NRF forecasts 4.1% increase in holiday sales
Furniture Today Staff -- Furniture Today, October 13, 2012
WASHINGTON - The National Retail Federation is projecting holiday retail sales will increase 4.1% to $586.1 billion this year, citing signs of improving consumer confidence.
NRF called the forecast its most optimistic since the recession. It's higher that the 10-year average holiday sales increase of 3.5% but lower than 2011 actual holiday sales, which were up 5.6% from 2010.
Online sales alone are expected to grow 12% over last year.
"In spite of the uncertainties that exist in our economy and among consumers, we believe we'll see solid holiday sales growth this year," NRF President and CEO Matthew Shay, said in a release.
"Variables including an upcoming presidential election, confusion surrounding the ‘fiscal cliff' and concern relating to future economic growth could all combine to affect consumers' spending plans, but overall we are optimistic that retailers promotions will hit the right chord with holiday shoppers," Shay said.
NRF said recent government data show mixed indicators that could impact holiday sales, including weak job and income growth and a stagnant unemployment rate but also increases in consumer confidence and home prices.
"While moderate compared to what we experienced the last two holiday seasons, the forecast is a very pragmatic look at what to expect this year given the current rate of economic growth," said NRF Chief Economist Jack Kleinhenz.
"There's still some general anxiety amongst consumers when it comes to how the state of the economy is impacting their spending plans, but retailers can expect to see excitement around their promotions and plenty of bargain hunters both online and in stores in the coming months."
NRF's forecast is based on a model using indicators such as consumer confidence, consumer credit, disposable personal income, and previous monthly retail sales releases. It includes non-store direct-to-consumer, kiosks and online sales.
Shop.org, NRF's digital division, projected online holiday sales will grow 12% percent over last year to as much as $96 billion. The U.S. Department of Commerce estimated that 2011 fourth quarter e-commerce sales rose 15% from 2010. NRF and Shop.org define the holiday season as sales in November and December.