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As we head deeper into this holiday retail season, the only thing that’s certain is that nobody’s certain about how it’ll go.
Maybe consumers will spend it up. Or, perhaps they’ll hold on to their wallets. It all depends on which economic forecast you believe.
The National Retail Federation projects holiday sales will be up at least 3.6% over last year, while eMarketer predicts 0.9% sales growth overall, with sales at brick-and-mortar stores falling by 4.7% and e-commerce sales rising by 35.8%.
CFRA Research, meanwhile, is calling for zero annual growth in holiday retail sales.
“Our base case is flat,” said retail analyst Camilla Yanushevsky. “If stimulus is passed before year-end, that would provide upside to our estimate. Lower-income households are waiting on purchases for the holidays to see how fiscal stimulus plays out. Until something is passed, they’re holding back on any sort of nonessential purchasing.”
What is clear is that these are uncertain times for retailers, especially small retailers.
If a small business could have a soundtrack, Seattle music store Patchwerks’ might sound like EDM, complete with synthesizers.
Owner Tom Butcher composes electronic dance music, and his store specializes in synthesizers and other electronic instruments. The four-year-old business was doing well, but when the pandemic hit, Butcher shuttered the store and laid off half his staff. Sales fell 60%.
He reopened in July. And “things have been going pretty well for us,” he said. “This summer we saw record sales.”
Butcher got a Paycheck Protection Program loan, added curbside pickup, and beefed up advertising and online sales. He also just-plain got lucky — selling the right thing at the right time.
“I think in the music instrument industry, a lot of people are just staying home. They’re looking at ways to bring themselves joy at home, maybe learn a new instrument or work on a project that they’ve been putting off for a long time,” he said.
“You know, we’re hopeful for this holiday season. Definitely stocked up and ready for big demand. We hope it comes,” he said.
Online sales are up, but Butcher said it’s still a hands-on business with a lot of foot traffic, at least in a normal year.
“Music instruments is a thing that you really want to touch and feel and play ideally,” he said.
This year, though, with COVID restrictions ratcheting up, Butcher’s relying more on customers’ imaginations to drive sales.
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