CE/Majap Retail Sales To Grow 5% This Fall: IBM

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Armonk, N.Y. - Retail sales of consumer electronics and major appliances are expected to grow 5 percent in September and October, according to a new forecast by IBM.

The analytics-based projection pegs the autumn increase at $739 million, suggesting that conservatively stocked dealers rethink their inventory needs.

"The forecast indicates that retailers should consider maintaining inventory levels, especially in the hot categories," said IBM global business services partner Michael Haydock, who heads the company's retail analytics efforts.

Haydock also recommends that CE and majap dealers "make sure that stores are staffed with skilled personnel who can assist customers with complex purchases," and that they continue to invest in advertising leading up to the holidays.

The IBM forecast is produced using statistical and analytical software to evaluate long-term sales trend and seasonal peaks, based on economic data gathered by the U.S. Census Bureau. Covered categories include TVs, cellphones, PCs, radios, audio, refrigerators, dishwashers, ovens and other devices.

IBM consultants use these predictive techniques to help clients improve performance by addressing complex supply and demand issues, which can help in planning their product mix or new store locations.

The autumn uptick comes after a slow start to 2010. Combined January and February sales were down $846 million, or 5 percent, from the prior-year period, although March through May sales recovered with an overall revenue increase of $483 million, or 2 percent year over year.

IBM had projected a 4 percent increase for the summer months, although dealers have described sales this season as unusually slow.

Haydock attributed the projected September to October increase to a rise in disposable income and the household savings rate, suggesting pent-up consumer demand. The two-month period also faces easy year-ago comparisons, with CE and majap sales falling 6.6 percent, or more than $1 billion, from the same period in 2008.

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