Holiday Sales Flat, CE Down: Report

By Alan Wolf -- TWICE, 9/28/2009

Columbus, Ohio — Fourth-quarter retail sales will be flat to last year, when holiday revenue fell 4.5 percent, according to the latest forecast by market research firm Retail Forward.

But sales through the CE specialty channel are expected to decline, the firm said.

The projected sales results, based on core distribution channels and merchandise categories, would rank the coming holiday season as the second-worst in 42 years.

But not all is gloom and doom. According to Retail Forward senior economist Frank Badillo, softer sales declines in August suggest an emerging retail recovery that will be driven by growing consumer confidence.

“This is positive news as we move into the critical holiday season, but the economic environment will remain difficult,” Badillo noted. “Sales declines will persist for specific retail channels” — particularly CE, apparel and home goods — “but will end for aggregate measures of retail sales.”

Consumer electronics stores are expected to experience the biggest declines, due in part to Circuit City's exit, while online sales across all retail channels are forecast to grow 4 percent this holiday season after declining 5 percent a year ago. The broad group of mass retailers that includes discount department stores, supercenters, warehouse clubs and small-format value stores is forecast to grow sales 2.5 percent this holiday season.