Hurricane Irene impacts U.S. East Coast and Retailers

This past weekend, the U.S. East Coast braced itself for Hurricane Irene, a massive tropical storm that so far has caused an estimated $13 billion in damage, over 20 deaths and left millions without running water or electricity.

Clothing retailers were greatly affected by the storms reach as well, many stores and malls closing for days to batten down for the impending life-threatening weather. Millions of dollars of revenue were lost as a result, as many "back-to-school" shopping trips were put on hold as the storm approached land.

Consumer reports are hoping that Labor Day sales will help close the gap of profit loss. But with that particular weekend being very promotion/sales heavy, those numbers may have a somewhat negative affect on the bottomline for some companies, especially those that are primarily found on the Northeast coast.

But not all retailers suffered. "Hardline retailers" such as Home Depot, Lowe's and even Walmart are expected to report a considerable spike in sales since many consumers stocked up on batteries, sand bags, tarps, plywood and other miscellaneous hardware supplies and essentials to protect themselves and their homes from the storm. Leading up to Irene's arrival, many locations extended their hours or converted to staying open 24-hours to meet the supply-and-demand needs of some areas.

During times like these, Russ Householder, Home Depot's company's emergency-response captain, likens the company's Command Center to that of NASA's Mission Control during a shuttle launch.

"We've got all the key news agencies on the big screens up front," he says. "We're also monitoring our store sales so we can better be in tune to what's happening in our stores, and we're also connected live one-on-one with district managers in the impacted areas."

Householder says supplies are flowing to stores because of a process that began months ago, at the beginning of hurricane season. "We take storm product, both pre- and post-strike product, we stage those in containers and we have them in our distribution centers, really ready for a driver to pull up and pick up and take them to our stores," he says.

As Householder mentioned, in addition to supplies purchased prior to the storms arrival, these stores also profit from post storm cleanup. Others stores to believed to not be negatively impacted by the storm are office supply retailers like Office Max, Staples and Office Depot, since they too are considered "core supplies" for consumers.

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Foot Locker reports (impressive) second-quarter earnings & Skechers sued over sketchy model dealings

As previously reported, there are a few retailers showing signs of financial growth and stability, even in a tough economy. One of the more surprising was that of Footlocker Inc., which recently released its second-quarter earnings to show an impressive $37 million dollar profit. This makes the sixth consecutive quarter of positive growth for the athletic apparel and footwear retailer. A year prior, the company's second-quarter earnings showed only $6 million in profit.

"Our associates worldwide are doing an excellent job executing the initiatives of our strategic plan," said Ken C. Hicks, chairman and chief executive officer of Foot Locker, Inc., in a statement. "As a result, we were able to deliver strong sales and profit results in the second quarter, including a comparable store sales gain of 11.8 percent and earnings of 24 cents per share. The results over this longer time period encourage us to believe that we have the right strategies in place to create shareholder value on a sustained basis."

Since the top of the year, the company opened 35 new stores, remodeled/relocated 95 stores and closed 54 stores. At the end of July 2011, the company operated 3,407 stores in 22 countries in North America, Europe, Australia, and New Zealand. In addition, 25 franchised stores were operating in the Middle East and South Korea.

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A $10 million dollar lawsuit was filed in Los Angeles Superior Court against Skechers USA Inc. by a group of models accusing the company of failing to pay for the use and global distribution of pictures of said models modeling the company's footwear.

"Skechers paid a small sum of money for only limited use of these images, for a limited amount of time," said David Shraga via statement, a lawyer from the Los Angeles firm Kawahito Shraga & Westrick, who is representing the 11 models. "Then it disregarded these limitations and embarked on a successful worldwide branding campaign that was built around the images of these young models."

The complaint alleges that Skechers "took advantage" of the models who would find it difficult to "discover the wrongdoing," since the majority of the ads ran in foreign countries.

The models are seeking compensatory and punitive damages. "The models are seeking no less than $10 million in compensation for Skechers' misappropriation of their likenesses," said the news release from Kawahito Shraga & Westrick.

A Skechers spokeswoman had no comment, stating the company does not comment on litigation.

This is the second lawsuit against the company to makes waves this year. The first was made by a woman who claimed the company's "Shape-Up" footwear caused her hip fractures.

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Retailers create jobs in a tough economy & Tod's steps up their profits

The Bureau of Labor Statistics released the July Employment Situation Report, showing that the U.S. economy added 117,000 jobs in July, 26,000 of those attributed to retail's ramp up for back-to-school season. Health care, manufacturing, mining and construction were the areas responsible for the additional jobs. This growth drove the unemployment rate from 9.2 to 9.1 percent, an unexpected push in the right direction. Only 46,000 jobs were reportedly added in June.

According to the Labor Department, 8,600 positions were created in health and personal care stores; 3,900 jobs in general merchandise (i.e. Wal-Mart and Target); 5,400 in department stores and 3,000 in clothing and accessory stores.

"While positive retail jobs growth in July is another indicator that retailers are pulling their weight in this economic recovery, a strong jobs agenda would allow retailers to increase hiring on an even larger scale," said National Retail Federation President and CEO Matthew Shay.

“In short, these numbers are an improvement," began Chad Moutray, chief economist for the National Association of Manufacturers, in his Shopfloor blog. "After a couple weaker months of job growth, manufacturing employment is once again moving in the right direction, led by the durable goods sector. Hopefully, this bodes well for future growth in that sector.”

Still, Nigel Gault, the chief U.S. economist for forecaster IHS Global Insight, was unimpressed.“The July jobs report was not as bad as May and June. That's about the best that we can say for it," he said.

JULY BY THE NUMBERS:

• Government jobs, down 37,000.
• Financial services, down 4,000.
• Temporary help services, up 300.
• Transportation and warehousing, up 1,100.
• Construction, up 8,000.
• Leisure and hospitality, up 17,000.
• Manufacturing, up 24,000.
• Retail, up 25,900.
• Health care, up 31,300.
• Professional and business services, up 34,000.

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Tod's, the iconic brand known for its luxurious accessories and driving loafers, floored it past competition and boasted a 44.5% jump in the first half of its financial year.

"The results released today confirm the effectiveness of our strategy, which led to a sound and strong growth, both in terms of revenues and profitability, in line with our expectations," began Tod's chairman and CEO Diego Della Valle. "Therefore, I'm really confident in the group's ability to achieve its targets for the current year and to continue to grow both in sales and, even more, in profitability also in the next years."

All the group's brands, including Tod's, Hogan, Fay and Roger Vivier, posted growth rates in the first six months of the year described by the group as "outstanding."

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