Whatcom County retail sales rise but suggest Canadian shopping slowing

THE BELLINGHAM HERALDFebruary 4, 2014 

Canadian Dollar

Canadian shoppers Kelly McCague, left, of Vancouver, B.C., and Mandy Meier of Burnaby, B.C., laugh while loading up their car Monday, Jan 13, 2014. at Ross Dress for Less in Bellingham. "It is still so much cheaper," in the U.S. than in Canada, even with the weaker loonie, said Meier.

PHILIP A. DWYER — THE BELLINGHAM HERALD Buy Photo

Retail sales continued to steadily grow locally last summer, but the data suggests that Canadians were already starting to slow their spending in Whatcom County.

Whatcom County tallied $915.3 million in taxable retail sales in the third quarter of 2013, a 6.3 percent increase compared to a year ago, according to data from the Washington Department of Revenue.

Retail trade, a segment that focuses on retail sold at stores, totaled $443.9 million for the quarter, up 5.6 percent compared to the third quarter of 2012.

Sales growth for this area was similar to the state average, which was up 7.6 percent for taxable retail sales and up 5.4 percent for retail trade.

The sales numbers broken down by categories suggest a slight slowdown in cross-border shopping in Whatcom County. Sales in the general merchandise category, which includes big-box and department stores, was down 2.8 percent in the third quarter to $112.4 million. One other Canadian-influenced category - e-commerce and mail order - jumped 26 percent to $20.4 million.

During the third quarter the loonie was between 95 and 97 cents compared to the U.S. dollar; in that period in 2012 it was around parity.

The Canadian dollar has weakened since summer and is currently floating around 90 cents compared to the U.S. dollar.

In addition to the declining loonie, a change in British Columbia sales taxes also may have kept Canadian shoppers home more often. As of April 2013, British Columbia went back to its traditional way of collecting sales tax. The short-lived Harmonized Sales Tax collected an additional 7 percent on a variety of products, including some school supplies.

Hart Hodges, director at Western Washington University's Center for Economic and Business Research, said the tax revisions and a weakening of the Canadian dollar between 2012 and 2013 would have a very small but measurable effect on cross-border shopping.

He expects Canadians still will find enough of a price difference on some key items such as gas and dairy that the impact of the weaker loonie will continue to be small.

"What is interesting to me is that retail sales were up more than I would have expected without a push from the Canadian shopper. That suggests a bit of strength from the local consumer - and that's a good sign," Hodges said in an email.

Other retail categories in Whatcom County posted significant growth, including furniture (up 24.6 percent year over year), new/used car sales (up 16.5 percent) sporting goods (up 14.7 percent) and electronics/appliances (up 14 percent).

In Skagit County, overall retail sales in the third quarter were up 5.5 percent compared to a year earlier, while retail trade was up 6.7 percent.

RETAIL SALES BY COMMUNITY

A look at how selected communities fared in overall retail sales and retail trade in the third quarter of 2013, and the percent change from the third quarter of 2012:

Community Retail sales Chg Retail trade Chg
Whatcom County $915.3 M +6.3% $443.9 M +5.6%
Bellingham $603.5 M +4.3% $282.9 M +5.3%
Blaine $39.4 M +10.4% $14.7 M +14.3%
Everson $5.9 M -1.7% $2.1 M +5.3%
Ferndale $46.2 M +8.7% $17.8 M +8%
Lynden $55.6 M +6.3% $23.6 M +6.1%
Nooksack $2.1 M +4.7% $993,319 +0.8%
Sumas $6.8 M -4.2% $3.9 M +15.7%
Unincorporated $155.7 M +14% $41.3 M +18.9%
SOURCE: WASHINGTON DEPARTMENT OF REVENUE

Reach Business Editor Dave Gallagher at 360-715-2269 or dave.gallagher@bellinghamherald.com. Read the Business Blog at bellinghamherald.com/business-blog or get updates on Twitter at @bhamheraldbiz.

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