You better watch out! You better not cry! You better not pout – I’m telling you why … that’s right! It is Christmastime again, and that means lots and lots of shopping! It’s estimated that $79.4 billion will be spent shopping online this holiday season. That is a 13.9% increase from the 2014 numbers as measured by statista.com. Many of us are deciding to buy more and more of our Christmas goods online to avoid the rush and the crowds associated with the big box retailers; a buying behavior that is creating an amazing opportunity for consumers this year.
I have to admit it: when I’m out doing my holiday shopping and picking up gifts for family and friends, I very often end up grabbing a bunch of extra things that I may be in need of. It is a habit that many of us have – you’re out shopping and spending money, anyway, and there seems to be a lot of good deals. So, you go ahead and splurge and buy yourself a pair of shoes, too. This holiday season, let me encourage you to hold off on those purchases that aren’t specifically for gift-giving.
Terry Lundgren, CEO of Macy’s, was on CNBC on November 11, explaining why Macy’s earnings and outlook had severely missed estimates. He said that unseasonably warm fall weather in the northeast and the recent rise in the dollar have caused a drop in demand for retail goods in the U.S. One other little “golden nugget” that he offered, per my paraphrase: retailers only have so many days left in the year to unload their inventory, and based on the massive amounts of inventory they still have left, he thinks that we should see price markdowns of 60-75% going into the end of the year. He even gave the date – the markdowns will happen on Sunday, December 27, as retailers desperately try to liquidate this year’s fashions and get ready for 2016. Any inventory left after December 31 is going to be viewed as a loss by most of these publicly traded retailers.
This year, when I’m out picking up holiday gifts for my wife, kids and family, I will be shopping with a big smile on my face thinking about all of the extra money I’ll save by holding off on my own personal shopping until December 27. I have been a big advocate of putting our money to work locally and supporting retail establishments run by local entrepreneurs, which I still fully intend to do for my normal holiday shopping. But for those few items that I can only pick up from the national chains, I will start my “Consumer Christmas” on Sunday, December 27, to take advantage of the inventory blowout that has been predicted by one of the most successful retailing CEOs in the U.S.
To “wrap up” (pun intended), it has been my honor to communicate to you some important issues in the world of finance through 2015. I wish you and your family a very Merry Christmas and a safe, happy and prosperous New Year.
800.338.4586 olvinvest.com The Durant 607 E 2nd Ave., Ste. 100 Flint, MI 48502 jlagore@olvinvest.com Securities offered through Sigma Financial Corporation, member FINRA/SIPC. Investment advisory services offered through SPC, a registered investment advisor. OLV Investment Group is independent of Sigma Financial Corporation and SPC.
