IndiaRetailBiz

“Retailers will once again be forced to market to more practical consumers, many of whom will be looking to trade down. Even areas of past high growth like luxury goods and online shopping will feel the pressure.” — Rosalind Wells, Chief Economist, NRF.

The National Retail Federation (NRF) has predicted an increase of just 3.5% in sales of retail industry this year (2008), over the previous year (2007). In comparison, 2007 sales had recorded an increase of 3.7% over 2006. This is the weakest growth in five years since 2002 when growth in retail industry sales was just 3%.

According to media reports, NRF has forecast that while first half of the year 2008 will witness a sluggish increase in sales of 3.2%, the second half will see an increase of 3.8%.

NRF represents interests of over 1.6 million retail establishments that account for $4.88 Trillions (approx Rs. 200 lakh crore) of retail industry sales, in the U.S. (This excludes the sales registered by automobiles, fuel pumps and restaurants). NRF also represents the interests of over 24 million retail employees in the U.S.

The U.S., on concerns of economic recession, witnessed one of the worst holiday shopping season (November-December, 2007) when sales increased by just 3% ($469.9 billion), the weakest increase in the last five years. They, in fact, fell by 0.4% in last month of the year (December, 2007). Clothing, furniture and home furnishings stores were the worst affected.