We Are Sunshine

U.S. federal tax rebate boosts retail sales in June; tanning industry may have benefited

Monday, July 14th, 2008

Retail businesses may have been bolstered by the U.S. federal government’s tax-rebate program this spring, as most major retailers reported stronger-than-expected sales figures in June, the Wall Street Journal reported Thursday.

Mega-retailer Wal-Mart led the way in June, with a 5.8 percent increase in sales, exceeding expectations, the company reported. But many non-discounters also reported sales increases.

2008-07-11-rebate-tanningnews-copy.jpgWhile economists predicted that the government’s $600-a-person rebate would spur sales of larger-ticket items, many analysts believe smaller retailers and service companies may also have benefited from the stimulus plan.

“Gas prices are believed to affect many indoor tanning clients, but there’s no doubt the stimulus checks may help ease some of that pain and may have helped tanning salons hold on to some of their business in trying economic times,” Smart Tan Vice President Joseph Levy said. “While we believe better marketing and sales practices are primarily responsible for the success stories we’ve seen this year, every little bit helps. And the stimulus checks may have helped a bit.”

Smart Tan surveys this spring showed that about a third of the tanning market is reporting stronger-than-expected sales, a third is reporting lower-than-expected sales and a third are right on projections.