Wednesday, December 11, 2013

X-mas Spending

Data predict a 1.7% to 2.4% increase in holiday retail spending this year. So why have retailers considered this a bad thing?

Well, the population has increased, so even if individual Americans spend less in 2013 than they spent in 2012, the number of people spending money will be greater, thus somewhat offsetting this year's decline in per-capita spending.

In fact, population growth is a key reason holiday retail spending almost always rises. According to National Retail Federation, the average increase in holiday retail spending over the past decade has been about 3%. In a good year, sales will rise by 4% or better, and in a not-so-good year, by 2% or less. By that reckoning, this is not a banner year.