https://www.usnews.com/news/economy/articles/2021-10-15/retail-sales-rise-in-september-better-than-expected
As we get closer to the holidays, it is expected to see rises in retail sales. This article discusses how retail rates rose by 0.7% in September which was higher than expected. After a 0.9% increase in August, economists predicted a drop of about 0.2% due to consumers being "skittish" about the delta variant and the rising inflation. One of the top contributors were food and gasoline. Gasoline sales were up 38.2% from a year ago and food service establishments saw an increase of 29.5%. They suspect that this is due to students returning to school and workers returning to the office played a role in the increase in gas sales and food sales. With people returning to work, it likely means that most of those people will be going to food establishments for lunch, thus increasing the sales.
The article goes further to discuss how it is expected that sales increase into October with the spending for Halloween and then holiday shopping. It continues to be somewhat of a concern as to how the economy will perform during the holiday months due to the delta variant, labor and material shortages, and rising prices for many products. The reach of the coronavirus has proved to be more pervasive than expected earlier this year which has resulted in global supply chains which has been one of the biggest unexpected results. Additionally, this has caused bottlenecks of key components used across the economy from housing to auto production and has, in turn, raised prices.
What do you think will happen with retail sales with the supply shortages and the holidays being impacted by covid?
4 comments:
I think that retail sales will definitely take a hit this holiday season. Not only will families not be able to buy as much as they usually would due to the pandemic but I believe many families will just use Amazon instead of going out shopping due to the delta variant. Many stores have also taken a hit due to low employment forcing many stores to close or be on the brink of it. I'm sure many retail stores are banking on this holiday season to be profitable for the longevity of their store but I dont believe it will happen.
In my opinion, despite the rising prices and challenges that the delta variant imposes, it is possible that consumers might continue spending. Thanks to a number of stimulus checks from the government, many people have abundant money in hand to spend. Also, people are SO DONE with being inside of their houses with restricted places to spend their money for so long, their marginal utility of spending might have increased compared to pre-covid along with the rising attitude of "enjoying your life like no tomorrow".
I agree with Hanna in that it seems people are tired of being stuck in the house especially after receiving vaccines I believe the holidays will give people a reason to go out into the world again and shop for the holidays.
I mean I'm not really surprised at all when you look at the bigger picture. People were inside for what, 13-14 months? so going from all online to in-store, of course, there is going to be an increase there, also stores were expecting things to go as normal so suddenly they have all of this old inventory they can't use so they need to sell it. and now it's getting towards the end of the season so there are going to be more and more sales, and retail is going to skyrocket. I wouldn't be surprised if stores and in-store shopping only and had discounts that they otherwise wouldn't have. with the chip shortages, I do think people will be surprised to see not a whole lot in the way of videogame consoles, computer parts, cars, and other electronics on sale, and if they are they will be very short stock. Having short stock means waiting outside like the good ol days ;(... nonetheless, this year will be very interesting to see what will happens in the retail industry.
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