A new Intuit QuickBooks-commissioned survey of 9,700 adults and 3,000 small businesses in the US, Canada, and UK reveals it could be a difficult holiday season for retailers.
Doing, not buying
At least two-thirds of the consumers surveyed say inflation will force them to buy fewer gifts this year. At the same time, in the US and Canada, there could be a shift in demand toward experiences, such as entertainment and dining out. Eight out of ten say this is because they couldn’t enjoy these things as much during the pandemic. Employment data from QuickBooks Payroll shows a similar trend—with recreation and entertainment businesses currently among the fastest growing industries.
If economy dips, spending will too
Inflation is making people more price-sensitive, and eight out of ten consumers will cut spending if the economy continues to get worse. As a result, more than seven out of ten consumers surveyed are shopping online more often to find the best deals. Some have protected their holiday season budgets by making cutbacks throughout the year (see How much consumers will spend).
Can small retailers get ahead of this?
Many small businesses, especially retailers, rely heavily on holiday season revenue. In fact, a large majority (up to eight out of 10) of the small businesses surveyed say the 2022 holiday season is more important to their overall financial health than last year’s holiday season. The stakes are high. What can small businesses do to get ahead of these trends?
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Featured Image Credit: iStock / AaronAmat.