Improving consumer confidence will trump the effects of lingering employment woes and the uncertain risks of the “fiscal cliff” and propel retailers to a 4.1 percent increase in holiday sales.
That’s the initial forecast for the season from the National Retail Federation, to be released today by the Washington, D.C.-based trade association. The projection is higher than NRF’s final forecast for a 3.8 percent gain in 2011 holiday sales, a figure which proved overly conservative when sales for the season grew 5.6 percent to $563.02 billion. NRF last year initially projected a 2.8 percent sales increase but in December elevated the number a full point based on the strength of Black Friday weekend and other results early in the season. Sales for holiday 2010 hit $533.39 billion, 5.5 percent over the prior-year period.
“This is the highest pre-holiday number we’ve issued since the recession,” Matthew Shay, president and chief executive officer of NRF, told WWD, “but it’s not as big as last year’s actual number. And we can safely say that if the [Obama] administration and Congress were showing the kind of leadership they should be in addressing the fiscal concerns that are causing consumers to hold back, the number could be quite a bit higher. The biggest distraction is the election, but the biggest risk is the threat of the ‘fiscal cliff’ if it’s not addressed in an adult manner.”
Jack Kleinhenz, chief economist at NRF, said, “There’s still some general anxiety amongst consumers when it comes to how the state of the economy is impacting their spending plans, but retailers can expect to see excitement around their promotions and plenty of bargain hunters both online and in stores in the coming months.”
NRF also projected, through its Shop.org digital division, that online sales would grow 12 percent over the holiday 2011 level this year, reaching between $92 billion and $96 billion. That estimate, the first ever made by NRF about online sales, is incorporated into the overall NRF forecast. It compares with 15 percent growth in online sales in 2011, according to Commerce Department data.
According to NRF, retailers are expected to hire between 585,000 and 625,000 seasonal workers this holiday season, which is comparable to the 607,000 seasonal employees they hired last year. On Monday, Macy’s Inc. said its holiday hiring would rise about 2.5 percent this year to about 80,000 from about 78,000 last year. Previously, Wal-Mart Stores Inc., Target Corp. and Kohl’s Corp. had said they would take on more seasonal workers than they did a year ago.
In the equity markets Monday, signs of strengthening in the U.S. manufacturing sector — including those among apparel and textile producers — helped lift stocks on both sides of the Atlantic.
The Dow Jones Industrial Average rose 0.6 percent, or 77.98 points, to 13,515.11 while the S&P 500 Retailing Industry Group advanced 0.2 percent, or 1.21 points, to 656.67. Major gains were registered by Coldwater Creek Inc., up 17.5 percent to 98 cents following an upgrade to “overweight” from “neutral” by Piper Jaffray, and The Bon-Ton Stores Inc., up 8.8 percent to $10.34 but well below the 52-week high of $14.99 reached on Sept. 12.
U.S. manufacturing activity expanded for the first time in four months in September, according to the Institute of Supply Management. The group’s Purchasing Managers’ Index, or PMI, rose to 51.5 for last month, up from 49.6 in August. A reading over 50 percent indicates growth in manufacturing. Of 11 production sectors seeing growth, textile mills were the strongest and makers of apparel, leather and allied products rated fifth.
Backlogs, however, were down in September and employment in the sector fell, ISM said. And apparel producers said their customers’ inventories were too high.
European stocks rose more vigorously than their U.S. counterparts, with the FTSE MIB in Milan as the strongest market, gaining 2.8 percent to 15,523.10, followed by the CAC 40 in Paris, which climbed 2.4 percent to 3,434.98. The DAX in Frankfurt expanded 1.5 percent to 7,326.73 and the FTSE 100 in London gained 1.4 percent to 5,820.45.
In his new book “Hollywood Royale,” Andy Warhol’s Protégé Matthew Rolston celebrates the Eighties revival of Hollywood glamour. Featuring more than 100 portraits taken by Rolston from 1977 to 1993, the book contains photos of icons like Michael Jackson, Cyndi Lauper, and @drewbarrymore, pictured here in 1991. “Hollywood Royale,” out today, will be accompanied by an exhibition opening at Los Angeles’ Fahey/Klein Gallery on March 1. #wwdeye
"Nowadays when life is not so happy with everything going on in the world, I think people come to me for a little bit of whimsy and color and fun." - Designer Rebecca De Ravenel on her cult-favorite jewelry line. (📸 : @vsteves) #wwd40
“Everyone is talking about how the retail industry is struggling, but I think it’s an incredible time because brands who are doing something different and innovative are setting themselves up for the future,” said @adamgoldston, who founded the luxury athletic brand @apl with his brother @ryangoldsten. The Goldston’s are part of WWD’s 40 under 40: a group of industry notables. See the rest of the list on WWD.com. (📷: @vsteves) #wwd40
@eyeswoon blogger Athena Calderone debuted her first-ever cookbook, “Cook Beautiful,” which is heavily centered on the presentation and visual expression of food. Pictured here are her miso glazed carrots from the book. Get the recipe on WWD.com. (📷: @johnny_miller_) #wwdeye
“It’s passion that helps get anybody to a certain point and it’s what’s propelled me,” said Kith founder @ronniefieg, one of WWD’s 40 under 40: a group of industry notables who are changing the face of retail, fashion and beauty. Fieg, who opened a Manhattan flagship on October 7, began his career at age 13 as a stock boy and salesman for footwear chain David Z. “I think staying true to [my] beliefs, hard work and passion have gotten me to where [Kith] is today.” See the rest of the 40 at WWD.com. (📷: @vsteves) #wwd40
25-year-old @samweaving is about to break out this fall, starring in Netflix’s horror film “The Babysitter,” fittingly out today on Friday the 13th. That’s not the only place you’ll be seeing her, though — Weaving’s got a role Showtime’s “SMILF” and another alongside Frances McDormand and Woody Harrelson in “Three Billboards Outside Ebbing, Missouri.” Though she’s got a full plate at the moment, there’s one role she’s got her eye on: Marilyn Monroe. “I’m a little too young at the moment, but it’s on my bucket list,” the actress told WWD (📷: @dandoperalski) #wwdeye
BFF's Poppy Jamie and Suki Waterhouse celebrated the launch of their bag line Pop x Suki at Nordstrom last night. "The line is really about our friendship, and how we are so different but complement each other," said Waterhouse. 👯 (📷: Katie Jones) #wwdeye
After designing the new @louisvuitton and @bulgariofficial flagships and a @chanelofficial boutique opening in Japan, @petermarinoarchitect has another project on his plate: The Lobster Club. Located in the Seagram Building, it’s the famed architect’s first restaurant project in New York, serving up modern Japanese brasserie-style cuisine. Bronze hues, bespoke material detailing, blush and chartreuse tones and a heavy emphasis on Picasso can be seen throughout. Mark your calendars for Nov. 1 for the much-anticipated opening. (📷: @clint_spaulding) #wwdeye
Did you know: @carlychaikin of "Mr. Robot" has been painting for about a decade? The actress, who plays Darlene on the show, is a self-taught artist who lists Salvador Dalí and Chuck Close as some of her idols. Chaikin told WWD that painting is a form of meditation for her — A much-needed one given the intensity of "Mr. Robot." See a piece Chaikin is working on at WWD.com (📷: @jilliansollazzo) #wwdeye