By Mish Shedlock of MishTalk
Christmas season rates to be dismal according to shipping analysis. And the economy is iffier than most think. Hold off on early sales, or better yet, just say no to a Christmas splurge.
The Wall Street Journal has some interesting thoughts on holiday sales this year partially based on import and rail traffic.
Early signs—from the number of boxes loaded on railway cars to rising consumer debt—signal a weaker holiday season than the past three, when pent-up demand coming out of the worst of the pandemic sparked shoppers’ spending.
“This holiday will be late breaking and heavily deal reliant,” Chris Cocks, the chief executive of toy maker Hasbro, which makes such wish-list staples as My Little Pony, Nerf blasters and Transformers, told analysts recently.
The National Retail Federation expects overall sales increases could be in line with the slower pace we saw in the decade leading up to the pandemic, from 2010 to 2019, when the average annual increase over that period was 3.6%. It expects November-December spending, not including inflation, to rise 3% to 4%. By contrast, sales rose 5.4% in 2022, 12.7% in 2021 and 9.1% in 2020.
Others are even gloomier. Some economic and company forecasts call for almost no growth in holiday spending this year, particularly when inflation is stripped out. The consulting firm Bain expects inflation-adjusted retail sales in November and December for stores and e-commerce to rise 1%, the slowest pace since the financial-crisis holidays of 2008.
Shoppers can look forward to more discounts as Christmas approaches, predicts Jordan Voloshin, CEO of the upscale chain of cookwares stores Sur La Table. “October was very soft,” he said. He expects sales will be concentrated on a few big days of discounting like Black Friday and the Saturday before Christmas.
Many businesses are planning for a ho-hum holiday season by importing less stuff. U.S. imports of TVs and computer monitors, footwear and toys—including games and sports equipment—fell 20% or more in the nine months through September, compared with the same period a year earlier, according to the Census Bureau. Bicycle imports are down 41%, and smartphones declined 16%.