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US Retail Recovery Will Take Time, NRF Says
May 11, 2020 11:25 AM
By Rapaport News
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RAPAPORT... US retail demand will recover slowly, with economic growth expected to bounce back in the second half of the year, according to the National Retail Federation (NRF).
“Getting back to work or shopping in a pre-virus manner is difficult to predict at this time, with households likely to tiptoe back in rather than making an immediate return to the lives they experienced before,” said NRF chief economist Jack Kleinhenz. “My overall impression is that the recovery will have fits and starts among states, regions and cities depending on the severity of the pandemic in their localities.”
The return to regular supply and demand will depend on several factors, including consumer sentiment and whether there is a second wave of coronavirus infections. Resumption of normal shopping patterns will also come slowly, the NRF noted.
“[In terms terms of an economic recovery] much will depend on consumers’ willingness to return to spending,” said Hackett Associates founder Ben Hackett in the National Retail Federation (NRF) and Hackett Associates’ Global Port Tracker report. “Our view is that second-quarter economic growth will be significantly worse than the previous quarter, but we continue to expect recovery to come in the second half of the year, especially the fourth quarter and into 2021.”
While factories in China have for the most part returned to full operation, orders along the supply chain will continue to be lower than the previous year. Imports at major US retail ports are expected to see double-digit year-on-year declines at least through the spring and summer, the NRF warned.
Imports at the US’s major retail container ports reached 1.37 million 20-foot equivalent units (TEU) in March, down 15% from the previous year. The figure is the lowest in four years, the NRF said.
Global Port Tracker expects imports to decline 13% year on year to 1.51 million TEU in April, and by 20% in May. Prior to the COVID-19 pandemic, imports for the February-to-May period had been forecast at 6.9 million TEU, but are now expected to fall 15% to 5.9 million TEU. Similar declines are expected in June and July, with more modest drops of 12% projected for August, and 9% for September, the NRF added.
Image: A couple with masks shopping at the mall post-coronavirus. (Shutterstock)
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Tags:
Ben Hackett, Global Port Tracker, Hackett Associates, Jack Kleinhenz, National Retail Federation, NRF, Rapaport News, US retail
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