Study: Holiday Sales to Rise

With the start last Friday of the infamous post-Thanksgiving rush—during which 75 percent of American consumers start the holiday shopping season, according to the National Retail Foundation—retailers are tallying their receipts as an indicator of what to expect by year’s end. Meanwhile, a new survey from the International Council of Shopping Centers shows that U.S. holiday sales are expected to rise 4 percent from last year’s disappointing increase, pegged by the NRF at about 2 percent.

The 4 percent forecast is the median consensus from 44 retail and real estate analysts whom the ICSC polled in October for its 10th annual holiday survey. Those analysts cited tax reform, the improving stock market and extra cash from mortgage refinancing as forces driving consumer spending this year. Other factors are greater job stability, lower prices for popular electronics items and new apparel offerings embraced by shoppers earlier this fall.

“We believe sales in the holiday season will be more positive this year,” said ICSC rep Patrice Duker. “Consumers have more disposable income from tax cuts and tax breaks. With all of the refinancing and new building that is helping the booming housing market, people still have some of that cash, and they’re looking for home electronics and furnishings. Plus, consumers showed during the back-to-school shopping season … [that] styles were right this year, unlike the past two years. People are spending more freely.”

The ICSC said that by most broad measures of retail activity, last year’s holiday season was the weakest since 1990. Sales for the November-December 2002 period rose by about 2 percent from the year before, according to the NRF, compared with average growth of 5.2 percent during the preceding nine holiday seasons. Last year, retailers were hampered by worries about Iraq as well as the tough comparison with the post-Sept. 11 surge in consumer spending in 2001.