Weak home furnishings holiday season seen
GDA Staff -- Gifts & Dec, September 27, 2007
Columbus, Ohio – Retail consultancy and market research firm Retail Forward is forecasting the weakest holiday sales in five years – a gain of 3.3%.
Acknowledging that the firm’s outlook “is probably one of the weakest out there,” senior economist Frank Badillo said the gloomy forecast was based on expectations that: fuel prices will remain high, more job cuts lie ahead, and the full impact of the housing slowdown has yet to be felt at retail.
Speaking during a webinar earlier today, he said Retail Forward expects the home goods segment to log a holiday sales increase of just 1.5%. Within the segment, Retail Forward expects the weakest performance to come from furniture and home furnishings stores. The company expects a year-to-year sales decline of 1.0% vs. a sales gain during holiday 2006 of 3.7%.
Noting that the housing slump hit the home improvement channel first, Badillo added, “Home furnishings stores usually lag about six months, so we should see their worst performance coming in the next six months – just in time for holiday.”
High-end retailers should weather the downturn better than others, he said. Retail Forward also expects the consumer-direct channel, led by online sales, to give the most robust performance this holiday. The consultancy predicts an 18.5% gain on top of last year’s 24.3% holiday boost.
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