United States Of America : Retailers Push Purses In Clothing Slump

Retailers looking to boost sales at a time when women are reluctant to spend money on a whole new wardrobe are falling back on an old fashion maxim: Accessorize.

"Little things" like belts, scarves, footwear and handbags are less expensive, and a fun way to update last-season's wardrobe.

That trend comes as apparel-driven department stores and specialty retailers, like Federated Department Stores Inc. (FD) and Limited Brands Inc. (LTD), have battled slumping sales at stores open at least a year, hit by rampant discounting, thinning mall traffic and ebbing consumer confidence.

"Whenever there's a pinch in someone's pocketbook, it's a lot easier (to buy) a new bag or a new umbrella. It's still not a high-dollar commitment versus buying a new coat or suit," said Maribeth Holland, an analyst for Goldsmith & Harris. "Accessories have almost been able to lead the fashion trends," she added.
 
Companies known for accessories, such as Coach Inc. (COH), Kenneth Cole Productions Inc. (KCP) and Claire's Stores Inc. (CLE) have shown a big leap in profits, helped by robust sales. In contrast, many other retailers have had to rely almost solely on cost controls.

Shoppers spent up to 24 percent more on accessories compared with a year ago, according to a survey of 1,000 people conducted in January by America's Research Group, said Britt Beemer, the group's chairman.

"There hasn't really been a new apparel look out there, and accessories have been the beneficiary of that," Beemer said. Last season it was the '60's-inspired Bohemian look that sparked a youth craze over ruffled peasant tops and flowy skirts.

With that trend fizzling, accessories are "certainly a less expensive way to look different," he said.

Marshal Cohen, co-president of market research group NPD Fashionworld, said accessories started to overtake apparel almost two years ago, when the U.S. economy was on the decline.

Companies like Gap Inc. (GPS), he said, are pushing accessories more than ever, helping pull traffic into stores, as well as padding profit margins. Retailers can charge five times as much as they pay manufacturers for hosiery or a belt, while the mark-up on apparel is generally less, he said.