IE 11 is not supported. For an optimal experience visit our site on another browser.

Christmas Is Coming: Will It Be Merry for Merchants?

If you ask the retail industry. it's going to be a happy holiday season for merchants. Independent analysts aren't as sanguine.
Get more newsLiveon
/ Source: CNBC.com

If you ask the retail industry, it's going to be a happy holiday season for merchants. Independent analysts aren't as sanguine. The National Retail Federation on Tuesday said it expects holiday sales to increase 4.1 percent to $616.9 billion in 2014, up one percentage point from last year in what would be the first gain of more than 4 percent in three years. But a separate report issued by accounting firm PwC Tuesday found that projected average household spending is expected to decline to $684 this year, down from $735 in 2013.

Leading the anticipated drive lower is a growing group of consumers the firm labeled "survivalists"—people who earn less than $50,000 annually and represent 67 percent of American shoppers. That's up from 65 percent in 2013, and 63 percent in 2012. What the two firms can agree on is that consumers will remain cautious when opening their wallets. NRF's holiday forecast is based on a model that uses indicators such as consumer credit and disposable personal income to predict sales in November and December excluding autos, gas and restaurants. PwC's report is based on a poll of more than 2,200 consumers across the U.S. that spanned all demographics and income levels, and defines the holiday season as September through January.

IN-DEPTH

-- Krystina Gustafson, CNBC