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Home > Consumer Products > CHART OF THE DAY: Holiday sales off to a sluggish start

CHART OF THE DAY: Holiday sales off to a sluggish start

Dec. 16, 2020 by Christopher Shaker and Seth Bacon

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The holiday shopping season was off to a sluggish start in November as retail sales fell 1.1% compared to October, the Commerce Department reported on Wednesday. It was the biggest drop in seven months and well below analysts’ estimates of a modest gain.

Retailers were hoping for a strong holiday season to help carry them through to the other side of the pandemic as a coronavirus vaccine is distributed amid a resurgence in cases. Sales at clothing and department stores, for example, were hit hard, falling by 6.8% and 7.7% from October.

The strongest performing sectors were food and beverage, up 1.6% on the month, and building materials, up 1.1% – two areas that have held up throughout the pandemic. The data suggests that there has not been a significant change in the habits of consumers as they continue to focus on their lives at home.

While holiday sales can still recover, the recent rise in coronavirus cases, coupled with renewed restrictions on businesses, most likely mean that the holiday season will not be the springboard that retailers were hoping for.

The bright spot continues to be strength in e-commerce sales. Nonstore retailers are up 30% on a year-over-year basis. Those retailers with a strong digital platform have performed well and are likely to be in a position to thrive in the post-pandemic retail ecosystem.

For more information on how the coronavirus is affecting midsize businesses, please visit the RSM Coronavirus Resource Center.

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Filed Under: Consumer Products, Coronavirus, Economics Tagged With: coronavirus, Covid-19, holiday shopping, retail sales

About Christopher Shaker

@ChrisShakerCP

Chris Shaker is a partner in RSM’s Boston office. He serves as a member of both the firm’s national consumer products and retail teams. In January 2018, Chris was selected as a senior analyst in RSM’s cutting-edge Industry Eminence Program to focus on trends impacting the consumer sector.

About Seth Bacon

@SethTBacon

Seth is a senior analyst specializing in consumer products for RSM US LLP in the Seattle office. He has more than 10 years of experience serving clients across the country by providing industry- specific insights and thought leadership focused on digital transformation. He has worked with a variety of clients in the consumer products industry helping them focus on acquiring and retaining customers through data driven insight.

In May 2020, Seth was selected as a senior analyst in RSM’s cutting-edge Industry Eminence Program, which positions its senior analysts to understand, forecast and communicate economic, business and technology trends shaping the industries RSM serves. These senior analysts advise clients on conditions influencing middle market leaders.

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