Searching for a silver lining to lackluster retail sales locally, the Greater Waco Chamber of Commerce’s Kris Collins said Thursday spending is up in Waco city limits, though maybe not in the suburbs.
That increase, though, may not merit a celebration.
It stands at about 0.7% Collins said. She presented Amarillo-based economist Karr Ingham’s snapshot of local trends to invited business leaders. Ingham uses data dating to 2000 to prepare the Greater Waco Economic Index, sponsored by the First National Bank of Central Texas and the Tribune-Herald. It considers factors including employment, spending, home sales, general construction, hotel revenue and vehicle sales.
The GWEI climbed to a record-tying raw score of 131.3 in July, with home sales, auto spending and hotel-motel activity doing the heavy lifting.
Retail spending again represented a sore spot.
“General inflation-adjusted spending per July sales tax receipts across the metro area was down by 3.2% compared to July of a year ago, which in turn was up by a solid 5.3% compared to July of the previous year,” Ingham said in his summary. “The year-to-date spending total is down as well, off by 1.3% compared to the first seven months of a year ago.”
Ingham tallies sales tax receipts for Waco, Bellmead, Beverly Hills, Hewitt, Lacy Lakeview, Lorena, McGregor, Robinson, West and Woodway.
Compared to these neighbors, Waco comes out ahead, barely.
With all the city has going for it, including creating 1,300 new jobs the past year and seeing Magnolia Market at the Silos attract an estimated 30,000 visitors weekly — buying Magnolia-themed merchandise as they walk the grounds — some might wonder why spending seems stuck in neutral.
“The nagging negative remains less-than-strong general spending, a pinnacle of any local economy in which we would always prefer to see ongoing expansion,” Ingham said, addressing the issue in what otherwise is a glowing report on Waco’s performance halfway through 2019.
Alan Ritchie, owner of Ritchie’s Western Wear on West Waco Drive, said Thursday any lull in retail sales locally had not found his store.
“I guess I could say our sales are the best they’ve ever been,” Ritchie said of his 40-year-old establishment, seller of jeans, western shirts, accessories and boots.
He said Ritchie’s is thriving despite the arrival of new competitors.
“I don’t get around to all the other places around Waco,” he said. “I just know our sales have been robust all summer, great in August. We’ve been seeing an increase every year for several years, some years more than others. We have increased our inventory, but we have not remodeled or made any other significant changes in quite some time. I’m assuming part of the answer is the overall economy is better, at least for those willing to work.”
Steve Valdez, who manages Richland Mall’s J.C. Penney store, said he gets the impression shoppers are relying more on sales and deep discounts.
“I think people are more conscious of how much they’re spending,” Valdez said. “If we have a big sale, I mean not the typical sale you might see on a weekend, but something even more significant, we get even more people in the store than we expected. It’s been a nice year so far.”
Retailing trends nationally have been a decidedly mixed shopping bag.
Tradingeconomics.com reported that retail sales in July increased 0.7% between June and July, beating market expectations and led by fractional increases in sales of building materials, clothing, electronics, appliances, food and beverages, and at restaurants and bars.
Sales of hobby-related merchandise, books, musical instruments and health and personal care items declined, according to the same report.
Meanwhile, during stock trading on Thursday, shares in Burlington Stores, Five Below, Guess and Dollar General all surged because of impressive second-quarter sales reports, better-than-expected earnings or, in the case of Five Below, management’s tout that it was able to “raise prices and mitigate tariff risks,” according to cnbc.com’s report on daily market activities.
Stock in Best Buy fell 5% on news its same-store sales during the second quarter lagged behind estimates by market analysts, cnbc.com reported.
Other highlights of Ingham’s July report include the following:
- Auto spending rebounded in July, “soaring upward to a new July monthly record, with inflation-adjusted spending on new and used motor vehicles up by 13% compared to July of a year ago,” Ingham wrote.
- Hotel-motel revenue was up 5.6% through July compared to the same period last year, which was up 14% from the year before. “In fact, lodging in the city has been growing impressively for 10 straight years now, including double-digit percentage growth in years 2016-2018,” Ingham wrote.
- The 47 permits issued to build new homes in July tied the previous record set in July 2016. The 358 permits through July is a new record.
- Residential home sales “continue smashing records along the way,” as the 338 sold in July and the 1,855 sold so far through July eclipsed last year’s totals by 15% and 10%, respectively, Ingham reported. The average home sales price in July was $230,585, a 1% year-over-year increase. Through July, the average stood at $216,354.
- The value of permits for nonresidential construction, including commercial and industrial, dropped by 30% in July from July last year. The Greater Waco Chamber of Commerce’s Collins, who recruits industry, said prospects in the pipeline could remedy that slump.