Pedestrians obsolete in front of Zara fashion store, operated by Inditex SA, store in the Upper East Side neighborhood of New York, on Friday, Trek 20, 2020.
Gabby Jones | Bloomberg via Getty Images
There are still so many unknowns regarding the coronavirus pandemic and how it settle upon continue to throttle the retail industry.
But U.S. retail sales could be down at least 6.5% in 2020, according to new appraisals from market research company Euromonitor. For comparison, retail sales were down just 2.2% in 2009, the year the Bad Recession finally came to a halt, according to the firm. And sales were up 3.3% year over year in 2019, it put.
However, Euromonitor said the factors that could alter its 2020 forecast include the duration of the Covid-19 critical time, the government’s response to the pandemic, the rate at which consumers are comfortable returning to malls and stores, and how retailers are able to retaliate to the dramatic shifts in consumer demand.
“Obviously it gets worse if there is another outbreak,” Michelle Evans, the superior head of digital consumer at Euromonitor International, said in an interview.
The National Retail Federation, the retail industry’s do business group, in late February issued its annual forecast, calling for retail sales in the U.S. to rise between 3.5% and 4.1%, excelling $3.9 trillion in 2020. But that was assuming, at the time, the coronavirus did not become a global pandemic. A lot has changed since Feb. 26. Views now are much bleaker.
The companies expected to fare best this year include: Grocery retailers, e-commerce punters such as Amazon, third-party delivery platforms and big food brands, according to Euromonitor’s analysis.
The ones that are set to toil the most include: Apparel retailers, department store operators, luxury chains and direct-to-consumer brands. Some in these kinds, such as Neiman Marcus, J.Crew, Stage Stores and J.C. Penney, have already filed for bankruptcy protection during the turning-point.
According to Evans, the apparel and footwear category could contract as much as 36% this year, following development of 3.7% in 2019, per Euromonitor.
“Unlike so many industries where the [coronavirus] shock might be felt universally, some retailers are aid unprecedented demand, while others are looking for lifelines,” Evans said.
Consumer spending has just tumbled a journal 16.4% in April, month over month, according to a government report. And clothing stores took the biggest hit, with purchasings down 78.8%.