Leading up to the Spring 2010 High Point Market, the High Point Market Authority issued its “Business Outlook & CEO Update.” The 12-page report (downloadable from www.highpointmarket.org) summarizes economic data from a variety of sources to paint a picture of what the home furnishings industry can expect sales-wise for 2010. Enhancing the report are interviews with furniture retailers from each region who bring the “big picture” statistics back to reality on a local level.
The purpose of the document is clearly to bolster the sense of optimism with which stores have entered 2010, tempering the “cautious” qualifier that remains. But it’s also refreshingly honest about the challenges still looming before us.
Among the highlights: Sales of existing homes got a boost in October and November, thanks to an $8,000 tax credit that expired Nov. 30. This led to an expected drop in December, but the National Assn. of Realtors® reported that 2009 home sales overall were up almost 5 percent over 2008, the first annual sales gain since 2005.
An October survey by Retail Forward’s ShopperScape™ asked consumers their likelihood of making a furniture or home decor purchase in the next six months. Not surprisingly, home decor — including accessories and lighting — is a more likely transaction than furniture, with 30 percent of shoppers surveyed indicating that they were “likely” to purchase these categories and 8 percent saying they were “very likely” to purchase them.
The High Point report also mentions holiday shopping season results — modest gains that nonetheless exceeded initial forecasts. And it cites several sources that keep reforecasting up for 2010 sales growth as more positive indicators surface.
Even unemployment figures, which have been kicking our enthusiasm to the curb, are showing some signs of hope. The jobless rate actually dropped in November, held steady in December and went down again in January from 10 percent to 9.7 percent. This has a direct effect on consumer confidence, keeping disposible income from being otherwise indisposed.
The report’s conclusion makes an important point: “The key challenges of retailing don’t change as the economy goes up or down; they just get more or less intense.” It has been a bumpy ride, to say the least, with some more rough road ahead. But it’s nice to have some reassuring stats as our GPS.