Retail Forward’s most recent forecast indicates 5.5 percent year-over-year growth in Q4 holiday sales, ending a trend of increasing growth rates going back to 2002 and falling lower than the average growth rate since 1995. The estimate covers such categories as home improvement stores, catalogs, online sales and GAFO (stores that sell general merchandise, clothing, furniture, CE, sporting goods, music and office supplies -- essentially anything but food and cars).
The forecast predicts continued negative growth at department stores whose sales will go to mass retailers. High gas prices are expected to favor supercenters, whose one-stop-shopping means less travel for consumers. Home improvement stores should feel the crunch of higher interest rates and a slowing housing market. At the same time, home furnishings are expected to benefit from past home buying, while CE and appliance sectors are expected to take a dip.
Online retail is expected to show the highest growth, surpassing $33 billion in sales over $27 billion last year for a 23 percent increase. This would still only represent 3 percent of all retail sales.
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