National Retail Federation Details April Retail Sales Growth; Matthew Shay and Jack Kleinhenz Share
WASHINGTON, DC - Inflationary pressures have been felt across the industry in recent months, and the National Retail Federation (NRF) has kept a close eye on the situation. NRF reported earlier this week that despite rising prices on grocery shelves, the retail industry has experienced monthly and year-over-year sales increases.
“April retail sales demonstrate consumer strength and willingness to spend despite persistent inflation, supply chain constraints, market volatility, and global unrest,” President and Chief Executive Officer Matthew Shay said. “While consumers are facing higher prices, they are preserving their budgets by shopping smart. Retail businesses are also facing increased costs like higher energy bills and rents as well as the cost for goods, transportation, and wages. Despite already tight margins, retailers remain committed to their customers and are doing everything they can to absorb these costs to keep products affordable. With the Federal Reserve already raising interest rates, the Biden administration and Congress have an opportunity to provide targeted relief to American households by lifting the China tariffs, passing legislation to fix the supply chain, and addressing immigration reform to ease the tight labor market.”
With April retail sales demonstrating consumer strength and willingness to spend despite persistent inflation, ANUK is left to wonder whether this relationship will impact price conversations at the retailer and supplier negotiating table and provide suppliers with some relief.
NRF’s calculation of retail sales showed April was up 0.9 percent seasonally adjusted from March and up 6.4 percent unadjusted year over year. According to a press release, although grocery and beverage stores were down 0.2 percent month over month, they were up 8.9 percent unadjusted year over year.
As this data comes in, we're also seeing big box retailers fall short of quarterly earnings expectations. No matter what, supply chain struggles are still dogging the buy-side.
NRF's Chief Economist addressed some of these challenges.
“April’s retail sales data is encouraging because it shows consumers are taking higher prices in stride and remain resilient,” Jack Kleinhenz said. “Sales benefited from Easter/Passover spending and also from tax refunds, which have been delayed by pandemic-related issues at the IRS but are also larger than usual. High gasoline prices, rising interest rates, and price pressures across the board continue to be headwinds to spending, but wage and job gains are offsetting that with a tailwind that should bode well for moderate-but-steady spending growth going forward.”
For the full release, click here.
As ANUK continues to monitor this situation closely, keep following along for the latest reports.