NRF sees furniture among strong '04 performers
By Carole Sloan -- Furniture Today, January 25, 2004
NEW YORK — Furniture and home furnishings will be among the strong performers that will push sales in a key retail category up 5% this year, according to the National Retail Federation's new forecast.
The 2004 forecast covers the GAFS category — stores specializing in general merchandise, apparel, furniture and home furnishings, electronics and appliances, sporting goods, hobbies, books and music.
In contrast to 2003, year-to-year gains are expected to be stronger in the first half because last year started out weak, said Rosalind Wells, NRF chief economist. Additional income tax refunds from the 2003 tax cuts also will help the first half performance, Wells said at the NRF's annual conference here earlier this month.
The fiscal and monetary stimulus of the first half will dissipate towards the end of the year, she said. The forecast calls for GAFS increases of 6.4% in the first quarter, 6.2% in the second, 3.8% in the third and 4.2% in the fourth.
Furniture will benefit from a continued solid housing market "and could be even higher than the overall forecast," she said. "There will be a lot of refurnishing as people move."
Wells added that her optimistic forecast takes into account the effect of increased global sourcing, which means some furniture prices are declining.
Other strong business segments will be electronics and high-end stores in all products, the latter benefiting from the "wealth effect" of stock market gains. Lower and midpriced retailing will benefit from a strong economy and the presidential election year, as President Bush makes extra efforts to improve the economy.
Separately, Wells estimated that online retailing for multi-channel retailers increased 30% during the just-ended holiday period. The NRF has begun to survey online-only retailers, and by year's end will be able to offer comparative online sales statistics.
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