NRF forecasts slower sales for 2013
Washington, D.C. — Retail industry sales (which exclude automobiles, gas stations, and restaurants) will increase 3.4%, down slightly from 4.2% in 2012 and 5.8% in 2011, according to the National Retail Federation’s 2013 economic forecast.
The lukewarm forecast, released Monday, comes on the heels of a holiday season that went head-to-head with Washington’s political wrangling over fiscal concerns, shifting consumers’ spending plans downward. In the end, holiday sales in 2012 grew 3.0%.
In its Monday press briefing, NRF attributed the lukewarm forecast to political wrangling in Washington over fiscal concerns, and NRF president and CEO Matthew Shay said that while it’s too early to precisely predict how recent tax hikes will impact spending, “We can safely predict that consumers will be shopping for price more often [in 2013] and there will be more ‘trading down’ occurring.”
Shop.org, NRF’s digital division, expects online sales in 2013 to grow between 9.0% and 12.0%. Online sales in 2012 during the months of November and December last year grew 11.1%.
“What we witnessed during the holiday season is an indication of what we are likely to see in 2013,” said Shay. “Pushing fiscal policy decisions down the road will lead to even greater uncertainty, and will continue to impact consumers’ desire and ability to spend on discretionary items. The administration and congress need to pursue and enact policies that lead to growth and economic expansion, or it could be another challenging year for retailers and consumers alike.”
A number of factors contributed to NRF’s 2013 economic forecast, including:
- Employment: The labor market continues its modest recovery but 2013 is not expected to result in meaningful acceleration in growth. As of December 2012, the unemployment rate has held steady for the last two months at 7.9%. Retailers on average employed 150,000 more workers in 2012, and the industry remains one of the biggest employers in the world.
- Income growth: Consumers are constrained by modest growth in income, and recent legislation passed in January increased payroll taxes for millions of workers, further limiting Americans’ spending decisions.
- Housing: NRF expects the housing sector to continue to improve and the fundamentals for growth to see continued gains in 2013.
- Inflation: Price pressures continue to be contained. NRF expects the Consumer Price Index to increase 1.9% in 2013, below the 2.1% increase in 2012.
- Consumer confidence: Current consumer attitudes are likely weighed down because of the handling of the fiscal cliff and the increase in payroll taxes. NRF said it expects confidence to improve as the pace of the recovery accelerates in the second half of 2013.
“While it’s too early to know the full effect of higher payroll taxes, there’s no question that many consumers will feel some kind of impact from the change in their paychecks,” said NRF chief economist Jack Kleinhenz. “But consumers have been a key driver of the economy and I expect their spending to grow modestly in 2013.”
Target gets fresh in Detroit
MINNEAPOLIS— Target’s remodeling effort has made its way to Detroit. The company announced Monday that it will add fresh grocery to stores in the area.
In addition to featuring a large selection of affordable fresh foods, the new layout will include reinventions in several other departments such as beauty, home, shoes and baby, aimed at providing guests with an exceptional one-stop shopping experience.
Remodeled stores will include approximately 10,000 square feet dedicated to fresh food, including a curated assortment of fresh produce, fresh packaged meat and pre-packaged baked goods, in addition to dry and frozen offerings. Guests will also find a selection of national food brands, as well as owned brands including Archer Farms premium foods, Market Pantry value staples and meal options, and Sutton & Dodge premium quality USDA Choice beef.
Beyond the grocery aisles, the remodeled stores will also feature other enhancements. In the beauty aisles, guests will experience a more visual environment, making it easier to browse a mix of everyday essentials and exclusive brands. The home department will offer easier navigation with wider aisles and lower product displays. The shoe department will be more comfortable with additional seating and mirrors, and the baby department will become easier to shop with broader visibility between baby gear, supplies and apparel.
“We’ve heard from our guests that they want more fresh food options in the convenience of their local Target store,” said Annette Miller, senior vice president of grocery, Target. “We’re excited to unveil a new, one-stop shopping experience and believe this significant investment underscores our commitment to the Detroit community.”
Great American Group handles Bakers Footwear liquidation
Woodland Hills, Calif. — Great American Group said Friday it has been selected to handle the liquidation of Bakers Footwear Group, offering discounts for products in 56 of Bakers Footwear Groups’ remaining stores, as well as online at Bakersshoes.com.
Bakers locations in Alabama, California, Connecticut, Florida, Georgia, Illinois, Kansas, Kentucky, Louisiana, Michigan, Missouri, Nevada, New Jersey, New York, North Carolina, Ohio, Pennsylvania, Texas, and Virginia are part of the sale event.
On Jan. 15, 2013 a bankruptcy judge for the U.S. Bankruptcy Court in St. Louis signed a Chapter 7 order allowing Bakers Footwear Group to conduct going-out-of-business sales at its remaining stores. It once operated 236 Bakers and Wild Pair shoe stores in 37 states before filing for Chapter 11 bankruptcy last October due to declining sales. At that time, the company hired GA Keen Realty Advisors of New York, a division of Great American Group, to market leases for 150 Bakers and Wild Pair shoe store locations in 31 states.