New Canaan, Conn. -- Continuing a two-year slide in retail spending momentum, American shoppers will generate only a lackluster 2.9% rise in holiday sales, according to Customer Growth Partners’ 13th Annual Holiday Forecast. The CPG report paints a scenario that is decidedly less cheery than some of the other holiday forecasts that have been released to date.
“Holiday 2013 will mark the first time that retailers see an actual decline in store productivity per square foot since the recession, by about 1%,” said Craig Johnson, president, Customer Growth Partners. “And because of the steep promotional pace this year, earnings will be weak, leading to a decline in “TOP” ratios, the true operating earnings generated per square foot, an even worse sign. The Grinch may not steal Christmas, but he may spoil it for a lot of retailers.”
The key drivers behind the retail weakness, according to the forecast, are lagging income growth, and the declining share of the population with full-time jobs.
“Consumers — at least those with full-time jobs — will still do their Christmas shopping this year, but at a smaller and slower pace than the last few years,” Johnson said. “For retailers, particularly those dependent on solid discretionary spending, however, this will be a ‘Humbug Holiday’ — the worst since the recession — and more so for stores who placed their holiday orders earlier in the year, when sales were still healthy.”
For more on the CPG holiday forecast, click here.