Diamond Retailer’s Caution and analysts concerns
2003: Diamond Retailer’s Caution and increase in gross domestic product
The holiday season may not have been as bleak as feared for many jewelers, but the global economic climate and continued fears of war are curbing retail enthusiasm in the early months of 2003.
According to the International Council of Shopping Centers, mall-based jewelry stores posted a slight, 0.8 percent, increase in sales over 2001.
Despite lower-than-projected sales for holiday 2003, many retail analysts remain confident in the year ahead.
The economy could pick up in the second half of this year, said analysts at an early-2003 conference organized by the National Retail Federation.
The U.S. gross domestic product is expected to increase 3 percent this year and 4 percent next year, and, while the threat of war with Iraq will slow sales for the first half of 2003, tax incentives will help strengthen the second.
Analysts predict overall comparable-store retail sales to increase about 3 percent in 2003, with discount store sales expected to fare slightly better than specialty stores’.
These numbers, while somewhat optimistic, are little to comfort retailers coming off a holiday season that logged a meager 2.2 percent increase in general retail sales, according to the NRF. The 2.2 percent increase is the smallest sales increase since NRF began tracking these sales a decade ago.
"It comes as no surprise that retailers had a challenging holiday season," said NRF President and CEO Tracy Mullin. "Despite their efforts to maintain sales through heavy promotions and discounts, external factors surrounding this holiday season were too much for retailers to overcome. Consumers were cautious and the sales increase was low."