We expect the first half of the year to present challenges while giving way to sustained growth in the fourth quarter.”