The sale of goods and services to consumers is the lifeblood of the economy, keeping a legion of workers employed in countless establishments. From grocery stores and convenience shops to malls and online, retailers of all kinds rely on retail sales to thrive. And despite the COVID-19 pandemic’s disruption to supply chains, retail industry sales continue to grow, thanks to economic stability, rising consumer confidence, and the burgeoning middle classes of emerging economies who can afford more discretionary purchases.
Retail sales are a measure of the total value of consumer purchases of durable (last for more than three years) and non-durable (last less than three years) goods and services. These are typically collected from a sample of retail businesses and then modeled to represent national trends. The monthly report also provides insights into the overall pace of consumer spending, which is a key indicator of inflation and can ultimately lead to monetary or fiscal policy decisions.
Various factors influence retail sales, including the economy’s performance, unemployment and income levels, seasonal or cyclical trends, and consumer confidence. The latter is especially important, as it influences how optimistic individuals feel about their current and future financial situations, driving or limiting spending on products and services.
E-commerce is another major driver of retail sales, shifting a large portion of consumer purchases to online channels. And as consumers demand more from the brands they purchase from, the need to adapt and innovate remains vital for growth. From a more personalized shopping experience to committing to social and environmental sustainability, today’s consumers want more than just quality goods at fair prices from the retailers they frequent—they also expect their favorite companies to stand for something and prioritize inclusivity.
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