Are consumers about to buy a ton of new clothes post-pandemic? – Yahoo Finance
After a year of wearing the same joggers to work on Zoom calls — and essentially going nowhere during the pandemic — signs are emerging that consumers are starting to rebuild their very outdated closets with new clothes for their post vaccination life this year (hopefully).
“More recently, however, we’re seeing signs of customer interest in going out-type apparel beginning to emerge,” Urban Outfitters co-founder and CEO Richard Hayne told analysts on an earnings call Tuesday evening. “We believe as vaccines become more widely distributed, new COVID cases continue to fall and government restrictions begin to loosen, women will feel more comfortable venturing out and apparel demand will accelerate. The exact timing is hard to predict, but we believe it will coincide with spring weather.”
Hayne isn’t alone in seeing the green shoots of demand ahead of spring.
“Our product is resonating and our message is resonating,” Abercrombie & Fitch CEO Fran Horowitz told Yahoo Finance Live in an exclusive interview on Tuesday. “We are pleased,” Horowitz said on the start to the first quarter. “We are looking to grow sales 30% to 40% over last year.”
Kontoor Brands CEO Scott Baxter says demand for his company’s Wrangler and Lee jeans is beginning to pickup around the world.
“There is a little pent-up demand and that’s global. Right now we are already seeing that shift in China,” Baxter told Yahoo Finance Live on Wednesday.
The early signs of sales is likely music to the ears of apparel retailers after the pandemic crushed their businesses in 2020.
Sales at clothing and accessories stores went from $22.5 billion in January 2020 to a low of $3 billion in April as the pandemic spread and lockdowns ensued, according to data from the Census Bureau. At $20 billion in January of this year, sales at clothing and accessories stores have gained for two straight months. That’s still shy of the nearly $23 billion spent at clothing and accessories stores in May 2018, which represents the high water mark of the past 32 months, per Census Bureau data.
“Everyone is of the view that no one has bought anything for a year and now they’ll be dying to get out and shop,” one long-time retail watcher told Yahoo Finance.
Apparel stocks have begun to sniff out a strengthening recovery, too.
Shares of Abercrombie & Fitch have gained 17% this past month, Levi’s is up 22%, PVH Corp. is up 23%, Urban Outfitters has shot up 30% and Kontoor Brands leads the way with a 32% spike.
“People want to be doing more than ever, getting outside and traveling.” said Baxter.