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Despite supply and omicron issues, holiday sales up 8.5%

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(AP)

Holiday sales grow at their fastest pace in 17 years, even as shoppers struggle with higher prices, product shortages and new COVID-19 variants raging for weeks the end of the season, according to a spending measure.

Mastercard Spend Pulse, which tracks all types of payments including cash and debit cards, reported Sunday that holiday sales were up 8.5% from a year earlier. Mastercard SpendPulse was expected to grow 7.4%.

The results, covering November 1 to December 24, were driven by purchases of clothing and jewelry.

Holiday sales were up 10.7% over the pre-pandemic holiday of 2019.

By category, clothing increased 47%, jewelry 32%, electronics 16%. Online sales were up 11% from a year ago and 61% from 2019. Department stores registered a 21% increase over 2020.

After the success of omicron, some consumers stayed home and shifted their spending to e-commerce – but sales still surged. “I feel really good about how the season went,” said Steve Sadove, senior advisor at Mastercard and former CEO of Saks Inc., “I feel really good about how the season went,” when people feel a bit uncomfortable. , you’ll experience a little bit of online traction, and the store’s performance slows down a bit. ”

A broader picture will be revealed next month when the National Retail Federation, the nation’s largest retail trade group, releases its combined two-month results in mid-January. The results will be based on an analysis of November and December sales figures from the Commerce Department. Analysts will also dissect fourth-quarter financial results from various retailers that are expected to be released in February.

Overall, analysts were expecting a strong holiday season, boosted by early shopping activity starting in October in anticipation of product shortages. Consumers are also determined to celebrate the holidays after a year of silence. However, November saw retail sales slow, in part due to early shopping activity. And omicron, which has quickly become the dominant version of the virus in the United States, has now derailed the holiday plans of many Americans, who had to cancel gatherings last minute.

In early December, the National Retail Federation said holiday sales were on track to beat its record-breaking forecast of an 8.5% to 10.5% increase year-over-year. last. Holiday sales are up 8.2% in 2020 as shoppers, locked down during the early part of the pandemic, flock to pajamas and homewares, mostly online.

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The group expects that online sales and in-store sales, included in the total, will grow between 11% and 15%. The numbers do not include auto dealers, gas stations and restaurants. According to the group, holiday sales have grown by an average of 4.4% over the past five years.

The update from the NRF was sent in early December, just before omicrons became a bigger threat in the US and started disrupting businesses from Broadway theaters to restaurants. But overall store traffic is not falling, although some stores are reporting declines in major city locations. In the week ending December 18, store traffic increased nearly 20% from a year earlier, despite a 23% drop from the same week in the year before the pandemic 2019, according to Sensormatic Solutions. Peter McCall, senior director of retail consulting at Sensormatic, notes that shoppers are still going to retail stores but are now favoring outdoor malls and malls over malls. Closed shopping.

Retail sales continue to grow in an economic environment that has been difficult for some retailers. Many have had to raise wages sharply to find and keep workers, increasing the cost of their business. They are also scrambling to fill store shelves with major US ports still having spare parts.

At the same time, Americans have demonstrated their resilience in different ways. They pay more for necessities like food and gas, putting pressure on holiday shoppers’ budgets. In fact, consumer prices rose 5.7% over the past year, the fastest pace in 39 years, as soaring inflation confronts Americans with the holiday shopping season underway. The November increase, announced on Thursday by the Commerce Department, followed a 5.1% gain in the 12 months ended October, continuing a streak of year-over-year gains above the 2% inflation target set by the Federal Reserve. set forth by the Federal Reserve.

Americans are also learning to adapt to product scarcity, turning to alternatives if their top pick isn’t available, or looking at other places like eBay to find their top brands.

Although big-box retailers like Target and Walmart have promised to have shelves ready for the holiday, supply constraints appear to be in their infancy elsewhere. Target CEO Brian Cornell recently told The Associated Press he believes it will take several years for supply chain bottlenecks to clear.

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AP Economics’ Marty Crutsinger contributed to this report in Washington.

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https://www.winknews.com/2021/12/26/despite-supply-issues-and-omicron-holiday-sales-rise-8-5/ Despite supply and omicron issues, holiday sales up 8.5%

Aila Slisco

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