Holiday forecast: Shoppers to pull back from pandemic’s torrid pace
The holiday shopping season is usually strong at Park Ave CDs in Orlando’s Audubon Park neighborhood, but the past few years since the onset of the COVID-19 pandemic have been especially hot.
It happened because people who avoided restaurants, concerts and travel had more money to spend at stores, and vinyl albums grew in popularity, said owner Sandy Bitman. Inflation has also meant more is being spent by shoppers, too.
“We’ve always had a good holiday season,” Bitman said. “The revenue, I think, has gone up because the price of things have gone up as well.”
The National Retail Federation predicts holiday spending in November and December will grow 3% to 4% over last year to between $957.3 billion and $966.6 billion. While that will be an overall record, spending is expected to grow slower than in recent years.
Spending jumped 5.4% in 2022, 12.7% in 2021, and 9.1% in 2020.
Before the pandemic, gains were more in line with this year’s growth, increasing 3.8% in 2019, 1.7% in 2018, and 5% in 2017.
“It is not surprising to see holiday sales growth returning to pre-pandemic levels,” NRF President and CEO Matthew Shay said. “Overall household finances remain in good shape and will continue to support the consumer’s ability to spend.”
Record holiday spending follows consumers also going big on Halloween this year. Halloween purchases were expected to reach a record $12.2 billion.
Jack Kleinhenz, National Retail Federation chief economist, said the holiday season looks good, according to his monthly economic review for the organization.
“This year, a whole new set of dynamics is in place,” Kleinhenz said. “The average household remains on relatively solid financial footing despite pressures from still-high inflation, stringent credit conditions and elevated interest rates. Recent revisions to government data indicate that consumers haven’t drawn down as much of their pandemic savings as believed earlier, and savings are still providing a buffer to support spending.”
The national forecast returning to pre-pandemic growth rates makes sense for Bitman at Park Ave CDs, who called it the “natural flow of things.”
Holiday shopping at his store usually kicks off on Black Friday and really picks up in the two weeks before Christmas, Bitman said.
In addition to vinyl and CDs, the store sells other stocking stuffers such as socks, toys and Japanese candy.
“Our gifts are not big ticket items … it’s always an affordable option that we provide,” Bitman said.
In the same plaza, inflation hurt summer business at The Lovely Boutique Market, but a recent boost ahead of the holidays has owner Kim Hellstrom expecting a good shopping season.
“Things are a lot more expensive, so people have been holding back on items for their home or items for themselves,” Hellstrom said. “I’m very optimistic. In just the recent weeks our traffic has been higher. I feel like people are a lot more excited to spend money because they have a purpose with it being the holidays.”
Customers come in to find outfits to wear to holiday gatherings and then end up picking up gifts for their friends or coworkers, Hellstrom said. It’s a good place to do both as The Lovely offers vintage clothing as well as coffee mugs, books and martini glasses.
Elsewhere in Orlando, Steve Rausch is also optimistic for business at his Colonial Photo & Hobby. With his brother Mike, he owns the store in the Mills 50 neighborhood selling cameras, model trains, and other potential gifts.
“For us, we’ve been more busy this year than we were last year,” Rausch said. “I think more people are liking shopping local.”
