Despite the weak holiday sales forecasts and moderate October sales figures, the retail market exceeded expectations for November, growing 5.1 percent over November 2006 — much higher than most analysts had expected.
“Everyone was surprised, and I was as well. It was one of those reports that is an eye opener,” said Michael P. Niemira, chief economist and director of research with the International Council of Shopping Centers.
“Consumers have more strength than some analysts had given them credit for,” said Scott Krugman, spokesman with the National Retail Federation (NRF), which calculated the figure based on U.S. Commerce Department sales data released Thursday. NRF extrapolates retail data from the Commerce Department figures, which include other categories such as autos, gas stations and restaurants.
The NRF had predicted a 4 percent increase for the 2007 holiday season, bringing sales to a projected $474.5 billion for November and December. “The season isn’t over,” though, said Krugman, and “all eyes are on December.”
Krugman attributes the increase in part to the “pentup demand for apparel” after a warm October led consumers to hold off on winter outerwear and clothing. Clothing and clothing accessories grew 8.2 percent from November 2006, and 2.6 percent from October.
In December, weather could play a factor again, with possible snowstorms preventing people from getting to stores, Krugman said.
Aside from clothing, sporting goods, hobby, book and music stores had an 11.3 percent sales growth over last November. The season so far is “better than last year,” said Gwen Bowden, manager of children’s toy, book, and clothing store Doodlehopper 4 Kids in Springfield. According to Bowden, thestore had much larger crowds this year than last year on Black Friday.
Electronics retailers had a 6.1 percent sales bump, and sales for furniture and home furnishing stores climbed 2.5 percent. Discounts played a big factor, especially around Black Friday, Krugman said.
Concerns over the effect of the credit crunch and high gas prices were “sensational,” said Krugman. “Don’t underestimate the consumer during the holiday season.”
