A recent report suggests retailers performed better than anticipated in May, with many Americans taking advantage of heavy Mother's Day promotions.

Major retailers such as Macy's and Target all noted stronger gains than many analysts had projected. This followed a dismal April, during which retailers posted some of the worst results in nearly three years. The influx of sales was credited to Mother's Day and the launch of new summer styles.

"The pent-up demand is continuing to pour out a little," Ken Perkins, president of research firm Retail Metrics, told USA Today. "I wouldn't say it's happening in droves. But consumers are updating their wardrobes."

As the economy continues to improve, retailers expect this trend to continue. According to a report from the Commerce Department, the economy grew at an annual rate of 1.9 percent in the first three months of the year, which means consumers' financial positions are slowly improving.

Still, many merchants fear that higher commodity prices – namely, gas and food – will discourage consumers from spending more at retail.

The American shopper continues to grow more confident, both with the direction of the country's economy and their own financial standings. A new report from Thomson Reuters and the University of Michigan observed the consumer sentiment index at 79.3 in May, up from 76.4 the previous month.

The latest reading marks the highest the Index has been since 2007, before the economic crash. Half of respondents said the economy had improved over the past year, with many planning to spend more money on vehicles, household durables and other retail purchases.

"Unfortunately, consumer confidence is still extremely vulnerable to a reversal, as occurred in the past two years," survey director Richard Curtin said in a statement. "While their most optimistic expectation for job growth could go unfulfilled without much harm, if the recent slowdown in job growth persists in the months ahead, it could form the basis for a third retreat in confidence."

Many retail merchants are still concerned about the impact of rising gas and grocery costs, though, which they believe could temper retail purchases over the summer.

Retail operations in the U.K. are facing tough times, as the nation is entering a double-dip recession and an increasing number of stores are going bust.

There are, of course, many factors contributing to U.K. retailers' difficulties. However, a recent report from Fujitsu found that nearly two-thirds of businesses believe that the current rate of market change is moving too quickly for companies to keep up.

Customers are primarily driving change. In fact, the survey found that 83 percent of respondents cited customers as a significant factor in fluctuations, as well as the issue they felt the least equipped to handle.

"The hardest task for CEOs today is to strike the balance between responding to external change and allowing change to happen around you while you stay true to your long term plan," said Duncan Tait, CEO of Fujitsu. "[It] is about understanding the environment around you and arming your organization in advance with the tools it needs to be able to respond quickly."

One of the top strategies for keeping up with consumers and their desires is by making them part of the process. Query them about what they like, want or would do differently.

Canadian merchants are taking a second look at their retail operations, as new duty-free limit changes could adversely affect those north of the U.S.-Canada border.

The limits are set to change on June 1, with an increase from $50 to $200 for stays longer than 24 hours and from $400 to $800 for visitors who remain in the U.S. for more than 48 hours.

As a result, Canadian retailers are looking to industry associations to help them keep consumers in the country, The Montreal Gazette reports. One organization, the Surrey Board of Trade, has partnered with Chambers of Commerce in border cities to investigate why Canadian retailers pay higher wholesale prices to suppliers, which inevitably raises prices on the consumer side.

"The Canadian dollar has really remained at par with the U.S. dollar for many years, but retailers pay up to 50 percent percent more for the same products,'' Paul Huberman, CEO of the Surrey Board of Trade, told the paper. "We say the federal government needs to take a look at this seriously and research why Canadian retailers pay that much more for milk and butter and that type of thing than a U.S. retailer.''

For U.S. border retailers, the change in duty-free limits was welcome news, as an influx of Canadian shoppers could help businesses further boost the strengthening economy.

The pressing economic climate has driven many Americans to steal products from retailers because they can no longer afford to buy them. For that reason, it's crucial to store operations that retail merchants invest more time and energy into the management of their retail stock and ensure none of their inventory falls victim to shrink.

As Security Info Watch notes, there are many different types of theft to be worried about, ranging from organized retail crime (ORC) to employee shrink. Various products will be more targeted than others, depending on value and how easily they can be stolen. Retailers should identify these key targets and develop a protocol to ensure they are being sold and not stolen.

"This may mean conducting spot checks of these items in the store to note if a particularly high volume seems to be moving from the shelves," the source suggests. "It may mean running an extra weekly report on inventory and comparing it with sales to ensure targeted items are in fact being sold. A quick check can ensure that any major discrepancies are noticed and promptly investigated."

For retailers with operations in multiple countries, they should also take note that there are different theft threat levels globally. Employee theft is more common in the U.S., while organized crime is more prevalent in Central America, for example.

Brazilian President Dilma Rousseff has cut interest rates and taxes in an effort to bolster consumer spending, and the initiative has paid off for the local retail sector. For the fifth time in seven months, Brazilian retail sales grew in March, according to a national statistics agency based in Rio de Janeiro.

Economists had predicted an increase of 0.3 percent, and while that forecast was a bit high, sales were still up by 0.2 percent month-over-month. Compared with one year earlier, sales jumped 12.5 percent – the largest such leap since March 2010.

"Public banks last month said they would cut their lending rates by as much as 21 percent to help boost economic growth that slowed to 2.7 percent last year from 7.5 percent in 2010," Bloomberg Businessweek adds. "The Rousseff administration has also extended tax cuts for appliances to stimulate consumer spending and eliminated payroll taxes for industries including textiles and shoes."

The Brazilian economy is quickly become a global powerhouse and has been rated as the world's sixth-largest market, helping local retailers come out of the recession in a strong place.

The retail sector fared relatively well throughout the economic recession and is now positioning itself for growth. In an effort to help achieve that objective, many merchants are looking to bring on new help to assist with store operations. Because of the tough job market, recent college graduates are quickly becoming the preferred target for retailers nationwide.

Ramon Winemberg, a sales and operations executive with more than 30 years experience in retail, told the Fulton Sun that a common misconception is that retail only has low-paying positions, which makes job prospects unattractive at first glance. However, he was quick to note that there are several great-paying and challenging jobs within the sector.

"The retail trade sector is the largest employer in the United States," Winemberg added. "Even more compelling, the retail industry is expected to add even more sector jobs in the coming years and will continue to grow annually."

Retailers are receiving somewhere in the ballpark of 700,000 job applications a month, according to Kronos' Retail Labor Index, suggesting there is interest in working in the sector.

Retail merchants are increasingly going digital, offering mobile applications, internet stores and other amenities to consumers who would rather shop online than in-store. The same is true of digital circulars, which can be made available to consumers online or through mobile devices.

That said, traditional print circulars aren't going extinct anytime soon, Retailing Today claims. There are a number of technical barriers, such as having to actually own a tablet or smartphone, that will ensure print circulars retain some use.

"Because of print circulars' overall ease of use for consumers, it still reigns as an effective marketing tool for retailers," the news source adds. "Poring through inserts in the Sunday paper and in-store to find coupons and deals are still part of the shopping ritual ingrained into the consumer psyche over generations."

However, Millennial shoppers – 20- to 30-something-year-olds that are typically on the cutting-edge of new technology – may be more inclined to use digital circulars. In that regard, it's paramount that retailers think of their target audience when creating circulars.

A recent report from Market Track highlights the continued use of print circulars, with distribution and page count up in April.

Consumers are increasingly shopping online, with ecommerce spending jumping 17 percent in the first quarter of 2012, according to comScore data. Retailers are responding to this increased pressure by changing the way many shoppers think of the traditional retail experience.

For example, Reuters reports that Macy's is now offering customers a virtual concierge service that can make beauty product recommendations. The brand is also updating its flagship location in Manhattan, investing $400 million into renovations.

"The customer is changing dramatically and is wide open to new ways of shopping," Macy's chief executive Terry Lundgren told Reuters last month at a conference in Tucson, Arizona.

Consulting firm Kurt Salmon was quick to add that the retail experience will get smaller, but it will also offer new experiences that leverage cutting-edge technology and other services, much like what Macy's is doing with its virtual concierge.

Other retailers are planning different initiatives. For example, PetSmart will offer overnight dog accommodations at stores, while handbag maker Coach is adding men's sections to more stores this year.

A report released on Tuesday by the U.S. Commerce Department suggests that retail sales continue to grow as consumers grow more confident in the economic recovery, employment and their own financial standings.

Overall, sales were up by 0.1 percent, following a 0.7 percent gain in March. While April marked the smallest rise of the year thus far, this still bodes well for the retail sector, which continues to make a fast recovery from the economic recession that continues to grip many other industries.

Key retail segments included furniture and electronics, with big-ticket items generating a significant increase in retail sales. Meanwhile, Americans also spent more money at bars and restaurants, which is typically a sign of a recovering economy.

Mild winter weather and an early Easter are two of the biggest factors for the slow sales growth in April, experts suggest. Many consumers did their spring shopping in February because of warm temperatures, while Easter fell on April 8th, meaning many consumers did their shopping in March during the weeks leading up to the holiday.