Shoppers hold hands at the Willow Grove Park Mall in Willow Grove, Pennsylvania, November 14, 2020.
Mark Makela | Reuters
Retailers will see eager holiday shoppers flock to their stores and websites even as some toys, clothes and other gift-giving items remain stuck at congested ports, according to a new forecast that cited rising household incomes and high savings rates.
The National Retail Federation said Wednesday that it expects holiday sales during November and December to rise between 8.5% and 10.5%, which would total $843.4 billion and $859 billion of sales. The sales forecast excludes automobile dealers, gasoline stations and restaurants.
Other holiday forecasts have also predicted a significant jump in year-over-year spending. Sales in November and December are expected to grow at least 7% compared with last year, according to different forecasts from Bain, Deloitte and Mastercard SpendingPulse.
However, shoppers will face challenging dynamics as retailers struggle to get goods from factories to store shelves because of congestion at ports, rising materials costs and a shortage of truck drivers. That is expected to translate into fewer discounts, longer shipping times and more out of stock items.
NRF President and CEO Matt Shay acknowledged supply chain and labor shortages as headwinds on a call with reporters, but said retailers have planned ahead to make sure they have plenty of inventory and consumers have taken cues by starting to shop in October.
Retailers, including Target, Best Buy, Amazon and Walmart, have announced early holiday sales events, and have even dangled exclusive access for loyal customers or encouraged shoppers to buy their wish list items when as soon as they see them.
Last year, holiday sales rose 8.3% from 2019, according to the NRF, as consumers cheered themselves up with gift-giving during the pandemic. Holiday retail sales have increased by 4.5% on average over the past five years.
This story is developing and will be updated.