November Market Insights | WarehouseQuote
Key Summary
NRF Predicts Steady Holiday Sales Growth Despite Economic Uncertainty
The National Retail Federation (NRF) projects a steady 2.5%-3.5% growth in holiday sales, expecting consumer spending to reach nearly $989 billion. Despite mixed economic signals, such as slight GDP dips and slower job growth, household finances and rising wages are sustaining consumer confidence. Potential 2024 tariffs could, however, impact spending, particularly on items like toys and apparel. The NRF remains optimistic about the holiday shopping season, supported by increased wage growth and stable economic indicators.
Retail Inventories in Good Shape for the Holidays
The National Retail Federation (NRF) reports that retail inventories are stable and well-controlled ahead of the holiday season, reaching pre-pandemic levels. Inventory-to-sales ratios are now lower than last year, reflecting adjustments in ordering and planning, as retailers like Walmart and Target optimized inventory to align with demand. This has allowed retailers to avoid overstocks and stockouts, positioning them well for both holiday and early 2024 sales cycles.
Rise in Merchandise Lock-Ups Due to Shrinkage
A growing issue for retailers has been shrinkage, leading many stores to lock up more merchandise, including essential items. According to recent studies, this trend aims to deter theft, yet it can frustrate customers and impact shopping behavior. Locking up items may discourage in-store browsing and prompt some consumers to shop online instead, highlighting a complex trade-off between loss prevention and customer experience.
Lower Imports for Holiday Inventory Amid Tepid Forecasts
U.S. retailers, including Walmart, have reduced their import volumes for holiday merchandise this year due to cautious forecasts. The demand for holiday goods is anticipated to be moderate as consumers face inflation and tightened budgets. This shift reflects a strategy of lean inventory management to mitigate risks of overstock if consumer spending falls short of expectations.
TECHNOLOGY UPDATE
Supercharge Your Retail Fulfillment Operations with WarehouseQuote
In Q4’ 2024, WarehouseQuote has launched several technology solutions purpose-built to help our retail customers gain increased visibility into routing status to help maintain OTIF compliance, keep vendor scorecards green, and reduce chargebacks.?
For more information on our retail fulfillment program, check out this guide.
MARKET UPDATE
The Q4 ‘24 Warehouse Pricing Index Report is now available
Earlier this quarter, we launched the Q4 ‘24 Warehouse Pricing Index Report helping logistics and supply chain managers make confident supply chain decisions with national and regional warehouse pricing insights. Check out the full Q4 ‘24 report in the link below.