Frugal buying would make the holiday spend less than some had hoped for. But what is bad for retailers would have been beneficial for the Earth. Estimates from the U.S. Census Bureau indicated that US retail and food services sales for October were up 0.5 percent from the previous month (economists expected a 0.3 percent rise) and 7.2 percent above October 2010. Excluding gasoline, retail sales rose 0.7 percent.
Holiday buying estimates from the National Retail Federation (NRF) expected sales of around $465.6 billion, represent a 2.8% increase over last year’s robust results which were 5.2% above 2009 results.
On a per-person basis, the NRF surveys found that consumers say they will spend about $516 on gifts, down 4.6% from last year.
The global port tracker, a monthly report about import-cargo volume at the nation’s major retail container ports, is forecast to fall 1.9% in November.
Concerns about the prevailing economic climate is causing retailers to be cautious. “Retailers are being very strategic with their supply chains,” said Jonathan Gold, NRF’s vice president for supply chain and customs policy. “Although sales are expected to be in line with the 10-year average, retailers are keeping inventory levels extremely lean and filling their stores wall-to-wall with discounts and promotions. Unlike in 2008, when the financial crisis caught everyone off-guard, retailers have a strong understanding of the consumer mind set this Christmas,” he added.
Many retailers were expecting what can only be described as frugal spending. Consumer sentiment as measured by the Thomson Reuters/University of Michigan’s preliminary reading on the overall index edged up in October, but the ratings are about the same as they were in 2008, the worst holiday-shopping season in 35 years.
The industry feared what they were calling “mission shoppers,” who only purchase what they came for, meaning less unplanned buying. They were expecting consumers to embrace the “new normal” by spending less and looking for savings wherever they can.
While this would have been bad news for some retailers, less buying translates to less manufacturing, which implies less resource and energy use and ultimately less waste.
While many were predicting less not more holiday spending, these predictions have proven inaccurate as early indications suggest Black Friday’s retail spend represented a big year-over-year increase.
© 2011, Richard Matthews. All rights reserved.
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