This month's retail headlines cover an increase in store closings, a flattening in retail sales, a still-hopeful forecast from the NRF, and more.

 

Store Closing Announcements Jump as Discretionary Spending Slows

Store OpeningsIn the first calendar quarter of 2023, significant U.S. retailers announced plans to open about 2,570 new stores and close about 1,760 stores, nearly three times higher than the approximately 635 store closings announced in the first quarter of 2022, according to analytical work by The Daily on Retail, an investor-oriented consumer research platform. The drop in opening announcements and jump in closing announcements reflect the current tougher consumer backdrop.

Why Bed Bath & Beyond Stores Won’t Stay Empty for Long

It’s happening again—article headlines are proclaiming the “retail apocalypse” in response to Bed Bath & Beyond's announcement that it is filing for voluntary Chapter 11. New retail construction in many developed markets is slow due to the lack of available supply. A space like Bed Bath & Beyond is attractive to discount retailers looking to expand because in the current economic environment consumers want more bang for their buck, but also construction to the space would be minimal.

innflation

U.S. Consumer Spending Flattens

U.S. consumer spending was unchanged in March as an increase in outlays on services was offset by a decline in goods. Stubbornly high inflation was underscored by other data showing labor costs increasing solidly in the first quarter as a tight labor market continued to drive wage gains in the private sector. Spending on services rose 0.4%, driven by housing and utilities as well as healthcare.

Amazon Q1 Retail Sales Flat as Services Drive Growth

Amazon’s online store sales were flat year over year in Q1, reaching $51.1 billion, as physical store sales rose 7% to $4.9 billion. Product sales edged up less than 1% to $57 billion, per a company press release. Third-party marketplace sellers sold 59% of goods, up from 55% a year ago, Chief Financial Officer Brian Olsavsky told analysts recently. 

NRF Forecasts 2023 Retail Sales to Grow Between 4% and 6%

The National Retail Federation issued its annual forecast, anticipating that retail sales will grow between 4% and 6% in 2023. In total, NRF projects that retail sales will reach between $5.13 trillion and $5.23 trillion this year. “In just the last three years, the retail industry has experienced growth that would normally take almost a decade by pre-pandemic standards,” NRF President and CEO Matthew Shay said.

NRF Annual Retail Sales and Sales Growth

 

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