Wednesday, October 20, 2021

Consumers brace for even more inflation this Christmas shopping season

Consumers are likely to feel a cut in inflation on Christmas shopping this year, with a new forecast from Salesforce predicting retail prices will rise up to 20 percent this holiday season compared to last year.

Salesforce expects a strong Christmas shopping season this year, estimating sales to top $1 trillion globally, the company said in its September 29 forecast. But it warns of continued supply-side pressures and expects everyone along the chain to feel the pinch of rising costs.

“Increased costs appear front and center for retailers, suppliers and consumers this year,” Salesforce said in the forecast, which is estimated to cost the retail industry in the United States an additional $ in the cost of goods sold around Christmas. 233 billion will have to be faced.” .

The company says high shipping costs, lack of manufacturing capacity and labor shortage are mainly responsible.

Yug Times Photos
Shoppers make a last-minute visit to Macy’s flagship department store on December 24, 2020 in Midtown, Manhattan, New York. (Scott Haynes/Getty Images)

While Salesforce’s forecast of retail inflation is up 20 percent this season compared to last year, it taps into some of the numbers seen in the Consumer Price Index (CPI), one of the government’s official inflation gauges. While the most recent CPI data (PDF) showed energy prices up 25 percent in August, and sharp increases in some categories like bacon (+17 percent) and used cars (+31.9 percent), retail goods generally But a more modest price increase was observed.

Retail products that saw the highest price increases in August included women’s clothing (+11.9 percent), jewelry and watches (+12.9 percent), television (+13.3 percent) in the most recent month of available data. Most of the retail categories saw very little price increase and in some cases there was a decline.

Read Also:  Consumer price growth moderates in August, annual inflation remains stable

Miscellaneous personal items were up 7.5 percent in August, photography gear was up 5.6 percent, and musical instruments were up 3.2 percent. Computer software and accessories declined by 1.2 per cent, baby apparel by 1.4 per cent and audio equipment by 6.7 per cent over the previous year.

Beyond price pressure, customers may also face inventory shortages, Salesforce predicts.

“Barriers at ports and skyrocketing costs of containers, two major pressures shaping holidays, should cause consumers to be concerned about product availability,” the company said in the forecast.

Customers are already responding to the anticipated decrease by going out early, with purchases up 6 percent over the past year in the United States with the pre-cyber week.

Rob Garff, vice president and general manager of retail at Salesforce, said, “With persistent global supply chain disruptions, retailers are increasingly attracted to their online and physical stores early in the season to meet demand and capture holiday spending. should do.”

Price rises have been a major theme amid economic recovery, rising faster than wages, and reducing Americans’ purchasing power.

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Tom Ozimek has an extensive background in journalism, deposit insurance, marketing and communications, and adult education. The best writing advice he’s heard from Roy Peter Clark: ‘Hit your goal’ and ‘Leave the best for last.’

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This News Originally From – The Epoch Times

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