December Retail Sales

December retail sales were released last week showing a year over year increase of approximately 2.2%. A few takeaways from the report:

  • December's sales makes 2015 the worst year for sales growth since 2009
  • Big ticket purchases remain strong as autos closed out a record year in shipments and home furniture and building saw impressive year over year increases
  • Non-store or internet retailers continued their assault at the expense of department stores and electronics stores
  • Bars and restaurants continued to post strong increases and now contributes more sales than grocery stores

Despite the weakness, I don't believe it's nearly as dire as headlines make it out to be. We ended the year in positive territory despite headline sales being negatively impacted by higher housing costs and healthcare costs. With that said, one can't ignore the spend shifts. Departments stores, electronics and grocery continue to lose as spend shifts to non-store retailers and restaurants. Calculated Risk posted the following chart to depict 2015 relative to previous years: