Port Washington, NY – Until recently, general merchandise sales maintained strong gains over 2020 results, but that trend appears to be waning.
U.S. general merchandise retail sales revenue declined in the three weeks ending Nov. 5, according to The NDP Group, which recently merged with Information Resources.
Year-over-year revenue in October fell 5% from a year ago, followed by a 14% drop in the first week of November.
“Rising weekly grocery costs and monthly credit card bills have begun to curb discretionary purchases,” said Marshal Cohen, chief retail industry adviser for NDP. “Consumers can only absorb rising spending for so long before they begin to reassess their spending capacity.”
For most of 2022, high average prices kept general merchandise sales revenue at or above 2021 levels. At the same time, spending on food and beverages and other consumer packaged goods (CPG ) continue to outperform any of the past three years. The NDP data reveals that rising food and beverage prices and the shift towards consumer spending on food in general are now affecting spending in other areas.
The technology, analytics and data provider also speculated that many consumer needs are still being met by purchases made over the past two years, leading to lower levels of demand. Other factors influencing general merchandise sales volume include discounts on existing product inventory, prolonged warmer than normal temperatures delaying the typical seasonal shift to cold weather products, and mid-election distractions. mandate.
“Rising interest rates and other aspects of the economy are affecting consumer confidence, and the lack of new products is hurting their need and desire to spend,” Cohen said. “During the holidays and early in the year, consumers will be looking for exclusive product offers, unique perks and promotions that break through the noise and create a sense of urgency to make the purchase.”
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