The National Retail Federation again is betting on the resilience of the American consumer, even in the face of ongoing inflation, and economic uncertainty.

The Federation (NRF) released its 2023 retail sales forecast today, saying it expects retail sales, excluding motor vehicles, gasoline, and restaurants, to grow by between 4% and 6%.

The forecast is significantly below the 2022 forecast of 6% to 8% growth, but still more optimistic than some economic projections for a dramatic downturn in spending.

In 2022, sales growth landed right in the middle of the NRF forecast, at 7%.

Even at the lower end of its forecast – 4% – the NRF is expecting retail growth to be strong than the pre-pandemic average annual growth rate of 3.6%.

NRF President and CEO Matthew Shay, in kicking off the group’s annual State of Retail and the Consumer discussion where the forecast was announced, said that while growth has fallen from the unprecedented levels seen during the pandemic, the outlook for 2023 remains positive “as retail sales stabilize to more historical levels.”

“We know that consumers are resilient. We know that they are going to continue to spend. We’ve seen that already this year,” Shay said, in a press conference after the forecast was released.

“One of the reasons we’ve seen consumers continuing to spend is in part because of the tightness of the labor market and wage increases,” Shay said. Also making consumers confident to spend is the “aproximately a trillion dollars in excess savings still on the sidelines, held by households,” he said.


“That certainly contributes to our sense that consumers will continue to spend, because we know they have the resources to do so,” Shay said.

However, Shay said, consumers, particularly lower-income ones, have cut spending, or traded down to lower-priced brands due to inflation.

Between 2019 and 2022, retail sales grew by more than 30%, in effective equivalent to 10 years worth of growth over a three-year period, Shay said in the press conference.

The optimism of the NRF was echoed by the retailers who participated in the State of Retail discussion.

“We’re really seeing that women are back to expressing themselves through fashion,” Anushka Salinas, President and Chief Operating Officer of Rent the Runway, said.

“Post-Covid, we’re seeing this real dynamisn in the way women are getting dressed.” she said, with workwear rentals on the rise, as well as apparel for a variety of occassions.

However, even though Rent the Runway customers tend to be higher-income consumers, and less impacted by inflation, “we see that she’s as cost-consious as she’s ever been, and that is leading her to be very, very selective about where and how she is spending her money,” Salinas said.

“Even the higher-end consumer is doing the math right now, and it really highlights that you have to continue to deliver more value to her in order for her to continue to want to spend with you,” she said.


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