FTI Consulting Retail Report: 2.0% Decline in 2009 Holiday Season Sales Projected
24 Novembro 2009 - 7:30PM
PR Newswire (US)
Retail Turnaround Before 2011 Unlikely Due to Dismal Employment
Picture Luxury Goods May be the Lone Standout WEST PALM BEACH,
Fla., Nov. 24 /PRNewswire-FirstCall/ -- FTI Consulting, Inc.
(NYSE:FCN) the global business advisory firm dedicated to helping
organizations protect and enhance their enterprise value, today
released its 2009 Retail Report, which forecasts a 2.0% decrease in
2009 holiday season sales. The forecast focuses on General
Merchandise, Apparel and Accessories, Furniture and Home
Furnishings and Other (GAFO) sales as well as online sales from
November 2009 through January 2010. The 2009 projected decrease
compares with a decrease of 4.5% experienced in the 2008 season.
FTI's report provides an analysis of the retail sector by a team of
the firm's leading corporate finance executives with deep expertise
in operational improvement, liquidity management and turnaround and
restructuring services. In determining the 2009 holiday forecast,
FTI's 2009 Retail Report reveals that while current conditions and
consumer expectations have improved compared to last autumn, the
U.S. retail sector continues to experience monthly sales declines
on a year-over-year (YOY) basis in many categories: -- Total
nominal retail sales (excluding auto) have declined 12 consecutive
months on a YOY basis. -- Highly discretionary categories, such as
home furnishings, home improvement, electronics and jewelry, are
some of the areas hardest hit, with near double-digit rates of
decline or worse (YOY) for long stretches of the past year. In
preparation for a potentially weak holiday selling season, FTI has
observed that many merchants have ordered conservatively for the
2009 holiday season. This will also be a limiting factor for the
season's prospects due to a heightened risk of stock outs on
popular items. The report does suggest one glimmer of hope within
the sector: luxury goods. FTI predicts this sector will likely see
measurable improvement compared with last year, due in large part
to Wall Street's comeback and a stronger sense of optimism among
the more affluent that will inevitably lead to greater spending. At
the same time, many of the "aspiring wealthy" -- high income
earners but not wealthy yet -- are still quite cautious and may be
less inclined to resume their old spending habits. "While consumer
sentiment has improved from a year ago and there is less
uncertainty going into 2010, it is clear that the recession took a
heavy toll on wealth and earning power, resulting in new levels of
cautiousness among consumers across all demographics," said Bob
Duffy, Senior Managing Director and Retail Industry Leader for FTI
Consulting. "It means that, unfortunately, deep discounting by
merchants and wishful thinking by shoppers will not be able to save
the 2009 Holiday Season. We believe declining personal income will
be a huge obstacle for most retailers to overcome, especially in
big-ticket products and categories. Furthermore, rising energy
prices, which have not historically influenced spending to a large
degree, could be a burden this season due to its poor timing and
its disproportionate squeeze on lower income households." With the
near-record rate of unemployment expected to continue throughout
next year, the prospects for retailers to experience a meaningful
turnaround before 2011 remains unlikely. FTI's report highlights a
number of historical indicators, as well as factors unique to this
unprecedented downturn. The jobless recovery has now become a
standard feature of the U.S. economy and most forecasts for
unemployment over the next several years suggest the U.S.
unemployment rate will still hover around 8.5% in 2012 and may not
reach normal levels until 2014. "The reality is that income has
always been the strongest determinant of consumer spending and we
have not seen wage income declines of this magnitude since the 1974
recession," added Duffy. "Our report shows that the opportunities
for any meaningful near-term improvement remain bleak as consumers
will be unable to overcome the spending restraints imposed by
falling incomes, nagging job insecurities and reduced access to
credit. The comeback of store layaway plans is a good indicator of
how strained the financial situation has become for many middle
class consumers," he concluded. The full report is available at
http://www.fticonsulting.com/ or from Aisling Garvey at . About FTI
Consulting FTI Consulting, Inc. is a global business advisory firm
dedicated to helping organizations protect and enhance enterprise
value in an increasingly complex legal, regulatory and economic
environment. With more than 3,500 employees located in most major
business centers in the world, we work closely with clients every
day to anticipate, illuminate, and overcome complex business
challenges in areas such as investigations, litigation, mergers and
acquisitions, regulatory issues, reputation management and
restructuring. More information can be found at
http://www.fticonsulting.com/. DATASOURCE: FTI Consulting, Inc.
CONTACT: At FTI Consulting, Jack Dunn, President & CEO,
+1-410-951-4800; or media contact, Aisling Garvey, +1-212-850-5600
Web Site: http://www.fticonsulting.com/
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