Holiday Season Dollars: We (Somehow) Were Right

Back in October, the National Retail Federation (NRF)—through its chief economist—issued its annual projection of how the 2009 holiday season would fare financially. That prediction was a one percent drop in revenue compared with the identical 2008 period. StorefrontBacktalk thought that was absurd, and we did our own prediction, which is that the season's revenue would actually be up slightly, a figure we estimated would be an increase of "1.5 percent to 2 percent."

Well, the NRF issued its final official tally Thursday (Jan. 14): an increase of 1.1 percent. For our team, which never did better than a C- in economics class, that ain't too shabby. For the record, we knew the figures would be released about now and were fully prepared to eat crow if we had to. Glad we got it a lot closer than the NRF did. Personally, we hate eating crow.

But NRF did delve into a lot more detail than we did. From Thursday's statement: "Apparel was a big driver for retailers, as clothing and clothing accessories stores for December increased 7.0 percent year-over-year and dipped 0.6 percent from November. Sporting goods, hobby, book & music stores also performed well, with December sales increasing 3.9 percent from last year and up 1.6 percent month-to-month. Health and personal care stores continue to be a bright spot in retail, with year-over-year December sales increasing 4.8 percent and monthly gains of 0.8 percent. The weak housing market continues to impact the sale of home furnishings, with December sales of furniture and home furnishing stores decreasing 3.5 percent from December 2009 though increasing a slight 0.3 percent from the previous month."

"With an eye on managing inventory and maintaining lower price points, retailers did a tremendous job of planning for the holiday season," said NRF Chief Economist Rosalind Wells. "While the consumer appears to be spending again, double-digit unemployment numbers will remain an impediment to maintaining this momentum."

The NRF's figures showed retail industry sales (which exclude automobiles, gas stations and restaurants) for December rose 2.3 percent unadjusted year-over-year and fell 0.5 percent seasonally adjusted from November. "As a result, preliminary 2009 holiday sales, which combine the full months of November and December, rose 1.1 percent to $446.8 billion, surpassing NRF's projected decline of 1.0 percent."