Holiday sales forecasts getting better, but retailers face another down year
Filed under: Economy
We're another week closer to the start of the holiday shopping season and another sales forecast has come in slightly better than expected. Or at least not as bad as expected, which merchants will count as a win in this recessionary year. The National Retail Federation weighed in with a projection that sales will reach $437.6 billion, one percent below last year, but better than the three percent drop expected for the whole year. It's also an improvement over the 3.4 percent drop of last year, which suggests consumers are opening their wallets again.
Mild optimism got more support from the weekly sales numbers issued by the International Council of Shopping Centers. Its tally of sales for the last week of September was up one percent over the same time last year and up 0.6 percent above the week before.
Of course, being up above last September's debacle is faint praise, since that's when the credit crisis came home to roost. But while ICSC Chief Economist Michael Niemira held to his forecast of a two percent drop in sales for September, his statement said he sees "a bias on the stronger side" when full-month sales tallies come out Oct. 8.
After a series of grim forecasts in the summer, projections have turned slightly better in recent weeks, thanks to some mild improvement in some of the leading economic indicators.
But analysts aren't getting their hopes up for this holiday; after ten years of sales growth averaging 3.39 percent annually, it is going to be a threadbare season. There are no must-have items to drive customers in droves to the stores, and retailers have been methodically trimming inventory through the year to avoid big markdowns.
"As the global economy continues to recover from the worst economic crisis most retailers have ever seen, Americans will focus primarily on practical gifts and shop on a budget this holiday season," said NRF Chief Economist Rosalind Wells, in a statement.
And even if consumers can be convinced to splurge on big-ticket items like flat screen TVs, stores won't be getting as big a bang for the buck. Electronics have seen a big shot of price deflation, so profits will be hard to come by in that important category.
Indeed, by most reports, retailers have gone back to basics for this holiday because shoppers aren't looking for anything fancy. BusinessWeek reports stores are pushing gingerbread houses, ornaments and small gifts to cater to shoppers who are still spooked by an unemployment rate near 10 percent. There will be no upside-down Christmas trees or offbeat gadgets this season.
If the back-to-school shopping season is any gauge, shoppers will come out in the end, probably hanging back until the last minute and shopping carefully and frugally. And barring any new shocks to the system, stores will scrape by this holiday season.
Why is Oprah going to cable? Hint: It's nothing to get teary about
Kisses from Hershey: Candymaker may court Cadbury with $17 billion bid
D-Day for Harry Reid: Can he wrangle 60 votes for Senate health reform bill?
Reader Comments (Page 1 of 1)
10-06-2009 @ 9:48AM
Paul said...
What we will see today is More Government Number Twiddling in the Stock market These numbers are Not real as there is absolutely Nothing to support them. Soon the Price of Number Twiddling Will Come Due and when it does America Will Fall into the Worst Depression and Panic Far Greater than 1921 Germany. They Know this and that is Exactly Their Plan . I urge Everyone to Call your Congress and Demand they Stop doing this or Lose their Jobs next November . As a Direct result of all of these Government " Bailouts " and Number Twiddling here is the Future Problem that Will Hit Us All by end of Year ; These so called " Bailout " and " Stimulus " Packages will produce only Minimal results and will Not work as planned. But, it is Going to Raise both Income and Property Taxes by up to 42 Percent across the Pay Scale by end of next year. Those who are below the Tax bracket will find they Too Will Be Taxed. Despite what they tell you on TV, that is the Word. Insurance Rates are also set to rise Big as well as inflation in Food, Energy and Healthcare. The Dollar Will Become Worthless. Yes the economy Will become a Panic Like Germany in 1920s'. All of this Has to happen for this Worthless Playmoney Injection to have any value at All. With the Trillions theyre Printing and Spending on Bailouts along with Bogus Unsupported Numbers, the Economy Cannot Help but slide into a Panic that No one will be able to stop. Just do the Math
Reply
10-07-2009 @ 8:14AM
DRAGON13 said...
YES I ENTIRELY AGREE WITH PAUL. NUMBERS LIE AND ABSOLUTELY NUMBERS LIE ABSOLUTELY. THE GOVERNMENT AND OTHER SUCH AGENCIES (POLLS) WILL SKEW THE NUMBERS ANY WAY THEY WISH TO GET THE OUTCOME THEY WISH. I KNOW BECAUSE I WORKED FOR THE GOVERNMENT FOR 40 YEARS. YOU ARE OFTEN INSTRUCTED TO MAKE THINGS APPEAR IN A SPECIFIC WAY UNDER EXTREME DURESS. THEY CERTAINLY MANIPULATE THE MARKET AND EVEN MORE SO SINCE OBAMA TOOK OFFICE. THEY ATTEMPT TO SHOW GAINS WHEN INDEED IT IS ALL FALSE. THERE IS SO MUCH MONEY GOING OUT NOW I DO NOT THINK THAT ANYONE HAS ANY IDEA HOW MUCH IN DEBT WE ARE. SOON WE WILL BE USING MONOPOLY MONEY TO PAY BILLS AND GOLD WILL BE ONLY CURRENCY OF THE DAY.
Reply
10-13-2009 @ 1:29PM
laditaxi2 said...
THANK GOODNESS! ! Someone else can see what's going on... Wake up AMERICA ! !Smell the coffee--soon we won't be able to afford coffee ! !
Reply
10-12-2009 @ 9:55PM
dumb1 said...
Let me see, 3.4 percent lost last year. 1 percent more lost this year, that should be off 4.4 percent. That would make this year worse than the disaster of last year. Yeah yeah I see why retailers should be happy with that. If we are spending 4.4 percent less this year than 2 years ago, how does that indicate that consumers are opening their wallets more????????? Same stuff going on with oil prices, it is all about the spin. Tell you what ever to get your money. The job market is a lot worse . Unemployment is closer to 13 percent and getting worse, because they dont tell you most workers in the housing industry get paid 1099 and do not qualify for unemployment. Even illegal workers are going home in large numbers because they cant find work.
Reply
10-14-2009 @ 8:00AM
Glenn said...
Of course it's going to be a better xmas if you happen to be a banker or fund trader...........the majority of Americans are NOT in better shape financially since they picked up the tab for the wealthy investors (losses) once again! Wall ST does not translate to the real world on Main St where things are still getting worse and will continue to do so until companies STOP being rewarded for beating too low estimates and we start seeing TOP line growth in earnings. Until that day executives will keep FIRING workers to keep bonus numbers that beat "analysts BS forecasts>"
Reply
10-16-2009 @ 12:31AM
Carrie said...
"Of course it's going to be a better xmas if you happen to be a banker or fund trader..."
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Or a member of Congress...they know they'll get their raise and so many of them don't seem to have to pay income tax. How's that? The American people pay taxes, congress gets big bucks, plus insurance, plus retirement. I think I'll run for office...Of course since I pay taxes and don't get a SS COLA, and will have to pay more in Medicare, I don't think I'll have a chance of winning...
10-14-2009 @ 8:04AM
Paul said...
If sales are going to be down then why are the retail stocks at year highs ?
Reply
10-14-2009 @ 10:16PM
johhny credit said...
just look at other third world countries like zimbabwe.10000% inflation.doctors don't afford to take a bus to work because its more that thier pay.when the president was asked where he would get the money to help his country ,he replied "no problem i'll print more." they now have trillion dollar notes.the finishing touch was installing a non white moslem,obama, to make it official that america is now third world material.this country has to come down before europeans can reclaim and rebuild the land.remember whites are the true minority in the world. we have NEVER been more than 20% of the worlds population. we are now below 10%.in america the population below 18 years of age is now 78 % so called minorities. its unsustainable.just where is it that non whites are in charge that things get better? exactly. godspeed
Reply