Summary
American retailers are expecting a challenging holiday season due to financial pressures, tariffs, and inflation, which affect consumer spending. Economic forecasts predict a slow increase in holiday sales compared to previous years, and businesses are adapting by managing inventories and pricing strategies. Tariffs and other economic stressors are leading companies to expect reduced spending and shifts in consumer behavior.
Key Facts
- Shoppers plan to spend 5.3% less this holiday season compared to the previous year.
- Sales from November to January are projected to grow by only 2.9% to 3.4%, the slowest since the pandemic.
- Inflation is causing higher prices, meaning spending increases are not due to more shopping activity.
- The job market shows signs of weakness, with high layoffs and open positions.
- Consumers are more budget-conscious due to high inflation, tariffs, and debt.
- Businesses face challenges from tariffs impacting their holiday margins, leading them to adjust imports and inventories.
- Companies like Flora and 4Knines are scaling back sales forecasts and noting changes in consumer behavior, such as longer decision times for large purchases.
- The National Retail Federation expects a 20.1% drop in imports by December due to these economic pressures.
