Sifting Through Summer Discounts

July is the month retailers roll out deep discounts on most summer items to make way for back-to-school season and for the fall. The question is: Are this year’s discounts deep enough?

The answer varies, depending on the sector, which ranges from summer apparel to outdoor furniture to inflatable pools to summery bedding. If you are in the market for a new car, July and August are when car dealers offer incentives in order to sell the remaining 2010 cars before they bring in the 2011 models.

“Retailers are looking at merchandise and recognizing they still have a whole lot of inventory, and they start discounting because they know if you haven’t bought it by now you’ll only be motivated by [a lower] price,” says Peter Framson, a partner at X Team International, a retail brokerage alliance.

In most sectors, consumers shouldn’t expect to see the same steep discounts like last year. That’s because stores are selling more products at regular prices and because they have less inventory, says Daniel Butler, vice president of retail operations at the National Retail Federation, an industry advocacy organization. Women’s apparel, however, is one retail category likely to have equally high discounts this month compared to this time last year. That’s because it remains one of the worst hit sectors, with sales currently down 3.3% on average year over year following a 10.2% decline in sales in 2009 compared to the previous year, according to the International Council of Shopping Centers. (Only sales of children’s shoes and apparel are performing worse, down 12.2% and 5.5%, respectively.)

Here are four retail sectors offering discounts and incentives this month.

Apparel

Look out for summer clothing – the lighter weight cottons, the bright colors – for men, women and children, which are the most likely to be discounted this month. Of course you might have already bought your summer clothes at this point, so the items will have a limited wear time. In fact, most stores are assuming that consumers have bought all their summer clothes already, and the sales are just another way to get you into stores as fall and back to school goods start appearing on the racks, says Framson.

Women’s apparel stores are offering sales throughout the month. Anne Klein is discounting select spring and summer clothing at up to around 70%, and Motherhood Maternity is featuring sales of up to 50% through July 31. Women’s-only apparel stores are more likely to offer such discounts this month in part because women – especially those running a household – have pulled back on spending to prioritize for family needs, says Jeff Green, president of Jeff Green Partners, a retail consulting firm. Also, there tends to be much more inventory geared exclusively toward the summer season for women than there is for men, says Framson.

Sales for both genders are widespread as well. Currently, Eddie Bauer is discounting select summer attire at up to 50% through July 11, Calvin Klein is offering discounts of up to 60% through July 14, and Diesel.com is offering up to 50% off its remaining spring and summer attire through July 16. Also, expect swimsuits and flip flops – items tailored specifically for the beach – to have fairly large discounts since the summer season is about halfway through and the winter season when consumers travel to a warm destination is far off. At Speedo, swimsuits are on sale for up to 25% through July 31.

Outdoor furniture

Sales of outdoor furniture have been slow since the housing market downturn began. That’s when consumers started cutting back on purchases overall, but especially non-essential furniture, says Green. And at this point, a budget-conscious consumer deciding between a couch and an outdoor dining set will likely opt for the former since it can be used throughout the year, he says.

To move patio furniture that probably won’t sell at full price this summer anyway, retailers are rolling out the discounts in this sector as well, he says. Home Depot, for example, is offering discounts on select pieces of up to 25% through August 13. Target is also discounting outdoor furniture, including a patio four-piece wicker set, which is selling for $209.65, a 65% discount off the original price. Consumers are more likely to find such discounts at these stores and Lowe’s and Wal-Mart because they tend to buy in bulk and have a larger inventory, says Green.

In addition, there are discounts on other outdoor pieces, like inflatable pools, swing sets and grills. Through July 10, inflatable pools are 15% off their original price at eToys.com. At Wal-Mart, a five-burner gas grill sells for $220, down from $248.

Summer bedding & bath

If you need to stock up on summer sheets, blankets and towels, keep an eye out for big white sales this month. These tend to occur in July when the stores try to clear out the remaining spring and summer sets in order to bring in the fall and winter pieces and in January when the reverse cycle occurs.

At Macy’s, such sales can vary throughout the country, says a company spokesman, but at most of its stores “there are typically clearance markdowns in July for spring goods so that we have room in stores for fall goods.”

Currently, Macy’s online sales include 20% to 60% off bedding and bath pieces. Bed Bath & Beyond meanwhile has placed dozens of cotton sheet sets on clearance starting as low as $11 for a twin set.

Given that sheets, blankets and duvets can cost hundreds of dollars each, stocking up on for next summer could help you save money.

Cars

At most dealerships, the 2011 models will start rolling onto the sales floors around September. That means dealerships only have a few weeks to sell their remaining 2010 (and in some cases 2009) models.

During the next few days, they’ll start announcing incentives that they hope will bring in buyers, says a spokeswoman at the Kelley Blue Book, which is likely to include rebates and low APR financing. You might even be given a choice between the two, and in most cases you’ll get a better deal by choosing a, say, 1.9% financing deal (assuming you qualify) than $1,000 cash back since a lower interest rate on your loan will ultimately make the car less costly.

Currently, select Ford dealerships are offering financing deals of 0% to 1.9% on 2010 Mustangs through July 6th and select Hyundai dealerships are offering cash back of $750 to $2,500 to customers.