MARQUETTE - Believe it or not, many people have already begun shopping for the Christmas holiday season and some have even finished.
After today's Halloween festivities are scarcely finished, the turning of the calendar to November will herald in the holiday shopping push. In fact, some retailers have already begun alerting customers to day after Thanksgiving sales or have started the countdown to Black Friday, a traditional holiday shopping bonanza marked by special bargains, frenzied shoppers and extended retail store hours.
The National Retail Federation predicts holiday sales for this year will be average, with a 2.8 percent increase in sales projected to $456.6 billion. That expectation is lower than last year's 5.2 percent increase, but is just above the average holiday sales increase of 2.6 percent.
"Retailers are optimistic that a combination of strong promotions and lean inventory levels will help them address consumer caution this holiday season," said NRF president and chief executive officer Matthew Shay. "While businesses remain concerned over the viability of the economic recovery, there is no doubt that the retail industry is in a better position this year to handle consumer uncertainty than it was in 2008 and 2009."
In a news release, the federation said consumers this holiday season will shop at a variety of locations and channels as they scope out ways to get the best bang for their buck. According to the National Retail Federation's 2011 Holiday Consumer Intentions and Actions Survey, conducted by BIGresearch, holiday shoppers say they plan to shell out an average of $704 on holiday gifts and seasonal merchandise, down slightly from last year's $718.
Nearly 60 percent of holiday shoppers say they plan to take advantage of retailers' sales and discounts to make additional non-gift purchases for themselves and their families during the holiday season.
The federation said the average person will spend approximately $130 during the holiday season to take advantage of sales and discounts on apparel, electronics, home goods and other items for themselves or a family member, up from $112 last year.
"When it comes to retail growth this holiday season, slow and steady wins the race - and the same is true for shoppers, who are meticulously calculating the best ways to stretch their dollar," Shay said. "Knowing their customers are more focused than ever on value, retailers will entice shoppers with promotions that go beyond discounts, whether they're promoting free gifts with purchase, an extended warranty, or stellar customer service."
The federation said though there are several economic indicators painting a solid picture for the holiday season -including 14 consecutive months of retail sales growth and a substantial reduction in household debt- there is continued consumer uncertainty over the stock market, higher gas and food prices, fiscal policy and sputtering job growth which will impact spending this holiday season. Additionally, the substantial year-over-year gains for the 2010 holiday season will create more difficult comparisons for retailers to achieve this year.
"Just when you think the U.S. economy is turning around, another factor comes into play that changes the game," said federation chief economist Jack Kleinhenz. "Persistently high unemployment, an erratic stock market, modest income growth and rising consumer prices are all combining to impact spending this holiday season. How Americans will react to shaky economic data is the question, but the good news for retailers is that shoppers have not yet thrown in the towel."
The federation's holiday sales forecast is developed based on an economic model using several indicators including consumer confidence, consumer credit, disposable personal income and previous monthly retail sales releases.
According to the survey, the largest portion of a consumer's holiday budget will go toward gifts for family members, with the average person expected to spend $403 on kids, parents and other family members.
Money will also be spent on friends, co-workers and family pets. Shoppers are predicted to spend an average of $68 on friends, $21 on co-workers and $23 on other gifts. Consumers will also spend money on decorations ($46), greeting cards ($26), candy and food ($96), and flowers ($18).
Nationally, the federation predicts up to a half a million seasonal workers will be hired to work throughout the holiday season.
John Pepin can be reached at 906-228-2500, ext. 206.