ASK THE EXPERT: JANUARY SALES WERE GREAT! WHAT RESULTS CAN WE EXPECT FOR SPRING?

Q: My sales were robust in January, and they were not driven by discounts. From what I’m seeing in the news, many retailers experienced the same upswing. Does this change your forecast for spring?

Also, is there a chance that the market could get overheated, and demand could drop suddenly?

A: January was better than expected, coming in higher than last year, and higher than 2019 in most cases. Reading recent reports, these gains were not only in specialty stores but in retail generally.

The continued strength of retail sales is surely frustrating the Federal Reserve as they grapple with further interest rate hikes. Inflation does seem to have turned the corner, but there is concern that the Fed will need to continue restricting liquidity.

At this point, the jousting between the Fed and Inflation does not seem to have restricted demand in the specialty retail stores that Blacks works with. Sales have been positive, although slowing to a more normal pattern. We have been projecting single-digit gains into 2023. We are holding that position, even after significant increases in January. Most of our client stores beat both last year and their planned sales for January, many by mid-double digits.

Could the market direction change quickly? The answer is of course yes, but there are no indications of a quick drop-off at this point. That said, we remain cautious since a slowing cycle seems likely.

Image, above: energepic.com.