The Strong Dollar Is Squeezing Retailers

The U.S. dollar is starting to give more brands a headache. The greenback has gained against a raft of currencies lately, hurting U.S. companies that operate around the world and also brands that rely on tourists who come to the States to shop. Luxury jeweler Tiffany & Co., which revealed weaker than hoped for first-quarter results Tuesday, felt both kinds of currency pain. Tiffany’s sales for the quarter ended April 30 declined 2.9 percent to $1 billion as a strong dollar dissuaded tourists from opening their wallets in the Americas. The company’s comparable sales were also hurt by currency translations and fell 5 percent, including a 5 percent drop in the U.S. and the Asia-Pacific region, a 4 percent decrease in Europe and Japan. Net earnings declined 12 percent to $125.2 million. “The strong dollar had a meaningful impact on first-quarter retail sales attributed to foreign tourists in the Americas,” said its chief executive officer Alessandro Bogliolo, adding that tourist sales in the U.S. were down approximately 25 percent. The slide was even steeper among Chinese visitors. Bogliolo told WWD that while the brand remains strong in China, a very strong U.S. dollar and a weak renminbi made it more expensive for Chinese tourists visiting

Follow WWD on Twitter or become a fan on Facebook.

Read More...

from WWDWWD http://bit.ly/2XtkZxJ