While retailers may have suffered a terrible year, new figures show they’re looking forward to Christmas in a big way – and are now the most hopeful they’ve been in 12 years when it comes to the upcoming holiday quarter.
The Dun & Bradstreet National Business Expectations Survey shows retailers’ sales expectations are now 12 points above the national average.
The result comes just as a separate report from Deloitte Access Economics revealed sales grew by 2.8% in the first half of the year, besting the annual growth rate of the previous two years.
D&B chief executive Gareth Jones told SmartCompany there are a number of factors at play, but the strength of the dollar has had a significant impact.
“I think people are seeing some light at the end of the tunnel,” he says.
“This is the second month now where we’ve been presented with some positive data, and it’s consistent data as well.”
The number of retail executives concerned about the impact of the dollar has fallen from 49% to 35%. And the number of firms expecting no impact rose from 14 points to 41%.
Across all sectors, profit expectations are up 15 points to 17, the highest in seven quarters and 13 points above the 10-year average. Employment expectations are also up three points to six, five points above the 10-year average.
The measure of inventories is now up 27 points to 26 – the highest point in 12 years and 24 points above the 10-year average. Capital investment expectations are up two points to 10.
However, the selling prices index is down five points to nine, 21 points below the 10-year average.
There’s also a caveat, Jones says, as retailers will focus on discounting in the holiday quarter.
“The activity will be at the expense of lower prices, and that strategy is going to be focused on the discounting of price.”
“However, if consumers have been conservative for the rest of the year then it should create an environment for a good consumer season.”
Businesses expect fuel prices, wages growth and interest rates as the primary pressures on business in the December quarter.