Tokyo, May 25 (Bloomberg) -- Sales at Japan's large retailers rose in April from March, though not enough to suggest a three- year slide in sales at department stores and supermarkets will end anytime soon. Sales at supermarkets and department stores rose 0.3 percent in April, seasonally adjusted, after declining 3 percent in March, revised from an initial estimate of a 3.3 percent drop, the Ministry of Economy, Trade and Industry said. At stores open at least a year, sales slid 3.5 percent, capping a third year of falls. Sales at large retailers are decreasing as consumers become more frugal. More companies are going bankrupt, unemployment is close to a record high and income growth is slowing as manufacturers trim production, meaning workers are getting less overtime. Consumer spending, which accounts for about 60 percent of the economy, hasn't contributed to growth for the past two quarters. ``Income and employment trends, and the general state of concern about the economy -- meaning declining consumer sentiment -- suggest sales will stay weak at least through the rest of the year,'' said Ron Bevacqua, a senior economist at Commerz Securities (Japan) Ltd. Takashimaya Co., the country's largest department store, which sells brands such as Prada and Hermes, expects sales to fall to 992 billion yen ($8.3 billion) in the fiscal year started April 1, from 1 trillion yen last fiscal year. Ito-Yokado Co., Japan's biggest retailer, saw its group net income fall 26 percent in the second half of the year ended Feb. 28. The company cited the stalling economy and price cuts by discount stores. The 98-member index of retailers traded on the first section of the Tokyo stock exchange has fallen 22 percent in the past year, more than twice the 10 percent decline in the broader Topix index.
New Stores
Shoppers prefer new stores like Fast Retailing Co., which sells discount clothes under its Uniqlo brand. The company expects sales to reach about 1 trillion yen in Japan in the fiscal year ending August 2010, more than double the 400 billion yen in sales it expects in the fiscal year ending Aug. 31. ``Stores like Uniqlo, which offer cheap items, are the winners,'' said Yukari Sato, a senior economist at Nikko Salomon Smith Barney Ltd. before the figures were released. These new shops aren't included in the ministry's survey of retailers, economists say. The ministry has said new retailers are added to the survey, though it hasn't clarified how often the sample is changed. Reports yesterday showed department store sales were unchanged in April from a year ago, after falling for the sixth straight month in March. Meanwhile, supermarket store sales declined 5.5 percent from a year ago, the 29th straight fall. Overall retail sales fell 2.3 percent last month, today's report showed, the second consecutive decline. ``The message that retail sales are set to contract sharply in the second quarter is unmistakable,'' said James Malcolm, senior economist at J.P. Morgan Securities (Asia) Ltd.