NEW YORK, Sept. 20, 2017 /PRNewswire/ -- Retail holiday sales should rise a healthy 4 to 4.5 percent over last year's shopping season, according to Deloitte's annual retail holiday sales forecast.
Deloitte's retail and distribution practice expects total holiday sales (seasonally adjusted and excluding motor vehicles and gasoline) to reach $1.04 to $1.05 trillion between November and January.
Additionally, Deloitte forecasts an 18 to 21 percent increase in e-commerce sales in 2017 compared with 2016. E-commerce sales are expected to reach $111 to $114 billion during the 2017 holiday season.
"The projected uptick in holiday sales ties to four primary factors affecting consumer spending, starting with anticipated strong personal income growth," said Daniel Bachman, Deloitte's senior U.S. economist. "Last year, disposable personal income grew 2 percent over the year to the holiday period, and we may see that rise to a range of 3.8 to 4.2 percent this season. Consumer confidence remains elevated, the labor market is strong and the personal savings rate should remain stable at its current low level."
While fundamentals remain positive, Deloitte's economist also cited potential uncertainties that could affect income growth and bring the forecast in at the lower end of the range, such as an increase in the savings rate that would cause spending to expand more slowly. The threat of a government debt ceiling crisis – which has loomed over prior holiday seasons – could also cut employment and income growth. The impact of the unusually active hurricane season remains too early to project, as it could depress spending or increase it, particularly in the home improvement sector, due to rebuilding activity.
"Sentiment and spending indicators are firing on all cylinders, but the question is: How will retailers respond given the profound disruption across the industry?" said Rod Sides, vice chairman, Deloitte LLP and U.S. retail and distribution sector leader. "The good news is retail is thriving, and it is the proliferation of new, niche retailers that is resulting in share constantly changing hands. Consumers have unlimited alternatives and often bounce between brands, touchpoints and influencers, making it more difficult for retailers to attract shoppers without some level of customization. These disruptive factors are likely to combine to create a highly competitive and promotional holiday season. Retailers should modify their assumptions about what drives traffic, engagement and holiday sales growth, and realign around customer experience, creating relevant, emotional and inspirational connections that go beyond just product, price and assortment."
Note to editors: Deloitte is forecasting a 4 to 4.5 percent increase in 2017 holiday sales compared with 2016. Retail sales between November 2016 and January 2017 (seasonally adjusted and excluding automotive and gasoline) grew 3.6 percent and totaled $1.0 trillion according to the U.S. Commerce Department.
Deloitte is forecasting an 18 to 21 percent increase in 2017 e-commerce sales compared with 2016. E-commerce sales between November 2016 and January 2017 (seasonally adjusted and excluding gasoline stations, motor vehicles and parts dealers and food services) grew 14.3 percent totaling $93.8 billion.
About Deloitte Deloitte provides industry-leading audit, consulting, tax and advisory services to many of the world's most admired brands, including 80 percent of the Fortune 500 and more than 6,000 private and middle market companies. Our people work across more than 20 industry sectors to deliver measurable and lasting results that help reinforce public trust in our capital markets, inspire clients to make their most challenging business decisions with confidence, and help lead the way toward a stronger economy and a healthy society.
Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee ("DTTL"), its network of member firms, and their related entities. DTTL and each of its member firms are legally separate and independent entities. DTTL (also referred to as "Deloitte Global") does not provide services to clients. In the United States, Deloitte refers to one or more of the US member firms of DTTL, their related entities that operate using the "Deloitte" name in the United States and their respective affiliates. Certain services may not be available to attest clients under the rules and regulations of public accounting. Please see www.deloitte.com/about to learn more about our global network of member firms.