Forecasts Say Retail Growth Expected Over Holiday Season

Ernie Goss
Scott Stewart
The Daily Record

An economist who runs monthly surveys across the Midwest is predicting slower retail growth this holiday season, although a decline in sales isn’t forecast.

Ernie Goss, an economist at Creighton University’s Heider College of Business, expects retail sales to grow by 3-4% overall this holiday shopping season, with e-commerce sales growing by about 14% over last year.

That forecast contrasts with an estimate by national accounting firm Deloitte, which is predicting a 4.5-5% growth in retail sales accompanying a boost of 14-18% for e-commerce sales, based on its annual holiday retail survey.

Both agree that the good times may not last indefinitely. Deloitte says its first takeaway is, “Short-term consumer sentiment is positive, but headwinds are forming.”

Goss said consumers should take precautions because a slowing economy and high debt loads.

“You’re not going to see low interest rates on your credit card,” Goss said. “So, if you carry a balance, which I highly recommend against, don’t carry a balance on your credit card. Those interest rates are out of sight.

Goss said a slowing growth in the gross domestic product signals slower economic growth, which could increase unemployment, even as retail sales keep growing.

E-commerce is expected to be a clear winner this holiday season, although an analysis by small business technology service provider Womply found that local retailers do best in the days leading up to Christmas – when those one- and two-day shipping promises become harder to trust.

“Local brick-and-mortar retailers in Omaha still have one major advantage over e-commerce this holiday season: last-minute shopping,” according to a release.

Womply found that Nebraska retailers experienced the highest level of consumer spending the last full week before Christmas.  

From Black Friday to Christmas Eve, the average retailer in Omaha sees $956 in daily revenue – or 7.7% over the average, the company said. Small shops also get a boost from Black Friday, the seventh biggest sales day a year, even with 29% of local retailers closed for the holiday.

Overall, the National Retail Federation predicts holiday shoppers between 35 and 44 plan to spend the most this year on the holidays – a total of $1,158.

Only about a fifth of consumers plan to spend less this year, Deloitte found, with only 7% citing a concern about the economy as a reason for spending less; most say they want to save more.

“Despite potential future headwinds,” Deloitte said, “the holiday season should be cheerful.”

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