The ‘Retail Apocalypse’ May Not Be Nigh After All—But There Will Be Losers as well as Winners Nonetheless
NEW YORK (Sept. 20, 2017) –AlixPartners, the global business-advisory firm, today released its forecast for US retail sales for the upcoming holiday season. The forecast anticipates an increase in sales revenue for retailers for the November-through-January period of 3.5% to 4.4%, compared with 2016 holiday-season sales.
Joel Bines, co-head of the AlixPartners’ retail practice and a managing director at the firm, said:
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“The so-called ‘Retail Apocalypse’ may not be nigh after all. Based on our unique and historically highly-accurate methodology, we see a fairly healthy holiday season for retail. However, there definitely will be losers as well as winners this holiday season. And the overriding question is whether individual retailers can take advantage of the period ahead and redouble their efforts to deal, both strategically and tactically, with everything from the rise of online shopping to the fact that many younger consumers today prefer spending their money on experiences rather than on tangible products.”
The AlixPartners’ forecast methodology is based on the premise that year-to-date retail sales data though the end of the back-to-school season has historically proved to be perhaps the best gauge of what US consumers will spend during the holiday season. This is buttressed by the fact that over the past seven years, year-to-date sales through the back-to-school season have accounted for 66.1% to 66.4% of retail sales annually, with holiday sales accounting for 16.9% to 17.0%.
The AlixPartners forecast was first instituted in 2012, its numbers are seasonally adjusted and it covers core retail sales, which excludes motor vehicles, fuel, and restaurants and drinking establishments.
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AlixPartners’ US holiday retail sales forecast: 3.5%-4.4%
Forecast is for seasonally-adjusted Nov.-Dec. 2017 core retail sales, which excludies motor vehicles, fuel, restaurants & drinking establishments
Model first instituted in 2012, with subsequent, minor refinements, on the premise that:
- Historical US retail sales data demonstrates that the best gauge of what US consumers will spend during the holidays is what they've already spent year to date.
- Therefore, by the end of the back-to-school (BTS) period, AlixPartners models and forecasts holiday sales—based on the given year's cumulative year-to-date sales performance.
- Over the past seven years, sales through the BTS period have accounted for 66.1% - 66.4% of annual sales, and holiday sales for 16.9% - 17.0%.