Coming off of a better-than-expected Holiday retail sales season, the National Retail Federation is now forecasting that GAFS sales, which includes most general merchandise categories, will increase 3.5% in 2005. In its quarterly Retail Sales Outlook Report released last week, the NRF cited tough year-on-year comparisons and lack of economic stimulus as the reasoning behind its guarded forecast.
GAFS sales grew 6.7% in 2004, the highest retail sales growth since 1999.
GAFS sales soared 9.9% in Q1 last year, making it difficult to easily anniversary the period. NRF is predicting growth of 3.7% for the first quarter.
The luxury sector is again expected to do well in 2005, while the discount sector is expected to be challenged as that channels core consumers are “most affected by higher energy costs and slow income growth,” according to the NRF.
