“A big incremental concern for retailers this holiday season”
NEW YORK (September 26, 2019) – Though most forecasts are calling for a robust holiday-shopping season in the US, the stepped-up trade war with China is adding extra pressure on retailers to offset costs, as only 40% of Americans say they will still buy a product this season if tariffs cause the price of that product to rise more than 10%. That’s all according to a new survey of more than 1,000 US consumers released today by AlixPartners, the global consulting firm.
The survey also finds that just 41% say their financial health is better than 12 months ago, down from 47% who said that in an AlixPartners survey administered this time in 2018, and just 36% of Americans think the economy will be better a year from now, down from 45% who said that in last year’s AlixPartners survey.
Joel Bines, global co-leader of the AlixPartners’ retail practice and a managing director at the firm, said: “The trade war is a big incremental concern for retailers this holiday season. Retailers need to be vigilant to make sure that cost pressures resulting from tariffs don’t throw sand into the gears of what otherwise has the potential to be a very good season. They need to track the fitness of their business frequently during this critical period and be ready to quickly adjust tactics and strategy accordingly.”
Roshan Varma, a director in the retail practice at AlixPartners and one of the authors of the survey, said: “We saw a dramatic drop-off in consumer sentiment and future outlook in this year’s survey. With the extra 15% in tariffs earlier this month on products such as smartwatches, drones, TVs, headphones and smart speakers, and with consumer technology items such as smartphones and videogame consoles on the list for additional tariffs coming in December, retailers will need to focus on flawless execution throughout the remainder of the year. That, among other things, means being strategic about what differentiated value-added services to offer and then implementing them with highest of efficiency.”
Among other findings in the AlixPartners survey:
The AlixPartners survey follows on the heels of the release on September 17 of the firm’s annual US holiday forecast, based on a proprietary statistical methodology, which forecast an increase in holiday sales this season in the US of 4.2% to 5.3%.
About the survey
The AlixPartners US Retail Holiday 2019 Outlook Survey was administered online August 27-29, 2019, and polled 1,005 consumers ages 18 and above, across all major regions, demographics, and income levels in the United States.
AlixPartners is a results-driven global consulting firm that specializes in helping businesses successfully address their most complex and critical challenges. Our clients include companies, corporate boards, law firms, investment banks, private equity firms, and others. Founded in 1981, AlixPartners is headquartered in New York, and has offices in more than 20 cities around the world. For more information, visit www.alixpartners.com.