Shoppers are leaning in a little more at apparel and accessories specialty stores this holiday.
November sales at specialty stores rose a seasonally adjusted 0.5 percent compared with October and were up 34.8 percent from the socially distanced selling a year earlier, according to the Census Bureau’s latest sales reading on Wednesday.
That topped department stores, which saw sales fall 5.4 percent compared with the prior month, but were still up 24.9 percent from November 2020.
Non-store retailers — a category dominated by e-commerce — logged flat sales month-to-month and a 12.1 percent rise from a year earlier.
(Those trends generally hold for the September-to-November selling season, although e-commerce showed more relative strength over the three-month period, with seasonally adjusted sales growth of 4.6 percent this fall compared with this summer. Specialty stores were up 1.4 percent for the period and department stores were down 1.2 percent).
The sales picture has been complicated by, well, just about everything, from the comparison with the COVID-19-mangled season last year, the global supply chain back-ups and the higher prices that the shipping slowdowns have contributed to.
The holiday sales season has shifted earlier as well, with retailers promoting holiday in October, before Black Friday was even on the horizon.
Total November retail and food service sales rose a seasonally adjusted 0.3 percent month-to-month — less than the 0.8 percent increase economists projected — having risen 1.8 percent in October.
The National Retail Federation said the holiday season was on track.
“We expect demand will remain strong through December, even though consumers started holiday shopping earlier than ever this year,” said Matthew Shay, president and chief executive officer of the trade group. “Despite the rise of the Omicron variant, increased vaccination rates combined with retailers’ ongoing safety protocols and procedures have resulted in consumers who feel they can continue to shop safely and conveniently. We believe that holiday sales this year could grow as much as 11.5 percent over 2020.”
But questions linger about 2022.
Consumers won’t have the push of the holidays to buy and government stimulus also stops providing as much support to spend — and prices are going higher while the supply chain is expected to stay tangled up through to 2023.
Wholesale prices on U.S.-made goods rose a seasonally adjusted 0.8 percent in November, ahead of the 0.3 percent bump up economists predicted. (Most apparel sold in the U.S. is imported, but there were signs of higher producer prices in domestically made fashion. November women’s, girls’ and infants’ apparel prices rose 1.9 percent compared with a year earlier, while men’s and boys’ prices were up 2.2 percent).
Moody’s Investors Service offered a stable, but cautious outlook for the U.S. retail and apparel business next year.
“As consumers’ pent-up demand eases and cost pressures rise, retail operating income growth is set to slow in 2022,” Moody’s said. “Consumer spending on travel, leisure and entertainment is also likely to take a greater share of wallet. At the same time, the pandemic continues to fuel uncertainty as new virus variants such as Delta and Omicron emerge.”
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