In what may seem like a contradiction, retail spending in the United States soared 1.1% in September, to $395.5 billion from August's numbers. It was the eighth (out of nine) monthly improvement for 2011 and, even though inflation boosted the number, it was a record level - even if auto sales made up the bulk of the increase last month. Yet, Lowe's Companies (NYSE:LOW) is still closing 20 of its underperforming home improvement stores. The decision doesn't exactly jive with the government's retail consumption numbers.

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Any individual retailer can underperform even in the best of economies, but it's not just Lowe's. Several other major retailers are shutting down multiple units despite what appears to be an improving (albeit slowly) economy.

Gap (NYSE:GPS), for instance, is closing 189 of its doors, leaving approximately 700 open. Saks (NYSE:SKS) intends to close "several more" of its current 46 stores after pulling the plug on seven over the past couple of years.

What gives? The "blame inflation" excuse doesn't fly here; retailers are simply passing along their higher costs to consumers, and consumers are (for the most part) paying it. To really understand what's going wrong for some retailers but well for others, investors really have to dig deeper into the government's retail sales numbers. (Financial discipline is the key to successful growth in the retail industry. For more, see The 4 Rs Of Investing In Retail.)

The Devil in the Details
Most investors are aware that retail spending has moved higher all year long, especially last month thanks to back-to-school shopping and automobiles. What most investors don't realize, however, is the amazing inconsistency of the retail growth rates from one category to another.

Last month, the only major category of retailing that saw sales dip was hardware stores; their top line fell an average of 0.1% despite repair work following a major hurricane in the northeast. Considering home improvement retail sales also didn't grow significantly while hurricane victims were stocking up on portable generators and flashlights, Lowe's decision isn't all that tough to understand.

So where's the money being spent? As was noted, auto sales were huge in September, gaining 3.6% against August's numbers. That's good news for the likes of Ford (NYSE:F), which saw an 8.9% jump in year-over-year unit sales in the United States for September.

The bulk of the mid-ticket growth, however, came straight from clothing sales; specialty clothing store sales were up 1.3%, while department store sales were higher by 1.1% last month. This would seem to be a positive for Saks and Gap Stores; year-to-date, though, department store sales are actually off by 0.9%. That makes sense out of Saks' decision, and to a lesser degree explains the pending Gap closings.

The Bottom Line
Though there were no clear winning arenas (aside from autos) in September, year-to-date, it's the non-store online retailers - or etailers - putting up the most growth. Top lines are up 13.2% compared to last year's total at this time.

That's clearly good news for the likes of Amazon (Nasdaq:AMZN) and its peers. More than that though, it explains some of the struggles that electronics stores like Best Buy (NYSE:BBY) are having. The electronics stores group's sales are flat for the year so far, and Best Buy is in defense mode, via the sale of Napster and the possible shuttering of its U.K. business.

The dollars are out there and flowing. It's just that not everybody's getting them. (For related reading, take a look at Analyzing Retail Stocks.)

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