U.S. retail sales in 2018 could climb slightly higher than last year’s 3.9 percent gain, as lower unemployment along with growing wages drive consumer confidence higher.
The National Retail Federation on Thursday projected industry sales will grow between 3.8 along with 4.4 percent This kind of year, excluding automobiles, gas stations along with restaurants. that will compares with NRF’s forecast last year of growth between 3.2 along with 3.8 percent. A jump of 4.4 percent would certainly be the biggest increase since 2011, when retail sales climbed 5 percent.
Online along with various other non-store sales, which are included in NRF’s total projections, are required to raise between 10 along with 12 percent. that will incorporates sales made by mall kiosks, catalogs along with vending machines.
“A robust holiday season for retail sales is usually just one of many barometers that will points to a consumer that will is usually clearly feeling positive about their financial health,” NRF President along with CEO Matthew Shay said.
“Despite headlines to the contrary, the retail industry is usually strong, growing along with meeting consumer demand with the products they want at the prices they expect along with the shopping experience they want to have, online or in store,” he added.
NRF’s annual forecast follows an encouraging holiday season for many retailers. Department stores along that has a slew of specialty brands ended 2017 on a high note when compared with the year prior. Recent earnings reports by names such as Tapestry along with Michael Kors have also been upbeat.
“The push along with pull of forces both external along with internal to the U.S. economy will continue to provide challenges, yet on balance we expect a not bad year,” NRF Chief Economist Jack Kleinhenz said.
Companies are also still announcing plans for how they will use anticipated savings by brand new tax legislation. Bonuses, wage hikes along with sweetened benefits are being offered to some part- along with full-time retail employees already, yet the start of 2018 has also brought news of store closures along with job cuts across the U.S.
“Macroeconomic conditions are highly favorable toward consumer spending with low unemployment, modest wage gains, tax cuts, rising home values, record levels of consumer net worth along with elevated consumer confidence levels,” said Ken Perkins, the founder of Retail Metrics, in a note to clients This kind of week.
To be sure, many companies “still face the need for heavy investments in logistics along with last mile spend, in inventory management, in employees, within the introduction of AI & AR to their stores along with ecommerce platforms, in differentiation initiatives among various other needs that will will weigh on profitability.”
Read the full report by The National Retail Federation.