Slight Rise Expected in Holiday Sales

Economy still shaky, but shoppers haven't 'thrown in the towel,' NRF says.

by staff writer
- Oct 07, 2011

Though retail sales have grown consecutively each month for more than a year, holiday sales may rise only modestly during the holidays.

Experts say holiday sales will increase by just 2.8 percent, compared to last year, to $465.6 billion. But the modest increase does not necessarily spell doom for retailers.

The expected increase is higher than the 2.6-percent increase retailers have averaged over the past 10 holiday seasons, according to the National Retail Federation. Furthermore, while unemployment rates, small income increases and rising prices on everyday goods are concerning, buyers have spent more each month for the past 14 months.

Matthew Shay, president and CEO of the NRF, says the holiday outlook has retailers worried but "optimistic," adding that they will use a variety of promotions like free shipping to draw buyers.

"Business remains concerned over the viability of the economic recovery, [but] there is no doubt that the retail industry is in a better position this year to handle consumer uncertainty than it was in 2008 and 2009," he says.

During those years, sales dropped 4.4 percent and 0.4 percent, respectively. During 2010, holiday sales increased 5.2 percent, the third biggest jump in the past 10 years—and a welcome surprise, as holiday sales had been expected to be much lower this time last year, the NRF reports.

"How Americans will react to the shaky economic data is the question, but the good news for retailers is that shoppers have not yet thrown in the towel," says Jack Kleinhenz, the organization's chief economist.

About the Author

Auctiva staff writers constantly monitor trends and best practices of those selling on eBay and elsewhere online. They attend relevant training seminars and trade shows and regularly discuss the market with PowerSellers and other market experts.

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