The Strategist

2017 turns out to be paradoxical for the American retail market


12/28/2017 - 10:14



MasterCard reported that the volume of holiday retail sales in the US grew by 4.9% in 2017 compared to the previous year. This dynamic is a record since 2011. The growth in sales was marked by a record number of announcements about closure of traditional retail stores. Experts note that this is a natural trend in recent years. Now, the consumers prefer online shopping to traditional shopping trips.



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pixabay
The American retail market is one of the world's largest. It often indicates trends coming to retail markets of other countries. This year, perhaps, is the most interesting because of a paradoxical situation - a high growth of retail sales amid a record number of closing retail stores. According to the research company Fung Global Retail and Technology, it was announced that nearly 7,000 traditional stores are going to wind up their business in the United States, which is three times more than a year ago. BankruptcyData.com reports that 662 bankruptcies were declared in the retail sector in the US in 2017, which is 30% more than a year ago. Against the background of record low unemployment in the US, the retail sales sector lost 36,000 jobs this year. Some experts already call this situation "retail apocalypse". "Winners and losers are inherent to this industry. This market is always in a state of continuous change," commented Tom McGee, head of the International Council of Shopping Centers, quoted by CNN.

While some analysts are counting how many retail stores closed this year, others record a record growth in retail sales. Yesterday MasterCard published the results of its annual research SpendingPulse on the retail spending in the United States. This year holiday sales in the US increased by 4.9% compared to the holiday season 2016 - this is the maximum growth since 2011. Within the research, the company notes retail sales from November 1 to December 24 with all types of payments, including cash and checks. Electronics and household appliances turned out to be the most popular among Americans in this year: sales of these goods grew by 7.5%. This is the maximum growth for this category over the past ten years. The second place, with 5.1% growth, is taken by furniture and household goods.

The study said that this year's growth driver was Internet sales, which soared by 18.1% year-on-year. Experts say that this situation has become a logical continuation of the trend of recent years - the shift of consumer activity from traditional retail to online. "The evolution of consumer preferences is driving the popularity of online retailers in the United States," said Sarah Quinlan, senior vice president of research at MasterCard Market Insights. "But overall, the current year has been very successful for the entire retail industry. One of the reasons was the good state of the American economy, but we must admit that retailers who tried to apply a new strategy to attract consumers were able to take advantage of this situation. "

source: cnn.com




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