Credit Concerns May Put Damper On Holiday Sales
By Brian Williams on Tuesday, October 9th, 2007 :: 3:36 pmCategory: Financial News
The holidays may not be so jolly for retailers. Analysts expect slow growth of holiday sales as the onslaught of Christmas advertising is a month away.
The National Retail Federation, a major retail trade group, expects U.S. sales to increase 4 percent in November and December, the weakest gain since 2002.
“Retailers are in for a somewhat challenging holiday season as consumers are faced with numerous economic obstacles,” said NRF Chief Economist Rosalind Wells in a statement on the federation’s Web site www.nrf.com. “With the weak housing market and current credit crunch, consumers will be forced to be more prudent with their holiday spending.”
Indeed, credit concerns are rippling through the U.S. economy. Bloomberg News reports a tumble in home sales, increased fuel costs and higher interest rates have consumers wary about spending money.
The National Retail Federation expects sales this holiday season to reach $474.5 billion. The organization expects high-end retailers to fare better this holiday season than stores catering to poor and middle-income consumers. Retailers hope consumers ignore the negative economic news and whip out their credit cards and cash for holiday purchases.
Nevertheless, the average American shopper spent about $800 on holiday merchandise, the NRF states. A little restraint in holiday spending means people can avoid heavy debt in the new year. It also may be difficult to earn a little extra holiday cash this year.
The muted sales forecast may cause stiff competition for seasonal holiday jobs in retail. Many people supplement their incomes by working extra hours in a store during the holidays. You probably use it to get out of credit card debt when those credit card bills come in January and February.
Think about the prospect on stifling credit card debt while watching commercials for the latest hot holiday gadget. You should become a holiday hermit and avoid the malls. Spend what you can afford and what you feel is necessary on family and friends.
Author bio: Brian Williams, a graduate of the University of Texas at Arlington, has 11 years’ experience writing and editing at daily newspapers in Texas. Learn more about credit repair from Brian through Credit Solutions. Credit Solutions is your alternative to debt consolidation.
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