Putting recent retail sales data into perspective

Data sheds light on where consumers have spent the most money in recent months, including a wealth-killing amount on bars and restaurants

HIGH POINT — Just glimpsing at each month’s retail sales reports from the U.S. Department of Commerce, it’s easy to see what other sectors are competing most heavily with furniture stores for the consumer’s disposable income.

Like clockwork, these figures are produced around the 15^th of each month, highlighting the performance of segments ranging from restaurants and grocery stores to department stores, clothing stores, electronics and appliance stores, and pharmacy and beauty stores. Other categories include automotive, lawn and garden centers, and hobby, sports and musical instruments.

As recently as two years ago, year-over-year retail sales in the furniture category were through the roof, particularly when compared to weekslong mandatory shutdowns at the start of the pandemic. But while sales slowed some once stores reopened, they were still in the double digits as a renewed interest in furniture took demand to unprecedented heights.

Last year, much of the growth tapered off to the low single digits as demand cooled down and consumers gravitated toward other spending. Still, the furniture retail segment eked out a .5% gain overall in 2022, and the year got off to a strong start in 2023 with a 3.8% gain for the month of January.

Unfortunately, this was short lived as the industry slipped into negative territory — with the exception of a .01% gain in February — for the other three months. Hence, this has resulted in an overall 2.9% decline since the start of the year, compared to an overall 3.5% gain for all retail and food service sectors tracked by the government.

To be fair, other sectors also fared poorly, including gasoline stations, down 10.1% year to date, followed by electronics and appliance stores, down 2.7%, and building material and garden equipment and supplies dealers, down 1.3%.

The best-performing sector during the first five months of the year? Restaurants and bars, where sales were up 12.9%. This was followed by health and beauty stores, up 7.7%, and e-commerce sites and catalogs, up 7.4%. Grocery store sales were up 4.4% during the period, followed by general merchandise stores, including department stores, which were up 3.9%.

Smaller in gains during the first five months of the year were sporting goods, hobby and musical instruments stores, and bookstores, up 2.2% for the year, motor vehicle and parts dealers, up 2%, and clothing stores, up 1%.

Note, too, that furniture stores generated the smallest amount of sales at $55.6 billion during those five months, trailed only by sporting goods and other hobby stores at $38.7 million and electronics and appliance stores at $35.3 billion.

The biggest in sales, after motor vehicle and parts dealers’ whopping $654.2 billion and e-commerce platforms at $538.8 billion in sales? Restaurants and bars at $435.9 billion, a figure even higher than the $399.6 in revenues generated by grocery stores.

Chalk it up to the fact that people have gotten comfortable with getting out in public and enjoying each other’s company over a meal, a trend that we also saw last year, when revenues in the segment topped $1 trillion, or 12.6% of the $8.1 trillion in retail sales for the year. By comparison, furniture retail sales were a fraction of that at $143.4 billion.

In our last story on May’s 6.4% decline in the furniture segment, we reported that May furniture sales eclipsed pre-pandemic sales, which is a positive for the industry. But so are sales in other categories including motor vehicle and parts dealers, restaurants and bars, clothing stores, grocery stores, and health and beauty stores. Some of that is likely due to inflation for sure. But it’s also showing that inflation has not largely impacted consumers’ desire to spend. Except perhaps in categories like furniture.

Perhaps that’s why it’s so important for everyone with a stake in the industry to spread the word: Furniture is an investment in one’s family, one’s home and one’s well-being. It’s an easy pitch and one that will hopefully start to move the needle again on the category soon.