Retailers will see enthusiastic holiday shoppers flock to stores and websites, even as some toys, clothing and other gift items remain stranded in crowded ports, according to a new forecast that cited rising household incomes and rising rates. high savings for its optimistic outlook.
The National Retail Federation said on Wednesday it expects November and December holiday sales to increase by 8.5% to 10.5%, for a total of $ 843.4 billion to $ 859 billion. sales dollars. The sales forecast excludes spending by car dealers, gas stations and restaurants.
This would mark an all-time high for holiday sales growth and last year’s record. Last year, holiday sales rose 8.2% from 2019 to $ 777.3 billion, according to the NRF, as consumers took comfort in giving each other gifts during the pandemic. Holiday retail sales have grown 4.4% on average over the past five years.
NRF President and CEO Matt Shay said this year that consumers have been vaccinated against Covid-19, have become accustomed to navigating life during a pandemic and have additional funds because of the dollars stimulus and more time at home. This makes 2021 a smoother year for retailers than 2020.
He acknowledged the supply chain and labor shortages, but said retailers planned ahead to make sure they had plenty of inventory to sell and buyers took stock. benchmarks by starting their purchases in October.
“It’s not like there aren’t headwinds and challenges, and yet, despite this, we have great confidence that consumers will continue to propel the economy over this last. quarter of the year, “he said on a call with reporters.
In some cases, he said, people may need to purchase an item different from what is on their wishlist. Still, he said, that won’t dampen their enthusiasm.
âThey’re going to be shopping for the holiday season, and they won’t come home empty-handed,â he said. âSomehow they will shop, they will buy and they will find this item. “
He said if consumers feel more comfortable traveling, dining and staying in hotels again, they will buy products that support their more active and social lives. In addition, he said, fully vaccinated international tourists will be able to travel to the United States from November 8.
âWe believe this will also give retail a boost,â he said.
Growing consumer optimism
Other holiday forecasts also predicted a significant increase in spending year over year. Sales in November and December are expected to increase by at least 7% from a year ago, according to separate forecasts from Bain, Deloitte and Mastercard SpendingPulse.
E-commerce sales are also expected to increase as more consumers have added curbside pickup and door-to-door deliveries to their shopping routines. Online and other non-store sales, included in the NRF total, are expected to increase 11% to 15% to a total of between $ 218.3 billion and $ 226.2 billion. This is an increase from $ 196.7 billion in 2020.
NRF chief economist Jack Kleinhenz said he was monitoring inflation, a factor that is also driving increased sales. He said many households have a better balance sheet and have paid off their debts during the pandemic, allowing them to absorb higher prices.
He said he expects labor market gains and growing consumer optimism over the coming months as Covid-19 cases recede, booster injections become widely available and children qualify for Covid-19 vaccines. These factors will influence the mindset of buyers as they prepare to celebrate the season, he said.
âPeople are going back to work,â he said. âThere is a pick-up in foot traffic. We see spending in some service areas. All of this is therefore a strong indication for future job gains and retail spending. “
He said La Nina, a weather pattern that typically brings colder and wetter weather to the northern United States, also generally correlates with stronger retail sales.
Buyers will face different dynamics as retailers struggle to get goods from factories to store shelves due to congestion at ports, rising material costs and a shortage of truck drivers. . This should translate to fewer discounts, longer delivery times, and more out-of-stock items.
Retailers like Target, Best Buy, Amazon and Walmart have announced early sales events for the holidays and have even suspended exclusive access for loyal customers or encouraged shoppers to purchase desired items as soon as they see them.