US & Global Economic Impact Analysis and Forecasts

Freedonia analysts and economists are sharing their insights on how major events are impacting different parts of the US and global economies.

September Retail Sales Report: Improvements From Delayed Back-To-School Season

October 16, 2020 - The September advance monthly retail sales report was released on October 16. One thing worth noting – for the uninitiated – is that this information is linked to sales by type of retail outlet, but that doesn’t fully align with sales of product categories in some cases. For instance, sales of sporting and recreation goods might be lower than one would expect because the data only count sales at stores that primarily sell these products and do not include items in this category that are sold at mass merchants like Walmart and Target, whose sales are classified elsewhere.

The September report shows growth over August sales across most categories, as the delayed back-to-school shopping season combined with a return to some delayed shopping gave most a boost.

The big winners overall for the year continue to be the same ones from last few months. However, even as they continue to show strength against same-month 2019 sales, they are increasingly off pandemic highs:

  • grocery/food retail stores – September 2020 was essentially flat, up 0.1% from August 2020, but September 2020 was still up 10.5% from September 2019 (a trend grocers and other food experts expect to continue as consumers continue to eat and cook at home more than pre-pandemic)
  • building materials/garden equipment dealers – September 2020 was only up 0.6% from August 2020 but still up 19.1% from September 2019 (although experts expect the DIY trend to hold, this elevation may falter as the seasons change and weather cools in much of the country; still, September sales were supported by things such as seasonal décor and outdoor heaters)
  • retailers that operate outside of brick-and-mortar locations (including e-commerce not linked to conventional stores) – September 2020 was up only 0.5% from August 2020, but September 2020 was still up 23.8% from September 2019 (the convenience of e-commerce will make this trend sticky beyond the pandemic)

These are retailers that, for the most part, remained open during stay-at-home orders because they were considered “essential” businesses. Additionally, their product mix includes categories that continue to benefit from the shift toward staying home – e.g., home cooking over eating out and DIY home and garden improvements. Consumers are still largely limiting their shopping to these types of retail outlets.   

Sales at sporting goods, hobby, musical instrument, and book stores – which saw rapid gains in June 2020 – experienced declines from that spike during July and August. Still, sales at these retail outlets saw decent gains in September with the back-to-school shopping and fall sports spending with sales up 5.7% over August 2020 and sales in September 2020 were up 14.4% from September 2019.

A few other highlights:

  • furniture stores – September 2020 was essentially flat, up only 0.5% compared to August 2020. This category has continued to move into positive territory year-over-year as September 2020 sales were 4.6% greater than in September 2019. Setting up virtual classrooms, home offices, and furnishing home purchases likely contributed to gains here.
  • gas stations – September 2020 was up 1.5% from August 2020 but still down 13.3% from September 2019. People continue to leave home less often, and a reduced level of commuting and road-tripping is keeping sales at gas stations low.
  • clothing stores – September 2020 was up 11% from August 2020, but still down 12.5% from September 2019. The monthly boost was likely due to back-to-school shopping and the coming change of seasons. Still, bankruptcies are continuing in this market.
  • Food services with drinking places continued to see gains, with September sales levels 2.1% higher than those of August 2020, even though they are still seriously lagging 2019 same-month sales (-14.4%).

Economists and other interested parties – including Freedonia analysts – will be closely monitoring next month’s retail sales report to see the strength of sales in October, looking for the impact of the elevated infection levels in many parts of the country and shopping for Halloween and any cues to what the coming gift-giving season might look like if people start their shopping early as expected.

For more information and discussion of opportunities, see The Freedonia Group’s extensive collection of off-the-shelf research, including an expanding catalog of COVID-19 Economic Impact reports, which highlight how various industries are responding to the COVID-19 with a comparison to historical recessions. Food- and beverage-related reports are also available from our sister publisher, Packaged Facts. Freedonia Custom Research is also available for questions requiring tailored market intelligence.

  Construction & Building Products      Consumer Goods      Covid-19      Food & Beverage      Packaging    

An Adapted Halloween in the Pandemic Era

A number of companies are looking at this year’s Halloween season a bit differently this year. In light of CDC guidelines, many people are reconsidering traditional activities such as trick-or-treating, Halloween parties, and haunted houses. So how are companies – including many that typically count on this seasonal spending – responding this year? Here are a few examples:

Digital experience cater to how customers are engaging with retailers and shopping these days. Curb-side pick-up of online orders and e-commerce home deliveries are still the preferred mode of shopping. And of course, anything that gets customers in the mood for the holiday will support spending.

For more information and discussion of opportunities, see Packaged Facts’ food- and beverage-related reports, including US Food Market Outlook 2020: Home Cooking, Grocery Shopping & Food Trends in the Age of Coronavirus. The Freedonia Group’s extensive collection of off-the-shelf research provides a strong complement to packaged food industry analysis, including packaging industry titles such as the update of Pouches (coming soon), as well as Global Foodservice Single-Use Products and Global Single-Use Packaging Regulations.

Freedonia Custom Research is also available for questions requiring tailored market intelligence.

  Construction & Building Products      Consumer Goods      Covid-19      Food & Beverage    

With Smaller Holiday Gatherings, What Else Will Change? The Turkey

Earlier this year, as large gatherings were banned and families chose to delay celebrations and vacation in smaller groups, analysts from Packaged Facts and The Freedonia Group noted changing trends:

  • Costco shifted from its beloved half sheet cakes to emphasize its smaller 10” round cakes as more suitable for smaller celebrations or just at-home enjoyment (you know you want to).
  • Vacation rentals were readily available for large homes but were booked solid for smaller homes, as large multi-family vacations were canceled.
  • Large catered events were off, and venues closed.

Given this, how might the upcoming holiday season – traditionally a time of large, extended family gatherings – be different than in past years?

  • Smaller turkeys. Farmers and retailers are already preparing for families to host smaller gatherings with smaller birds.
  • Smaller seafood and appetizer platters. Grocers are developing smaller platters of shrimps and cocktail sauce and fruit, cheese, and crackers, presuming holiday gatherings will be smaller this year.
  • Smaller catered meal offerings. Grocers and caterers are offering smaller meals for 2-4 people as something to send as a gift to older family members who are unable to travel or for families hosting smaller gatherings but who still want all the trimmings.
  • Curbside carryout of family-style restaurant meals. These might be offered fully cooked or as prepped, uncooked meal kits. Families that are used to having holiday celebrations in restaurants will be looking for ways to have at-home dining without sacrificing the special foods of the season.

For more information and discussion of opportunities, see Packaged Facts’ food- and beverage-related reports, including Food Carryout & Delivery and the companion report with timely consumer insights from our in-house survey capabilities, as well as US Food Market Outlook 2020: Home Cooking, Grocery Shopping & Food Trends in the Age of Coronavirus. The Freedonia Group’s extensive collection of off-the-shelf research provides a strong complement to packaged food industry analysis, including US Restaurant Reopening: COVID-19 Impact on Supplies and Global Foodservice, as well as packaging industry titles such as Foodservice Single-Use Products, Global Foodservice Single-Use Products, and Global Single-Use Packaging Regulations.

Freedonia Custom Research is also available for questions requiring tailored market intelligence.

  Consumer Goods      Covid-19      Food & Beverage    

Effects from Closure of Movie Theaters Ripple Beyond the Entertainment Industry

Cineworld Group announced it would suspend operations at its more than 500 locations (including Regal Entertainment Group theaters in the US and Cineworld and Picturehouse theaters in the UK) beginning this coming Thursday, October 8. The company’s CEO Mooky Greidinger blamed the ongoing postponements of big-budget films, saying “We cannot operate for a long time without a product.”

The fallout for this closure ripples into areas such as the snack food and beverage industry and the suppliers of single-use products such as cups, straws, lids, trays, napkins, and popcorn containers.

Suppliers of soda and other beverages as well as of candy, popcorn, and other snack items have seen increased sales for home consumption, but many are still hurting from the closure of restaurants, bars, and theaters as well as few or no fans at sporting events.

Providers of packaging products – particularly cups and lids – have seen a particular hit, as there is no corresponding increase in home use. Although restaurant carryout and delivery has helped support demand for foodservice disposable products, many customers have chosen to forego picking up to-go beverages in favor of those they already have at home.

For more information and discussion of opportunities, see Packaged Facts’ food- and beverage-related reports, including Food Carryout & Delivery and the companion report with timely consumer insights from our in-house survey capabilities, as well as US Beverage Market Outlook 2020: Grocery Shopping & Personal Consumption in the Coronavirus Era and US Food Market Outlook 2020: Home Cooking, Grocery Shopping & Food Trends in the Age of Coronavirus.

The Freedonia Group’s extensive collection of off-the-shelf research provides a strong complement to packaged food industry analysis, including packaging industry titles such as Foodservice Single-Use Products, Global Foodservice Single-Use Products, and Global Single-Use Packaging Regulations as well as US Restaurant Reopening: COVID-19 Impact on Supplies, Global Foodservice, Surface Disinfecting Wipes, and Global Industrial & Institutional Disinfectants & Sanitizers.  

Freedonia Custom Research is also available for questions requiring tailored market intelligence.

  Covid-19      Food & Beverage      Packaging    

Breakrooms in the Pandemic Era & Beyond

From the essential workplaces that remained open throughout the pandemic to offices that are starting to bring back workers, many are realizing that community breakrooms as they used to be no longer fit COVID-related sensitivities and hygiene expectations. Touchless technologies, app-based ordering and payments, and pre-packaged and single-serving beverage and snack options are some of what will equip a breakroom in the pandemic era and beyond.

This has resulted in some unique opportunities for office coffee and snack providers, including:

  • high-end machines that offer touchless technology (from app-based ordering and payments to proximity sensors)
  • provision of specialty coffee beverages to workers who prefer such options but are now hesitant to leave the building as often (via high traffic elevators and lobbies) to make their “Starbucks run”
  • individual, grab-and-go bottles of pre-made coffee, tea, and juice beverages
  • prepackaged meals and snacks, particularly if they either appeal to interests in healthy food that supports immune function or to comfort foods, which have risen in popularity in a high stress era
  • deliveries to remote workers, either as a company-provided benefit or as a personal subscription for convenient access to preferred coffee beverages

For more information and discussion of opportunities, see Packaged Facts’ food- and beverage-related reports, including Office Coffee Service in the US, as well as US Beverage Market Outlook 2020: Grocery Shopping & Personal Consumption in the Coronavirus Era and US Food Market Outlook 2020: Home Cooking, Grocery Shopping & Food Trends in the Age of Coronavirus. The Freedonia Group’s extensive collection of off-the-shelf research provides a strong complement to packaged food industry analysis, including packaging industry titles such as Foodservice Single-Use Products, Global Foodservice Single-Use Products, Pouches, and Global Caps & Closures as well as US Restaurant Reopening: COVID-19 Impact on Supplies.  Freedonia Custom Research is also available for questions requiring tailored market intelligence.

  Consumer Goods      Covid-19      Food & Beverage      Machinery & Equipment      Services